Das Secure Access Service Edge (SASE)-Rahmenwerk wurde von Gartner aufbauend auf den neuen Anforderungen an den modernen Geschäftsalltag entwickelt. Im Zeitalter des „Work from Anywhere“ gilt es, User, Geräte und Anwendungen sicher miteinander zu verbinden – ohne dabei auf das klassische Netzwerk zurückzugreifen. Die Sicherheit muss dazu aus dem Netzwerk ans Edge und damit zum einzelnen Mitarbeiter hin verlagert werden. Die Zscaler Zero Trust Exchange hilft dabei.
Heute werden Anwendungen neben Rechenzentren zunehmend in Multicloud-Umgebungen vorgehalten und die Anwender arbeiten in hybriden Arbeitsplatzmodellen. Der Büroschreibtisch wechselt sich dabei mit dem Home Office oder shared Office-Umgebungen ab. Da Anwender und viele Anwendungen das Netzwerk verlassen haben greift die herkömmliche Sicherheit am Unternehmensperimeter nicht mehr.
Die Gartner-Analysten stellen mit ihrem SASE-Konzept den traditionellen Ansatz auf den Kopf. Das Rahmenwerk geht davon aus, dass nicht mehr das Netzwerk in den Mittelpunkt der Sicherheitsbestrebungen gestellt werden muss, sondern die Absicherung des Datenverkehrs zum Anwender. Der Kerngedanke lautet, dass Sicherheit für das Zeitalter des „Working from Anywhere“ ebenfalls über die Cloud bereitgestellt werden sollte. So kann der Datenverkehr während des gesamten Weges vom User zu seiner Applikation geschützt werden, ohne dass der Standort des Anwenders oder der Applikation eine Rolle spielt. Der herkömmliche, netzwerkbasierte Sicherheitsansatz wird durch ein Anwender-zentriertes Modell abgelöst.
Ausschlaggebend beim Secure Access Service Edge-Rahmenwerk ist das „Edge“. Dieser Begriff dient nicht dazu, den Standort des Users zu beschreiben, sondern worauf er zugreifen möchte, denn. die Applikationen können bei unterschiedlichen Cloud-Providern liegen. Trotz der damit einhergehenden Komplexität von Mulicloud-Infrastrukturen hat der Anwender die Erwartungshaltung, mit der größtmöglichen User-Experience auf seine benötigten Anwendungen zugreifen zu können. Im Idealfall bemerkt er gar nicht mehr, wo die Applikationen vorgehalten werden, wenn der Zugriff reibungslos stattfindet.
Das SASE-Rahmenwerk bezieht für die direkt Anbindung ans Internet von jeder Niederlassung deshalb weitere Komponenten für die Konnektivität, wie z.B SD-WAN-Lösungen, mit ein. Direktes Ausbrechen von jedem Unternehmens- oder sogar Mitarbeiterstandort spart Umwege und profitiert wiederum von einem Cloud-basierten Sicherheitskonzept. Um niedrige Latenzzeiten zu gewährleisten und den Anwender auf dem direkten Weg mit seiner Anwendung zu verbinden können außerdem Peering-Points zwischen Cloud-Anbietern und Cloud Service Providern beitragen.
Damit nun die Sicherheit bei einem solchen Rahmenwerk gewährleistet wird, kommt Zero Trust ins Spiel. Zero Trust Network Access (ZTNA) bietet den sicheren Zugriff für autorisierte Anwender auf ihre Applikationen, ohne die Infrastruktur des Netzwerks zu exponieren. Ein Zero Trust-basiertes Modell agiert auf Basis der User-Identität und ermöglicht granulare Segmentierung, wer auf welche Anwendungen Zugriff erhält. Dies bedeutet das Ende von geteilten Netzwerkressourcen, da jeder Zugriff auf Applikationsebene vor der Freigabe validiert wird. Dem User werden nur die Anwendungen freigegeben, die er für seine Arbeit benötigt und für deren Zugriff er berechtigt ist. Dadurch hat der Anwender nie Einblick in die gesamte Applikationslandschaft im Netzwerk und kann sich auch nicht mit Services verbinden, für die er keine Befugnis hat.
Dadurch werden solche Risiken ausgeschaltet, die Unternehmen derzeit über all die Schwachstellen in der Netzwerkinfrastruktur angreifbar machen. Wenn die Infrastruktur nicht mehr offen im Internet dargelegt wird, besteht keine Angriffsfläche für Hacker. So eliminieren Unternehmen die Möglichkeit, ihre Infrastruktur im Internet zu exponieren und nehmen Angreifern die Möglichkeit, sich ins Netzwerk zu hacken.
