Entering new markets [Q&A with Google]

Entering new markets is always somewhat of a gamble: Is your timing right? Is there a viable market for what you're offering? Are the stars correctly aligned? How much research is enough research?

If you’ve been considering upscaling, Vincent Xu, Marketing Lead at Google has some expert advice on next steps and what to consider when taking your brand global.

Q: I've enjoyed small-scale, domestic success, but I'm keen to develop my business and enter the international market. What would be your main piece of advice for someone like myself who may be looking to upscale and venture into uncharted territory?

A: “Congrats first of all on the domestic success - that’s an accomplishment in itself!

“For expanding into international markets, I would approach this in three steps, at a high-level.

“Firstly, determining your markets of expansion. At this stage, it’s critical to do a complete analysis and establish a framework for how you’d decide on the appropriate markets to expand into. You can approach this by asking yourself ‘what are the important ingredients for the success of my product in a particular market?’ For example, do you need markets to have a certain / optimal demographic breakdown (age/gender/income distribution)? Perhaps your product depends on internet access - is there enough online penetration in the markets you’re looking at? Etc.

“Secondly, once you’ve decided on the markets you want to expand into, it’s time to do more focused ground work on how you’d push your product in the market. Start with a comprehensive ‘lay of the land’ study - fully understand your target user personas (their needs, lifestyles, barriers to purchase, etc.), as well as what competitors in the space are doing. Use all the information and insights you gather at this stage to craft the marketing campaigns that’ll best resonate with users. One pro tip: make sure you fully localize your content; there may be cultural nuances that you’ll only be able to tease out if you really roll up your sleeves and get into it (e.g., via in-depth user studies, conversations with locals).

“Finally, it’s time to launch! Leverage all the groundwork you’ve done and start off with a small-scale pilot to test product reception in the market. Even with a ton of previous ground work, there are likely places you haven’t anticipated, and through the pilot test you’ll be able to learn, tweak, and finally scale (if the pilot is successful/once you’re happy with the results) to maximize your impact.”

Q: I work for a company in a highly competitive market. Funnily enough, customers come to us after they've exhausted their efforts elsewhere. What's your advice for a product marketer looking to differentiate from the competition, while building trust with an audience that has been burned a few too many times?

A: “To differentiate from competitors (without having any more details on your product, competitor landscape, etc.), I’d recommend at a high-level to do lots of digging (e.g., user research, competitor analysis) and find areas where you might have a competitive advantage (e.g., is your company more nimble / able to act faster? Do you have exclusive partnerships? Do you have access to resources competitors don’t?).

“It seems as though if customers have exhausted their efforts with competitors and are now coming to you, this could be the perfect opportunity to differentiate. If I were you, I’d fully understand why customers have not been satisfied with their experiences with competitors (you can do so through in-depth interviews with these customers), and see if there are nuggets of insights that you can act on. For example, if users were not happy with the competitor company’s customer service experience, is this an area you can over-index on/over-invest in to leave a strong impression? This situation may also very well be the “perfect” opportunity to kill 2 birds with one stone - differentiate from competitors AND build trust with your new customers at the same time :).

“Simultaneously, however, I would try to find out from the competitor company’s perspective. Using our earlier example, if bad customer service experience led to losing customers, why did it happen in the first place? This is where it might get complicated; going off of the bad customer service example, if the competitor companies actually ran detailed calculations and intentionally chose to have subpar customer service in order to save the bottom-line, would this also apply for you? At the end of the day, if differentiation from competitors is difficult and results in meaningful negative impact to the company (e.g., bottom-line, reputation), then new innovations/solutions to the problem will be required. Take this problem-solving lens though and see where you get to -- approach it in a methodical way, having as much information on hand as possible so that you can make the most informed decision possible.”

Q: Could I get your advice on the Freemium business model for a B2B SaaS solution when expanding to new markets? What should the PM's role be in this?

A: “To be honest, I haven’t worked with a freemium business model for B2B SaaS solutions before, but I could offer some general best practices/role of PM through the expansion.

“Firstly, I’d recommend you do a complete ‘lay of the land’ exercise for markets you intend to expand into - what are other B2B companies with similar SaaS offerings doing? Is freemium common in the market you’re expanding into / would it even work? How should your freemium pricing model differ based on different local dynamics? Where is your freemium model competitive advantage vs. other B2B SaaS solutions? Etc.

