Use some of those 75% of the resources you spend on innovating your product on the business model instead. Particularly in exports.
First start all over with understanding the customer value
It is the customer who determines what a business is. What the business thinks it produces is not of first importance. What the customer considers value is decisive, and it is never a product. It is always utility, that is what the product does for them.Peter Drucker
Then forget about the product
Now, you have to cross that chasm into the export model evolution. Understanding the customer value in depth will lead you into adjustments of your export model – as long as you appreciate that the export model is dynamic – “when it rains, it pours”…
Remember, sustainable scale – I assume this is why you would export in the first place – is not a necessarily millions of users, a great product, or the best user recommendations. Sustainable scale is the act of translating that new insight on customer value into a revenue model and a repeatable process that delivers that customer value over and over in your export market.
Design your go to market strategy
So target your distribution channels: Do you want to be ’hands on’ and in control of your relationships with your final customers / buyers or take a ’hands off’ approach and let an intermediary manage the transaction? Would you prefer a hybrid of both approaches? What does that look like? Define your prospects (e.g., OEM manufacturer, distributor, importer, sales representatives, etc.) accordingly.
Consider LinkedIn as a primary source – the tools to narrow down your search are quite exhaustive. And of course, trade shows and related directories can be supportive as well.
As you move towards new distribution channels, why should (s)he take on your unfamiliar product without traction in the market?
Often the answer is by providing a point of reference that makes it easy to understand the new product. Perhaps you will have to conduct the first sales yourself to visualize the business opportunity to future distribution channels and educate prospective distributors on the new offering.
But that in itself is rarely enough. Your value contribution must address not just end-users but also the channels driving your product towards the end-users. So, how can you make it easy for the distributor? How can you add value to the distributor’s business? Your export model must address this in a convincing manner.
And make it stick
With the right human capital your company will know that the go-to-market process is of iterative nature. You will have to continuously challenge your key assumptions – or hypotheses – to fine-tune the model and to constantly adjust to market dynamics. The further the mental distance between your export market and your company’s DNA, the higher the importance of working with the hypotheses.
These are all vital parts of making it real. It is tough. And rewarding. Perhaps. There are ways to reduce the significant risks and free yourself and your resources to start perfecting your export model. Let me know, if you want to know how to increase your chance of success from 1 out of 4 – to 2 out of 4.
Read this article in Danish here.