Die Migration der geschäftskritischen Systeme in die Cloud erzwingt ein Umdenken, wie Mitarbeiter auf die Services zugreifen können. Angesichts der Allgegenwart günstiger Internetverbindung ändert sich die Erwartungshaltung der Mitarbeiter an die Zugriffsgeschwindigkeit und auch an den Komfort des grenzenlosen Zugangs zu Anwendungen. Die größte Umstellung für die IT-Sicherheit ist die durch die Transformation einhergehende Umstellung von der Kontrollinstanz hin zur Risikominimierung. In der Cloud-basierten Welt muss anstelle der separat betrachteten Netzwerke und Sicherheit ein übergreifendes Gefüge aus Netzwerk, Sicherheit und Connectivity treten, das den einfachen, reibungslosen und komfortablen Zugriff auf Anwendungen ermöglicht, unabhängig davon, wo diese vorgehalten werden. Denn dem Anwender ist nicht vermittelbar, dass die Zugriffsgeschwindigkeit durch die Cloud leidet.
Die Zscaler Zero Trust Exchange basiert auf dem SASE-Modell und hilft bei der Bewältigung der Herausforderungen des New-Work-Modells und der sich wandelnden Arbeitswelt. Neben einer schnelleren Bereitstellung und besseren Nutzung von Cloud-Diensten profitieren Unternehmen durch die hochintegrierte Security-Plattform von höherer IT-Sicherheit bei reduzierten Kosten, weniger Komplexität, geringerem Verwaltungsaufwand und zentraler Durchsetzung neuer Richtlinien auf allen Systemen. Die IT-Abteilung kann damit nicht nur ein sicheres und schnelles Anwendererlebnis anbieten, sie erhält über eine Cloud-Plattform auch wieder den Einblick in alle Datenströme zurück und kann damit das Internet als neues Unternehmensnetz kontrollieren, auch wenn die Mitarbeiter mobil arbeiten.
Pandora took the business world by storm this year as the renowned international jewelry retailer successfully drove digital transformation and innovation in the midst of COVID-19 and launched the much-talked-about Digital Hub.
To find out more about the Digital Hub and Pandora’s agile aspirations, Management Events interviewed Pandora’s CIO, Peter Cabello Holmberg, winner of CIO of the Year 2020, who shared the objectives of the ‘Hub’ and its importance in Pandora’s continued digital strategy.
The Digital Hub, also known as the Hub, opened its doors in Copenhagen in July 2020. But what exactly is the Digital Hub?
The Digital Hub is actually a place. It’s a physical location; a full floor in a building next to our global office, where we have room for some 200 headcounts. We initially called it ‘Global Office 2’, but as we wanted to create some hype around digital and our digital strategies, we decided on ‘Digital Hub’.
Also, we were running out of space in our global office, and we had pockets of digital talents – the IT, marketing, and e-commerce teams – sitting in different places globally. That wasn’t optimal so we wanted to consolidate our digital talents in Copenhagen.
We believe that having our digital talents in the same location would help our delivery speed, and our intention was to have a new layout of office space that could facilitate agile ways of working, where people can move around and sit in teams to exchange knowledge on a daily basis.
In the early phases, we discussed building it in New York or Amsterdam, but we decided to build it next to our global office in Copenhagen because there was a need for proximity with the rest of the senior executives there. We were super lucky that we could get the office space next to our global office.
How did the idea of the Hub come about?
We’ve been working with our thoughts and aspirations on digitizing across our value teams for a couple of years. And what we realized was that we had to orchestrate ourselves differently to deliver faster on our digital aspirations.
We’ve been relying on waterfall approaches, business cases, and other methods that were very slow for us to get things started and signed off, so we needed a different operating model and a different engine room.
It was that realization – for us to deliver on our digital aspirations, have more transactions on our online channels, and improve digital marketing, omnichannel, and in-store technology – that we felt the need to bring the technology, e-commerce, and marketing teams together and implement new, agile ways of working.
Projects like the Digital Hub are huge investments, and getting the stakeholders’ buy-in is always a challenge. How was the project presented for the executive buy-in?
