What are the biggest challenges to entering new markets and how do you overcome them?

There is no single way to overcome the challenges to new market entry. Conversely, those challenges/obstacles should be determined before products or strategies are developed, to prevent substantial expenditures in the midst of entry. Once you understand which obstacles/challenges must be tackled, you determine how to overcome them. In a rush to move things along, many organizations fail to recognize the importance of carefully evaluating challenges before jumping all in.

 

Carlos Escobosa commercial and administrative director of The Residences at Solaz says that in Mexico, where an important percentage of sales are directed to foreign buyers north of the border “the biggest external challenge is the negative perception that North Americans have of Mexico.  The best way to overcome negative perceptions is through  PR campaigns focused on the value, security of investments, and levels of capital being invested. In addition, there is often an internal lack of knowledge of what a consumer wants or needs in our industry (Travel & Leisure and recreational Real Estate)”. Cindy Collins founder of Mining Technology Partners told us that  “the approach for us would be the same as it was in coming into a new territory in our market of mining & metals. Except now  we have greater access to online resources such as advertising, SEO marketing and so on.  We are working to take advantage of this … with a new website, podcast and other content.  This is in addition to face to face meetings…it is more than about effective marketing, it comes to relationships”.

Rahul Samant CEO of Rehabtronics stated that “…the biggest challenges include regulatory, sales, distribution, and marketing. Typically to overcome these we enter markets where we have first established a strong sales and distribution partner that understands the local issues in this context”. Alejandro Godoy founder of Seafood Business Solutions adds that “entering new markets is all about understanding the demand. But on the other hand, explaining and demonstrating your product and its benefits in comparison to others” is key.

The research and development phases of a project often seem protracted, but it is essential to prepare and take your time to do it right. As noted above, the key issues to keep in mind for overcoming barriers are marketing, a clear understanding of demand, and relationship building.

Each organization has its own way of navigating areas of opportunity. Some companies are well versed in entering new markets, have strong processes and count on the necessary resources to do so effectively. For many others, hiring a consultant the most effective way to define specific challenges and design a strategy for tackling them. The avenue offers a way to overcome a lack of initial internal capacity within an organization, and support capacity building in an effective way; while continuing to move forward with the due diligence required for new market entry.  In addition, consultants can assist in overcoming sensitive subjects, as they can bring an impartial opinion and an unbiased eye, as is mentioned in an article by Alex Nuth  titled “Why Companies Really Hire Consultants” .

In a nutshell, taking the necessary time and doing your homework will minimize risks and maximize results.

This article is part 3 of 3.

In case you missed Part 1: Top 4 Challenges to Business Development. 

In case you missed Part 2: How important is it to develop strategic relationships and contacts inside target markets?

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Marketing Strategy vs. Execution: Ending the Blame Game for the Sake of Success

Blame is often distributed generously when companies don’t obtain the expected return on investment. Most often, the “execution” phase becomes the accused party. As noted in a recent article in the Harvard Business Journal, it is common for businesses to follow the mantra that “a mediocre strategy well executed is better than a great strategy poorly executed.”[1] The article argues that the metaphor is misguided, and that having a good strategy is important. Therefore, a poor strategy won’t cut it even with a spectacular execution.

We agree. Success depends to a great extent on a sound strategy – because even great execution simply follows a blue print. A key element to designing a good strategy is considering the realities and needs of the business from the perspective of the staff that will execute strategy, as well as management’s expectations.  Communication across the board is important if you want to start on the right foot.

Having said that, once you have a sound strategy  it is not wise to underestimate the importance of the execution phase. Follow-up, guidance and communication will continue to be necessary throughout the execution phase.  This way management can determine if processes are flowing effectively and  if there are any areas for improvement.

Strategy and execution go hand-in hand. Although it is essential to stick to the strategy’s framework, it is also important to allow it a measure of flexibility. Thus, the strategy can be modified or improved according to the needs of the company’s day to day operations. Companies and – especially- organizations that depend on external funding are subject to ebbs and flows, and do not always operate under ideal circumstances.  The strategy must be able to adapt to changes.

In conclusion, strategies should not be abstract concepts designed from the top-down. Their design requires communication with all levels of the company to become truly effective. Execution must be properly monitored to ensure the strategy is implemented correctly. Both phases are important and fulfill specific needs. Both must be approached seriously if your goal is success rather than reaching a state of “good enough”.

CIS

Carolina@sinclairandruiz.com

www.sinclairandruiz.com/marketing

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[1] Roger L. Martin, “Drawing a line between strategy and execution almost guarantees failure,” Harvard Business Review, July – August 2010, 66.