“In terms of the PM’s role here, I would say this depends heavily on the type of market you’re expanding into (e.g., mature vs. new, local user dynamics). For example, if users in your intended expansion market are looking for larger platforms (vs. single product services or entry points), the PM may need to build the product roadmap to fit this need. On the other hand, if users in the intended expansion market are not familiar with SaaS solutions, the PM and PMM may need to work together and invest time in user education to teach prospective customers how SaaS solutions differ from bespoke enterprise solutions (e.g., scale, frequency of updates, operations).

“As a general best practice, the PM should always take an empathy-driven approach and fully understand the user needs, subsequently tweaking and building the product roadmaps based on this. Once there is enough understanding of the users and what the product roadmap will look like, it’s also critical for the PM and PMM to work together and determine metrics of success in the new market -- what KPIs make sense given local dynamics (e.g., besides sales, should you also track purchase intent or even just awareness for SaaS evergreen markets)?

“Lastly, I think one trap many PMs fall into in the SaaS space is wanting to launch the “perfect” product, but it’s often much more conducive to create scrappy versions of the product, launch, learn, iterate, and repeat when entering new markets. Food for thought!”

“I’m sure you’re not alone here! But also great on you for supporting competitor intel, in my opinion it’s one of the most crucial aspects of successful marketing.

“Here’s some advice I have on cost-effective ways to conduct competitor intel:

1) Google search - I know this sounds cliche, but you wouldn’t believe the number of times I’ve just looked for publicly available reports on Google Search and used freely accessible stats (e.g., from Statista) as many of my analysis / presentations!

2) Quick-n-dirty market studies - this could be something as simple as getting a group of your target users into a focus group and having an in-depth interview to hear their thoughts, preferences, etc. on competitor products. If you’re in the brick-n-mortar business, I’ve also seen folks literally go into competitor stores to assess foot traffic, product placement, etc. Lastly on this topic, I think there also services out there that allow you to pay a small fee to conduct surveys online (e.g., you’d pay like a small fee for every response you get) -- you should consider this too if you’re looking to get a quick sense of consumer sentiments. I’m sure there are more creative ways here as well.

3) Subscriptions to data sources (e.g., for my role, I’m subscribed to sources like IDC / GSMA that provide data on digital accessibility), there may be basic / cheap membership options that suit your needs, and / or group subscriptions that significantly bring down the price.

“Also, I know that Product Marketing Alliance has some great pieces / insights on competitor intel, so check those out too if you haven’t yet!”

Q: Which factors should be taken into account when entering a new market in a different country? I've narrowed down prospective launch locations to two, but I’m wary of making the wrong choice.

A: “Narrowing the launch locations to two is already a mighty feat, and well more than half the battle won!.

“For my recommendation, I’m going to assume that when you say “entering a new market in a different country,” you’re just talking about location (as opposed to entering both a new product industry AND a new geographical market).

“As you decide between the two launch locations, I’d say the most important consideration would be the KPI/success metric. Even if we assume bottom-line revenue impact is the ultimate goal, there are a number of things you might be more tangibly trying to drive in the short / medium term, for example:

Maximizing ROI (highest dollar in, dollar out ratio)
Establishing brand presence
Increasing product awareness/comprehension/purchase intent

“Each of these, along with many other potential short/medium-term goals, will have a different KPI or success metric, making one or the other location you’re considering better suited. If you’ve gone through all the thought processes/pre-analysis and still feel stuck, you could consider running a small pilot in both countries to assess success, and only after you see tangible market results decide on which of the 2 markets to “go big” and scale in.”

Q: Do you have any suggestions on how I can source a reliable local partner as I prepare to enter a new market? I’m entering unfamiliar territory and I need someone I can trust! 🙏

A: “I would recommend approaching this in 2 steps.

“Firstly, cast your net wide and make note of all the potential companies/organizations you could partner with. Do this by fully understanding the market/local nuances, talk to other companies who’ve entered the market you’re trying to enter and have established local partnerships (or, if that’s not possible, do a bit of digging via online / market research). Who are the other companies partnering with locally? How did they choose their partners? Are they satisfied with the partners? Would they do anything differently? What are the pros/cons of their current partners? Do they have recommendations/suggestions for partners you can work with for your particular needs?