I went to the CEO and the executive leadership teams a year and a half or 2 years ago and said that we needed to do an IT transformation. I said that I would save money for the company, build new career duties, and introduce agile working. And I got a sign-off on that.
The CEO bought into it because we – on top of the savings – also presented strong business cases for digitalization and data-driven consumer growth that were very attractive with significant incremental revenue.
AGILE WORKING AND CHANGE MANAGEMENT
After getting the sign off on introducing agile ways of working, how did you start its implementation?
We did a number of introduction sessions before we did anything else. We talked about what agile is, its meaning and principles, and the choice of methodology, and introduced the terminology. We also did a few proofs of concepts, small projects that we would normally put into an agile release train (ART), and applied agile ways of working, like scrum meetings.
Other than that, we had meticulous discussions about Spotify and SAFe, and supporting tools for agile ways of working. We initially made a decision to go with both models, which was a mess for us. Now we’re back to the principle of one model.
We made some decisions along the way that were just wrong. So when we went live, we went in knowing that we had to learn if the decisions and changes worked and asked everyone to give feedback so that we could adjust on areas that didn’t work.
Major organizational transformations can be difficult to execute smoothly. How did Pandora handle the change management?
This was a massive change management exercise, but we knew we had to shift our ways of working completely.
So we gave people a flavor of how this change would look. We started to talk about what an ART should be like and introduced new and different roles to both the business and organizations. We pieced it step by step, presenting increasingly more elements of agile working.
There was change management happening both bottom-up and top-down, but at some point, we came together and communicated to everyone involved that ‘This is how it’s going to look, and here are the members of the Arts’.
We communicated the incoming change to all parts of the organization with 50 to 70 lightning talks about agile working held for all the employees to participate. More than 1,200 people from the entire business signed up to learn about it.
Even when we went live with our first ART, we continued having lightning talks because more and more people wanted to know about it.”
We try to stay as open and transparent along the way so that everybody knows what was happening. It was a lot of communication on where we were, what was happening next, and what to expect.
HIRING AND TALENT MANAGEMENT
With all the transformation initiatives, what were the responses from the teams and employees?
The interesting thing is, as we implemented the agile ways of working, our churn rate of people in IT, marketing, and e-commerce leaving Pandora has gone down. Even though we did this massive transformation, the turnover rate has decreased.
From what I’ve seen and heard, people are actually quite excited to try agile working. They want to see how it works. Some have already tried it and are super happy with it. And those who have always worked in traditional waterfall approaches are keen to learn about agile ways of working because everyone’s talking about it.
With about 200 employees working on a collective digital strategy, how does the Hub ensure that decisions and responsibilities are delegated to the right people and teams?
We have a number of ARTs now, and the biggest and most mature one is our consumer ART.
Whatever the team does in this agile release train is tied to our business strategy, so there’s a link from the strategy to how we work with agile portfolio, lead portfolio management, and so on. So we can track from strategy to ARTs to APEX to features to use cases.
Since we have defined the ART with all the members and different roles, there’s full transparency on who’s responsible for what. Everyone knows what their role is in the whole process.
Furthermore, the tool that we use holds the overall description of the business strategy, and breaks down into the related ARTs and components, so that we’re constantly updated on the business timeline and deliveries. Hence, I would know exactly what’s going to be delivered and when. It’s pretty amazing.
It’s not news that Pandora has been actively hiring digital talents for the Hub. What talents are being seeked, and what hiring strategies are being used?
We’re hiring very different types of profiles into the Digital Hub from all over the world – Columbia, Argentina, the US, and Singapore. We want people who are creative, who have an opinion, who want to push things forward and make a difference. And because we also want to set them free with the business, we want them to be self-operating.
What we did with hiring was create hype around the Digital Hub. We had the CEO talk about the Hub when he was interviewed, and we sent out press releases and reached out to different media. We also talked to universities about what we were doing and trying to achieve and spread the word that we wanted to build a digital powerhouse in Pandora and be number 1 in our industry.
So we set the ambition level quite high, which is part of attracting talents while doing features and events and mobilizing all types of channels to spread the word.
What challenges did the Digital Hub encounter in terms of recruiting talents and managing the current workforce?
One of our bigger problems was that, when we got a ‘go’ for the Hub, it was the time when COVID-19 hit. So we had to hire these positions using Teams and Zoom since we couldn’t meet the candidates face-to-face.
