List of International Market Entry Strategies | Adloonix (2024)

Entering an international market is one of the most important and strategic decisions for businesses. And careful preparation is the key to success in the foreign markets. If a company has been successful in the past, success cannot be guaranteed when it comes to advancing internationally and doing business with different countries or cultures. So you have to create the international market entry strategy. This is a crucial and strategic decision for each business because improper entry strategy selection may result in financial loss and disastrous entry.

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Entering new foreign markets may be accomplished in different ways. Each of these ways has a unique effect on the company in terms of organizational and financial capabilities. But do you know the first step? It is hiring a market research company. It is an agency that collects and analyzes information about the market, your target audience, competitors, evaluates the risks of new market entry, and looks for ways to improve your business conditions.

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You have to know the company does not conduct market research with the help of intuition, at least not every company. Unlike the other, Adloonix can provide you with a proficient digital market entry strategy based on up-to-date information. Our team is enthusiastic about creating incredible promoting and creative solving for brands and new companies.

Many business owners think that the timing of entry is the time between the founding of a company and the initiation of its international operations. Actually, it is the moment when the initial decision to enter an international market was defined. A firm can establish itself in the new market as an early entry or a late entry.

Early entry is the first firm on the market with a new product. However, the status of the first firm is the beginning of a long and complex way. The business should defend market share from followers to stay ahead of the competition.

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The early entry has its benefits. The firm grabs the best market place, builds brand loyalty, and can create barriers to entry for the competitors. The disadvantages of early entry are: the cost of pioneering can be high; the risk in terms of possible failure in the market; the loyalty of first-time buyers is often weak; products can be primitive and might not live up to expectation.

Late entry is the second company on the market that enters the market by imitating the early entry. It is easier to capture a large market share because late entry knows the mistakes of the early entry and develop the ways to avoid them. The main benefits of the late entry are: ability to learn from the mistakes of the early entry; ability to focus on making superior product; ability to polish the design and capture a larger market share; ability to occupy a previously unoccupied niche in the market; lower risks and greater chance of return on investment.

There are also disadvantages of the late entry. It works well if the firm has a robust marketing strategy and enough resources to compete. Moreover, the firm can continually follow the early entry and do not launch innovative and interesting products or services.

As I said before, you have to choose the appropriate international market entry strategy. We define three different rules to it:
Naive rule – the firm implements the same entry strategy for all international markets.
Pragmatic rule – the company uses a workable entry strategy for each market.
Strategy rule – the firm creates an alternative entry strategy and evaluates the risks and opportunities before a business decision.

My colleagues and I can assure you that each market is unique and you cannot use the same strategy for each market. We conduct market research to learn more about the target markets of our clients. Only after this procedure, we can build a strong international market entry strategy.

You have to consider several factors before selecting the market: cultural distance, administrative distance, economic distance, geographic distance, and market potential.

Cultural distance impacts the way messages, concerning the ability of the product or service to satisfy the needs and wants of the target audience, are received and interpreted. Culture is considered among the most challenging aspects while selecting a new market.

Administrative distance is also termed as political distance. It exists due to different bureaucratic, working and political structures prevalent in host countries. Different government policies are an important source of administrative distance.

Economic distance is a measure of economic inequality between the two countries. Firms find it easy to deal with host countries that are close in the economic distance because they have similar market segments that use similar types of products and services.

Geographic distance plays an important role in the foreign market selection. When the distance between the home and host increases it is hard to conduct business.

The market potential is one of the most important explanatory factors in country attractiveness. We study the market size, growth, competition, target audience, predict demand for products or services to estimate the potential of your target market.

Traditional international market entry strategy refers to planned systems of delivering and distributing products and services to an international market through foreign-channel intermediaries. Before the development of Internet-enabled communications, conventional market entry strategies focused on manufactured products and the need to secure physical firm assets and monitor international partners, so they gave rise to approaches designed to bridge or avoid differences across countries.

For example, with a pure exporting strategy, a firm can sell and ship its domestically manufactured products to a foreign distributor in the desired market without requiring a physical presence in the country. Licensing agreements (e.g., Microsoft Enterprise Agreements) and franchising (e.g., Hertz corporate car rentals in Europe) also allow firms to enter international markets by assigning most of the capital risk to local agents.

If the firm’s offerings demand complex manufacturing techniques, it may prefer fully integrated production, such as through the purchase of a local firm, or foreign direct investment to build physical assets in foreign markets. Such options are prevalent in the services sector, too, such as when a consulting firm sets up offices abroad to ensure control over its output to international customers.

