On May 26th, while buying $77 US product through Clickbank, the total amount of the purchase showed up as $90.07 in Canadian dollars (as shown in the screenshot below).

I then checked Oanda for the correct exchange rates from US to Canadian dollars and discovered that the factor was 1.12404, or $77 US equalled $86.59882 Canadian (see screenshot below).

That’s a difference of $3.47 – completed wasted!

Well, it would have been completely wasted if I had chosen to use a Canadian dollar credit card – but because I do business in US dollars all the time, I use a US dollar credit card for such purchases.

Using a US dollar credit card to pay for US dollar purchases also allows me to save whatever exhorbitant exchange rates the bank decides to charge on their credit cards – which are also always significantly higher than the actual exchange rates.

Last but not least, I earn affiliate commissions in US dollars which are deposited into a US dollar bank account here in Canada, from which I pay my US dollar credit card bills – and therefore incur no exchange rate losses at all from that setup.

So, if you’re doing business as an affiliate marketer here in Canada and earning US dollar commissions, get a US dollar bank account and a US dollar credit card and save some money!

CBC (Canadian Broadcasting Corporation) News last night reported that there is already a huge backlog at Canadian mail sorting centers due to a surge in cross-border online shopping … and the holiday shopping season has barely just begun.

Shopping online for cheaper goods south of the border is expected to increase as the Canadian dollar continues to soar against the greenback. Yesterday it rose 0.3 percent to $1.0513, and is up 22.6 percent against the U.S. dollar for the year. There will be more impetus to shop online as Canada-U.S. border crossings slow to a snail’s pace, clogged with traffic and restrictions requiring proof of nationality in effect (passports will be mandatory for crossing in January).

Although Federal Finance Minister Jim Flaherty urged retailers in Canada to lower their prices for Canadian consumers “as soon as possible”, only a handful – such as Wal-Mart and Zellers – have responded.

Book pricing has been a particularly contentious issue here. For example, a book that I picked up last Saturday is sold for $18.95 in the US whereas it costs $23.95 here in Canada. That $23.95 CDN is now worth $25.14 US, or $6.19 US more than I would have paid for it in the States. To appease its Canadian customers, Indigo announced yesterday that it would cut all book prices by 10 percent and up 20 percent for their irewards members — but only through the Christmas season. Aargh.

The fact that postal rates within Canada are outrageously expensive gives Canadian consumers even more reason to buy from U.S. retailers, especially from those that offer free shipping to Canada, such as LLBean.

The point is that affiliates can profit wildly from the US dollar nosedive by selling to Canadians over the holiday season… and until Canadian retailers lower prices or pinhead government officials to remedy the situation in both countries.

To make more green this Christmas, review your merchants’ policies regarding sales to Canadian customers and geo-target your PPC campaigns accordingly. Pay particular attention to those U.S. retailers that have established distribution centres in Canada so your referred Canadian customers won’t be charged brokerage fees or duty costs. Better yet, look to programs such as Buy.com Canada where I’ve found particularly fair pricing on the Canadian side.

[tags]US dollar,Canadian dollar,loonie,cross-border shopping,online shopping,deals,affiliate[/tags]