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We're a growing Canadian software company selling online. Customers download freeware, later upgrading to a paid version.

We've received significant interest from customers and resellers internationally and are preparing to push our direct model more aggressively outside North America.

  • What are your thoughts on setting “country specific” pricing in order to best serve each individual international market? Currently we offer a fixed price in US$.

  • If we adopt a “country specific” pricing model, what advice would you offer to combat online price conflict issues that may present themselves? For example, customers seeking to buy at the lowest possible price regardless of location.

Any other relevant advice or experience from those who have been through similar international expansion would be extremely welcome.

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2 Answers

up vote 3 down vote

James,

Unless you are going to expand to English-speaking countries only, the internationalization and localization of your software and customer support would be much bigger issues. (Okay, French may be less of a problem given your origin. :) )

To some extent it depends on your product. I do not think you can successfully sell a B2C product to German consumers without localizing it, but German developers have no problem using our product and communicating with our techsupport in English. In contrast, we had no sales to Japan until signing a deal with a local reseller that provides not only product information and sales but also first line support in Japanese.

As for pricing, we differentiate not by country, but by customer type, extending substantial discounts to early-stage startups, microISVs and other very small companies. Again, this may or may not apply to you.

Why don't you tell us a bit more about your product?

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I think James is spot on here. The language typically defines your markets and allows you to offer different pricing and marketing - without jeopardizing other markets all too much. The English product offering will always be most exposed and is therefore the most sensitive one in terms of pricing. If you use one of the major e-commerce providers (i.e. Digital River, Cleverbridge) you can set the pricing to appear automatically in local currency and at the price point you want, based on the IP address. – Hans Fremuth Apr 27 '12 at 13:43
up vote 2 down vote

If you localize and translate your product for a specific country, you can (and should) certainly ask a premium for that offering. However you don't mention anything like that.

If you are simply going to charge different $ in different countries for the same product or service, customers will hate it. I've been on both sides of this (vendor and customer) and can assure you that them customers will hate it.

So if you want to charge customers of a specific country more, you should offer them more, like premium support, free updates, whatever you can think of. Then you are likely to realize that you don't want to diffirentiate by country. You may want to offer different packages (with or without premium support, with or without free updates) for different prices, but equal for all countries. I believe this works best.

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Pricing is independent of what you actually paid for making your product. It should reflect a good value in the eyes of your CUSTOMER. So, you typically can't ask add premium to the price just because it is localized. – Hans Fremuth Apr 27 '12 at 13:34

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