Going Global – Assessing Viability And Steps To Launch Product In A New Territory
Raamish Rana | 0 comment
In a highly competitive, and globalized world of today, it is imperative that companies products and services reach to international markets have a greater probability of sustaining performance. While expanding internationally is important companies should be vary that not all markets are equally attractive, and certain factors need to be given serious consideration. Insights shared by Simitri Chand therefore offer some support:
Legal and political factors
The attitude of the foreign people, government, institutions can all make meaningful impact on how a product is perceived in a foreign market. Therefore, it can benefit internationally oriented companies to take into consideration how value can be generated in foreign markets in terms of generating people interest and fostering benefits to attract a larger support base. In addition, certain political indicators such as political stability of country, and attitude of people to the host country can indicate the likelihood of company sustaining in the long run– example country trade liberalization policies can indicate about foreign people attitude towards imports. Other factors can include legal systems, political ideologies largely supported, tax systems, and public attitude toward international products/services.
Social and cultural variables
Countries can differ in a number of cultural and social dimensions including but not limited to: religion practiced, ethnic boundaries, food, e.t.c. Thereby in deciding to enter a new market, companies should alter products subject to social factors and tastes that prevail locally. Even marketing practices have to be localized to the preferences of local people. Socio-cultural settings do require adapting a new type of ‘marketing mix’. A core example could be that advertisements should entail cultural values or perhaps translating messages to a local language.
It will also serve a great deal if the company can evaluate economic conditions and understand economic stability of a country – A number of factors can be considered: Exchange rate stability, income per capita in selected segments relevant to one’s product, economic well-being in general with openness to trade, and general contribution of the relevant sector to the country’s overall GDP to assess anticipated competition or how much people spend in general.
Careful evaluation of the target market size
When launching a product/service in a new market it is important to take a venture approach to launching the product as argued by Irene A Blake, and serves a highly impactful means. This entails conducting an extensive market research to determine product/service attractiveness in a target market.
Therefore as argued by Irene A Blake, this exercise should entail a series of steps:
- Undertake an assessment of needs that the product can actually serve in the new market.
- Carry out a market research to identify the demographics of customers interested in the product, whose solution the product would solve, and customer willingness to pay. Market research should extract customer attractiveness to competitor products. Market research can be completed through surveys or by hiring a market research firm or through individual means of conducting surveys, and focus groups.
- Size the market to determine how much revenue can be generated and extract key drivers in the market together with their growth rates specific to local markets
- From a sample of target market, prototype the products to obtain a feedback from a reasonable sized sample
- Prototyping can be iterative, focus groups can also supplement until there is a reasonable level of surety and confidence that the product matches the requirements locally.
- Identify a series of external factors that can affect the business including but not limited to natural disasters, economic shocks, likelihood of additional competition e.t.c
- Evaluate completely, the costs associated in launching the product in foreign market such as capital commitment, operational expenses, administrative expenses, overheads and others.
- Analyze all the collected information to consider if it is economically viable for the business to progress ahead
Assess company capability to deliver
- For a company deciding to launch internationally, it should be able to assess with reasonable confidence that it can establish a competitive and sustainable advantage in terms of superior product than competitors, sound company capabilities, solid consumer base, established group of partners. These elements can help explain company capability to beat the competition, and indicate a likelihood to sustain. Additionally, it is important to establish a strong local connection. People preferably with a strong experience in the local market can also contribute largely to the company success.
1. Chand, Smriti. "5 Factors You Must Consider While Your Company Is Entering to a New Market." N.p., n.d. Web.
2. A. Blake, Irene. "How to Determine Market Viability for a Product or Service." N.p., n.d. Web.