Market research: two words that dictate your success in a foreign territory. This endeavor is so important, that if you’re relying on information that’s missing even the smallest pieces, your product expansion hangs in the balance. Yet time and again, brands make the mistake of relying on inadequate, incomplete or downright incorrect information. In fact, their failure to conduct all-stones-unturned, a to z market research can cost them an eye-watering sum of money (not to mention brand awareness, advocacy and profit).
Expanding your operations into a new territory without doing your homework is akin to buying a house based off of a rudimental glance at an online ad alone.
There’s a substantial chance that the reality is very, very different, and instead of suburban bliss, might consist of the following: Upon arriving at your new abode (kids and pets in tow) you may find out that your neighbors have a rabid pit bull who’s known for his Houdini-like abilities (say goodbye to Fido!), and that your grandmother’s dining set does not, in fact, fit into the entertainment area (say goodbye to your inheritance!). What’s more, the Wi-Fi connection is non-existent, and the school bus that used to stop right outside the door has now been re-routed, adding an extra 35 minutes onto your morning commute (say goodbye to sleeping in!). In other words, the reality is far from ideal. It’s safe to say that if you were privy to this information beforehand, you probably wouldn’t have purchased the house in the first place. This scenario is a lot like those who enter a foreign market wide-eyed and bushy-tailed, and very, very naive. In short, if you don’t know about your market, making a success of your move becomes a whole lot harder.
Laying the foundation for a foolproof strategy begins and ends with market research.
And the only way to really get to grips with the country and culture at hand is to commit yourself to the cause (and by cause, we mean market research). Many companies, when setting their sights on a new territory or market, are of the (mistaken) opinion that conducting a PESTEL analysis will give them more than enough information with which to work with. PESTEL (Political, Economical, Social, Environmental and Legal) is the standard outline from which businesses analyze potential areas of growth, and while this method is a crucial part of market research, it’s just that – one part of a much larger picture. So what else should market research into a new market entail? I’m glad you asked…
There’s a good reason why global translation services prioritize market research into the culture at hand.
The culture of your new market influences all aspects of your product expansion, which is why expert localization providers prioritize the research of the culture at hand. Yet, too often, the market research phase gives too little attention to the cultural context of a market or region, and the effect this has on product expansion. Whether due to the fact that culture is nuanced, and is therefore that much more difficult to ‘measure’, or whether down to just plain ignorance, this key factor is what trips up many a foreign expansion. There are no two ways about it: the culture at hand has a massive role to play in the way you conduct your expansion. Having a crystal clear picture of your target market is the first step in getting to grips with the cultural influences at play – be they religious, societal or political.
To summarize: market research for planned product expansion needs to consist of:
Target market demographics, their buying power, their purchasing behavior, their attitude towards foreign brands, their cultural sensitivities and conventions and an analysis of the surrounding macro and micro environment.
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