Localization 101 — Five Elements to Optimize Conversion Rates

This post is a continuation of last week’s localization post.

As a digital merchant, you know your product is valuable to customers around the world. But you can’t just set up shop in a new market and expect overnight success.

To increase your global revenue, you must have an in-depth understanding of exactly how customer preferences vary from place to place. Then use that understanding to design unique shopping experiences for your customers across the globe.

Now, localization entails more than just translation. A true localized shopping experience depends on things like:

  • Speaking your customer’s language
  • Letting them pay how they want
  • Setting the right price
  • Designing for usability
  • Displaying tax for optimal conversions

Let’s dive into each one, shall we?

Speaking your customer’s language

Truly localize your content by using words that make sense to your readers and puts them at ease when making a purchase. For example, in your U.S. store, the word for where a shopper’s products are kept is called the cart. The preferred nomenclature in Great Britain, however, is bag.

From a tactical perspective, avoid making assumptions about which language to display to your customers based solely on their geolocation. Instead, rely on the preferences customers select in the browser. Use those preferences to deliver the right customer experience for sign-up pages, marketing emails, customer account sections and in-app messages.

Letting your customers pay how they want

Letting your customers pay how they want involves two elements: currency and payment method.

Localizing currencies

If someone in the U.S. were to walk into a brick-and-mortar store and see items marked for sale in euros or Japanese yen, there is a good chance they would walk right out of the store without buying a thing—it’s too confusing and not worth the hassle.

The situation is the same when shopping online. Consumers do not want to see product prices displayed in an unfamiliar currency. Show pricing in currencies that are relevant for the customers in that country.

Localizing payment methods

Know which payment methods are the most popular and make sure you offer them. Always keep an eye on the latest trends in the markets you serve, and add payment methods accordingly.

Do your research, because what is typical to you as a consumer in your home country may be a barrier to conversion for someone buying online on the other side of the world.

For example, most Americans use credit cards for ecommerce purchases. However, the situation is very different across European countries. In Germany, customers tend to use PayPal, wire transfers and direct debit payments more than they use credit cards. In the Netherlands, the vast majority of shoppers avoid using credit cards and prefer to use the local iDEAL system. Your carts must support your shoppers’ payment preferences in order to convert them effectively.

Setting the right price

Dig deep into fluctuating exchange rates and local purchasing power to determine how to price your products.

Just because U.S. customers will purchase your product for $50 does not mean that someone from India or China will too. A $50 product (converted to local currencies, of course) is probably unreasonable in these areas considering that the average income per person is well below what it is in the U.S.

If you are a merchant located in a market with a strong currency you might have to drop your prices in other markets just to stay competitive. It may result in lower revenue than you would like, but it goes a long way in improving conversion rates and decreasing piracy for your products in countries that cannot afford to pay your typical asking price.

Conversely, if you are a merchant located in a country with a weak currency, you might consider raising your prices for markets that can bear to pay a little more. If you don’t do this, you may be perceived as offering a lower quality product that consumers won’t trust.

The key is to determine the purchasing power equivalence of your global visitors to help you understand the relative value of a currency. Don’t forget to research how your competitors price their products in your target markets.

Designing for usability

Know what successful design looks like in the countries you are trying to reach.

For example, in English language homepages, you’ll often notice a heavy emphasis on the search field, few featured images and a minimal amount of text.

In other regions like Japan, one sees many more links, a lot of text and less emphasis on the search options.

To ensure that you’re assuring customers with proper presentation, research the most popular websites in the countries you are interested in, and have native industry experts help design your site if possible.

Displaying Tax for Optimal Conversions

Although ecommerce removes many barriers to global selling, there are challenges that occur no matter how you sell your product. One of the most important issues is calculating, collecting and remitting sales and/or consumption taxes when required by the laws of the countries you are selling in. Compliance is achieved by consulting your own legal advisors, so don’t take this as legal advice.

VAT included in total price
VAT included in total price

However, we do know a thing about optimizing conversion rates by localizing the way you display the tax on the sale.

In the U.S., sales tax is added to the advertised price. Customers who go to a brick-and-mortar store and see a price of $79 know they will ultimately pay more than that. In Chicago, Illinois, the sales tax is 10.25 percent, which means that the tax on a $79 product is $8.20 So, on a website, the product would be advertised for a price of $79. However, once the customer enters the shopping cart, the tax is displayed and added to the price, resulting in $88.19. This is how U.S. customers are used to seeing prices, so this is how they expect it will be displayed in the cart.

In the European Union, however, Value Added Tax (VAT) is a tax on the perceived value of a product and is marketed as a component of the final price. European customers who see an advertised price of €79 expect to pay exactly €79 at checkout. Usually, an additional note on the marketed price indicates how much of that price is actually the VAT.

As you can see, it is important to be aware of not only what the tax rate is for a country when selling globally, but also how to present it to customers. Make sure your store supports these important details and are easy to implement. They make a huge difference in conversion rates.


Once you’ve successfully localized your ecommerce, you’ve got to stay on top of it. You should continue to monitor your regional traffic and conversion rates, test different layouts for conversion rate optimization, and always research new payment methods. Localization never ends.

For a deeper dive into localization, check out our 7 Tips for Growing Your Global Subscriber Base.