Janice Spark in bizcommunity.com has five valuable lessons for brands entering new markets:
1. Value must be the core of the brand
New players seeking to gain market share in an established industry can generally expect to be met by a public with a mixture of hope and resigned cynicism. While some potential customers will display a touching belief that the new player will drive prices downward, many consumers believe first in the tendency of business to maintain monopolies, duopolies and a fixed range of prices.
2. It’s the experience, stupid
Entering in competitive markets around the world new companies are predisposed to compete on price, because it is the easiest value proposition to communicate when services and products across the industry are fairly standard.
Price wars quickly tend towards attrition, and often it is the larger, established players that are able to ride out the storm and dispose of competitors through price cuts. It is true for most brands entering an established market that the nature of the customer experience will lay the foundation for long term value and market share.
It is also imperative that the experience truly lives up to the brand promise, at every interaction. When competing against an entrenched power brand, it is incumbent upon the challenger to ensure more consistent brand delivery over a wider range of touch points than rivals.
3. Segmentation and speaking the customer’s language
A lot of companies suffer from brand fragmentation across their business units. This fragmentation results in the transmission of mixed messages to the market, with a range of complex and often separately branded products and services adding to the confusion.
If the new entrants creates a clean and unified brand architecture across its offerings, it will be able to set itself apart from its rivals. The ultimate goal in entering a new market is to segment effectively and to speak the customer’s language: to let customers understand how your services or products can empower them.
New market entrants also need to be aware of the unique opportunities that starting from scratch will generally offer up. Brands starting from the beginning are given an important opportunity to re-look redundant and inappropriate offerings currently in the market – and to offer alternatives.
4. Reputations must be managed
Media and customer interest will be at a peak in the days leading to the formal launch of the new brand. The new brand should be able to leverage this interest to cost-effectively blanket the market with its message. Reputation management – otherwise known as public relations – will undoubtedly be a central plank of the new entrant’s launch marketing strategy.
5. Personality will count, as always
As with all new market players, the ‘big picture’ challenge for the new will be to create a personality that consumers understand and buy into.
Personality is the encapsulation of all of the previous brand pillars. If the pillars are sound, the brand personality will be engaging, and the company will have a chance of growing healthy roots and building market share that matters.