In a rapidly changing world, companies who are flexible and forward-thinking will always have an advantage. Identifying opportunities for new market development, and formulating a clear strategy to take advantage of those opportunities can give your business a significant edge – but it’s not always easy!
What is new market development?
In the simplest terms, market development is about getting people who currently aren’t buying from you to do so. This might mean targeting an untapped overseas market, or a different local demographic, such as reaching out to younger customers, ‘C Suite’ executives, or looking at offering franchise opportunities for budding entrepreneurs.
Why expand when things are going well?
All too often, companies only look at expanding to new markets and territories when their current ones are already in decline and their profits are falling. If there were easily tapped markets or ‘low-hanging fruit’ open to them, the chances are good that their competitors have already explored them, and probably have a foothold already.
As the old adage goes, having all your eggs in one basket is rarely a good approach, especially for a business which has employees that depend on it for their livelihood. Exploring new opportunities and conducting market research, even in a casual manner, should therefore become an exercise you do regularly and routinely – so when there’s a prospect too good to be passed up, you’re primed and ready to take action.
Clearly define and research your target audience
Depending on the nature of your product or service, how you’re going to approach market research will be different. If you conduct most of your business or sales online, then looking into territories with high search volumes for your offering through tools like Google’s Keyword Planner, Think with Google, and Google Trends is always a good start. There are various other online tools available to help you gather and make sense of data surrounding your potential customers.
If you’re marketing a product you intend to sell in retail stores, or which is unfamiliar to the market you’re exploring, then ideally you’ll want to get samples in front of real people for feedback. Surveys can also be a great help when there isn’t existing data available, or your product is unlike anything currently available in that territory.
Whichever approach you take, bear in mind that how people respond to your product may be very different from what you’re used to. Language, cultural and other social factors should all play a role in how you ultimately package, promote and price your product.
If all the signals are good, establishing a physical presence in the location you’ve chosen may be the next logical step. Here’s one area where that forward-thinking strategy can make a big difference! If you’ve already explored the commercial property for sale in the region, you’ll be able to act a lot more swiftly than your more shortsighted competitors.
Define what makes you different
Perhaps most importantly of all, you have to have a crystal clear idea of why your product is better than, or different to, what’s already available in the market you’re investigating.
What’s special or unique about your product or service?
What can you do that local competitors can’t?
If you’re not 110% convinced yourself that what you’re offering is better than what’s already on the market, there’s little chance you’re going to be able to convince wary new customers.
Some brands have had to learn this the hard way. In 2006, Mahindra & Mahindra (India’s largest manufacturer of utility vehicles) made a play to enter the US market selling their rugged diesel pickup trucks. What they hadn’t given enough attention to was how their vehicles were different from what was already available. Their offering and brand story was confusing to the American market, and their strategy ultimately failed – despite the fact that their product was actually better.
But Mahindra learned from this mistake, and in 2015, they gave it another shot – this time with branded ‘agricultural utility vehicles’. On the second go around, they partnered with a US-based company to acquire a deeper understanding of their target audience, and clearly differentiate themselves and their vehicles from what was already on offer. And it worked – since then; they’ve managed to achieve an impressive 70% year-over-year growth in what is traditionally a flat-growth category.
Of course, most small and medium businesses won’t get the luxury of a second attempt at entering a new market. This is why conducting in-depth research, both on your target audience and your potential competitors, and laying out a clearly defined plan of attack is so important. Taking the time to make sure you have as much information as possible at your disposal now can pay off handsomely in the future growth of your business.