Steps To A Sound Market Entry Strategy -Asia

One can always send employees across the Pacific and tell them to, "Make lots of money." However, the "just do it" approach is extremely risky—when it comes to going overseas, one should scout out the lay of the land or one is likely to enter a swamp.

It’s sometimes said that large MNC's suffer from analysis paralysis—spending months and millions on market research. One the other hand, some SME's tend to launch a new endeavor based on a conversation with a friend.

If information can be compared electromagnetic radiation, the American market acts like a supernova while many countries in Asia function like a black hole. In Asia, it's especially important to develop a network of contacts since market research in some countries and some industries is not available or is unreliable.

Market Entry Strategy Phase 1: Screen For Overseas Opportunity

The prophet knows no more than ordinary man but he knows it earlier.

We believe opportunity will never be fully understood without meeting business people overseas. This phase consists of doing some basic market research, going overseas as part of a trade delegation, going to an overseas trade show, prospecting for leads, meeting with potential business partners, etc.

All of us are surrounded by opportunity as the following story illustrates:

Kim's wife started noticing how forgetful he was becoming. Being the concerned wife, she convinced him to see a doctor. William was a little worried when the doctor came in. Sensing his patient's nervousness, the first thing the doctor did was to ask what was troubling him.

"Well," Kim answered. "I seem to be getting forgetful. I'm never sure I can remember where I put the car, or whether I answered a letter, or where I'm going, or what it is I'm going to do once I get there, if I get there. So, I really need your help. What can I do?"

The doctor thought for a moment, then answered in his kindest tone, "Pay me in advance."

Once one has a better understanding of the nature of opportunity, one can go to the next step.

Market Entry Strategy Phase 2: Perform A Readiness Assessment
Three men had adjacent businesses in the same building. The businessman who ran the store at one end of the building put up a sign reading, "Year End Clearance Sale." At the far end of the building, the other businessman followed with a sign that said, "Closing-Out Sale." The businessman in the middle knew his business was going to be hurting bad, so he put up a sign that said, "Main Entrance."

Once one has identified the opportunity, the real work begins. Rarely can a domestic product offered without modifications in overseas. at a bare minimum, one will have to change packaging, distribution channels, pricing and promotion.

Market Entry Strategy Phase 3: Develop The Overseas Market Plan

To do great important tasks, two things are necessary: a plan and not quite enough time.

If marketing mainly is concerned with the customer, then strategy’s main focus is on the competitors and other barriers to entry. By closely looking at entry barriers, the strategists determines whether the opportunities developed earlier are real or illusory. Unfortunately, many smaller businesses are not clear on what makes their company and its products and services better than the competitors. Also, business models, marketing materials, pricing, sales channels, etc. will then need to be tweaked to work overseas.

One doesn't need 100-page Plan MNC's put together to be successful -- remembering the advice of Winston Churchill who once commented, "This document by its very length will defend it from ever being read." On the other hand, too many people don't think things through.

According to experts, "Every organizational policy solves certain problems and generates others." This is especially the case where a company falls into a trap of assuming that what works in the home market will work overseas. We have seen companies that try to use existing business models, marketing strategy, and sales tactics overseas and fail miserably

It’s in this phase that you would put together the type of business enterprise. This could range all the way from a virtual office to a joint venture. And one must make decisions regarding the pricing, value chain, channels to pursue, the marketing mix, budget etc.

Market Entry Strategy Phase 4: Execute the Strategy

There was once an officer in charge of a group of military engineers constructing a road through a swampy area. He ordered a subordinate to take fifteen men and get on with the job. Presently, the junior officer came back to see the colonel. "Sir," he reported, "the mud is over the mens' heads. We just can't get through." "Nonsense," yelled the commanding officer. "Make out a requisition slip for whatever you need to get the job done and I'll see that you get it." A few minutes later, the lieutenant laid this memorandum on the CO's desk: "Needed: Fifteen men 18 feet tall. Objective: Cross swamp 15 feet deep.

Once the strategy is in place, one then implements. Here the capability and quality of one's employees or partners becomes critical.

Acknowledgement and thanks for these article to Deepak Pareek, Head – Indian Research Advisory Group. He can be contacted at [email protected].