Product managers must juggle a number of challenges in their role. These typically include overseeing product strategy and optimizing product user experience. Ultimately a product manager is charged with maximizing business value from their product.
This means obtaining as much value out of every aspect of the product as possible to drive its success. For products that depend on foreign exchange (FX) data, it is imperative to implement and follow best FX practices.
Products that require FX functionality
There are many types of product that now require FX functionality. With advances in technology and the massive global increase in cross-border trade, more businesses need to use FX data to help power their products. These include online travel agencies that convert and give quotes in different currencies to customers from a range of countries.
Many financial organizations such as banks and new, technology-led companies require FX functionality to support their products. Also, companies across various sectors increasingly require implemented FX functionalities to power currency conversions and inter-currency payments.
The 4 FX best practices for product managers
1. Ensure you receive reliable FX data
Dependable data is consistent,
and for the benefit of your product,
technical errors must be avoided.
Dependable data is consistent, and for the benefit of your product, technical errors must be avoided. These can include problems to do with currency conversion or quote delivery. A reliable FX provider should offer an uptime of at least 99.99% and promise a high level of security.
As a product manager you can ask the following questions: How long has the FX provider been in business? Do they have a proven client list? Do they provide FX solutions built on the latest financial technology?
Additionally, ensuring you receive information from a reliable FX source requires periodic appraisal of your FX functionality provider and a benchmarking process.
2. Stay informed with accurate FX data
Precise exchange rates ensure that you can offer a more accurate service to your clients. Unfortunately, not all FX quotes are an accurate representation of the market. While it is commonplace to see two different FX providers produce very different exchange rate quotes for the same currency pair, FX rates should be precise, consistent, and true to the market at all times help you deliver a product that your clients can trust.
3. Localize prices in your customer's currency
13% of customers abandon
the sales process due to
foreign currency pricing.
Price localization leads to more sales. It's that simple. 13% of customers abandon the sales process due to foreign currency pricing. According to a study of 50 SaaS companies, a focus on price localization leads to as much as 30% or more in higher growth. Pricing in a currency that is foreign to the customer can create confusion and raises questions.
"What is the equivalent amount in my currency?"
"Am I paying a higher price?"
"Are there any hidden costs?"
This slows down the sales process or leads to purchase abandonment altogether.
Pricing in your customer's currency, whether they are in the United States or Spain, or the UK or Israel, aligns you with your customer. They immediately understand how much they are paying in their own currency and are therefore more likely to complete the purchase. Moreover, it communicates a message that you care about your customers and you want to make the purchase process as smooth as possible.
4. Automate your FX function with an integrable exchange rates API
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For an optimized workflow, a reliable, accurate FX API should be easily integrable and updatable. This allows for automation of your product's FX function without a need for substantial technical involvement or to worry about potential bottlenecks.
As product manager, you can look for a robust FX API that supports various data formats. To avoid any potential problems with integration, function, and updates, you can also identify an FX API provider that has a support team on hand.
FX best practices for smart product managers
Using these four FX best practices will move your product closer to achieving maximized business value. They will help ensure that your product is positioned well with regard to providing reliable, accurate data, and that, as a company, you can focus on growing your product's success.