“Secondly, once you’ve created a comprehensive set of potential local partners, establish a criteria for zooming in on your ideal partner -- e.g., cost, level of experience, peer reviews can all be a part of the criteria. You should be able to make a shortlist based on your established criteria (e.g., each of the options on the shortlist can technically work “on paper”), but make sure to follow-up with each of these shortlisted options with a real conversation (face to face if possible). At this point, it’s like any interview, use the conversation to suss out who you’d most enjoy working with, who would bring most to the table, etc.

“Lastly - I’m sure this wouldn’t apply to you, but in general one thing to note is that a partnership is a two-way street. Make sure that your company is also offering value to the partner in a meaningful way. Over-index on a fair relationship (e.g., avoid shortchanging/‘taking advantage’ tactics) an unequal partnership builds “bad blood” and never ends well, especially in a foreign market!”

Q: What would your advice be for startups considering entry into such a diverse market like APAC? Would especially be interesting to hear how marketing campaigns have to adapt their messaging, look & feel to APAC markets.

“I think the very first thing to keep in mind is the sheer diversity and amount of nuanced local dynamics among APAC markets - even those often grouped together (e.g., Thailand and Vietnam are often categorized under the same “Southeast Asia” umbrella) may have vast underlying differences that only surface through extensive user research, in-depth interviews with local users, etc. There is rarely a “one size fits all” when it comes to crossing markets, especially one as diverse as those in APAC (in fact, the level of cultural and social differences even within the same market can be quite staggering at times).

“As a tangible example of local nuances at work, consider one of my own discoveries: after I started working extensively in the Korea market last year, it wasn’t until my 2nd or 3rd month that I realized Korean consumers aren’t actually familiar with the Android product (which is what I work on), as they mostly identify smartphones by just the brand (e.g., Samsung Galaxy vs. iPhones). This was a ‘mistake’ I could have easily avoided if I had invested more time upfront to speak with local users in greater depth to tease out critical product insights!

“All of this is to say that you should absolutely do your best to tease our nuances before entering your intended APAC market. Invest the time to conduct thorough research, deep-dive user interviews, comprehensive study of other campaigns in the market to assess what’s worked vs. didn’t work, etc. You certainly want to avoid coming off as tone deaf during launch. Consider this tangible example of a marketing work I saw a while back that “missed” the mark - it was a video ad meant for Indian users that featured a western-style wedding (the western style wedding wasn’t an important part of the product storyline, and a ‘traditional’ Indian wedding could have been easily substituted). Probably not the best look!

“It would be optimal if the start-up looking to enter new markets had employees on ground/familiar with the local nuances to sense check marketing messages and creatives before launch; if that’s not possible, try instead to craft the marketing campaign with a local point-of-contact (e.g., establish a local partner or hire a local marketing agency to help with the review).”

Q: As I'm sure you've seen, Big Tech has come under scrutiny in the last few years for monopolizing various industries, making it harder and harder for startups to compete. This is particularly important in the Marketing landscape, where I'm sure Google and other FAANG players have 20-50x the "war chests" (aka budgets) that a Seed, Series A, or Series B startup may have ... essentially, FAANG can buy user acquisition and retention for their products, by giving discounts, cash backs, ad blitzes, etc.

What are your thoughts on this front and what role are you playing to ensure that the tech landscape is equitable and maintains an innovative spirit?

A: “What you describe is indeed true to a large degree, on many fronts it is very difficult for start-ups to compete with the likes of FAANG, especially in industries that are becoming areas of mainstream focus or where large ‘war chests” for marketing/promos lead to an outsized advantage (e.g., industries like Payments, RideShare).

“With that being said, however, I do believe there are areas where start-ups can still have a competitive edge, and doubling down on these areas may help mitigate the ‘war chest’ disparity (after all, FAANG hasn’t always succeeded against start-ups -- e.g., rise of companies like Wikipedia, Whatsapp, YouTube, Dropbox in the face of FAANG alternatives).

“For example -scrappiness/nimbleness -- at large companies, there are often layers of decision-making / alignment needed to launch a product, and priorities slip or change quite frequently. Start-ups on average have the ability to act much faster, drastically shortening the time needed to put certain products on the market. Additionally, in new tech there are lots of ‘grey’ areas on the verge of legality, presenting risks that large companies simply can’t afford to take given public scrutiny (but which start-ups can much more easily swoop in to “fill the gap”)

“Information asymmetry - large companies have public filings where they must disclose company operations, investments, etc.; start-ups can fly “under the radar” until they’ve established themselves or reached a certain level of success, when it may simply be “too late” even if large companies notice. Google, in fact, was founded this way 🙂.

