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Navigating the Complexities of Entering a New Market: The Role of Strategy and Adaptability in Achieving Success

Having a solid strategy in place before launching into a new market is critical for the success of the venture. It will allow you to understand the market conditions, identify potential risks and opportunities, and develop your plan to succeed.

How can you ensure that your market entry strategy is strong enough for a successful launch?

If you’re ready to take the next step in expanding your business into new markets, then you’ve come to the right place. In this article, I will present real-life examples of companies that failed to launch successfully in a new market due to weak strategies, lack of preparation, or poor market understanding. I will delve into the reasons behind their failures and provide a comprehensive guide on how to avoid similar mistakes.

Venturing into a new market requires careful consideration and planning to avoid common yet costly mistakes that are easy to make. While some might seem obvious, many are often overlooked because they don’t seem like big deals, until it’s too late!

Is your strategy strong enough to launch into a new market successfully?

Let’s say you are already successful in your domestic market. You know what they say: if it ain’t broke, don’t fix it! But what if your current strategy doesn’t give you the edge in a new market?

Taking into account the following factors and considerations are crucial, both in relation to your business and your target market:

• Market research and plan

Have you conducted thorough market research to identify potential opportunities and assess the feasibility of a new market launch before considering a new market launch? Have a strong marketing and communication plan, and ensure that you have a well-defined target audience and a plan for reaching them effectively. All your marketing materials and campaigns are tailored to the target market’s language, culture, and preferences.

• Customer satisfaction

Do you really know the needs of your customers? A high level of customer satisfaction indicates that you are meeting the needs and wants of your target market, which is a key component of your current successful strategy. Now you need to make sure your new customers will feel the same.

• Competitive advantage

Does your business have a unique advantage over its competitors such as patented technology or a strong brand? A strong value proposition is essential for any new market launch. You are looking to ensure that your product or service offers something unique and valuable to customers in the new market. Clearly articulate the unique value your product or service offers to the target market.

• Team and engagement

Are your employees engaged and motivated? I’ve been there. You’re sitting in the boardroom, your entire team is staring at you, and you’re about to tell them that you want to enter a new market. But… are they ready? Do they have the skills and experience needed to succeed? Are they familiar with the market? Will they be able to ‘read the room’ and adapt to new market conditions? Having a devoted and capable team you can rely on means you are more likely to execute a successful strategy and be able to adapt to new market conditions. Assemble a strong team of experts who have experience in the new market and are familiar with local culture, language, and business practices. Invest in local talent: Consider hiring local employees who understand the market.

• Local network

Are you able to establish partnerships and alliances? Develop relationships with key partners and stakeholders in the target market, such as local distributors or suppliers.

• Market share

Do you have a strong market share in your industry? It’s more than often an indicator that you are executing a successful strategy and are well-positioned to expand into new markets.

• Positive financial performance

Is your business consistently achieving or exceeding its financial goals? It’s one of the best indicators that your current strategy is working well.

• Industry trends

Are you aware of and do you respond to industry trends? Identify potential risks and develop a plan to mitigate them. This could include cultural, political, or regulatory risks.

• Always test

Test the market with a pilot programme or small-scale launch. This will help you gather valuable feedback and make any necessary adjustments to your strategy before going full-scale. Continuously monitor your progress and adapt as necessary. This will help you stay competitive and take advantage of new opportunities as they arise.

Many have succeeded. Many have failed.

The failures of companies like Kodak serve as valuable lessons and highlight the importance of not neglecting these crucial components.

Developing a new market, and scaling up it’s never smooth and you should be prepared for some bumps in the road. The reality of the process is that even the biggest and most established companies can fall short so it’s imperative to understand that regardless of size or brand recognition, every company must have a solid strategy, preparation, and execution plan in place to succeed.

Failing to Thoroughly Research the Market: Kodak’s Misstep in Japan

When Kodak was a leading company in the film and photography industry for many years, they had no idea that their future would be anything less than bright. However, when digital photography began to gain popularity in the late 1990s, Kodak failed to adapt and develop a strong strategy for this new market. They were slow to shift their focus from analog cameras to digital cameras and software, and as a result, they were unable to compete with other companies that had already established themselves in the digital market. Despite their efforts to catch up, Kodak ultimately filed for bankruptcy in 2012.

So what can we learn from Kodak’s misstep? First of all, don’t take anything for granted! The market is changing constantly, so it’s important to keep an eye on what’s happening around us and adapt accordingly. Secondly, don’t underestimate your competitors! If Kodak had taken time out before entering the Japanese market in the 1960s it might have realised that there were already local competitors who had a better understanding of consumer needs and preferences than they did themselves. Thirdly, don’t forget about yourself either! Even though your product may be great at first glance, maybe even better than any competing products, there may still be room for improvement if you take some time.

Ignoring Cultural Sensitivities: McDonald’s Struggle in the Indian Market

It’s hard enough to break into a new market. But when you don’t respect the culture, it becomes even harder. McDonald’s failed to understand Indian culture and its impact on consumer tastes when it entered the market there in the mid 90s. They did not offer enough vegetarian options on their menu, and they were criticized for using beef in their products. It also failed to adapt its menu to local tastes and preferences, which resulted in a lack of consumer interest. Because of these factors, McDonald’s struggled to gain market share in India.

Airbnb’s Journey to Success in China: Overcoming Challenges with Adaptation and Local Partnerships

We’ve built a platform that enables anyone to belong anywhere, and that’s powerful. Our vision is to create a world where people can feel like they can belong anywhere, where they can travel anywhere and feel like they have a home wherever they go. Brian Chesky, CEO of Airbnb

The tech and hospitality startup, Airbnb, faced challenges when entering the Chinese market. Despite having a successful business model in other countries, Airbnb struggled to gain a foothold in China due to intense competition from local players such as Tujia and Xiaozhu. Additionally, they failed to understand the local market dynamics and consumer preferences, leading to a weak initial strategy. To address these challenges, Airbnb had to adjust its business model and adapt to the local market by forming partnerships and investing in local operations. This allowed them to gain a better understanding of the market and improve their offerings, resulting in increased success in the Chinese market.

Any new market presents both challenges and opportunities for a company. Having a strong strategy, thorough preparation, and a well-executed plan are key components to success. By taking lessons from the failures of companies like Kodak or PeaPod, businesses can avoid similar mistakes and increase their chances of success in a new market.

Remember, success in a new market requires careful consideration, research, and adaptation to local conditions, tastes, and preferences. With the right approach, your company can successfully expand and reach new heights in a new market.

Here’s to the crazy ones. The misfits. The rebels. The troublemakers. The round pegs in the square holes. The ones who see things differently. They’re not fond of rules. And they have no respect for the status quo. You can quote them, disagree with them, glorify or vilify them. About the only thing you can’t do is ignore them. Because they change things. They push the human race forward. And while some may see them as the crazy ones, we see genius. Because the people who are crazy enough to think they can change the world, are the ones who do. Steve Jobs, Apple

Author: Patrycja Maksymowicz

This was posted in Bdaily's Members' News section by Open Solutions Global Limited .