Speak to global users in their monetary language

from deal united by Jürgen Weichert

Digital and virtual goods have several huge benefits from a business perspective.

A) They can be replicated with almost no variable cost.
B) They can be distributed all across the globe via the internet.

These points are great because they provide us with a powerful lever for scale. The idea of placing your product in front of a global audience and being able to deliver this product digitally is extremely compelling. I know I’m stating the obvious — this is why we are all in this business.

But (why does there always have to be a “but”?) it also confronts us with new challenges. The challenge is LOCALIZATION. Zynga, the social gaming giant from San Francisco, has launched their new game “CityVille.” It’s the first game that Zynga localized into several languages, including French, German, Italian, Spanish. But the localization goes further than just translation — CityVille’s French version allows the user to build an Eiffel Tower in his city. Even objects and surroundings are customized to the local user.

The same has been done by software publishers for many years.

But here’s the catch: so far, many big players in the gaming, software and digital media space put a lot of effort into translating their products. They even go the extra mile and add local relevant content. But too many stop at the point where a corporation should be paying close attention: monetization.

Payment preferences across the globe

You can’t assume that credit cards will do the trick across the globe, as many countries don’t have a relevant credit card distribution. Germany, for example, has a credit card distribution of about 20 million cards but a population of 83 million — most with plenty of buying power.

With this in mind, there are two options:

1) Wait until global credit card distribution increases
2) Offer local payment options

We recommend the latter. Why? Payment markets change slowly, and it is not wise to leave money on the table.

But how do I prioritize the integration of local payment options? Every country with a major online market has one, two or even three dominant methods of payment besides credit cards. Germany has bank transfers, the Netherlands use IDEAL, France uses Carte Bleue, Danish users like to pay with DanKard, Japan offers a range of convenience store payments and so on.

Of course, nobody can integrate everything at once. So the first thing to do is analyze data and prioritize according to three main criteria:

1) How many users do I have, and what countries are they from?
2) Are these countries tier 1 (U.S., UK, Germany, France, Japan…), tier 2 (Italy, Spain…) or tier 3 countries?
3) How time consuming would it be to conduct business after sorting my data according to the first two criteria?

How can I stay fast and efficient?

Well, of course it makes sense to use payment service providers (PSPs) and eCommerce Service Providers (ESPs). They’ve already done the work and integrated all these payment options. We can only recommend taking a look at the PSPs/ESPs on the market and analyzing whether they cover the regional payment options relevant to your user base. Also take a look at your future plans. There may be regions with expansion potential. The PSP should have links to these regions and be able to offer payment options in these areas. Because no matter what the sales guy says, integration with a PSP is a one-time effort — you shouldn’t have to repeat this often.

Expect neutrality from your PSP

A good PSP/ESP is a consultant for payment strategy. Hence, they must be neutral. Make sure that your PSP/ESP does not run payment as a side business.

In the meantime, it makes sense to complement your payment mix with PAY.BY.SHOPPING. Our payment service is completely localized, carrying relevant local advertisers on a global scale. What’s more, our local advertisers in each country offer your users the relevant payment options for their market.

(I hope you can excuse the shameless plug.)

Questions? Drop us an email at merchant@dealunited.com

Cheers,

Juergen