Which Markets should Kiwi Tech Exporters enter first? The Great Tech Debate.

The case for going all in on Strategy.

“How do tech companies decide on their go-to-market strategy? They use a complex algorithm, intuition, dart throwing, and the latest tech buzzwords.”  - A light-hearted moment from our CEO Michael Friedberg at our recent VIP event - The Great Tech Debate.  

But beneath the laughter, and friendly banter was the complex reality of how you go about choosing the right market to grow and offshore. Australia or America? - how do you navigate this decision?   The answer of course is always…. It depends.   But more than that we’re asking ‘What’s the strategy?” 

There’s a complex web of strategic decision-making that determines a tech company's international success. The answer to "Australia or America?" is nuanced and multifaceted.  It's not just about where you can sell, but why you're choosing to expand internationally in the first place.

So - What’s the Strategy? 

Here are some key considerations that could help you frame the strategic thinking process. 

Setting the Strategy

When charting a course for international expansion, the decision on which market to enter first—be it Australia, America, or any other—  the goal is to make an informed, strategic choice that leverages your company’s strengths and uniquely positions you in the global marketplace.

This should be underpinned by a strategic framework tailored to your business’s unique value proposition and long-term growth objectives.

Here’s a quick guide to help you begin to explore the fundamental considerations of sustainable growth and opportunity cost, structured around 3 core areas: 

1. Establish your growth trajectory and your drivers for growth.  

• Define what sustainable growth looks like for your business. Is it rapid market share acquisition, steady revenue growth, or establishing a foothold in a niche segment? Your growth objectives should inform not just the 'where' but the 'how' of your market entry strategy.
• Deep customer insights are crucial. Who are they, what are their pain points, and how does your offering solve their problems? A market might be appealing in size but consider if your target customer’s demographics and behaviors align with your product. This understanding shapes your messaging, product development, and ultimately, your market positioning.
• Analyse the competitive landscape. A market with fewer competitors might seem attractive, but a highly competitive market can indicate a healthy demand for your product or service. Evaluate your competitive advantage and how it stacks up in each market.
• Consider the opportunity cost of choosing one market over another. Does entering market A now potentially preclude you from easily entering market B later? Assess how each market aligns with your long-term vision and the potential trade-offs involved.
  

2. Identify your competitive arena. 

• Evaluate relevant markets that align with your objectives and where you can win.
• Beyond size and accessibility, consider how well each market aligns with your business values, product lifecycle, and service capabilities. Does the market culture value that which resonates with your offering?
• Where do you have the highest potential to win? This involves understanding not just the external factors like market demand and competition but also internal factors like your ability to innovate, adapt your product or service, and meet market-specific expectations.
  

3. Define how you will resource, meet and support market demand.

• Effective market entry requires adequate resourcing in terms of capital, talent, and infrastructure. Determine what it will take to meet the market demand, from initial launch to scaling operations. Consider the logistics of supply chains, customer service, and local presence.
• Establish the support systems needed to sustain market presence. This includes local partnerships, regulatory compliance, marketing, and after-sales service. Understanding the level of investment required to build these systems is critical for long-term success.

During our Tech Debate, it became clear that cultural compatibility plays a crucial role in market success.  Does the familiarity of Australian culture or the vast opportunities in the American market weigh more heavily in your decision-making process? 

The United States offers unparalleled scale, but is it the right first step for every Kiwi tech company?  Does the allure of the American dream outweigh the pragmatic approach of testing closer waters first? Weigh in with your perspective, and join the conversation on LinkedIn.


Want to explore more on which market is next for your business? Get in touch, and let’s start a conversation.  We're here to help Kiwi tech businesses grow.