Received a phone call from a Greek brand owner who wanted my help launching his brand in export markets. My first question was ” How is your brand selling at retailers in Greece” ? The future exporter replied that he wasn’t selling locally because the retailers were too tough ! Maybe I was harsh, but my advice was that if you can’t market through retailers in your home country, you have low chances of export success.
Another story is of USA manufacturers claiming difficulties in selling to Europe. To help them understand the issue, I propose the following case study. ” Would you ever dream of approaching Kroger with a product that is priced twice the local competition with very limited marketing support and using a representative that is a one man organization ? ” So why do you think that this strategy will work in attempting to sell to demanding retailers like Carrefour,Metro, or Tesco ?
Our business has very few secrets. Industry veterans learned the basics of selling early in our careers.
Create a brand with a meaningful USP ( Unique Selling Proposition), price it fairly, support it with marketing investments, and align with a strong distributor or broker. I frequently serve as a speaker at Conferences and Workshops. I always challenge my audience on the factors that it takes to succeed in their home country. Then, I remind them that this is similar to requirements to win in export. However,export is even more difficult as we face incremental logistics costs, lack of scale, and the inability to “babysit” the product everyday through visits to your neighborhood stores.
The good news is that there are more common elements in doing business globally, then differences.
Listed below are a few tips on solving the export puzzle.
1. Analyze Costs of Building Brands in your Country
Divide costs on a per capita basis. As you consider export markets, compare spending on an equivalent per capita basis. What will a $50,000 investment deliver in the United Kingdom, a country of 63 million ? How much should you invest in Brazil, a country with 200 million people, three times the size of the United Kingdom ?
2. Align Expectations with Competitiveness and Spending
Export success often reflects a collection of niche markets supplemented with a few countries where your brand achieves mass scale. The key is to align strategy and expectations with spend level and competitiveness.
Your programs and focus should reflect your own commitment.
3. The Consumer is first
International strategies must address fundamental marketing issues. What news does your product deliver to the category ? Is this difference important ? What will you invest to gain consumer awareness, trial, and repeat?
4. Select the Right Type of Partner
Big brands with big budgets should link with Best in Class distributors ( see page 4). Niche products with minimal investments should approach smaller, more entrepreneurial distributors.
5. Invest in Few High Potential markets
Recommend focus on a few countries where you can invest and support your brand properly.
Gain learning and build a success story. This generates better results versus a strategy of selling to as many countries as possible.
6. Think Local
Stop dreaming of China unless your sales exceed $50 million.
USA exporters should look at Canada and the Americas first, starting at Mexico and Puerto Rico and working your way south. Europeans have been exporting for centuries, but consider emerging countries in Central and Eastern Europe and then the Middle East.
Export is not easy. However , we’ll find many answers if we remember what we learned in our first year on the job selling to local retailers. Good Luck !