We also had to go about the hiring processes in a different way because everybody was on lockdown globally, and we couldn’t fly them in and bring them to the Digital Hub. From Day One, they had to start from their home office. We sent PCs and laptops to them, and onboard them from their home and whichever country they were in.
Now that the Hub is completed, what initiatives is Pandora taking to ensure a functional communicative and collaborative culture?
The Hub initially was driven by the CDO, CIO, and our SVP for data analytics. Now that we have consolidated these functions under a CDTO then the Hub is anchored with the CDTO. We’re trying to create a community so that the Hub is seen as one team with one common purpose.
Now, the Digital Hub has its own dynamics, and there are social events, fireside chats, and town halls where people across different organizations can participate. We put these people together in one location, and what this has actually done is broken down the silos that we were experiencing previously.
We’ve been sitting on different floors, in different buildings, in different countries. Now that we have brought the teams together, they talk to each other every day – they literally sit next to each other – so it has broken down the silos between different functions. We’re much more aligned compared to before, and that is a huge improvement for us.
DATA AND DIGITALIZATION
In terms of technology and innovation, what challenges did you face with the Hub?
We didn’t have many challenges with our technologies and choice of technologies when we started the transformation.
We already had a roadmap on what to do with data. We had our online platform, our salesforce, e-commerce, and cloud. Our biggest challenges are with integrations, master data, and a scattered point of sales landscape. But overall, we are in fairly good shape.
What stage is the digital transformation of Pandora at the current moment? What other processes are underway to boost the brand’s digital experience?
What we have now is a pretty solid digital strategy that has been shaping up over the last 8 months or so.
We’re going all in on our user data for tips on marketing and personalization. We’re also considering communities for people who are interested in our type of jewelry, and planning to introduce a global loyalty program that will hopefully further drive brand loyalty.
The consumer ART is working with data, and working with the marketing team on digital marketing and personalization. In regards to data-driven consumer growth, we also set the teams free to use data to drive sales. By combining the different data sources that we have, such as our transactions and customer browsing data, the ART teams are free to make decisions on their own to allow faster decision-making.
What are the biggest differences between the company’s past and present data utilization?
It’s two different worlds before the Hub and after the Hub is live. The incremental revenue that is delivered from our data-driven consumer efforts is just outstanding.
We’ve built the integration between different sources in our stack, applied new technologies, and hired Ph.D.-titled profiles to work with data so that we can learn more about our consumers.
We didn’t have that data focus a year and a half ago. I think we had one person in Pandora working with data, but now we have 60+ people working only on advanced data analytics and the use of data.
SUCCESS AND THE FUTURE
What do you consider to be the key achievements of the Hub?
What’s interesting is that the agile way of working that we implemented has really proven its value when the pandemic hit.
Our stock prices have gone up some 100% during 2020 when COVID-19 hit, and that’s quite amazing. It’s actually all down to our technology readiness and the shifts from physical stores to taking advantage of our online channels and digital initiatives.
We were able to step back and look at our priorities and completely change our focus, and now the rest of the business – HR, finance, and other parts of our commercial organization – want to embrace agile working because they see its value. This is just the start and we want to do even more.
Additionally, we see that we can move much faster now. Because the teams are dedicated to the agile release trains (ARTs), they’ve become very efficient and knowledgeable about their role, purpose, and responsibilities. So we’re able to come up with solutions to business strategies at a faster rate.
There are always expected ROIs for major projects. What is the anticipated ROI in 2021 due to the Hub?
When we first started, my focus, and marketing’s focus, was on revenue-generating and return on investment. It was clear when we went to our CEO that what we proposed was very attractive and that data-driven consumer growth, meaning advanced data analytics alone, would pay for our Digital Hub. And we still have many other initiatives that we’re driving.
In some cases, in terms of ROI, we’re talking about a factor of 10 of the investment. Also, our stock prices have gone up significantly because we took advantage of our online channels and digital initiatives. I think that alone shows the impact of getting digital right.
What are the upcoming plans and strategies for the Digital Hub and Pandora?
We are in the middle of finalizing our digital strategy for the next 3 to 5 years. We never had a digital strategy before, but now we have it, and it sets the direction for our technology investments across our value chain – where we want to invest our bodies and resources.
Also, we’re focusing on how we can take agile working and our technology operating model to the next level. Yes, we started out with Agile but we’ve only been live for a year or so. Now, how do we bring this further? What do we need to invest in? What kind of profiles, like what agile coaches or release train engineers, do we need to bring on board to further mature our agile ways of working?
