Global Purchasing Power Parity (PPP) Pricing
Calculate fair prices for international markets based on local purchasing power. Maximize global revenue by making your product affordable everywhere.
Base Price
USD Equivalent Price Comparison
The Affordability Gap
Why $100 isn't $100 everywhere.
The US Baseline
We assume the US price is affordable for the average US customer.
The Brazil/India Factor
Notice the massive discount (~60-70%). This isn't charity; it's math. A $100 software subscription in India feels like a $300 expense would to an American.
Revenue Expansion
By lowering the price 70% in India, you might increase conversion by 1000%, resulting in a net revenue gain.
Execution Steps
Enter your standard US Price ($).
The tool automatically calculates the equivalent 'Buying Power' price for key global markets.
Review the 'Local Price' suggestion.
Use this data to create regional coupons or localized pricing pages.
Pro Strategy
- For digital goods (SaaS, Ebooks), aggressive PPP pricing is a no-brainer. The marginal cost is zero, so any revenue from India/Brazil is better than $0.
- For physical goods, be careful. You cannot price below your landed cost (manufacturing + shipping) regardless of PPP.
- Round the local prices. ₹2490 looks better than ₹2431.
Core Concepts
Purchasing Power Parity (PPP)
An economic theory that compares different countries' currencies through a 'basket of goods' approach. It measures what money can actually buy locally.
Price Discrimination
Charging different prices to different segments (in this case, geographies) to capture consumer surplus without losing volume in lower-income regions.
Geo-Blocking
Technical measures to ensure users in rich countries don't use VPNs to access prices meant for developing nations.
What is Global Purchasing Power Parity (PPP) Pricing?
This tool applies Purchasing Power Parity (PPP) factors derived from World Bank data to your base US price. It calculates a 'Fair Price' that represents the same relative financial burden to a local local user as the full price does to a US user.
Best For
- • Launching a SaaS product globally.
- • Selling digital courses or ebooks.
- • Expanding ecommerce into emerging markets (if margins allow).
Limitations
- • Indices fluctuate with currency exchange rates.
- • Does not account for local cultural perception of value.
- • Physical goods have hard cost floors that limit PPP flexibility.
Alternative Methods
Direct Exchange Rate Conversion
Simply converting $100 to €92. This ignores affordability.
Market Penetration Pricing
Setting a low global price to enter all markets simultaneously.
Industry Applications
See how this methodology generates real revenue uplift in different sectors.
Streaming Service
Spotify/Netflix needed growth in Asia.
Priced subscriptions in India at roughly $2/month vs $10/month in the US.
SaaS Dev Tool
High traffic from Brazil but 0% conversion.
Implemented automated PPP pricing banner offering 50% off for Brazilian IPs.