7 Short Rules for Conquering the Global Market
Hi, Habr! Startups are very important in today's corporate world. But sometimes, even having received recognition in his own country, it can be very difficult for a business to move to the global arena. Our colleague, Laurent Ellerbach, head of the Evangelical team in the CEE countries, highlighted 7 main rules that startups should remember to enter the global market.
In the global market, it does not matter where your startup comes from. It can be from France, Germany, Russia, Belarus or any other country - the main thing is how unique and new the solution is offered by this business and how much it is demanded by the market. So, foreign clients and investors will not look for special characteristics in Russian startups compared to startups from other countries. However, in order to conquer foreign markets, several rules should be observed that will help achieve the desired faster and with less losses.
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First of all, you need to make sure that potential customers from the business and / or end-users in the markets that interest you know about your company and your product. A large corporation based in the United States or Western Europe is unlikely to accidentally “hear” about the existence of a Russian startup. As a rule, there are several startups at the same time offering identical solutions, and those that are more visible are becoming successful. Many things can be done online, but still worth attending various conferences. Also, do not forget to establish personal contacts with the press, potential investors and customers. Any mediation will reduce the profitability of your project.
Many companies that have become successful in international markets have achieved this because they planned international expansion at the time of its foundation. As a rule, companies in large European countries - Russia, Germany, France - do not think in global categories, and plan to start from the local market, and then think about entering foreign markets. However, later it turns out that all their processes and structures are sharpened only for one, local market, and it is quite difficult for them to restructure for expansion into other countries.
If you decide that your startup will build a global business, first of all you need to think not about naming and branding - you can always change them. Many companies have different names and brands in different markets, for example, Auchan. The first thing you need to think about is your potential customers abroad. Of course, there is quite a lot in common between buyers in Russia and, for example, Portugal, but now it is already much more difficult to make a product interesting for both European and North American audiences. In any case, think about your target audience in a global way from the very beginning, so as not to be captured by your first market.
Of course, this is not necessary for all startups - in particular, in niche markets, when in the current realities the product can be sent anywhere in the world, you can stay at home and pay more attention to marketing. However, it should be borne in mind that in larger segments it is often more profitable to open a representative office in order to make it easier to export your goods, due to existing legislation. This applies in particular to the United States and China.
Do not underestimate the costs of developing awareness of your company and your product in a new market, participation in conferences, meetings, hiring local consultants and so on. As a rule, the founders are too optimistic about these figures, but they must correspond to reality and be immediately taken into account in the business plan. If this is not done, then the project's business model may undergo significant upheavals, including a decrease in profitability, an increase in the price per unit of product, and so on.
To successfully enter a new market, you need to understand it, so a good decision would be to hire a sales specialist, business consultant or marketer from this market, who, ideally, are already recognizable in a positive way. Many large corporations recognize that for them the most important factor in evaluating a startup is its team, and it is ahead of the importance of the product that it produces. Do not give up the effort and cost of exploring a new market, even if it seems close to you from a cultural point of view - this is one of the most common mistakes made by startups who want to expand their reach. In addition, it is always beneficial for the founders to spend some time in a country where they want to develop in order to form their own presentation and, if possible, to communicate with potential buyers.
No need to rush, the coverage of new markets is better to implement step by step, otherwise your business may choke and lose the core of development.
We also invite you to chat with Laurent on the Russian Startups Go Global , which will be held on November 29 in Moscow.
In the global market, it does not matter where your startup comes from. It can be from France, Germany, Russia, Belarus or any other country - the main thing is how unique and new the solution is offered by this business and how much it is demanded by the market. So, foreign clients and investors will not look for special characteristics in Russian startups compared to startups from other countries. However, in order to conquer foreign markets, several rules should be observed that will help achieve the desired faster and with less losses.
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If you want to take over the world - plan it from the very beginning.
Laurent Ellerbach, Team Leader of Evangelicals in CEE, Microsoft
Rule 1. Be visible
First of all, you need to make sure that potential customers from the business and / or end-users in the markets that interest you know about your company and your product. A large corporation based in the United States or Western Europe is unlikely to accidentally “hear” about the existence of a Russian startup. As a rule, there are several startups at the same time offering identical solutions, and those that are more visible are becoming successful. Many things can be done online, but still worth attending various conferences. Also, do not forget to establish personal contacts with the press, potential investors and customers. Any mediation will reduce the profitability of your project.
Rule 2. Immediately think "globally"
Many companies that have become successful in international markets have achieved this because they planned international expansion at the time of its foundation. As a rule, companies in large European countries - Russia, Germany, France - do not think in global categories, and plan to start from the local market, and then think about entering foreign markets. However, later it turns out that all their processes and structures are sharpened only for one, local market, and it is quite difficult for them to restructure for expansion into other countries.
Rule 3. From the very beginning, think about overseas customers.
If you decide that your startup will build a global business, first of all you need to think not about naming and branding - you can always change them. Many companies have different names and brands in different markets, for example, Auchan. The first thing you need to think about is your potential customers abroad. Of course, there is quite a lot in common between buyers in Russia and, for example, Portugal, but now it is already much more difficult to make a product interesting for both European and North American audiences. In any case, think about your target audience in a global way from the very beginning, so as not to be captured by your first market.
Rule 4. Think about the need for a physical presence in new markets.
Of course, this is not necessary for all startups - in particular, in niche markets, when in the current realities the product can be sent anywhere in the world, you can stay at home and pay more attention to marketing. However, it should be borne in mind that in larger segments it is often more profitable to open a representative office in order to make it easier to export your goods, due to existing legislation. This applies in particular to the United States and China.
Rule 5. Consider the cost of entering new markets.
Do not underestimate the costs of developing awareness of your company and your product in a new market, participation in conferences, meetings, hiring local consultants and so on. As a rule, the founders are too optimistic about these figures, but they must correspond to reality and be immediately taken into account in the business plan. If this is not done, then the project's business model may undergo significant upheavals, including a decrease in profitability, an increase in the price per unit of product, and so on.
Rule 6. Take to the team of someone who already knows the foreign market you are interested in, and study it yourself
To successfully enter a new market, you need to understand it, so a good decision would be to hire a sales specialist, business consultant or marketer from this market, who, ideally, are already recognizable in a positive way. Many large corporations recognize that for them the most important factor in evaluating a startup is its team, and it is ahead of the importance of the product that it produces. Do not give up the effort and cost of exploring a new market, even if it seems close to you from a cultural point of view - this is one of the most common mistakes made by startups who want to expand their reach. In addition, it is always beneficial for the founders to spend some time in a country where they want to develop in order to form their own presentation and, if possible, to communicate with potential buyers.
Rule 7. Do not try to conquer the whole world at once.
No need to rush, the coverage of new markets is better to implement step by step, otherwise your business may choke and lose the core of development.
We also invite you to chat with Laurent on the Russian Startups Go Global , which will be held on November 29 in Moscow.
Source: https://habr.com/ru/post/343340/
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