And another iFX Expo is in the books with the Hong Kong version of the event taking place last Tuesday to Thursday. Having attended the iFX Expo in Cyprus, this was the first time I had the opportunity to cover the Asian edition.
As in the past, I wanted to chronicle some of the trends and revelations I learned at the event. (Part two here)
Different strokes for different folks
If I had to pick a theme for the expo, it was localization. This term came up time and time again in the panels as well as talking with attendees. While localization is obvious, there were certain specifics of it that were more stressed then others. The examples which nobody argues about are with the product. As such, websites should be customized to be both comfortable to customers from various regions and sales staff should have language skills to match their customers.
Beyond the obvious, localization needs for sales practices went farther than I thought.
Partnerships – One of the big goals of western broker attendees from the show was to meet Asian affiliate operators and introducing brokers (IB) as partners. What I found is that firms successful in China and South East Asia are contouring their partnership programs to fit marketing methods popular in the region.
For example, some countries such as Malaysia are well versed in how multi-level marketing schemes work. Therefore, having products that provide a simple interface to track distribution of commissions for and IB’s sub-IB’s is critical.
Also, depending on the country, education materials have higher levels of importance to converting customers. As such, more than just translating education portals to various languages, firms cited that they are incorporating more interactive programs that are customized for clients. This includes seminars in various cities that include local representatives and education videos that have a regional flavor.
Connectivity – During the technology panel, one of the topics discussed was connectivity. Having been used less in the past but becoming more widespread are direct point to point (P2P) connections. With them, brokers can create local access points which their customers log into, with direct fiber connectivity from that location to their servers in Western trading hubs like NY4 or LD5.
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Beyond direct P2P, Paul Smith of Mobile Trading Partners and Andrew Ralich from OneZero also cited the importance of incorporating local experience for handling connectivity. This includes working with local telecom firms to better understand how data is streamed in various countries and how to best optimize connectivity. This is especially important for handling the ‘Great Firewall of China’ where brokers have to have in place methods for both streaming data in and out of the country, but also processes in place to continually check the connections.
MetaTrader 4 is Global
Interestingly though, localization seems to have skipped over perhaps the most important aspect of the retail forex market; trading markets. MetaTrader 4 (MT4) has proven to be a truly global product with brokers favoring the platform when marketing in and around Asia (the one exception continues to be in Japan).
This is very notable as MT4 provides minimal front-end localization features. Other than simple changes such as what language appears when it is installed and integrating regional based widgets that almost always require hacks to integrate, the platform looks the same for everyone. The one exception cited is with regard to binary options, where providers such as Broctagon have had success with creating customized solutions for different locales.
Continuing on platforms, one area where there was chatter but I have yet to see groundbreaking progress is with mobile. The theory is that with a massive population in China and South East Asia reaching the internet for the first time not via PCs but through smartphones, there is a massive opportunity to be a mobile first broker. The evidence though hasn’t shown that to be true.
My opinion on this is that retail forex trading has its roots being distributed through brokers and not consumers. This contrasts from apps that become viral where users are typically responsible for igniting growth through double viral loops and word of mouth. Forex brokers though are distributing through known channels like MT4 and copy trading where revenue forecasts and the upsell to partners is understood.
I would like to think that someone will come out with that killer app, and it was discussed at length during the technology panel but, and this is a HUGE but, killer apps have traditionally been value adding. It’s hard to say the same thing about forex trading.
That being said, I find it unlikely that an app will become a huge hit by being shared by users. However, if a mobile platform exists that can prove its value to brokers, then it could become the MT4 of mobile in that it becomes worth the time and money of brokers to promote it to their traders and partners.