It’s finally happened. Your business has been on a steady upward climb, and you’ve reached the revenue targets for the year. And your brand image is starting to gain traction.
But what’s next?
Scaling your small business to the next level and taking over new markets.
But before you set out to scale your business, understand this—over 469,500 new business applications were filed in the US in July 2023 alone. So, your small business expansion plans might face stiff competition from other entrepreneurs.
That’s why you need a robust business scaling strategy to supercharge your business growth. In this article, we’ll outline six steps to help you enter new markets and expand your small business.
Define your business goals
When you decide to expand your business, it’s natural to start looking for new markets. But here’s the thing—you must know why entering a new market is the right growth strategy for your business.
When it comes to growing your business, there are several ways to go about it. These include:
- Occupying a larger share of existing markets through customer acquisition
- Reaching customers in a new market
- Launching new products and services to meet changing customer needs
- Diversifying your offerings to target new customer segments
You must know what makes breaking into a new market a better choice than diversification or increasing market share. This will help you outline realistic and measurable goals for small business expansion.
Besides increasing revenue, you can set other goals, such as taking your business international and strengthening your brand identity. You could also aim to gain the first-mover advantage in an untapped market. Knowing your goals will be helpful when formulating a business strategy for expansion.
While you’re at it, assigning KPIs (key performance indicators) to each goal is a good idea. These measurable metrics help you track progress and determine whether you’ve achieved your business expansion goals.
Did you know that 35 percent of startups fail due to poor market demand? It’s the second-most common reason, right behind a lack of funding and cash flow issues.
What does that mean for growing businesses eyeing new markets? To successfully scale operations, you must choose the right market.
Once you’ve identified a few potential markets, dig deeper to understand your target audience. Use online surveys, social media polls, and in-person interviews to understand their needs and pain points. This is also an excellent time to develop a clear picture of the local culture and language. It’ll help you understand whether there’s enough demand for your products and services in the new market.
It’s equally crucial to study market conditions and trends. Find out how consumer behavior and sentiments have evolved.
While you’re at it, closely examine your competitors in the new market. Find out whether you’re up against fresh players, startups, or established brands. Use competitor research tools to delve deeper into their marketing strategies, business models, and target audiences.
Build a local team
It’s easy to assume that you can remotely expand a business into a new market. While possible, you need local connections and expertise to grow your business in unfamiliar territory.
Locals have a deeper understanding of cultural nuances, customs, and behavior. This knowledge comes in handy for building customer relationships. It can also help localize your pricing strategies and marketing campaigns. They can even help you understand the region’s laws, tax codes, and other regulations to ensure compliance.
If you don’t have the resources to recruit and onboard new employees, consider outsourcing the job. However, make sure the local employees you hire are familiar with your company’s core values and vision. This will help maintain a consistent company culture across different locations.
Overhaul your tech stack
If you’re a business owner in 2023, you’re likely already using various applications and tools to streamline operations. But you’ll need a more robust tech stack as you scale operations and grow your customer base.
For instance, you’ll need project management software and cloud storage solutions to facilitate collaboration, regardless of location. Similarly, your employees will need online communication tools, including instant messaging apps and video conferencing software.
Using a robust customer relationship management (CRM) platform to cater to your expanding clientele is also a good idea. This type of tool can provide an overview of a customer’s purchase behavior, online activity, and service history. That means you can address customer complaints and requests promptly.
CRM platforms like Act! CRM also come with powerful marketing automation features. They let you implement automated marketing workflows personalized for different customer segments. That, in turn, minimizes the need for manual intervention and lets marketing teams focus on scalability.
Other tools that you should add to your tech stack include:
- Business intelligence (BI) solutions
- Website analytics tools
- Social media management platforms
- Email marketing software
- HR automation tools
Judicious use of technology can help you automate and streamline various business processes, leading to greater operational efficiency. It also gives employees more time to focus on customers.
Localize product, pricing, and marketing
You can’t break into new markets with a cookie-cutter scaling strategy. Instead, you must tailor your approach to that specific region. For instance, as a video streaming provider, you’d have to offer subtitles or audio in multiple languages.
Next, you must identify the right price point for your products in the new market. For instance, Netflix launched a mobile-only plan in India starting at about $2 per month—among the lowest in the world—to tap into the suburban and rural audience of the country.
Understanding your target customer’s demographics and socio-economic backgrounds can help you optimize pricing. It should be pretty easy if you’ve performed thorough market research. Checking competitor pricing also helps, especially when entering a price-sensitive market.
Then there’s marketing. Localizing your marketing campaigns takes more than changing the text to the local language. You also have to understand the region’s culture and customs.
That’s precisely what P&G overlooked when localizing a US-centric ad for Japanese consumers. It featured a stork delivering Pampers diapers to a happy Japanese family. The imagery left shoppers in Japan baffled because, in their folklore, a giant floating peach brings a baby home.
Measure and adapt
The last step is to evaluate the performance of your business strategy for expansion. It’s where the KPIs you defined initially come into the picture.
Measuring these KPIs will help you understand whether your efforts yield the desired results. It’ll also enable you to identify where you fall short and spot new growth opportunities.
Adapting your strategies according to these findings will help ensure continuous improvement and scalability.
Scale your business the right way
Expanding your small business to enter new markets isn’t about unplanned, rapid growth. Instead, it requires a calculated approach to identify target markets, understand potential customers, and localize offerings. You’ll also need a local team.
Additionally, you have to use the right technology to streamline operations and maintain your focus on customers. A platform like Act!—with its integrated automation capabilities—can be a powerful ally when scaling your business.
Wondering how Act! can help you? Sign up for a free trial to see it in action and understand how it fits into your small business expansion plans.