Thinking of branching out overseas? Roderic Michelson, business growth consultant at Aralex Consulting reveals the six most common sins of marketing abroad
There are huge opportunities to sell B2B products and services abroad – but without a good understanding of the target country it can go horribly wrong. We’ve all heard the horror stories of product names that mean one thing in one language and something very different in another. But there is more to marketing abroad than just getting a good translator.
The bad news is most companies fail to gain traction as they unwittingly commit at least one of the six following sins of marketing overseas.The good news is, with planning and research, these sins can be avoided and new overseas markets can be opened up. Here are the six sins and some advice on how to avoid them.
1. Insufficient research
Before you start you need to have a basic understanding of the target country. One useful source is the Economist Intelligence Unit’s series of country profiles. Another source is the country’s investment promotion authority. Type ‘invest in [name of country]’ into Google and it will show up. An unconventional source of useful information is property investment sites covering the country.
2. Lack of partnership
Unless you intend to open an actual branch in the target country, your best bet is to find a partner that can help you market to local customers.
Speak to the trade section of the nearest embassy of the country and be ready with a short presentation of your company and product. Ask if they can recommend possible partners. Note, you’ll generally be taken more seriously if you say your company has been recommended by their embassy.
When choosing a partner, look for companies where your product will receive proper attention. Seek out opportunities to piggyback on other popular but non-competing products, or on a company’s established B2B customer base.
3. Lack of local contacts
The local Chamber of Commerce is a useful resource when doing business abroad. Often they will organise relevant seminars, joint events with an overseas embassy or international trips. If no trips are scheduled, ask them to organise one, or if you missed a trip, ask who attended and contact them to seek advice and recommended contacts. Your local chamber should be able to put you in touch with the Chamber of Commerce in your target country’s capital city. Ask for your enquiry to be included on their electronic bulletin board and newsletter.
If you are a member of your own industry association, find out if they have exporting information. If not, can they commission a consultant to look at key export markets and distribute the research among members?
Another direct way to generate a list of potential contacts is through the kellys.com and compass.com online databases. Create a short list and then research the individual companies.
4. Ignorance of regulations
Packaging and goods will need to comply with local regulations. You can find out about labelling regulations from your target country’s local customs office or by contacting the trade department of their embassy.
Another good way to start is to try to get free advice from Bureau Veritas, a Swiss company specialising in product verification. Check with local offices of large courier companies like FedEx and UPS. Do they know the requirements, can they provide advice?
5. An irrelevant USP
When entering a new market against local competition, the one thing that all companies that have managed to stand out from the crowd have in common is – a unique voice.
Although you may have the perfect unique selling point (USP) for the UK – will it work abroad? Are the needs of customers in your target country the same as your customers in the UK? Not addressing these issues is definitely a major marketing sin.
6. Poor logistics
Inability to fulfil orders or satisfy demand is a cardinal sin, so put some effort into arranging the logistics. Transport costs will form a substantial amount of the final price to the customer in your target country so be prepared to cut into your margin to match the local market. Be ready for price drops by local players. This is an area where conscientious homework pays handsomely.
Calculate the minimum order quantities required to make it worthwhile. Calculate several scenarios and what they would do to your margin. Decide if you are ready to accept less profitable business in order to penetrate the market. These days there are plenty of order-fulfilment houses, in-country, that service local Internet businesses. Could they be an initial solution for you?
Finally, exporting is an excellent avenue for growth but it needs patience and persistence to get established in foreign markets. Realistically it will take about 18 months before you’ll reap significant benefits from a market.
