Expanding your business in the international market can bring massive rewards that will change everything about your brand forever. But if miscalculations are made in the initial market assessment stage, it can also cause irreversible damage.
From business development manager to marketing head, everyone must assess the business potential of a future market by understanding the demand for the product and what competitors are offering in the target region.
This market assessment must be done before you make the final decision to expand into a new region or country. A part of risk will always be involved, but the rewards can be extremely profitable if you conduct thorough research on your opportunities. In this blog, we will discuss the step-by-step process of a successful new market assessment.
Key Steps To Successful New Market Assessment
From local competition to cultural hindrances to customer behaviors, every aspect needs to be considered in a proper step by step manner for market assessment.
However, before you dive into searching for a potential market, you must understand where your business stands in your current market. You need to find out if your product or service is satisfying strong customer demand in your domestic market and how are you going to learn from it to get in a different market with different consumer behaviors.
If you do not see any growth in your domestic market, expanding into a new country might not be the ideal choice, as this might be an indication that your offering is not aligning with your customers’ requirements.
Invest your time in understanding your consumers, polishing your products, and honing your marketing message in your current region before expanding to a new one.
Let’s discuss the key steps to the new market assessment.
#1 Select a country for evaluation
Performing market evaluation will protect you against expanding into a new territory where you are not yet active just for the sake of it.
It is critical to conduct a market opportunity assessment for all countries one by one. But then a question arises on how to select one country for your international expansion? Well, this is the point when a well-calculated, thorough, and strategic market research comes into play.
#2 Examine your in-house data for consumer behavior and funnel activity
You need to begin by examining your internal data to understand your company’s current position in the market.
- Is there a rise in leads from a specific market even though you haven’t invested much there?
- Are you seeing a short sales cycle or high win rates in some regions?
- Do you see a higher average purchase price in a given market?
You can have your sales or business development team help you in gaining these insights. You can also use some online tools for the same.
You can see where the traffic is originating, what happens to them after arriving, and to what extent they are converting because the majority of platforms track traffic distribution by location.
Plenty of traffic coming from a particular country supplemented by enticing engagement and many conversions might be an indication that the country is an excellent option for your expansion.
#3 Research the top markets of your competitors
Researching the markets where your competitors are performing well can be beneficial information. There are plenty of tools available in the market that you can utilize to find out the locations where your competitors have built a notable presence. These insights will help you uncover some great opportunities for your business in the international market.
#4 Get a full view of competition in a new market
After spending so much time in researching your competitors individually, you would want to understand the entire market thoroughly to spot your opportunities accurately.
Investigate the activities in the competitive landscape in your target market by using online tools. You can find out which company is leading in your niche in that country. Next, you can analyze their traffic generation, tactics they are using to drive traffic, and how they are engaging with their audience. Observing the market potential of such companies will help you discover the market potential for your business too.
#5 Evaluate your potential market size and competition
It is pretty logical that you would want to enter a new market that has the most substantial opportunities for your company, and for that, you must know how to estimate the market size.
Google Market Finder is the best tool to evaluate the size of a market, but you must also remember that you might need to adjust for different search engines and market assessment tools as you endeavor international expansion.
For example, here we will be looking at Google’s data, but if the most popular search engine is different in your target market, you will have to take it into account to explore the correct percentages.
#6 Analyze the difficulty if doing business in the target region
Next, you need to find out the ease or difficulty level for doing business in a specific country. You can access this information from the third column of the Google Market Finder tool.
From the state of a country’s local economy to their overall position in the global economy to their average disposable income per household, you need to conduct everything. Because having a promising product is one thing, but finding the consumers who are willing as well as capable of paying for it, is another thing.
Similarly, you can assess the competition in the target country by finding out the number of market players and their distribution. For example, if the tool is showing multiple game-changers, it might be a strong signal of a fast-evolving market, which is an excellent place to put your time and effort. However, if there is barely any movement in the ruling players, it might be an indication of a difficult-to-penetrate market.
#7 Take language barriers and the localization expense into account
Apart from buyer behaviors, market volatility, and economic growth, considering English proficiency in the target region is crucial, when expanding beyond the English speaking world.
For instance, English proficiency is very high in Germany, and very low in U.A.E., which means the localization expense of your product and the communication therein will vastly differ between these two countries.
#8 Benchmark your performance against the competition
By the time you reach this stage, you will be done with all the basic market evaluation. Now you have to get a comprehensive understanding of the competition and benchmark your performance against it to uncover marketing opportunities.
- Benchmark your site’s performance against your competitors in your current region. You must ensure that you are stable in your domestic market because if things are not working out great at home, then you must focus on fine-tuning your strategy before you take off into a whole new country.
- Compare the performance of your domestic competitors in your new target market. Find out the strategies and tactics they employed when they entered the market first. You might end up learning a lot from their experiences and avoiding the same hindrances instead of repeating the whole test-experiment-discard cycle.
- Compare the traffic volumes of your local competitors and the local player of your new target market. Comparing the traffic dynamics between countries and analyzing the difference in online customer behaviors in both regions can help you understand how you can compete in this market.
#9 Prepare a spreadsheet
International market expansion surely requires a lot of research to build a robust plan. Now that you have all that you need, it’s time to organize all these research data in one place.
Prepare a spreadsheet, gather all the related metrics in one place to find out which country has topped your research and has the most potential for your business.
When it comes to identifying your target audience and benchmarking yourself against your main competitors to make sure you are ready for the launch, this spreadsheet can be very helpful to fill in your strategy.
#10 Advance to your strategic market expansion plan
Typically analyzing and gathering all this data would be an exhausting and challenging task to do on your own. But considering how many market assessment tools are available at our fingertips today makes the whole process more comfortable than ever.
By following this step-by-step process mentioned above, you will be able to prepare and put in motion a well-researched and calculated plan to expand in a market that will reap the most significant benefits for your business.
This was all about the new market assessment. Let us know how this strategy works out for your business in the comments below. We hope this information was useful for you.
Hariom Balhara is an inventive person who has been doing intensive research in particular topics and writing blogs and articles for Tireless IT Services. Tireless IT Services is a digital marketing, SEO, SMO, PPC, and web development company that comes with massive experiences. We specialize in digital marketing, web designing and development, graphic design, and a lot more.