Anticipating market entry barriers and addressing them in your go-to-market planning reduces risk, minimizes slow-downs, and trims costs. Effective B2B market research can give you the foresight you need to do just that. Here are the most common market barriers to entry and how to use research to get past them:
Types of Barriers to Entry
Economies of Scale
When an existing competitor dominates a market with vast market share, they often enjoy economies of scale and an inherent cost advantage. Use competitive intelligence research to examine these dynamics in detail so that your go-to-market plan can address solutions.
The same competitive research can uncover product features already in the market concentration you’re entering — and give you intel on their strengths and weaknesses. Pair it with customer research to uncover unmet needs and opportunities. Based on these insights, you will be able to position your product as unique and compelling, and gain a competitive advantage.
For new entrants, customer research and competitive research will give you insights into the challenges you face so that you can start attaching dollar figures to the market entry strategy you will need to deploy in your launch. You can use this knowledge to establish budgets and capital requirements to ensure that you have enough money to successfully enter the desired market and start gaining market share.
What will it take for a customer to give up their current solution and adopt yours? Understanding switching costs is vital to the selling process and proposition. Customers typically won’t volunteer this information during the buying journey, which is why conducting research into this market entry barrier (like asking market-sizing questions) is so vital for new entrants.
Access to Distribution Channels
You will want to research how your potential customers want to buy and access what you sell. Is your prospective product or service typically bundled with others? Is there a limited reseller network that can’t take a competitive product? Will you have to pay a slotting allowance to gain access to distributors? HR market research can uncover these details in the buying journey.
Interviewing regulators and policy makers is less common for a new entrant, but can be invaluable in regulated industrial markets and markets with active policy changes in process. Identifying policymakers is generally straightforward, but it takes sleuthing to find bureaucrats and specialists in specific niche policy areas.
How to Overcome Market Entry Barriers
As a potential entrant, you can only resolve the issues you are aware of and fully understand. Winning in the new market at launch and over time requires you have your finger on the pulse of the market concentration and anything that can get in your way.
Knowing your market and barriers to market entry better than your competition is a competitive advantage that is invaluable. Yet, it is not uncommon to encounter strategic barriers to gathering insights into the entry barrier. That’s where decision-quality B2B research comes in: it finds you the exact right people who have the knowledge you need.
That is where NewtonX Custom Recruiting and B2B market research services can help. If you are looking for ways to find people with specific knowledge into potential market barriers to entry, please contact us.