If you’re thinking of selling your products or services abroad, be sure to look into three recommended areas of market research before “going global”.

Should online businesses consider marketing their products globally? If so, what factors should a company consider first? There are some basic strategies a company can implement to most effectively market their products overseas.

The first thing to keep in mind is that borders do not necessarily define world markets. For example, Canada actually represents three distinct markets, with English-speaking Canadians, French-speaking Canadians, and the burgeoning population of Mandarin speakers in Toronto and Vancouver. Each of these distinct markets requires a unique marketing strategy. Taking this into account, it makes better sense for e-marketers to consider global markets as defined by the attributes of language, political atmosphere and cultural climate, rather than the dotted lines found in the pages of an atlas.

When selling outside of the U.S., most domestic companies begin by first approaching the English-speaking markets into which Federal Express ships, with secondary expansion into Western European markets where English is spoken by a large percentage of the population. Over time, an adventurous few might seek to penetrate further, translating their site’s content into the language of a foreign market and working with indigenous shippers. While this piecemeal marketing approach is safe, it leaves plenty of room for local competitors to step in and take away a considerable portion of your sales, not to mention competition from your traditional rivals whom might move faster and invest more money in courting international markets.

To stay ahead of the competition, a company needs to address three key concerns: the portability of the product, the politics of the market and the intended customer base. Concerning the portability, businesses should start with products that can be sold “as is” in the target market. In other words, without extensive redevelopment, re-engineering or re-packaging. Decide on a few initial products that “travel well” and use these as a gauge to test overall marketability. Use your understanding of the target market, gradually building up an international presence as you move along.

Of course, global selling also requires that you investigate the politics of the target market. Local regulations such as tariffs, taxes and privacy laws, as well as logistics and business practices, such as post-sale service and returns, can have an enormous affect on sales. These factors will ultimately determine whether to “set up shop” in the area.

Once questions regarding the product’s portability and the logistics of its delivery are answered, a company still needs to ask itself some important questions about the customers they’re selling to, such as, can the population of this market afford the goods or services I’m selling? Another question to be asked, is whether a large enough percentage of the population is purchasing online to justify marketing the product? This requires a little more homework. Again, geographical borders do not always define global markets. For example, Brazil has a very diverse population, a large part of which inhabits rural areas where Internet penetration is minimal. However, another segment of the population, centered in the densely populated cities along the Atlantic coast, makes for an attractive online market. Another factor to consider is the method of payment preferred by the foreign market. International online merchants must make preparations for accepting forms of payment such as foreign credit cards, smart cards, phone cards and foreign personal checks.

With all of these various issues to consider, global marketers have more than their share of research to do. Luckily, there are consultants and analyst firms that can help businesses get a comprehensive view of potential world markets. In addition, there are a few sites worth looking into for details on certain markets. A good place to start is the CIA’s country index, which can be found at http://www.cia.gov. Portals at vendor and globalization providers can also be helpful, for more information check out http://www.idiominc.com/worldwise. Some other research potentials include informational sites maintained by the U.S. Department of Commerce, which can be found at http://www.doc.gov and the European Union at http://www.europa.eu.int. Chambers of Commerce of the countries in which your potential markets lie is another option as well.

Source: Which Markets First?
Donald DePalma
E-Business Advisor, Jan. 2001
http://www.advisor.com/Articles.nsf/aidp/DEPAD03