Progress is an imperative factor for the success of any kind of business. To last in a progressively competitive international market, it is not sufficient to do business with just the existing customers. You need to explore new marketplaces as well – and that means expanding internationally. However, un-prepared expansion is often dangerous and can prove detrimental to your business. Hence, it becomes important that before you plan for business expansion, you need to evaluate the prospective growth and risks in the new market.
Evaluation Stage – Asking the right questions
Companies that neglect to evaluate the new market before expanding will sooner or later face hurdles that can slow down their progress. Been unaware of the real challenges, or the gaps that exist in the new market often results in companies trying growth tactics based on faulty strategies that are not backed by proven data. To prevent this from happening, organizations must contemplate a number of dynamic factors before devoting to any expansion endeavors. The following questions will help you evaluate the factors important for new market entry and eventually take the right decision.
Who are my Customers?
This question is a good starting point since you are already aware of who your customers are! However; try identifying them in the new market. Who are those customers/clients? The answer to this significant question can assist you in defining the accessibility of the market and guide you to concentrate your marketing and sales efforts in suitable areas. The reliable practice is to start by evaluating your existing customer. What qualities do they share?
By taking cues from the behavior, likes, and dislikes of your current customer base, you can get the insights to build up a customer profile that can enable you to reach out to the ideal customer in a new market. This will also tell whether there is a market for your offering or not. Your organization is going to succeed when it focuses on customers that have identical needs and wants as your existing customer.
What products are prospective customers using?
After identifying your potential customers, the next step is to know if the product or service that you are offering will be a success or not. For that, you need to know what kind of product your target customer is using currently. What is the upside of the product? What does it lack? Study the needs of the potential customer and figure out how your offering can fit in.
You can then compare that data with the features of your own product. Does your product/service have better features than the product/service the customer is already using? Is your offering able to focus on the disparity in the market? The answers to these questions are deciding factors whether or not your product/service can sell.
What is the market potential?
Certainly, it is not adequate to simply know the type of customer who may buy your product. To properly evaluate potential revenue in the selected market, you additionally need to evaluate the market size for your product or service. This specific question does not have an upfront solution and requires extensive market research. Using primary and secondary resources can assist you in finding the answer. It is important to note that there are many research service providers who specialize in conducting market research and opportunity assessments. You may very well decide to seek professional assistance and make use of such a service.
Who are the competitors in the market?
Identify the competitors in the new market. Unless you have an innovative product/service for your potential customers, you will face a lot of competition. Study the products/services offered by the competitors so that you can further evaluate the prospect of your success. Knowing the strengths and weaknesses of their offerings will go a long way in helping you define the value proposition for your product or service. Also, try to understand the pricing strategy of the major competitors as it will give you an insight into the customer’s spending habits. Another critical element here is to gain an understanding of the market share of major competitors.
What are the customers saying?
Identify the areas in which the competitors are inadequate to focus on the needs of the customer. Research on challenges the competitors may be facing or will face in the future. An overall level of discontent, or a perception that current products are average, is a clue that your competitors may not be as established in the market.
Well researched competitive intelligence will help you decide whether you can enter the market or not, whether you need to tweak your offering in order to be a consideration for your customers.
The gist
To ensure that your organization succeeds in its endeavor, you need to evaluate the size and value of your new market. Do the crucial research and utilize the information to analyze how important factors might influence the success of your business. While evaluating a new market, it is important to gather as much information as possible so that your new market entry strategies which would be based on data, have a better chance of succeeding.
Are you in the midst of planning an expansion of your business and looking to identify opportunities and risks associated with a new market so that you are better prepared for success? Click here.
