What is the best way to do market analysis for a foreign country?
We usually consult for startups and small businesses doing social media, SEO, PPC and the like. But one of our clients wants us to analyze a foreign market to determine if it makes sense to enter that market. I have a few ideas but would also like to get input from the community.
Your local university business school may already have some or all of the research
you are looking for.
There are 2 components to consider when doing market analysis for a
1. Direct Factors
A. Determine your industry
category. Are you providing a product or a service? The nature of your offering
will determine your approach and sources for your market research. Example: Is
your business in the following categories?
B. Determine region
and country. Secondarily, the region and country of interest will determine your
market research strategies and available resources, data, expertise, etc.
C. Determine product
D. Determine your
E. Determine who
are the experts in that market and see if they offer research insights, blogs,
articles, etc. You’ll probably want to try and get the latest insights and
publications from them
2. Indirect Factors
and business etiquette
Historical data on the country’s currency value
fluctuation and import/export timelines
Ultimately you need to look at the new market and figure out whether you can make enough revenue to offset the cost. You should consider though that there are some additional costs, both monetary and non-monetary, of entering a foreign market including:
Ability to communicate
Different native languages
Different local business hours
Localization of assets
Even if they speak the same language, assets such as websites and offsite creative may need to be localized for currency, colloquialisms, etc.
Costs of shipping if you are selling a physical product
These would just be a few costs to consider, but each vertical and business will have their own unique challenges.
When looking to analyze the opportunity you have to weigh these costs against aspects such as market growth potential and cost of entering the market. For example, if there are no local competitors to your products and buying media in that country is relatively cheap, it may be worth the investment.
You can gauge price of media in different markets using free tools Google Keyword Planner, or could pay for more advanced tools depending on the size of the opportunity and the level of investment needed to expand there. For gauging the size of the market you could use Facebook Audience Insights if you wanted to go down the free route. This will give you an idea of whether or not the target exists in that market, and the size of the opportunity.
I have rolled out to new markets for a few products, so if you have any specific questions, feel free to shoot me a message.