Do you already have a developed product and operate successfully in Croatia, and are you considering expanding to foreign markets?
You’re probably wondering:
When is the right time for internationalization? Which market to choose and why? How to approach a new market? What is the difference in approach between B2C and B2B?
Entering foreign markets poses risks due to various uncertainties that arise along the way. However, the expansion of startups into foreign markets is possible in several ways. In this blog post, inspired by a lecture from the Grow IT program organized by ICT County, held by Sanja Buterin, Marketing Director at Gideon Brothers, we will try to provide answers to which approach is most suitable and what challenges we may encounter. Whether you are at the very beginning or in an advanced stage of startup development, the tips & tricks from this article could be beneficial.
The importance of a marketing strategy in every business, including the phase of entering foreign markets, is enormous. This is undoubtedly true since marketing influences the user’s journey from the need for the product to purchase and recommendation.
Why do a significant number of startup attempts end up unsuccessful?
It is a known fact that a large number of startups fail. But why does this happen?
The reasons why startup companies fail are many, and one of the crucial ones is a lack of understanding of the market where they place their products or services. If we look at it from a marketing perspective and in the context of marketing strategy, the failure of startups hides in:
Poor identification of the target market and the absence of a Go-To-Market strategy
When entering foreign markets, consider:
- Market size – What is the exact number of potential customers in your target market?
- Market value – Does the market have enough money to spend on your product?
- Market competition – What is the competition like in the market? Is the market oversaturated?
- Product value – Is the value of your product unique enough?
About the importance of the market, types of markets, market value, and its research, you can learn more from this recording of our lecture in the ICT County incubator from 1:09:00. If you are interested in more about the entrepreneur’s experience and finding a suitable market, listen to our webinar From Idea to Market.
More about market research and how to do it can be found in the article “Startups, do you know the market where you will sell your product?”
Lack of marketing/sales knowledge in the startup team
It often happens that entrepreneurs focus on the product and its quality and do not realize the importance of the marketing strategy in product sales. If your entrepreneurial success is No. 1, then a lot of time needs to be spent on product marketing. After all, what good is an excellent, high-quality product with a perfect design if no one has heard of it?
Why is it good to understand marketing?
Will a startup be successful if it doesn’t solve a real user problem? Probably not! Therefore, from the very beginning of startup development, activities that help identify these problems are necessary. Experience and understanding of marketing can be obtained from a marketing expert who would be good to be involved in the project as soon as possible. If you already have such a person on the team, their activities include:
Brand building, defining the buying persona, product positioning
Our first piece of advice is that the marketing team should be part of the startup team from the beginning. In addition to helping you discover who your ideal customers are, what problems and needs they have, what is important to them, where they get information, how they make decisions, and much more, this team will also help you in the design and development of the product.
For defining the buyer persona, there are some free tools like Make My Persona and Xtensio.
Market research, A/B testing
Today’s marketing strategies include a lot of research and testing. When launching a product, the marketing expert’s task is to examine which strategies work, and which do not yield good results, and to find out if the source of the problem is in the product or the messages you are sending.
After successfully going through the first two steps and having a product/market fit, it’s time for marketing campaigns. It includes content marketing and social media campaigns. The trap many startups fall into is starting paid advertising on social media early and then correcting communication mistakes. Therefore, it is important to remember that paid advertising comes only at the end when it is known which channels are effective.
Now that you have mastered your initial market well, users love your product, and revenues are promising, it’s time to expand to other (foreign) markets. So, you surely ask yourself…
Where to start then?
We mentioned some of the key steps in the development of any startup earlier, and below, we focus more on entering foreign markets.
Step 1. Explore the market you want to enter! Ask yourself: Am I ready to enter a foreign market? Is that market ready for me?
Step 2. Try to understand what customers in the selected market are looking for and want. Is it a new service? How should it be positioned for that market?
Step 3. Connect with partners and expand business relationships!
Step 4. Think globally, act locally!
Step 5. Consider the budget needed to finance actions necessary for entering foreign markets.
Step 6. Hire experts who understand the local environment, know how to scale the product, have a broad network of business acquaintances, and can connect you with other organizations and accelerators.
What do I need to consider when expanding business to foreign markets?
The goal is to sell solutions, not products!
If you want your business to be successful, your primary goal must be to sell a solution. Many startups focus on the product and less on the solution. What the user is looking for is not the product but a solution to their problem. Always think about the problem your product solves, and know that it is not an end in itself.
You must have a good story!
A good story is a very useful sales tool. Everyone likes to hear the background story behind a quality product or service. Startups often have a good and authentic story, and don’t be afraid to tell it. Be sure that your clients, investors, and the media will want to hear the story of the development of the product you offer, what mistakes you made, and what you learned along the way.
Use all available resources!
Every member of your startup team is also a useful marketing tool. So-called evangelists have a strong passion for what they do, so use that and encourage them to spread the story of your startup and product.
Marketing tactics for entering foreign markets
Marketing is a very broad field, and there are numerous tactics for expanding the network of clients and customers. Some of them will be listed below.
- Branding tactics
- Positioning and messaging
- Potential customer
- Content marketing and SEO
- Communication on social media and community building
- Paid advertising
- Event sponsorship (offline and online)
- PR and analyst relations
- Employer branding
Certainly, do not try to implement more activities at once. It is best to start with activities at the top and then follow them in order.
The Startup Starter pack
Understanding the 3 Cs: Customer, Company, Competitors
It’s crucial to know who your customer is, their habits, and characteristics. Don’t forget your role—why you exist, what you produce, and what change you aim to bring. Equally important is understanding your competition, identifying their weaknesses, determining if you can cover those gaps, and figuring out your market share partners. Read more about the 3 Cs here.
