Venturing into a new market is always a ‘tricky business’. Entering markets overseas where consumers think differently, follow different cultural norms, and speak entirely different languages could prove to be extremely complicated and a daunting task for organizations. For companies seeking to venture into and establish themselves in an already competitive and culturally different market from what they currently operate in, an effective market penetration strategy is a must-have. There are several examples of even some of the top international brands who have failed to garner customer support and establish themselves in new markets despite having a strong brand name and displaying business excellence in key markets of the world. The absence of a strong market penetration strategy is one of the prime reasons for the lack of success.
Having a penetration pricing strategy could prove useful in the case of new market entry. But beyond this, there are several factors that businesses must take into consideration for reaching out to a multilingual and diverse audience. Smart brands do their homework and analyze new ways to engage local customers and undertake promotions that resonate with the audience. Here are some factors to take into account while pursuing a market penetration strategy on an international scale.
International market penetration strategy
Focus on demographics
It’s always a good idea to deep-dive into the demographics of a market before formulating a market penetration strategy. Businesses must gain a clear idea of how the market breaks down in terms of age, ethnicity, gender, income, and several broader census categories. Once this is done, brands must hone in on individual regions. Although population across a region are often believed to be homogenous, mostly this is not the case. Varying levels of conformity and diversity can be seen in different regions. Gaining a clear understanding of these diversities can helps brands create a successful market penetration strategy. This will also help brands craft native brand experiences that are personalized and speak specifically to a particular market or region. Consequently, helping to ensure that those messages resonate with the local customers.
Identify target customers
When a brand plans to expand its business into a new region or country, this does not mean that the entire population of that country is their target audience. Once the business gains a clear idea on the demographics of the new market, they easily identify their target customers a build their market penetration strategy accordingly. If the target market size is not estimated, then it would eventually skew the other predictions of the company, making it more difficult for their market penetration strategy to become successful.
The feasibility of the market penetration strategy to enter a new market should be estimated. Does the decision make sense financially? Will it net more revenue than the costs incurred? These are some of the key questions that businesses must have answers to before going ahead with the implementation of their market penetration strategy.
Localizing content and strategies are paramount to resonate and be accepted among local audiences in a new territory. Localization entails layering appropriate cultural nuances on top of content translation. Websites and mobile apps should be revamped to suit the taste of local audiences and are easy to use and understand for them. Any touchpoint of interaction between customers and the brand must be natural and meaningful to the target audience.