If you are thinking about expanding your business internationally, you would be right to be cautious as moving into new markets can provide a few pitfalls. As general manager at Savoo.co.uk, here are my top tips on how to launch internationally – with as little stress as possible.
There are certain things you need to research in detail – particularly in the performance marketing sector – before you make a call on launching in a new country.
The key factors you must consider are:
- The size of the ecommerce market – it seems obvious, but if nobody is buying online, then I would leave that market alone
- Consumer sentiment – even if the ecommerce market is small, is it growing? Is there the potential to be first in an emerging market?
- Network presence – you need to work with the networks when you start a business abroad, so if there a weak or little network presence then it’s probably best to avoid for now
- Payment – check how consumers pay for online shopping as it differs everywhere. Does that method work for you?
- The use of your USP - in Savoo’s case are retailers issuing voucher codes - and, if so, are consumers using them?
Another obvious tip, but you need to look at the local language and assess how complicated it is. Does it require a new character set? Are there cultural language differences? Does your technical platform support that language? Are there different local dialects you need to consider for certain regions of a country?
Finally, all of the above means you have to make a call on whether you should outsource work to that country or whether you can hire in house and base the operation from your international hub.
Suppliers / Partners
As with all of these sectors, there are questions that need to be answered:
- If there are networks, how open are they to affiliates talking to retailers?
- What is the business development culture like in that market like? Do you need to be prepared for a large expense bill or are things more ‘formal’? And that can even extend to how you dress – some countries expect all business to be conducted in suits.
This is one of the biggest challenges you will face when starting a business abroad – hiring the right people. In essence, you have two options: hire someone with vast experience or someone with a good business brain, but who doesn’t know the performance marketing sector and who you can train. There are pros and cons to both, but never underestimate the power of someone’s contacts in a market and how much training you will need to do to whoever you hire.
Also, you should delve into the market’s employment laws as they can vary and be really complicated and, in some cases, costly. More on that later.
Traffic and How to Get it
Each market has different methodologies and ways to get traffic with a good ROI. But as a general rule, I recommend you test, test and test.
- Paid search: there are differing rules and enforcements on trade marks
- SEO: there are different levels of overall content with a lot of spammy sites in some markets
- Each market is unique so don’t think that what works in the UK or US will work in any other territory
Networks / Agencies / Competitors
These guys should be able to help you talk to retailers who want to expand internationally – a great way to grow together.
You should actively go and meet all the networks and agencies of each market you are looking to enter. This is not the time for a phone call.
If you can, you should try and meet the competition as there may be the opportunity to get some advice or even start an alliance. Always keep your options open.
Big bang or enter under the radar?
There are lots of extra costs you need to factor in if you want to go enter a market in a blaze of glory. Agencies and suppliers’ costs need to be added to the budget and in some countries there are no ‘deals’ to be done i.e. – they will not see the potential growth of your business and reduce initial fees.
It really depends on your strategy, but I would always advice a cautious approach to launching. Get a feel for a market and see how you are doing before you commit to a vast launch budget.
The laws in each country all tend to be extremely complex and I would advise you employ a good pan –European or global firm of solicitors to guide you through the maze of legal technicalities you have to adhere to.
Top three things to look out for are:
- Tax liability
- Local laws (business / employment)
- Banking issues
How to beat the competition? Bet on having better innovation and technical expertise – two things that you can carry over from your UK/US knowledge.
What are the three things I would advise you to take away from this?
- Don’t underestimate the value of research and diligence
- Business development and market conditions: things always take longer than you are accustomed to
- Consider market quirks – relationships and ‘friends’ in each market can offer you knowledge that you will only find for yourself through making mistakes