Use of Online Channel International Marketing Operations

Seven strategy considerations for new market penetration

  1. Determine which markets to enter

An obvious one, right? However, possibilities are near endless when it comes to entering new markets in today’s digital era and it is easy to get sidetracked and diluted.

  • Do your homework and consider which markets are most suitable for your brand. Think medium to long term to limit the risk of having to pull out in a few years time.
  • Spend time looking at your business’ trends: which markets are your sales predominantly coming from, at what growth rate, what is the average spend, and any other data point you have at hand to help inform your decision.
  • Evaluate each contender looking at future growth opportunities, barriers to entry, competitive environment, internet and mobile penetration, etc.
  • Consider how these markets fit in with your overall strategy. Will they require much adaptation to your offering and future product development? If so, are you geared up to cater for these incremental needs?
  1. Gain knowledge of local laws and regulations

Don’t underestimate the impact local laws and regulations can have on your expansion plans, and certainly don’t assume that what applies in one country will apply equally in any other.

Local laws and regulations are likely to differ, often significantly from the rules you are familiar with. Entering China as an e-tailer for example will require a fairly lengthy process, starting with obtaining a business license which could take up to a year.

  1. Make payment super easy

If you are selling any goods or services, investigate carefully which payment options are most popular in the markets you are targeting.  Think beyond PayPal and debit/credit card as they might not be the only or even most suitable payment options in some markets.

Take Germany for example, where it is common for e-tailers to offer payment on invoice or by bank transfer.  Offering inadequate payment methods is a sure way to instantly limit your addressable market.

  1. Evaluate the logistics

Depending on the nature of your business, you might need to import, produce, store, or despatch goods from a local centre.  Assess your options, can these operations be performed from your existing factory/distribution centre? Could they be outsourced to an experienced local partner? Which would be the most efficient and cost-effective way to operate? What are alternatives and their inherent risks? Needless to say, this is a critical aspect of your expansion plan with potentially major cost and legal implications so spend time conducting thorough due diligence.

  1. Decide on your localisation model

Localising your website can take different shapes. From entering English-speaking markets with a clone of your existing site (with a local ‘.xx’ extension) to offering a fully customised website in the local language with a product range that has been specifically tailored to local tastes.

  1. Define a local structure

The type of structure your brand will require in these new markets will depend greatly on your business model, your localisation and logistics choices and your aspirations.  Typically it is advisable to start small and grow organically.

If your goods are being produced, stored and dispatched from your existing production centre, and if your website is maintained by a team based in your Headquarters, chances are your physical local presence will be minimal (possibly a Sales Rep or BD manager and a local-language editor).  If on the other hand most of your operations require a physical presence in-country you might need to consider setting up a production/distribution structure locally.

  1. Understand cultural nuances and customs

Although this has evolved tremendously over time, there is still a tendency to believe that what’s ‘good enough for the initial market will be good enough for any other’. 

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