For example, when Uber tried to expand into South Korea, many assumed they would succeed. After all, the company had well-established markets in many nations around the world. However, Uber failed to understand its target market, and this had serious consequences.
The taxi industry in Seoul is tough due to too many taxis and a slowing population growth rate. Seoul alone has over 70,000 taxi drivers (compared to 13,000 in New York City). The government has begun to reduce the number of taxis and offices no longer issue licenses. As a result, the price of taxi licenses has increased significantly.
If Uber were to start operating in the market , the taxi industry would have experienced a considerable downturn. The government feared a backlash from industry representatives and Uber's development in South Korea was hampered as a result of these regulatory issues.
Conclusion? Without adequate information, any market expansion plan is reckless.
3. Understand local politics
To get a handle on the business climate of a location, you also need a good understanding o italy mobile number example f local politics. Some markets may not be as attractive due to an unfriendly political climate or general instability.
In the business world, this is reflected in the PEST (ELI) analysis , which the global business community often refers to when considering market expansion.
4. Consider language barriers
Let’s take a look at WhatsApp’s expansion into Germany . WhatsApp has successfully acquired 1.2 billion users worldwide. However, before expanding into Germany, they failed to translate their terms of use into German.
As a result, the Federation of German Consumer Organisations filed a lawsuit against the company, claiming that the technical language was "largely incomprehensible" to German users. A small oversight cost the company more than a quarter of a million euros.
A smaller brand probably wouldn't have come through this challenge unscathed.
5. Study price sensitivity
Look at factors like the average amount of disposable income residents have. If the margin is too low, residents may not be able to afford your products.
6. Take seasonality into account
Last but not least, geographical realities, such as reverse seasons between the Northern and Southern hemispheres, can have a major impact on consumer demand.