This is a guest post by Kalie Moore who is head of content marketing for Rivalfox.
In today’s global economy, startups should not be asking themselves if they should go global, but when? Decisions about the details, when and where to expand, must take hundreds of factors into account. Just peruse Quora on this topic and you will find thousands of people asking questions like what are the key challenges that companies expanding to foreign markets should take care of? Or, what are the best methods to research incumbents, market size, and viability in a foreign market?
One critical part of every internationalization effort is awareness of what is happening in foreign markets and to constantly monitor what competitors are doing internationally.
Competitive intelligence (CI), which is the art of defining, gathering, analyzing information about your competition and the market place to better inform your own strategies, should be a core component of every startup’s strategy anyway. Tackling ten markets, some of which may be unfamiliar, is very different than competing in just one.
What value does competitive intelligence bring when going global:
CI shows You How To Differentiate
There are a lot of startups out there. The Next Web just reported that 565,000 startups launch every month. While every company believes they are special, it is up to you to prove it to potential customers. This can be challenging, especially when entering an unknown market ripe with established competitors. Through competitive intelligence reporting, you can track and analyze the marketing and communication strategy of your competitors. By staying current with their messaging, press releases, and social strategy, you can capitalize on areas that your competitors are executing poorly, and make your company stand out.
CI Alerts You To New Trends
Monitoring your global competition can alert you to larger market trends that you may have missed previously. What if, one day, you notice that each of your competitors is adding a similar new feature? Chances are that new market research has provided insight into product enhancements that resonated with their target audience. CI can also alert you to lack of demand signaling that it is time to pivot, or even bail on the market completely, like it did for Gigalocal, a hyper-local, real-time market-place for mini services.
The errand market was rife with competition. The biggest names in the industry were TaskRabbit and Zaarly, which Gigalocal tracked closely. The tracking was easy because both services allowed you to look at errands being posted in your neighborhood through geolocation. By counting the dots, one could see how many tasks each service had and in which locations. The Gigalocal team began to notice a trend: no matter what city you looked at about 10% of the errands were exactly the same and listed for the same price. The numbers were being padded, even by the successful industry leaders. It started to look like there just wasn’t enough demand for digitalized peer-to-peer errands.
By using competitive intelligence and analyzing the data to discover industry trends, Gigalocal made the decision to leave the marketplace. Probably a wise choice, as Zaarly soon followed suit and Taskrabbit appears to be in trouble. This March, Zaarly pivoted from a peer-to-peer model to Storefronts, a platform that allows sellers to showcase their services, similar to Etsy. And, in July, Taskrabbit announced layoffs of 20% of their team based on lack of demand.
CI Helps with Timing
Some companies start their expansion by creating landing pages before they actually launch a new market. With competitive intelligence tracking software, you will be alerted of competitors’ website changes and track their progress in every market. If you receive an alert that one of your competitors just launched their site in four new countries, you will have the opportunity to analyze the implications and decide if you need to push for a faster launch to secure greater market share. If you enter at the right time you can pummel the competition, just like Facebook did with Sonico, once the Facebook of Latin America.
Multinational status is no longer reserved for huge corporations – it is available to startups of all sizes. In a hyper-competitive global economy it is absolutely critical to keep an eye on all competitors, strategies accordingly and successfully launch into new markets.
About the author: Kalie Moore is head of content marketing for Rivalfox, a service that monitors your competitors, and gives you comprehensive reports on their activity with actionable business intelligence. She also writes about international startup ecosystems on her blog Berlin Startup Girl. Follow Rivalfox and Kalie on Twitter.