Profitable growth is a challenge every CEO faces. In simplistic terms, you have two options: Sell more in your existing markets or identify new markets in which your products and services can be sold. New market opportunities are filled with rewards and fraught with risk. To mitigate this risk, the process for choosing new markets requires precision and extensive market research to provide actionable insights.
Start close to home. Perform a data analysis of your existing customer base. Determine the attributes that define your ideal customer profile. Identifying key attributes such as vertical industry, revenue, number of employees, growth rates, and geocentricity will be key inputs in identifying new markets. Best practice would be to assemble an expert panel of your top performers to gain a deep understanding of what attributes define an ideal customer. List these unique attributes and assign a weighting to them to produce an account scoring methodology. Apply the scoring methodology to your customer base and compare to quantitative metrics such as deal size, annual spend, and customer lifetime value.
Buyer interviews should always be conducted to provide insights that are not skewed by the internal perspective. You need to learn what your buyers value from your organization. You need to know how the buyers want to engage with your company. Track the buyer’s journey back to the lead source. A thorough understanding of how your buyers make decisions will be key in evaluating new markets and the level of effort needed to attract buyers.
Your corporate strategy clearly defines those markets in which you have chosen to compete and chosen not to compete. Study the criteria used in this decision process and determine if internal or external conditions have changed. Examine your competitive advantage: price, product, or customer experience. It is important to ensure you do not suffer from false differentiation—differentiation that is not important to the marketplace or is a false presumption of superiority. Is this competitive advantage transferable to new markets?
Utilizing these inputs, you can evaluate which markets fit your criteria and estimate total available market potential within each. Next, consider both the competitive landscape and your own talent strategy. Is the market dominated by a competitor that limits your growth potential? Do you have the talent needed to compete in the new market?
Extensive market research will increase your chances of success and enable you to design an effective launch strategy.
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The key to sales greatness is a well-aligned strategy that simplifies the buying and selling process. It’s why “A-Players” love their employers and almost never leave. Turn to page 37 to learn more.