Increase SaaS Conversion Rates in the Online Brazilian Market

Localizing payments is crucial when looking to increase SaaS conversion rates. We cannot stress how important this strategy is. Brazil’s payment landscape is a topic of interest for business owners, especially those in the SaaS industry. Discover how to navigate it, boost your sales conversions, and find a way to reach customers in Latin America’s largest market.

In 2022, the Brazilian SaaS industry was estimated at $3.9 billion. This means new and exciting business opportunities for software developers, especially due to the impressive growth speed and relatively low competition. 

It’s true that Brazil remains one of those virgin markets where SaaS companies have actual chances to easily stand out. 

No matter how good that all sounds, it’s crucial to mention that to succeed, you need more than a powerful product. You also require a robust payment infrastructure, allowing you to localize payments and capture them effectively. 

This article explores the Brazilian payment landscape while pinpointing actual growth strategies companies looking to expand globally can implement.

Key Definitions and Background 

Brazil SaaS Market Overview

Market Potential

When discussing possible customer bases, Brazil stands out with its population of 219 million people, making it the largest market in Latin America, as well as occupying the fifth largest country in the world. This certainly qualifies Brazil as a great opportunity for SaaS businesses, but it is also challenging to navigate various payment preferences and shopping behaviors. 

Tailoring payment options to answer the demands of Brazilian customers can have a greater impact on this landscape than anywhere else. It can lead to impressive growth in sales conversion, significantly boosting business profitability.

Local Currency and Exchange Rates 

Surviving different economic reforms since the introduction of the Brazilian Real (BRL) in 1994, Brazil is now regarded as a stable and strong economy, attracting investors from all over the world. 

It’s relevant to note that the Brazilian Real functions as a floating currency. This means that the exchange rate is determined by the Forex market. This allows for economic growth. However, in this context, SaaS businesses must be aware of the  "tourism exchange rate". Foreign companies can lose money if they are not careful.

Payment Methods

As mentioned, Brazil has a diverse payment method landscape, reflecting the preferences of its large population.

For instance, SaaS businesses that offered Bolleto or credit card installments as alternative payment methods noticed a 90% higher conversion rate. 

In terms of payment methods, here is a short rundown of the top options in Brazil: 

Localizing payments is crucial when looking to increase SaaS conversion rates. We cannot stress how important this strategy is. 

Subscription Vs. One-Time Payments 

Subscription are occupying a leading position in business models around the world, and Brazil makes no exception to this rule. In Brazil alone, subscription services generate R$ 1 million annually. 

With 88% of consumers saying they’d commit to a recurring service, B2B and SaaS companies looking to expand in this region need to seriously consider this model in their pricing offering. 

Brazilian Market: Key Takeaways 

To enter and succeed within the Brazilian landscape, you need to consider the following aspects: 

5 Strategies To Increase Conversion Rates In Brazil 

So, your first goal is to sell in Brazil. Check. But you also need to make sure that you are selling a notable amount in order to recover your investment and increase business profitability. 

So why not focus on achieving both goals from the very beginning? 

Here are five best practices you need to consider when preparing for the road to success. 

Localize your transactions 

As we’ve mentioned earlier, Brazil stands out as a real growth opportunity due to its large customer base. But this is a double-edged sword because the greater your audience is, the more diversified their payment preferences are. 

Offering diverse payment methods to cater to various preferences can have a tremendous impact on your sales conversion rates.

When entering the Brazilian market, be sure to provide potential customers with options like: 

• Credit cards
• PIX
• Boleto Bancário
• Débito online
• Online bank transfers
• Mobile payments

Reduce your SaaS payment failures

Payment failures are a big issue for SaaS companies, and solving it will ultimately lead to increasing profitability. Make sure to partner with payment partners that offer: 

• Robust cascading systems
• Smart payment routing
• Card validation
• Pre-dunning communications
• Multilingual customer support for dispute handling
   
  A Merchant of Record solution like PayPro Global can provide you with a strong payment infrastructure to help you grow worldwide. 

Implemet language localization 

Yes, investing time and resources into speaking the same payment language as your customer is a huge step forward. But you mustn’t stop here. Take another step and localize your website language as well. 

60% of Brazilian consumers said they would purchase more if the brand in question would speak their language.  And that’s saying something. 

Present your SaaS products in your customer’s native language. This is a piece of advice you can apply to all countries you wish to expand in, not just Brazil. 

Also, for this region in particular, your goal is to use Brazilian Portuguese and not literary Portuguese.

Be compliant with local rules and regulations

This is more of a requirement rather than a strategy. Complying with different regulatory laws is necessary should you wish to sell your products in Brazil or anywhere else, for that matter. 

Yes, this process is time-consuming and must be treated seriously, It implies several administrative tasks, ongoing monitoring, and expert advice. 

Failing to do so can lead to: 

• Fines
• Penalties
• Business disruptions
• Potential legal consequences

Consider a hybrid revenue model 

Although there is a growing market for subscription businesses in Brazil, adding one-time payment choices can provide extra income.

Your SaaS development can be further fueled by managing a hybrid business model that satisfies the needs of various customer segments, particularly when paired with:

• Adaptable pricing methods
• Free trials
• Regional costs
• Tailored advertising strategies according to cultural events

Is The Merchant of Record a Solution?

The straightforward answer is yes. The Merchant of Record model offers a comprehensive approach to worldwide expansion for SaaS and software business, simplifying operations and allowing developers to focus more on perfecting their products. 

Here is exactly how a trustworthy MOR can help your business expand in the online Brazilian market:   

How Can PayPro Global Help? 

• Using AI-powered cascade systems to achieve strong authorization rates.
• Offering various local currencies and payment methods and intelligent routing.
• Increasing international SaaS transactions and upholding PCI-DSS Level One accreditation, which guarantees the highest requirements for payment information security.
• Ensuring comprehensive tax administration.

Find out more about our all-in-one payment solution and how we can help strategically scale your SaaS business anywhere in the world, including the highly-rewarding Brazilian market.