If you’re like most marketers, you spend much of your time focused on expanding your brand’s market share in the target markets where you already have significant traction. But if you want to drive above-average business growth in 2016, you need to begin thinking about expanding to new markets, as well.
Target market expansion is not something that should be entered into blindly. Rather than “going with your gut” when selecting a new target market and building a strategy to reach its members, you should approach your target market expansion armed with data that can help you make smart marketing decisions and investments.
Here are three steps to follow when planning a data-driven market expansion:
In many ways, expanding into a new target market is similar to launching a new business venture. You can minimize your risk by first assessing the market and the viability of the opportunity. Is there demand for your product or service in the new market you aim to serve? What is the total size of the market? How much market share can you reasonable expect to own in the next year, five years or ten years? Is the market likely to be receptive to your existing marketing messages, or will you have to invest in developing new campaigns that will resonate with them? You should aim to answer all these questions and more as you conduct an opportunity analysis to assess a target expansion opportunity. Conducting this type of analysis can be complex, involving market sizing research, value chain analysis, needs assessment research and pricing strategy exploration, or it can be simple and straightforward, with a focus on frank conversations with a few of your potential target customers. Just make sure you’re putting in the time and effort required to gain an adequate understanding of your ability to succeed in your expansion effort.
As we’ve said before, it’s a mistake to assume that your new target market will have the same needs, pain points and concerns as the customers you already serve. After you’ve determined that there is a viable opportunity to expand into a new market, spend time talking to your new potential customers. Just as you did when you launched into your first target market, conduct focus groups, interviews, surveys and more to gain a deep understanding of your new buyers and the drivers that motivate them to take action.
Before you sink a significant portion of your marketing budget into reaching your new targets, test both your offering and your marketing campaigns among small groups that represent your new stakeholders. Even if you think you know your new buyers, you may find that they respond in unexpected ways to your product, pricing and marketing messages. Wouldn’t you rather know if your intended approach has flaws before you sink all your resources into pursuing it?
Are you seeking a concrete framework through which to evaluate a new market opportunity? Check out Mind the Product’s POEM framework. Then, when you’ve vetted your new opportunity and are ready to think about selling, download our whitepaper: 4 key steps to engaging B2B buyers BEFORE the buying process.
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