Business growth can be achieved in a multitude of ways, but we will turn our attention to how you can do so through expansion. You can either expand your product offering to new locations, or expand your reach by providing new products or services to current customers. Most of the time, expansion happens because of a hike in demand for products or services. You can also be proactive about finding new revenue streams, increasing brand awareness, and differentiating yourself from major competitors. But when is the right time to make that essential move and go for an expansion? Here are four tactics to help you pin down the very best time to enter a new market.
1. Do research and development
Research & development sits at the heart of every growing business. It’s an essential step so whatever you do, don’t miss it out. R&D is all about innovation, introduction and improvement of products and services. It involves undertaking a series of investigations to improve existing output and foster noveties, vital when identifying the potential for growth in a new market. Derived insights will point you in the right direction. Ideally you’ll have a dedicated research and development team. If not, it’s down to you. Luckily there’s a wealth of guidance online.
2. Harness market research
You can’t guess what people think and feel about your products and services. Relying on your gut feeling alone is not enough to achieve sensible conclusions. Weighing in what people are buzzing about alongside your own judgement should be the desired course of action. That’s why market research is such a vital step to entering a new market. The insight you infer from collecting and analysing information about consumers, competitors, and even your own marketing activities, helps you figure out the feasibility of new expansions. It also advised that you monitor ongoing trends and draw a complete picture of the economy. The research you need to do also involves monitoring trends in your sector and even analysing the economy as a whole.
Market research helps you see what your competitors are up to, develop tactics to promote business, and create a workable, effective competitive strategy. There are several ways to do the work, and you might find yourself harnessing more than one of these:
- Do online customer surveys and phone interviews
- Analyse the customer feedback you’ve collected from your website and social media
- Carry out live product trials, field studies and usability studies for the new market
- Set up focus groups of people from the new market
- Observe what you see going on in the wider industry or sector
- Use big data to help you evaluate your competitors’ strengths and weaknesses, for example a good quality, comprehensive UK business directory gives you vital data-based insight into exactly what competing businesses in the new market look like, and how they behave.
3. Identify competitor strengths and weaknesses
You can’t beat the competition until you know exactly what you’re setting out to beat. And that means competitor research. You need to know your ‘enemy’, since some competitors might naturally outperform you, making success particularly difficult to achieve. What are their strengths and weaknesses? Are there areas where your products and services win every time, or are your products and services generally weaker than theirs? Knowing these facts will help you decide where to target, and pinpoint areas for improvement. It might turn out that you need to do some work first to get you into a fit state to compete. But you won’t know unless you do the research.
4. Pin down the potential market share you can grab
You can’t know how much potential there is for you in a new market until you have a look. Knowing the possibilities lets you figure out how well you will perform. If you identify a high potential, it indicates you stand a good chance. A higher market share means you’ll sell more while spending less on marketing. To find out, divide the total sales you anticipate by the industry’s total sales over a set time period. How does that stack up?
Knowledge makes risk taking so much less risky!
As a business owner, make sure you take a long, hard look at the goals you’ve set and the risks you face before planning to expand into a fresh market. Only when you know your exact situation will you be able to make important decisions with the right level of confidence.