Such traditional strategy must account for distinctions between foreign and domestic environments, including differences in culture (language, tastes), currency, legal concepts, import duties, and customs, and physical distance. Culture largely determines whether firms can sell their products “as is” or instead should make significant changes or develop new offerings specific to the chosen market.

The second option is the digital market entry strategy. This strategy is the most appropriate if you run or if you want to run a prosperous online business. The main advantage of it is that you do not need to open new offline offices. On the initial stage, you have to conduct the online study, create a step-by-step strategy, createe a website or a mobile application (both can be even effective), and set up digital advertising.

It is in fact, entry to an international market, and it is what we do. With this method, you can save investments at the initial stage and put them into advertising. You can test the international market without big investments. Adloonix is an expert in this niche. Our team creates a personalized strategy for your business that includes many components and features. We pay attention to the implementation and adaptation of your products or services to the foreign market.

Our experts create a market entry strategy based on market analysis, future competitors and customers. Marketers conduct market research of the digital markets, lessen the risks and boost the opportunities. We concentrate on all details of the market entry and the complicated task of an international market entry gives great results for our clients.

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The main benefit of this strategy is the ability of the company and the customer to communicate. You also can reach the potential and existing customers at one time. One more advantage of digital marketing is that consumers are visible to the brand, and the product or service can be advertised effectively. We can target your audience using specific information and set up social media ads for your potential customers. Our team knows how to get your clients via Facebook, Instagram, YouTube, LinkedIn, and Twitter advertisem*nts.

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Using digital marketing you can reach so large number of users that there are no geographical limitations. It allows you to wind up global and extend your business to different countries than the country it is based. Another benefit is that digital marketing allows business owners estimating PPC (Pay per Click), CPL (Cost per Lead), the effectiveness of promoting, traffic generation, the amount of activity, and conversions.

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Relational international market entry strategy refers to firm actions that aim to build strong relationships with exchange partners to overcome exchange risks associated with foreign markets, including physical and psychological distance, opportunism, relational instability, communication difficulties, and deception. Principally, relational strategy attempts to enhance commitment and trust (i.e., informal governance), often through relationship-specific investments or contractual obligations tailored to the local market (i.e., formal governance).

This strategy takes many forms, including joint ventures, alliance networks, cooperative planning, and hiring local personnel. They encourage information sharing, flexibility, and solidarity, and in conjunction with flexible contracts, they can provide a foundation for establishing legitimized practices.

In turn, various conditions influence the success of a relational market entry strategy. Market ambiguity or dynamic business environments often require increased communication, to create trust and minimize perceptions of opportunism that may arise from the internal uncertainty that firms experience when entering foreign markets.

However, the scope and magnitude of relationship-specific investments must reflect the firm’s competitive positioning in the marketplace because these investments could restrict expansion with other foreign partners or limit alternative opportunities.

Hybrid international market entry strategy blend relational and digital strategies, increasing the potential complexity of firm efforts to enter a market. The firms must not only overcome risks associated with the local market, but they also must do so within the restrictions of digital environments that can limit the level of interpersonal interactions that help build strong buyer-seller relationships.

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Hybrid strategy refers to firm actions that blend customer relationship building into digital channels of delivery and distribution of products and services to a foreign market. In a landscape in which digital marketing is fundamental to, relational strategies require adaptation to exploit modern technological advantages, especially those that facilitate exchanges.

Relational approaches integrated into digital environments help lessen the risk perceptions that arise in purely digital contexts. Digital, technology, and social media platforms also make it possible for a new type of firm to help customers develop professional relationships or customer relationships.

To make this story short, I want to emphasize one more time on the one thing. You have to consult with the market research company before making an important business decision. Marketers will give you unbiased information about your business conditions, evaluate risks and opportunities of the international market entry, give you recommendations concerning the market entry strategy.

You should also think about the role of the Internet and social media in the modern world. As we can see, they are powerful tools not only for communication but as well as for promotion. So, you can easily advertise your brand, engage more clients and traffic, boost profit, using digital market entry strategy.

Our team of professionals can help you to enter a foreign market with no stress. The agency thinks about engaging the quality and efficiency of the business inside the market. We know how to enter an international market and are responsible for what we do. If you want to get more information about digital market entry or you want to hire us, just contact Adloonix. We know how to help you.

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How do you choose the international market entry for your business? What difficulties do you face during this process? Leave your comments below and share your experience with us.

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Yours faithfully,
Vlad Sapozhnykov

International market entry strategy