Increase your international market knowledge

The results of your research should help you identify the niche(s) where your offerings are most likely to be in high demand. In a perfect world, you’d find that:

• The niche is under-served by your competitors, or you have no direct competition there at all.
• Your company has a unique ability to solve the problems of potential customers within the niche because you provide one-of-a-kind products or special expertise.
  

There is usually some degree of competition. You’ll also need to convince potential customers that you have superior solutions for them. Start with a competitive scan to examine the target niche, its customers, and the businesses that will be your rivals within it. Conducted properly, a scan can identify the superior value that your company offers compared with your competitors, and suggest how you can exploit that superiority to strengthen your competitive advantage.

Most competitive scans, (also called market scans), include the following four steps:

First, look for information sources that will reveal as much as possible about your competitors, their products and services. If your competitors are numerous, focus on the market leaders. These sources may include:

• Information they themselves provide, such as their advertising, marketing materials, annual reports and social media presence
• Articles and other data about them in print and online
• Industry association statistics, news and reports
• Other relevant sources of data or anecdotal information

Attending trade shows can be another good source of information about your competitor’s products and how they’re marketed. Your on-the-ground visits to the market should also include a close look at your key competitors in the target niche.

Your second step is to search these sources for detailed information that will help you assess your competitive position relative to the market leaders. The following list suggests what you might look for, but it isn’t exhaustive and will vary depending on your product and target niche.

1. Products and services

Which are your competitors’ top offerings? What is the delivery platform? How are goods manufactured and where? How are they packaged and presented? Are they designed to be replaced or are they intended to last? How might their service be superior to your own?

2. Innovation record

Are your competitors strong in R&D? Do they regularly bring new or improved offerings to market? Do their innovations have a high success rate?

3. Brand strength

Do they enjoy high brand loyalty and awareness? What positives do their customers perceive in their brand? What negatives?

4. Market share

What segments do they serve? What does their customer base look like? How fast are they growing? What are their revenues and total sales volume?

5. Distribution strategy

Do they use direct or indirect sales? What partners do they have? Do they cover the entire market or, like you, a niche within it?

6. Pricing

Do they command premium prices? If so, why? Do they offer discounts or incentives?

7. Promotional/marketing strategy

How much do they spend? Whom do they target? What is their reach?

A competition grid is an effective way of comparing your competitive position to the positions of your rivals. Your own grid can vary in layout, size and complexity according to what you need, but an extremely stylized and simplified example might look like this:

Additional columns might include further competitive factors such as:

• annual sales
  
• product functionality
• product quality
• product line breadth
• financial strength
• partnerships
• supply sources
• overall strengths
• overall weaknesses

Fill in as much of the grid as you can using the information uncovered in your search. This will help you evaluate how and where your product or service will fit into the market, and what you’ll face in the way of competition.

Using the grid to analyze your data can produce surprisingly sophisticated results. Together with your overall knowledge of your target niche, it can reveal not only the gaps in your own competitive position but also how to fill them in ways that will create superior value for your customers. It can also expose weaknesses in your rivals’ positions and suggest ways of exploiting them. A sparsely populated category, for example, may signal a need for more exploration into a competitor’s quality issues. For your own company, it may indicate where you need to do more work, such as creating new distribution channels.

Once you’ve completed your analysis, you can start using the refined information to tailor your product and your marketing strategy for the niche. This will involve adapting the product for local tastes and needs, and developing the value and selling propositions that will carry your key marketing messages.