Expanding into new markets can be a lucrative business move, but it’s one that should be taken with care.
Before you so much as dip a toe into a new market, you need some idea management. New markets may be the lifeblood of any business, but business history is littered with companies that leaped into new markets without, literally, any ideas. For every Microsoft Xbox, there are a dozen Coors Sparkling Waters. Here are the five steps to break in.
What’s Your Market?
One of the most dangerous places an innovation can arrive at is to be the solution without a problem. Before you consider entering a new market, ask yourself what this market is, and why they’d be interested in your product. How would they use it? Would it be better than a product they already use? Can you demonstrate it, in a context that will engage them? If they have no impression of your company, what will they take away from your product?
And remember to apply this to any market, even on the ones you’re already in. Part of idea management is finding new ways to apply mature ideas. In some cases, in attempting to break into a new market, you might solve what seems to be an intractable problem in a market you’ve been in for a while.
What’s The Future?
Another important aspect is the future of this market. To be clear, nobody’s asking you to predict the future. But you should know where the trends in this market are headed, and how your product fits into that. For example, robotics companies had an idea, when they began developing tools for the military, that their biggest consumer products would be vacuums scooting across floors. They perhaps didn’t know it’d be a competitive market, but they knew there was interest, and it’s since been a major driver for consumer robotics. What’s the possible Roomba for you? And don’t forget the other approach; if the market doesn’t pan out, what’s your risk and exposure?
Which market do you want to enter next?
How Are You Entering?
There are a lot of ways into a market. You can build from the ground up, buy out a competitor, partner with a company already in the industry, or even repackage a product you already sell with a new approach, a tactic familiar to anybody who’s noticed Fudgy The Whale and Carvel’s Santa Claus ice cream cakes look suspiciously similar. However, each approach has its own challenges, and each challenge needs to be considered carefully. For example, if you’re buying out a competitor, careful due diligence will need to be the order of the day.
Once that’s in place, you’ll need to ask how, precisely, this growth is going to happen. In some cases, it truly is a natural process, where infrastructure you already have in place can be scaled up or retooled to fit almost any need. Notice how Amazon went from books and other media to larger items that could be shipped, and has steadily expanded from there.
No matter what your company does, there are always new markets to explore. The chemical companies that started turning out sodium percarbonate for industrial purposes had no idea it’d become OxyClean. And with smart idea management, you can find, and open, those markets with ease. To learn more about idea management, contact us!