Which of the following market entry strategies are the most common (2024)

FAQs

Which of the following is the most common market entry strategy? ›

One of the most common market entry strategies is exporting. Exporting is when a company or organization ships goods into the international market. The main advantage of exporting is that it is a relatively low-cost way to enter a new market.

Brand extender market entry strategies are the most common for existing firms. Brand Extension is the use of an established brand name in new product categories.

The most common and least risky way to get goods into an international market is to export. You manufacture products in your home country, transport them abroad, and then sell through agents or distributors in the target market. A perk of exporting is that you don't need to invest in production in a foreign country.

Importing is not a market entry mode, because importing is not advertising any product.

You can choose direct exporting by selling your products directly to someone in an international market. Or, you can choose indirect exporting and sell your products to a third party in your own country, which, in turn, sells your products to an international market.

Exporting is a low-risk strategy that businesses find attractive for several reasons. First, mature products in a domestic market might find new growth opportunities overseas. Second, some firms find it less risky and more profitable to export existing products, instead of developing new ones.

These are the direct, indirect, hybrid and business acquisition approaches. My experience with my global language service and international marketing services company is mainly with the direct strategy, but I considered other options before I decided which was the best approach to use.

Basic Entry Decisions

A firm contemplating foreign expansion must make three basic decisions: which markets to enter, when to enter those markets, and on what scale.

A market entry strategy is where you spell out such all-important specifics. It outlines your business goals, an overview of the target market, precisely what you will sell there, expected sales and how you will achieve them.

Which entry strategy is the riskiest? ›

The highest risk method of entering a foreign market is Direct Investment: A company may invest directly in a wholly-owned subsidiary to carry out full-scale production and sell its goods on a global scale.

Direct investment-Foreign Direct Investment (FDI's) risk and profit potential are the highest in the foreign markets.

Answer and Explanation:

Exporting. Exporting is the cheapest and easiest way to venture into a new market. Compared to other means of entering new markets, exporting requires less initial capital.