In an international market it has become fundamental to create an added value in your bid for business.
After all, the position of a product as compared to competitors is one of the main reasons why a company fails or succeeds when entering a new market.
Simply assuming that opening up a shop abroad will automatically make you competitive may not be enough for your internationalization strategy. The continuous growth of e-commerce allows customers to compare your offer with others all over the world, so the parameter for which a customer chooses a product is no longer based on physical proximity, but rather on unique features. So, what are some of the main strategies? Let’s look at three of the most popular:
- Competitive Price
Offering a lower price than the competition is certainly one way to make your product stand out, but it can also be dangerous. All it takes is for someone to undercut your prices, and you lose your edge. Then, if you lower the prices again, not only does your profit margin shrink even more, but you also risk setting of a price war. You should also keep in mind that in the eyes of the customer low price is often associated with low quality.
- Offer an exclusive niche product
This is a winning strategy: offer a product that satisfies a specific need for a certain group of people. This means less competition and more profit! In fact, starting from this concept, you’re setting yourself up for even more success as a market leader.
- Become the market leader.
Statistically speaking, customers tend to only remember the top 2 or 3 favorite companies for any given product. Now, it takes a lot of work to become #1 in the world for your market. But how about #1 in a specific city? Or specific quality?
A practical example: RED BULL
Rather than fight in a category with two giants like Coca-Cola and Pepsi, the producer of Red Bull chose to segment the market by creating a relatively unexplored niche called “energy drinks”.
This positioned the brand in a yet undefined category, and helped it to become one of the principal sponsors of every extreme sport.
So, here are some questions to keep in mind as you plan your internationalization strategy:
- Do you have a niche in the international market?
- What does your product do that no other product can?
- What does the target country need that only your product can provide?
- How can you let your target audience know this?
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