Join Doug Ladd for an in-depth discussion in this video Market development, part of Marketing Foundations: International Marketing.
- Car companies have created engines that can run on hydrogen. They produce no emissions. And even the process of creating the hydrogen necessary to run the cars is clean, compared to gasoline and electricity operated vehicles. The product development effort has been significant, as you can imagine, but now the real hard work must be done. The market must be developed. Customers have to be informed, educated, and trained on how to get the cars, how to maintain them, and where to get hydrogen. Hydrogen stations need to be built, and a market for moving and storing the gas must be devised.
In essence, a market needs to be made. When you move into a new geography, you may find that you need to do market development as well. Mobile phones were popular in Europe for more than five years before they really began to take off in the U.S. That's because the wired phone infrastructure in the U.S. was very solid. Every home and apartment had a landline, and there were payphones everywhere. So why would anyone need to carry a phone with them? The mobile handset makers had to develop the market in the U.S.
Just having a successful product in your home market doesn't guarantee you'll be able to have that success elsewhere. If you underestimate the amount of money and resources necessary to develop the market, your efforts to get the product into the market may go unrewarded. Market development efforts may require a different set of skills than traditional product development, or promotional marketing skills. Here are some ideas on how to determine if marketing development activities will be needed so you can begin your planning and budgeting in advance.
I'd suggest creating a sheet where you can list all the Things We Know about how customers use your product today, in your home market. This should include everything, from where do they learn about the product, how they gather information or make comparisons to competitors, where they buy the product, and so on. In a column next to this list, you should then document what's different about the consumers in the new market. It's important to separate assumptions from knowns when completing this portion of the exercise.
You'll want to validate the assumptions, before you invest in your market development plan. In your final column, you'll want to highlight the differences between your home and future market. You can imagine what you'll do later as your plan comes together. Creating ideas of how you can fill the gaps to develop the new market. As you embark on this exercise, think about who you can involve to get different perspectives and insights.
The course also investigates options for global expansion, such as exporting, licensing, joint ventures, and direct investment, and details how to put together a successful marketing mix using distribution, promotional methods, and translation. Plus, learn where to turn for more information about your specific target markets.
- The rise of the global consumer
- Learning about customers in global markets
- Accessing foreign markets
- Adapting products
- Balancing risks and rewards