Monday, May 21, 2012

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Google: Entering New Markets

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By Deborah Sweeney, CEO of MyCorporation.com

Rivalry makes the world go round! At least, that seems to be Google’s thinking. The corporate giant has been known for trying to pounce on pre-existing markets in an attempt to lure away users from popular web services to the Google product. . We have already seen this in action with Google Plus, Google Buzz, Google Gears and, quite soon, a more centralized version of Google Shopping will be rolled out to try and fight online retailer behemoth Amazon.

I love Google and have seen them do wonders with this strategy. They have revolutionized e-mail, cloud computing, and document storage. At the same time, their other services have been a little . . . lackluster. Don’t get me wrong—I made sure MyCorporation had its Google Plus page the minute we could get one. However, the mass exodus from Facebook to Google Plus that many were expecting is unlikely.

Despite the failure of Buzz and the anticlimactic story of Plus, Google’s success has often had many business owners wondering whether they should follow a similar model and try to break into markets that may already be well served. While I can’t answer that question directly, I can give you some advice to follow when determining the best course of action for your own company.

  • Determine where your markets are currently, and where you can expand.

This step is key. While researching this particular aspect about your market may seem fairly obvious, a lot of business owners simply overestimate their reach. Yeah, if you own one of five tire shops on a main street in a small town, you know that you aren’t going to be getting much outside business. Heck, you may not be getting much inside business, either. But if you run something like an online company, things can get a little tricky.

This really is where Google is starting to falter; they are overestimating their usefulness in other markets and industries. So instead of charging headlong into a new area, first look at the locations of your current customers or the addresses in your mailing list and determine exactly how many people your company is in contact with. From there you can find where, geographically, you are a little weaker than your competition, and you will have a literal map laid out in front of you as to where you can grab market share from your competition. Both franchises and online businesses use this method to maximize their gains and it is a great way to begin your quest for more market share. Then, once you are established in a particular area, make sure people can find you!

  • Look for signs of stagnations in your industry.

If there is one thing the business world has learned from the web-based ventures, it is that businesses stagnate. Google was able to make billions despite heavy competition by tackling e-mail and websearch simply by thinking of a better way. It is just how the business world operates; as people become complacent, the call for innovation dies and, unless there is some outside competition, things only get worse and worse.

After you’ve made your rough map of the competition, see who else is operating in these areas. If it looks like there are only one or two competitors, and it has been that way for a while, it is highly likely that every one of those companies has begun to stagnate. That means that, as long as you present your product or service in a way that is clearly distinguishable from your competition (whether in quality, presentation, or innovation), it will be like a breath of fresh air.

Also remember to fight against stagnation in your own business. Listen to your customers, change according to the market, and never stop moving. Social media has given businesses everywhere an inside view into the minds of their customers, yet so many companies refuse to use it as more than a tool for advertising! Be as personable as you can; this is much easier for small businesses, as the lack of a rigid hierarchy really helps to showcase personality.

  • Try and figure out how your competitors are running things.

So you have an expansion plan and you have a fresh take on your product. Chances are you are going to do well when you try to expand. However, there is one more step that can really help you out, though it ventures into the more aggressive side of the business world. You should keep an eye out for the competition’s talent and see who, if anyone, may be a good addition to your own company. After all, they are already located in the region you want to expand into and can help bring a lot of experience to your efforts.

Startups have a lot of success by appealing to innovative thinkers who feel pigeonholed or ignored in their current job. Again, don’t be afraid of using social media for this. Is the VP complaining about not being listened to on Facebook? Do they have a great marketing manager who keeps updating their resume on LinkedIn? Look around and try to headhunt some people by offering them a way off of a sinking ship. Also remember to be flexible with them; simple things like offering to let them work from home can greatly increase your chances at hiring them away from the competition.

Now don’t misunderstand me; breaking into a new market is very, very difficult. Customers will typically go with what they know, so this whole process will be an uphill battle. However, if you are willing to fight for your piece of this new market, and are well equipped to do so, your company could see a nice, long list of new customers.

Maybe we can’t all be like Google, but entrepreneurs can learn quite a bit from its successes and failures, and use them to help expand their own business interests.

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