Defining your position and narrative
What problems do you solve? Whose problems are you trying to solve? What makes you better/worse than others? Step into the customer’s shoes! Explore various ways to test customer interest, from social media activity and newsletter subscriptions to concrete research methods like interviews, surveys, ethnography, and focus groups. Find inspiration for testing potential customer interest here.
Developing a marketing plan
Don’t rush into creating a plan! Prioritize planning marketing strategies and tactics. If you’re a beginner seeking help with creation, research how to build a marketing plan and its essential components.
Defining corporate identity
Corporate identity isn’t just about your company or project’s logo and design. It’s also tied to communication style, behavior, and slogans. These factors significantly influence how clients and investors perceive your company. Start by establishing fundamental standards, from visual identity to audience communication.
Preparing a quality pitch deck
Prepare a pitch deck in advance, as it will be frequently needed, especially in the initial stages of startup development, where the founder plays a crucial marketing role. Don’t forget the 10/20/30 rule in deck creation—10 slides, 20 minutes, font size 30. Utilize simple and free tools like Canva for creating visually appealing pitch decks.
Creating a press kit
Prepare a press kit in advance to have the material ready. This package should provide anyone interested in learning more about you with key information, saving time for both parties and enhancing media relations effortlessly. Wondering what a press kit should contain? Every media package should include a short startup origin story, your biography, relevant photos, various logo versions, high-resolution images, video and audio materials, contact information, links to your company’s social media, and details about the product or service you offer.
Investing in a quality website
Avoid hiring acquaintances with limited web development knowledge unless they are professionals. Allocate a portion of your budget to create a high-quality website, considering that your website is the core of your brand.
Producing quality content
The content you provide to your audience can take various forms—blog posts, webinars, podcasts, advertisements, and visuals. It’s crucial to stay in constant touch with your audience and, most importantly, with customers. Quality content creation can significantly impact your business; studies show that producing high-quality educational content increases the likelihood of your product being purchased by 131%.
Defining marketing communication channels
Consider which social media platform is more suitable for the product you offer. Accordingly, decide whether it will be Facebook, Instagram, LinkedIn, YouTube, or another social network.
Creating marketing strategies for entering foreign markets
- Defining Goals
- Ensure that marketing strategies support business strategies.
- Define goals at the beginning, ensuring all team members are aware.
- Evaluate your current market position.
- Choose 2-3 main goals and several sub-goals.
- Accept that not all goals can be achieved immediately.
- Set milestones.
- Be consistent and always measure the chosen metric from the beginning.
- Do Your Homework
- Research the market and competition.
- Conduct a SWOT analysis to identify your strengths and areas for improvement.
- Create buyer personas and gain insights into their behavior, habits, characteristics, etc.
- Create Marketing Strategies
- Remember that, initially, you are the brand representing your startup. A brand isn’t what you think it is; it’s what your customers think.
- Developing brand awareness and customer trust is a challenging task but a crucial step.
- Use social media to communicate with your audience consistently.
- Remember that Facebook and Instagram are not the only social networks; quality communication happens on Quora and Reddit.
- Influencers exist in every business area. Try to contact them, gain their trust, and consequently, their followers.
- Build a network of contacts before you need it.
- Guest posts on various blogs to make your brand recognizable on other sites.
- Join local accelerators and organizations that can help you.
- Participate in events whenever possible.
- Create relevant content. Do it not just because you think you have to but because you believe it will be valuable to your audience.
- Localize your website.
- Determine Key Performance Indicators (KPIs)
- Start A/B testing to gain insight into what works and what doesn’t for you. Learn from your mistakes and successes and document them.
- Create a Tactical Plan
- Identify priorities and determine 4-5 main tactics to use in the upcoming year.
- Align tactics with what you want to achieve, how you will achieve it, how you will overcome challenging phases, and how you will determine the next steps.
5 enemies of good marketing
We’ve outlined what to do right, and now, here are five (precisely 5) pieces of advice on what not to do if you want successful marketing.
- Never test on a large sample. Conduct all tests on a smaller sample, as errors are easier to correct in such cases.
- Avoid excessive use of buzzwords and jargon. While we all love using short terms, forget about it. Your client wants to receive a precise and understandable message.
- Don’t focus on the product; focus on solving a problem.
- There isn’t just one buyer persona; there are up to 7 different profiles.
- Don’t waste time creating content that doesn’t add value.
Tips & Tricks
As the cherry on top, here are some final tips and recommendations for a successful startup market presence.
Establish strong foundations! – Ensure that your product is clear to the customer, highlighting its uniqueness and why they need it.
Hire a marketing team! – If you’re starting and plan to hire only one person, begin with a product marketing manager.
Focus on one theme! – When it comes to content creation, start by concentrating on a single theme and become an authority in that area.
Build a brand! – Accept invitations to events, podcasts, webinars, etc.
Engage with the community! – Join startup accelerators, associations, forums, and actively participate.
Follow EU funding programs! – Through these programs, you can secure funds for organizing events or developing a website.
Communicate in the local language! – If expanding to foreign markets, try to communicate in the local language; clients and investors will appreciate your effort.
Whether you’re an entrepreneur with a ‘lifestyle business’ or a tech startup, the advice and resources mentioned in this article could be beneficial. Business internationalization involves various other challenges, and we hope to publish tips on dealing with them in future blogs. For more on other topics related to the startup ecosystem and entrepreneurship, check out our blogs on our website.