Location via proxy:   [ UP ]  
[Report a bug]   [Manage cookies]                
Scribd
Upload
8 views

Guide To Identifying and Researching New Markets

This document provides guidance on conducting market research to identify and target the right international market. It outlines three basic steps: 1) Screen potential markets by collecting export statistics in your sector and identifying 5-10 large, growing markets; 2) Assess top markets by studying trends, consumption, competition, distribution channels, and trade barriers; 3) Draw conclusions by selecting 1-2 focus countries based on your analysis. The document emphasizes using secondary data sources initially and then conducting primary research through direct customer contact to learn their needs and validate opportunities. A checklist of 10 questions is also provided to profile and compare potential markets.

Uploaded by

exp.mah.tehrani
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
8 views

Guide To Identifying and Researching New Markets

This document provides guidance on conducting market research to identify and target the right international market. It outlines three basic steps: 1) Screen potential markets by collecting export statistics in your sector and identifying 5-10 large, growing markets; 2) Assess top markets by studying trends, consumption, competition, distribution channels, and trade barriers; 3) Draw conclusions by selecting 1-2 focus countries based on your analysis. The document emphasizes using secondary data sources initially and then conducting primary research through direct customer contact to learn their needs and validate opportunities. A checklist of 10 questions is also provided to profile and compare potential markets.

Uploaded by

exp.mah.tehrani
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 4

Guide to Identifying and Researching the Market

Your Target Market


After the export plan, market research is the most important contributor to international success.
With 190 countries to choose from, you want to pick the right market for your product or service.
To do this you need to get a clear picture of the political, economic and cultural factors that can
affect how you operate. You may need specific information to take advantage of an opportunity
you already know about or may have a target market for which you need more detailed
information on demand. The key to understanding these opportunities, confirming that they insist
and developing market successfully lies in market research.

You’ve made the decision to export and you have the capacity, the money and time to do it. The
next step is to access the market you want to target. The importance of comprehensive market
research cannot be overstated. On-the-ground information is by far the most valuable information
you can have and acquiring it is not usually a major strain on resources. Bear in mind the crucial
piece of data you require is simple: the number of people in the market who are willing and able
to buy your product. All your research should be done with this guiding principle in mind.

Before you start … get your short cut ready


The quickest route to any new market is for the customer to come to you.
Anecdotal evidence suggests that this happens more than you might think. In some sectors, up to
50 per cent of exporters have entered a new market based on an unsolicited order.
It goes without saying that a professional, internationalized website is a must. Potential customers
around the world should be able to quickly assess from it whether your offering is what they are
looking for.

There are three basic steps to international market research:

1. Market screening

To screen potential markets start by collecting statistics on exports to third countries within your
sector. Identify between five and ten large, growing markets and see whether they have
experienced consistent growth over the past three to five years. See how recession has affected
growth. Check for opportunities in smaller emerging markets where you may have less
competition. Then select three to five of the most promising markets for further study.

2. Assess target markets

With those markets, look at trends that could influence demand of your product or service.
Work out overall consumption and identify how much has been imported. Study the competition
and look at each competitor’s market share. Examine the channels of distribution, cultural
differences and business practices that affect the marketing and use of a product or service in a
particular market. Check for export controls and tariff or non-tariff barriers to imports. Look for
government incentives which will help with export promotion.

Bahamas Trade Info Portal – www.bahamastradeinfo.gov.bs


3. Draw conclusions

Once you have completed your analysis, you may decide to limit your marketing efforts to a few
countries. If you are new to exporting, it’s best to concentrate on fewer than ten markets - one or
two countries are usually enough.

Types of market research


There are many ways to study a market. Some people call with gut feelings while others prefer to
work with statistics. The more detailed your research is, the less likely you are to miss something
important.

There are two types of market research: secondary and primary.


Secondary research uses data from studies, market reports, books, periodicals, surveys and
statistical analyses. Use information from Chambers of Commerce, economic development
organisations, industry and trade associations and local businesses that are already working in
your target market. Once you have completed this step, move on to primary research.

