Entrepreneur Ideas: Four Tips for Cracking a New Market

The old joke goes something like this:

A shoe company sends its chief financial officer and its vice president of sales to a tropical island to gauge the market’s sales potential.

They were barely off the plane, when the CFO wrote to the home office, “There’s absolutely no potential. The islanders aren’t wearing shoes.”

At almost the same moment his sales counterpart wrote, “There’s amazing potential. The islanders aren’t wearing shoes!”

Certainly the right attitude can enhance your chances for success when bringing your product or services to new markets – be it a new customer category, a different geographic area, or a just an expansion of your offerings to your current clients. But enthusiasm can only take you so far.

You need a focused strategy, and these tips can help you put together a plan that can make your entry successful, no matter what the islanders are wearing.

1. Hire a Superstar

One way to ramp up quickly and make your presence felt in the new market is to hire a well-established professional – in sales, service, or some other high profile role – who is known and respected in the new space…a superstar, if you will.

The knowledge the new hire brings to the table should include industry contacts, the likely needs of key customers, and the strengths and weaknesses of your competitors.

A seasoned, experienced pro can dramatically shorten your company’s learning curve and make you aware of opportunities you otherwise might have missed.

Tip: If you’re unable to make a commitment to an expensive hire, or believe the position would become redundant or unnecessary after a relatively short time period, consider working with a recently retired industry veteran on a contract basis. Trade organizations and industry publications are good sources of potential referrals.

2. Find a Partner

If you believe your target market holds significant potential, but might be tough on a newbie, consider proposing a strategic partnership to an established company in a related category.

Example: Your company provides landscaping services to private residences and you would like to crack the market for office buildings. If your cold calling is getting you nowhere, you could approach a commercial cleaning or janitorial services business to help you get your foot in the door. This could be as informal as, “I’ll refer you, and you refer me” (and be sure to keep your end of the deal), or as structured as a legally-binding contract where you pay your strategic partner a percentage of fees generated by his actions.

And don’t be stingy with your referral payouts. Remember, this is revenue you could not have generated without outside help.

3. Offer Complete Solutions

If you’re the new guy in the market, you might as well think big. Introduce your company as a solution-oriented resource, not just another company with a catalog or a website.

Example: You don’t just sell polymer tubing – there are hundreds of companies that sell polymer tubing – you offer complete, turn-key fluid control systems. Yes, you do. Even if you technically don’t right now, you are about to. (How? See #1 above.)

It’s not quite that easy, of course. But assuming you have given your staff a reasonable amount of time to prepare for the new market launch, you can take steps to ensure that you are able to offer the services most appreciated and desired by the potential buyers. Do some research.

4. Commit to the Long Haul

There are internal and external components here.

Internally, keep your expectations realistic, and make sure you have designated enough resources (time, energy, personnel, money) to give your new plan a chance to succeed. You’ll run into unexpected complications but, if you’ve made it known throughout your company that you’re in the new game to stay, you’ll have a better chance of finding ways to make it work.

Letting the market know you’re hanging around is where external focus comes into play. Publicize your efforts via press releases, paid advertising, or trade show activity. Position yourself as an expert in the new arena, even if you don’t quite feel like you’re there yet. (Besides, you have related, compatible, useful experiences that your competitors don’t, and that fresh perspective can be valuable to a customer.)

And of course, depending on how your sales force is structured – and especially if you basically are the sales force – make sure you cross-sell along with your more established offerings at every opportunity.

Summing Up: Breaking into New Markets

One of the potentially most lucrative ways to grow your company is by entering new markets. It’s also difficult, time-consuming and risky.

Fortunately, there are ways to shorten the path to success and reduce your risk. The right new employee or partnership can help, so can positioning your company as a solution-oriented resource with a demonstrated commitment to the long-term

For More Great Ideas for Entrepreneurs from MP Star Financial:

Entrepreneur Ideas: Your Guide to a Painless 2013 Business Marketing Plan

Entrepreneur Ideas: Making Trade Show Marketing Work

Entrepreneur Ideas: Four Year-End Questions for Your Accountant

Entrepreneur Ideas: Four Things a Business Owner Must Do Before Year-End

Entrepreneur Ideas: Trademarks, Copyrights and Patents can Protect Your Work

Entrepreneur Ideas: Using Your Calendar to Sell

Stop waiting 45 or 60 days for payments! MP Star Financial can help you get a better handle on your company’s cash flow management. Call for more information and to discuss your cash flow management solution. (800) 833-3765, extension 150.

 

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