Differentiation at market entry – what is enough?

Welcome! In this Takehill blog post we will discuss:

    - About the challenge in entering the US B2B market
    - About the importance of differentiation, what is enough: 10% vs. 10x ?

With all positive notes about the US market size and opportunity, nobody should claim that entering the USA is easy. By applying the right methodology, it can be affordable, predictable, and the risk of failure may be lower than in many other markets - but no, it’s never easy.

The other side of the coin is that many US industrial tech sectors are more conservative (or “very pragmatic”) than what we find in Europe, and while the opportunity for scale is there, the adoption of any new technology can be tricky. This means, for example, that if an American business owner already has a “good enough” solution for his problem, then why bother to look for something new? “If it ain't broke, don't fix it” – thinking is often more extreme in the United States, where business volumes and risks are higher than in other smaller markets. Therefore, to be successful in selling a new technology solution to a factory manager in the USA, it is imperative to be able to verbalize, and quantify: how exactly are you eliminating a significant pain, or enable a significant gain?

But let’s assume that you have a compelling and clear value proposition in your country. Then the question becomes: how does your solution compare with other alternatives on the US market?

First, all else being equal, from any U.S. B2B buyer's view point, the fact that your headquarters is behind a 5-10-hour time difference is considered as an additional risk. Even if your country of origin is ranked high in producing innovative high-quality high-tech products, for any practical market entry purposes “made in Germany” or “made in Finland” is not going to give you any advantage. You can be sure that if there is a “good enough” solution in New York, sold by Bob and Jane from their Acme-USA, Inc., then that will be the source for the winning product. To overcome this challenge, the only way is to find such a compelling and unique differentiation that it really moves the needle for the customer.

When you are coming from a foreign business culture and a faraway country, your story about your differentiation as “easier to use” or 10% faster, will not win the business of U.S. enterprise buyers. The differentiation that you claim, with validated performance and competitive advantage, should be significant enough to outweigh the risk that you are an unknown new entrant among existing domestic U.S. suppliers.

Takehill guidance: focus on creating a marketing story that does not just explain your technology details, but instead makes you a far better choice, with advantages and benefits that are closer to 10x than 10%.  

There, hope you find this  all helpful.  Your comments will be very much appreciated. 
Until the next time!
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