E-commerce and Digital Marketing has reached new heights in the current climate and reaching overseas consumers has become increasingly mainstream. This has meant that businesses can reach a wider breadth of consumers through innovative technology that can help diversify their customer base.
I studied International Marketing as a module in my Business degree and I was fascinated by the important guidelines to follow when a firm wishes to expand overseas. It was intriguing to learn the importance of adapting a product/service to meet local customs, as well as, the use of local expertise to overcome barriers to entry.
Research potential export markets
Firstly, it is important to research new markets and identify issues such as logistics and customer service. You also need to know whether you will need to adapt your product or service to meet cultural needs and legislation. Therefore, it is crucial to identify potential export markets where you might be able to sell your product/service to fulfil a need/desire. Competitor research is key to identifying market conditions as you can easily be blinded by a niche or high demand, however, it could be that the market is dominated by competitors or that the market is either unprofitable or unsustainable.
A “SWOT” analysis is important to identify the internal implications of expanding into an international market. This helps firms make informed decisions by assessing their strengths and weaknesses, as well as, whether the opportunities outweigh the threats in their potential new market. Furthermore, it is important to use industry research data to identify key trends including purchasing behaviour, market developments and fluctuation in demand.
Assess the political and economic environment
When trading abroad, understanding the political and economic environment is essential to identifying potential challenges you may need to overcome. This could include trade barriers and tariffs. Also, it is recommended that you work with local partners, whether it’s affiliates, distributors or agents, local expertise could be essential to getting your company off the ground overseas, as you won’t only have access to local knowledge, but assets and contacts that could be the key to success overseas. This is even more important if political legislation favours local companies, so therefore a local partner is crucial to overcoming barriers to entry.
Furthermore, it may be necessary to adjust your marketing strategy to suit developing markets that still rely on offline communications such as magazines, newspapers and radio. This will also form your budget and pricing strategies as you will need to consider exchange rates, as well as, the cost of logistics, freight transport and any commission you’ll face. A “STEP” analysis consisting of social, technological, economic and political factors is important to assess the hurdles you’ll need to overcome when expanding to a new market, enabling you to make informed decisions on whether your product/service has the potential to perform well overseas.
Learn about local customs
Learning about local customers is essential to succeeding abroad, what works in one country may not work in another due to cultural differences including a different language. Using the same marketing strategy that you use domestically, is the equivalent of going abroad on holiday and speaking louder and slower to get around a language barrier, without realizing that you’re just becoming obnoxious in doing so. Leaving your marketing strategy to chance when expanding overseas is not advisable, especially when there are high levels of risk attached to your plan. Investing time into learning local customs such as cultural norms, business etiquette and the native language is valuable to succeeding abroad.
There have been many well documented and publicized cases of marketing faux pas abroad and the consequences are not worth enduring. Modern-day technology can easily iron out any embarrassing mistakes and with the first example, you can learn a bit of the native language or use Google Translate without having to resort to potentially impolite measures to communicate with locals.
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