“Work flexibility - the war for talent is real. Start-ups have been known to give more flexibility to their employees (e.g., working abroad, across time zones), which allows them to attract talent in ways that FAANG might not be able to (although, admittedly, this is less relevant today given COVID).

“Even given these considerations, in large part it will ultimately depend on the product in question (the more niche, the better for a start-up) - e.g., a start-up trying to create a search engine to compete with existing players will probably have a much harder time, than, say, a start-up creating bespoke enterprise firewall using patented AI recognition software.

“In addition to the areas mentioned above, I do think that the government should have a role in helping to preserve the spirit of entrepreneurship / innovation -- e.g., consider the India government’s recent decision to cap payments processed by any one app to 30%.

“Lastly, for what it’s worth, I do know that FAANG companies all have divisions dedicated to nurturing entrepreneurship for example,Google for Startups is something a few of my colleagues are involved in and from what I know, it does have a tangible impact on the local developer community.”

Q: I'm finding it difficult to break into a mature market. Do you have any suggestions or advice for PMMs such as myself on how to attract the attention of prospective customers who may already have an allegiance to a particular company or brand?

A: “Specific methods to attract the attention of prospective customers with loyalty towards another brand already would depend on the product, country, and of course local insights (e.g., via deep-dive research to establish personas, segment users, uncover what drives brand loyalty for the product/market, how “sticky” consumers really are). However, on a more foundational level, here are a few ideas you can explore to capture the attention of prospective customers in mature markets:

1) Play with price -- there are various ways of using price to differentiate, depending on your product, industry, user base, etc. For example, while launching a cheaper product may help you stand out in utility-based products, setting premium prices (e.g., +20%) can be equally as beneficial in other sectors (e.g., Apple and MacBooks!). Read up on price as a differentiating factor if you’re interested (I think the Harvard Business Review have quite a few papers on this), but in general there are multiple other creative, research-backed methods of leveraging price to differentiate (e.g., giving similar products the same price -- such as 99 cents for songs on iTunes, bundling services and clearly laying out to users how much each component costs so there is no ambiguity on what they’re paying for -- such as upselling consumers on flights with a bundle care/food package).

2) Provide awards / promos - for example, fun awards / games users can get access to when they start using your product (Google Pay scratch cards is a great example of this), or create unique, attractive loyalty programs.

3) Invest in partnerships -- are there other companies (could be from totally different industries) you can partner with that allow you to differentiate your product / messages to users? Think creatively (the Delta/Mezzetta Pizza one is my favorite!).

“At the end of the day, I’d say the North Star is to anchor everything back on research / user insights -- what are user needs that are not being met fully by their current company or brand? What truly inspires your target users? Etc.”

Q: What are the top 3 tips you have for efficient and effective B2B marketing, especially in entering new complex markets here in APAC / SEA?

“My top 3 tips would be:

1) Understanding of the current state - you’ll see this as a general trend across many of my responses, but I can’t emphasize enough how important it is to fully understand the “lay of the land” before jumping into any type of marketing. What markets are you trying to enter, and what are the barriers to entry for each? Who are your competitors in the new markets (you can even tier them by most relevant, to somewhat relevant, to tangentially relevant), and what have they done in terms of marketing? What can you learn from your competitors, or “steal with pride”? Who are your target users, and what needs do they have (always take an empathy/user-first approach where possible)? How are your users fulfilling their needs now without your product, and what improvements / added benefit will your product provide? Etc.

2) Localize, localize, localize your marketing messages - no one size fits all, especially in across markets as dynamic and complex as those in APAC (e.g., while many countries are bucketed under “SEA,” the sheer amount of diversity and local nuance among countries like Thailand, Vietnam, Indonesia is staggering). To best localize your content, I’d highly recommend working on the marketing campaign with someone deeply familiar with local dynamics (could be an employee or local agency), to make sure your marketing messages are tailored and 1) are not tone deaf to local cultural / social nuances, and 2) resonate with local users’ needs / preferences.

3) Employee considerations - I think B2B in general requires a lot of on-ground support (whether this entails meeting with large customer clients or visiting mom-n-pop shops as part of small business initiatives), and trying to break into complex markets like Indonesia or Thailand from, say, the US without on-ground support will be tough. Additionally, given how intrinsically tied B2B marketing is with sales and customer engagement, having employees who fully understand and can work within this dynamic (e.g., marketers with previous experience in Sales or Business Development) may be helpful (although not necessary).”

