Ask HN: How do you localize your prices?

https://news.ycombinator.com/item?id=32136715

by jamesfisher • 4 years ago

6 12 4 years ago

news.ycombinator.com

We recently released an online course. [1] It's $29, but we've had users saying, "I'm in ${country poorer than USA}, and I can't afford the $29. Do you offer regional pricing?"

I would like to support this. The dollar-value to a customer in India is probably lower than in the USA.

Most big platforms (Udemy, App Store, Play Store) seem to solve this with a price tier matrix. They maintain a big table of prices per (tier, currency). The tier comes from the product, and the currency comes from ... the user's IP address? (See example matrix [2])

To build this from scratch, I would have to:

* Define a list of tiers, each with a hard-coded USD price.

* Maintain a list of Purchasing Power Parity multipliers for each currency. For example, regularly scrape OECD data.

* To get a tier's price in currency X, multiply by the current PPP.

* Somehow clamp the prices to "appealing" values, so we get e.g. £25 instead of £24.19.

* Ensure we never make a loss after subtracting Stripe fees!

* Detect a user's location. Presumably using IP. Map location to a country, and country to a currency.

* Probably many more things I haven't thought of.

This feels like a generic problem that I shouldn't be re-solving myself. So, questions:

* What libraries/services can I use instead?

* How do you do implement localized pricing?

* Are there complexities that explain why there's not an out-of-the-box solution?

[1]: https://news.ycombinator.com/item?id=32118530 [2]: https://s3.amazonaws.com/udemy-images/support/Udemy+Price+Tier+Matrix+-+EN+09-17+Matrix.pdf

howlett2• 4 years ago

As a user I hate it when I get localised prices, especially if the at-the-time exchange rate ends up being more expensive for me. If I see something sold for $9.99 but I get £9.99 I think "why am I paying more for this", simply because the exchange rate is more favourable since I'm in the UK. But when I only see USD prices I'm more likely to buy something as it's not overly complicated.

If you want you could pull real-time exchange rates and have a button that indicates the conversion for someone who wants to see the "most likely" price (depending on when they actually pay for it).

For example if you sell something for $9.99 just leave it as such, and Stripe will make the conversion and you'll always sell at the same price regardless from where someone is coming from.

That's how I feel about it anyway!

2143• 4 years ago

It's not just exchange rates.

The problem is that, in some places (like India, for example) $10 might be a lot of money.

One might be able to do a lot more with $10 in India (₹800), than with $10 in USA, due to reasons that are beyond anybody's control.

For instance, I can travel 3000 km by train with $10 equivalent in India if I really wanted to (wouldn't be very comfortable, but it's possible).

The wages in those countries are also proportional of this.

This becomes relevant if you want your product to be not expensive, so that it reaches a wider audience.

For expensive goods the price difference doesn't matter as much. (Though I know people who were bummed that the Ford Mustang 5.0 V8 was twice as expensive in India than USA — but that's a different market).

howlett2• 4 years ago

I totally agree with you, but the common "this is why we can't have nice things" end result of such scenarios is that people will VPN via India in order to buy your product. And then you have to identify VPNs in order to avoid this, etc.

I don't have a solution for this, I just think the effort/reward should be considered.

jaclaz• 4 years ago

Don't forget VAT (in EU countries but possibly not only there, GST in Australia).

There is a VAT MOSS (Mini One Stop Shop) requirement for selling courses in EU AFAIK, see (example only, no idea if contents are accurate):

https://botflo.com/eu-vat-moss-tips-for-online-course-creato...

This (of course it is essentially an ad for the company) quickly explains the possible issues:

https://www.youtube.com/watch?v=azeNA13kVpY

beardyw• 4 years ago

I think you are going to tie yourself in knots with this.

jimkleiber• 4 years ago

The approach I'm trying is to set a price and then give people an option to raise it or lower it based on what they can or want to pay, maybe along with a message talking about the difficulty in creating prices for people across the world.

Currently, I only have this set to some of the more scalable options (the plan to get access to all the recorded audios and not the plan where I give an hour of 1-on-1 calls per month), yet it may even work for things with more variable costs, if the minimum price is still sufficient.

So that's what I'm gonna try, because as you mention, the other way seems highly complex and also we customers can sometimes feel annoyed by regional pricing, especially for digital goods. But who knows how it'll work.

muzani2• 4 years ago

A solution I like is just two tiers. Full price and discounted price. People from certain countries get the discounted price.

Then figure out a line where it's worth discounting. Perhaps 5x lower purchasing power than say, the US. Maybe a third tier if it's 15x difference, though I doubt it's that bad.

jamesfisher2• 4 years ago

After consideration, I think I'll go with this option.

We can actually go even lower effort: add a discount code for this, and just say "get in touch if the US price is unreasonable for your country" or similar.

Thanks for reminding me to KISS :)

jamesfzhang• 4 years ago

Hey there! I work on Stripe Checkout and we recently released an update that should make selling globally a lot easier, removing most of the bullet points in your post.

Here are the docs, and please let us know if you try it out and have feedback: https://stripe.com/docs/payments/checkout/present-local-curr...

Thanks!

jamesfisher2• 4 years ago

Ooh, that's nice progress! At TigYog we're actually using Stripe Elements - not Checkout or products - so I think this can't work for us yet. It would be cool if you exposed some of this functionality in Elements. I'm not sure what that would look like though :)

Ask HN: How do you localize your prices?

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