Primary research means collecting data this through direct contact with potential customers or
other sources. You usually have to get personally involved in this process and you will need to
have a clear idea of your company’s objectives and what you want to find out
For example, you should give a brief description of your company, its history, the markets it
serves, professional affiliations and your product or service.

Use your secondary research to help you describe one or more objectives for your proposed
export product or service. Clearly describe that product or service and ask specific questions,
basing this on your secondary research.

How to profile potential markets


Here is a checklist to help you summarize what you have learned about a potential market. When
you pull that two or three markets, it is easy to compare to see which market or markets have the
best opportunities.

Your market research checklist: 10 crucial questions

1. Is your business model transportable?


Every market has a competitive situation. Have you established what is similar and different in the
new market compared to here? Are the conditions that allowed you to win before, present there?

2. Are you analyzing the market correctly?


Avoid being seduced by the ‘macro picture’, for example population size or economic growth. If
your product is a consumer offering, will it be affordable in the new market? If you offer a
business-to-business product or service, will you be pitching at broadly the same level as your
competitors?

3. Who else is in this market?


In the biggest, fastest growing markets, the competition is likely to be fierce. Potential customers
may be spoilt for choice. Is your offering strong enough to win out?
4. Are you only looking at the obvious?
So-called ‘second tier markets’ may not be as large or growing as fast, as say, BRIC countries but
may have less competitors and offer greater customer loyalty.

5. Is your market ready?


If the market for your product or service is not yet mature, do you have the resources to get in
early and educate the market? On the other hand, if you let a larger organisation develop the
market, can you persuade customers to switch to you later?

6. Are you ready for the long haul?


South East Asia is a classic example of a market that will take two or three years before you start
seeing any pay-off. Do you have the cash-flow and the resources to stay the course?

7. Does your offer need to be fine- tuned?


Differences, however subtle, in the offering outside of your country are important and will have an
effect on key selling points, the competitor position, the choice of sales channels and customs
duties.

8. How many markets should you look at?


There is no set rule for how many markets an SME should target. In some sectors, a large portfolio
of markets is entirely feasible and helps spread risk. However, limits to your human resources and
management capacity will eventually come into play. Ultimately, you should be guided by accurate
market information: the potential of a market will decide whether you concentrate resources in it.

9. Could innovative partnership models work?


It can be difficult for a new company to gain traction and compete with large, established
multinationals. Consequently, identifying industry contacts throughout the value chain and
partnering with them may be an option in such markets.

10. Have you got the right person to represent you?


The correct choice of local partner is one of the most critical success factors for SMEs in overseas
markets. Good partners will not only give you access to markets; they also give you market
intelligence and cultural translation. In a perfect relationship, they will be ‘you’ on the ground.

Market types
When you are screening markets it is important to understand the three types of markets exist.
These are:

Type 1 — fast paced competitive economies such as the United States and Western Europe where
you will only succeed with efficient delivery of products and services, excellent quality assurance
and an in-depth marketing plan. Use local partners to handle linguistic and cultural differences.

Type 2 — relationship-based, affluent economies such as some South American countries. For
these markets you will need interpersonal communication skills, cultural sensitivity and linguistic
fluency to develop a business relationship with a local partner – and these should be developed at
a senior level.
Type 3 — international financial institution (IFI) funded economies such as Africa. In these
developing economies market development can take time and it is important to be flexible and
politically astute. Experience working with third party funding organisations is also very helpful.

Don’t ever feel that you can’t compete overseas. The market for your product or service may not
be obvious but if your domestic market is healthy, why shouldn’t your products and services sell
abroad? It’s not just price that is the selling point but need, utility, quality, service, credit and
consumer taste can also help you to be competitive.

---
Note: Original text from the Exporter Toolkit from the Caribbean Export Development Agency (CEDA).
The content has been updated for the Bahamas Trade Information Portal with permission of CEDA.

You might also like