How to Leverage Growth in a Foreign Market While Maintaining Consistent and Stable Profitability

The world is more connected than ever before. With supply chains stretching across the globe, consumers online shopping from anywhere and everywhere, along with high-level competition at seemingly every turn, in 2019, leveraging growth in a foreign market is no longer an option for many companies.

Leveraging this growth is easier said than done, in more cases than not, it can be incredibly expensive with effects across your entire business from opportunity costs, revenue potential, and most importantly, profitability.

What strategies are your competitors following? How do they make it seem so easy, sustainable, and profitable? Let’s take a look at a few key components that you should incorporate into your international growth strategy.

Invest in the Right Things

It’s easy to think that if you just throw money at personnel, marketing, supply chain management, and every other area of the business, you’ll start making money hand over fist. The reality is, you need to invest smarter in dedicated areas that will stimulate growth rather than hinder it in the long run. In my experience, I’ve found that three key areas require the most attention first. If you can tackle these three areas, the rest of your international growth strategy will follow suit.

Invest in Sales

First and foremost, you must invest in sales. What does that mean exactly? Investing in sales means ironing out the bottlenecks in your marketing channels and solidifying your messaging to potential customers. Since you’ll be moving into an international market, you need to make sure that you’re speaking your target customers’ language both literally and figuratively.

Your international marketing efforts should be more than just a translation of your existing marketing messages and should speak directly to the consumer. They want to know that you’re more than just a foreign brand invading their country and rather an extension of your brand built specifically for them with products and services that they genuinely need.

In relation to your profitability and expansion in a stable and consistent manner, your sales need to be on the rise consistently. This means that you never take your foot off of the gas even after market penetration and you follow a slow and steady approach after your initial splash. Determine the right channels to use to reach your target audience and confirm that your messaging is engaging with them through market research.

Invest in Existing Relationships

Apart from investing in new sales through your messaging channels, you can't forget about your existing customers in the process. Relationships are increasingly becoming crucial in a company's international success. When leveraged correctly, your current customers can become your most prominent brand advocates, and the power of referrals goes a long way in boosting your bottom line in the long run.

As the old saying goes, it's cheaper to sell to an existing customer than to find a new one. By following a systematic approach to deepen your relationships with these current customers, it will create a strong tailwind that will help your other sales efforts. If you want to generate real growth in the international marketplace, strive to increase customer recommendations to influence exponential growth.

Invest in Higher Value

The simple formula to increase your profitability is to raise prices for higher margins. With that being said, you can’t simply jack up the prices when you enter an international market just because you think people are willing to pay a premium. You must give them a reason to pay a premium for your products or services by providing more economic value.

This step requires more research than you might initially assume, with every market perceiving value in different ways. Determine what your new customers care about in the products and services they purchase and either integrate this value into the products itself or find a way to accurately communicate it to them by demonstrating the economic value in established data that proves the existence of that value.

Summary

As a final point, if your company works through intermediaries in the market place, you'll find that effectively leveraging your international growth will be more challenging than if you were more actively involved. Global growth is a challenge for many businesses and the problems that many face come regardless of their target customer segments, budget, size, product, etc. They affect everyone.

Senior management must place a crucial role in the growth strategy in coordination with other areas of the business. They must fully understand these principles first, so they have a clear vision as they lead the company further. If you invest in the right things and stay focused, maintaining profitability will be less of an uncertainty and more of a systematic process.