Key challenges for expanding into new markets 
Target the right markets and understand them thoroughly

In a former article we discussed the basic approaches for expanding into new markets – through alliances with market leaders or by expanding through independent business  networks. Whichever strategy you choose, the challenges you will be facing are similar:

Where to invest my limited resources? Which country and market segment do I choose first? What are the key factors for success?

What are your best bets in selecting the right geographic market: Exploit the vast opportunities of the North-American market, choose the European market (which will still require selecting one or several target markets out of the 25 current member countries) or position yourself now to participate in the accelerating growth of the Asian region?

The choice of target market depends on various factors such as:

• Type of product, application or service – for example, if you market a software application or service related to wireless, the market might be most likely in Europe or (long-term) in Asia
• Stage of corporate development – as a North-American start-up with only a few clients, you may be better off to postpone your expansion plans into Europe until you have lined up some solid references in your home market. You might also consider forging country-specific alliances with established partners before going direct and setting up your own local representation. Some markets such as Germany are very difficult to enter. In these cases we recommend to evaluate exclusive partnerships with local firms – or to consider buying out one of the local competitors to gain instant access to their clientele.
• Planning horizon – are you looking for “instant”, medium or long-term revenue streams – some markets take longer to develop than others.

Based on our many years of experience, we recommend, as a first step to success, to get started with thoroughly understanding your new, targeted market.

What you need to know:  

• The profile of the local players in your field of activity
• How do you differentiate yourself from them
• Who is your target client
• The specific problems or  “pain” of your potential clients (e.g. the compliance to specific regulations which might vary from country to country!)
• What are the best sales channels (direct online/off line, alliances, distributors, resellers)
• What are the local requirements (products specifications, certifications, licenses...)
• What are the requirements for serving your clients before/during/after sales?

And last, but not least:

• An understanding of the cultural background of your potential partners and clients.

Our team at iFact assists you in developing the market expansion strategy tailored to your specific product/service offering, objectives and resources. We work with young start-up firms with little experience in other geographic markets as well as with established companies that want to move rapidly into a specific country or continent by leveraging our experience and local contacts.

For more information on how we can help your company increase your revenues by expanding into new markets, please give us a call +1-514-735-9892 or write an email to skerner@ifact-consult.com.

Other questions for me or our other experts? We are looking forward to hearing from you!

Related articles:

Perspectives on the North-American market potential

Montreal as your gateway to the North-American market