Q: We are planning to launch our product in three different markets in 2021. What's the best way to ensure that I stay on top of all these three entries? What are the top three contacts I need to establish in these three markets to help us position the product successfully?

A: “Congrats on the prospective launches -- amazing news!

“To stay on top of your launches in the different markets, I have a two tangible pieces of advice (that I try to incorporate in my day-to-day):

1) Read, read, read - I spend at least 30 minutes every morning reading through the latest news across my markets to fully familiarize myself with what’s going on. I often use Economic Times, Tech in Asia, Tech Crunch, and Financial Times, but if you don’t have subs to these you can just do a quick search on Google News (feel free to play around with the latter, I think it even allows you to set up alerts based on keywords), but yeah as you’re going through the news, actively think about whether any pieces of it might be relevant for your products / launches. Added bonus: as I’m going through news, if I find anything that I think can be beneficial to any of my teammates, I would send it across to them (and they would do the same for me) - this not only builds collaborative culture within the team, but with so many eyes and ears, it also greatly reduces the chances of you missing any critical pieces of news that’s relevant for your products.

2) Set up a review / analysis framework to assess how the launches are performing, e.g., if you’re primarily focused on sales, set up a time every day (or week, whatever the cadence for you) to check on progress (perhaps create an Excel spreadsheet where everything is tracked in one place). Actively think about how the launch performance is laddering up to your expectations - for example, is it on track to hit the KPI? If not, why not? Assess any problems that come up as soon as you can so you can learn, tweak, and apply changes to maximize product performance / impact. You don’t have to do this yourself - as soon as you see a “problem area,” set up a meeting with your manager or stakeholders, get into a room, and problem-solve together! Collaboration and collective brainstorming always leads to richer and more diverse insights / solutions.

“On your second question, I’m not completely sure what you mean by contacts (also, who you contact would depend heavily on your location, industry, etc.). However, I do think it’s very beneficial to have on-ground employees that can help with the product launches (e.g., helping you to localize the campaign and track success/progress), but if that’s not available, establishing strong local partnerships to help you navigate local dynamics and nuances.”

Q: What are the most effective methods for conducting consumer research when entering new markets?

A: “I think that if you can afford it, I’d strongly recommend partnering up with a dedicated research agency (e.g., Kantar, Ipsos) to do a market deep-dive and fully understand your consumers. They’re experts in consumer research, and can provide a lot of guidance in terms of the consumers to deep-dive on, use of qual vs. quant research methods, segmentation studies, etc. that best fit a local market’s nuances.

“If this is not possible (e.g., given cost, resource constraints), I listed a few ‘scrappy’” options in response to a question above - feel free to take a look!”

Q: What are some of the most profound challenges you’ve faced when entering new markets? How did you overcome these obstacles?

A: “I think my biggest challenge came when I first moved to APAC 2.5 years ago to work on the local markets here. Coming from a US-centric position back in Google San Francisco (and not having lived in APAC for the past 20 years), there was a ton of ramping up to do in terms of understanding all the local dynamics and nuances. Shortly after my move, I was thrown into a major launch for our India market and definitely felt like I was drinking from the firehose, with an exponential learning curve.

“To ramp up as fast as I could, I think a few things definitely helped, and I’d recommend anybody in similar shoes as myself do if possible:

1) Conduct deep-dive user research - I worked directly with a local research agency to conduct deep-dives on personas, user dynamics, user needs / preferences, etc. Always, always start with understanding exactly who your users are!

2) Visit the local market - no matter how much research / paper work you do, nothing beats spending a good few weeks in the market and completely immersing yourself in the local culture. I was fortunate enough to have had this opportunity as part of my work, meeting face-to-face with local partners / users to build a more robust foundation of user-based empathy and understanding.

3) Frequent communication with on-ground marketers - I over-indexed on communicating frequently with our local India marketers and business development teams (multiple meetings per week), sought their feedback / perspective on every piece of creative before going into the market, etc. This greatly helped me better understand the local nuances, and, after a few months in, I was able to discern for the most part what might “work” vs. “not work” in the market - all thanks to the local team’s guidance and time investment in helping me ramp up! Note that familiarizing yourself with a market is not a “one and done” type ordeal - it takes months of back-and-forth, drinking from the firehose, and really getting your feet wet to begin getting the hang of it, particularly in complex, context-rich markets like those in APAC.

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