An International Market Entry Strategy

An international market entry strategy is defined as the planning and implementation of delivering goods or services to a new target international market. It often requires establishing and further managing contracts in a new foreign country. There can be various strategies to go international. A company may want to enter only one foreign market at a time or a number of markets simultaneously. Based on number of markets to be entered, the strategies could be either waterfall strategy or sprinkler strategy.

In a Waterfall strategy, the business is spread in international markets sequentially. First a firm enters a new market and establishes an identity in the same. Establishing an identity involves estimation of potential market size and revenue patterns, identification of target segment, creation of brand awareness, identification and creation of possible distribution channels and finally formulation and implementation of sales strategy. All these strategies at individual stage are dependent on the product type and the life cycle.
Waterfall strategy allows the company to take time to understand a market and make appropriate adjustment to its marketing mix in order to satisfy the specific needs of each market. Managers can maximize the use of available resources; they can leverage their experience from the first market and make necessary improvements or changes to enter the next market.
The prime motive for the waterfall model is that adaptations of the marketing strategy for the host market can be very time-consuming. A phased rollout is also less demanding on the company resources. Other constraints such as the absence of good local partners may block a global rollout. Apple, for example, needed to negotiate partnership deals with local mobile phone service companies for the launch of its iPhone. These negotiations were not always successful. In China, for instance, Apple’s negotiations with China Mobile, China’s largest mobile service provider broke down,