You have established your business within your target customer base and are looking to expand. Now what? Your finance team has stack ranked the opportunities and recommended that you enter a new market with untapped white space. Product has signed off, and marketing is developing new value props, competitive positioning, and enablement to support your eager sales team. Everything looks like a go – but have you considered how your new target customers will perceive your brand? This seemingly simple step is often overlooked as companies rush into a new market and are met with unexpected headwinds.
Many examples exist that illustrate well-known companies misjudging how their target customers will perceive them. McDonald’s spent a decade in Jamaica before closing their doors due to the perception of their company compared to Burger King. Best Buy and eBay both attempted to enter the Chinese market. However, buyers perceived that the local alternatives were more so tailored to their culture and the way they wished to buy. Brand perception can be a hard thing to predict – and equally hard to understand what truly drives it.
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3 Things to Do When Entering a New Market:
Publish a Clear Mission Statement
Your Mission Statement is your elevator pitch to a new customer. This can leave a lasting impression, which is why so many companies spend a lot of money nailing this. Aside from the statement itself, you should consider how all markets will perceive it. How will a different region and culture interpret this statement? Do you need to have your statement translated into different languages so that it’s easier for new customers to consume?
Message Your Vision for the Future
With a laser focus on what your company does today and what the mission statement is now, it’s easy to overlook sharing the vision for what’s next. Customers want to know what is on the roadmap for the future so they can align strategically with you. Partnering strategically or selling through indirect channel partners makes this even more critical. Take a page from Apple, which has always been a leader in sharing just enough of the future to keep their base excited and wanting more.
Create a Values List with Demonstrated Definitions
Do you have a documented set of values that dictate your rules of engagement within your company? Do vendors and customers know you as a company that stands behind their core values? This sounds a little squishy at face value, but it makes a difference. Your sales team will benefit from credibility when they are in front of their customers. Being known by your customer base as a company of values and people that adhere to those values makes a big difference in a B2B selling environment. Stating what your company values are and walking the walk by upholding them can be very important when establishing your company in a new market.
3 Things to Avoid During Expansion:
Trying to Make a Big Splash
A total rebranding to enter a new market is tempting but is often too much. Resist the urge to shake everything upside down and feel like you need to make a giant splash. This isn’t to say that re-branding isn’t something to consider, but it shouldn’t be an automatic trigger. You still sell into existing markets and have an established customer base to consider. What should be done is to engage with field marketing to help translate the brand message for the nuances of your new market. Language, culture, purchase preference should all be considered – just don’t hit the reset button on everything that got you to this point in the first place.
It’s great to be agile and responsive to new market opportunities. What you want to avoid is diving in without adjusting your documented corporate strategy and objectives. Even a no-brainer opportunity will have ripple effects through the rest of your organization. It is surprising how often the current corporate strategy isn’t updated to account for a significant shift like entering a new market. Do you have the capacity without hiring more personnel? Can you acquire the right level of skills needed to execute this strategy? How will this impact other initiatives across the organization? Ensure this is documented as part of the overall corporate strategy.
Failing to Segment the Buyer Within the New Market
It’s one thing to have an excellent market opportunity, but it’s equally critical to segment the buyers within this market. Who is more likely to purchase and why? How do they prefer to buy – is it common to purchase directly, or are they used to buying via a distributor or reseller? Do you have new persona’s you need to create to arm sales? Understanding the buyer at the most granular level will make entering a new market easier.
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Entering new markets can be an exciting time for a leader. It can also be a make or break event in a CEO’s tenure that has the ability to leave their signature on a company for many years to come. Arm yourself and your team with the right framework to help navigate this expansion and nail it on the first pass. SBI has developed a Revenue Growth Methodology to help leaders increase their chances of making this transition and hit their target.
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Use this tool to help score your company as you read through the following list of do’s and don’ts.