What commercial goals does Pandora seek to achieve in 2021? What role does the Hub play in achieving these goals?
Our key focus right now, and into the next 3 to 5 years, will be on revenue-generating initiatives. We want to drive even more revenue through our online channels.
Aside from that, we’re also focusing on creating an even more seamless customer journey across our different channels. We want to engage with our consumers in a more meaningful way – be more precise in what and when we communicate so that we become more relevant.
Of course, we do all of these to drive revenue, and the Digital Hub is instrumental for us to proceed with the plans.
As the world crosses into 2021, the distribution of the COVID-19 vaccine has brought surges in global stocks and market optimism.
However, even with great hopes of economic recovery by the end of 2021, organizations still need to ensure that their business growth and plans continue positively. Chief Information Officers (CIOs) are playing a big part in achieving these goals by maximizing information technology (IT) investments and advancements.
What IT Investments To Focus On?
According to our Executive Trend Survey, 67% of CIOs placed data science as a top priority for 2021 with core focuses on analytics strategy, data management, and big data analytics.
Meanwhile, cyber security and cloud were named as other top CIO priorities by 59% and 53% of surveyed leaders respectively.
But what does this mean for CIOs across the industries?
Based on feedback from CIOs and key IT executives, the majority (47%) of them are facing 2021 with slight changes in their goals and a lower budget for their function.
With limited budgets, CIOs need to pick and choose which goal takes priority over the others and select a solution that will truly give them the return on investment they seek.
Thus, even if CIO trends point towards analytics if their current end objectives don’t correspond with the need for data solutions, they should focus on more pressing investments.
Another key factor influencing their investment priorities lies in the current maturity levels of their technology and operations. For instance, some are still new in forming data strategies while others are more advanced in their data-driven processes, thus their focus areas in the use of data science differ greatly.
Investing In Data Science
Today, it’s uncommon to find any company that is not taking advantage of their data. From enhancing customer experience to improving predictive maintenance, business leaders are aware that data is critical to their organizational growth.
But which area of data analytics should your organization focus on? Between the different analytics applications and components, what should be the foremost priority?
In recent interviews with CIOs and other IT decision-makers, over 450 of them named analytics as their core focus. Even so, under the analytics umbrella, their interests ranged from big data analytics and predictive analytics to data warehousing and analytics strategy.
55% of them selected data management as their foremost investment in analytics, naming master data management (MDM) and product information management (PIM) implementation as some of their projects.
The MDM solution is largely adopted by the banking, financial services and insurance (BFSI) sector to manage massive amounts of transactional data on their customers. PIM, on the other hand, is seeing higher demand by the e-commerce industry and an anticipated fast growth in the media and entertainment sector.
In regards to data analytics strategy, some of the CIOs are investigating how they can make the business work more efficiently through analytics strategy while others are taking the next steps to improve data quality.
On the other hand, a number of the interviewed decision-makers are still setting up and realizing their data strategy, indicating that they’re still in the planning stages and concentrating on becoming a data-driven organization.
Investing in Cyber Security
Meanwhile, our most recent interviews with CIOs on cybersecurity investments discovered that cloud security is foremost on their priority list followed closely by cyber security strategy.
From our findings, a number of the interviewed decision-makers expressed interest in implementing security information and event management (SIEM) solutions.
Another hot spot in 2021 cyber security spending, according to Forbes, is identity and access management (IAM), which is a prime focus for 30% of business leaders investing in cyber security. Some of their projects regarding access and identity management include:
With uncertainties still forthcoming, some CIOs are worried about guaranteeing a high level of cyber security with a limited budget while facing challenges in approaching the topic of online security to a diversified and remote workforce.
Investing in Cloud
Based on CIO investment feedback from the interviews, most of them are still in the planning stage of their cloud strategy with cloud integration and migration as their core priorities.
Microsoft Azure, Amazon Web Services, and Google Cloud are three of the most popular cloud platforms in the market, and interviewed decision-makers are contemplating between the cloud computing services while some are even working with all three of the platforms.
Alternatively, a group of IT leaders and other key C-suites are working towards a hybrid cloud environment, which is commonly used in industries such as:
What is Your Focus Area?
As seen in our survey findings and interviews, each of the IT leaders is prioritizing a specific solution that best serves their target goals with consideration to their budget, their available expertise and IT talents, and current processes.
For some, the immediate focus is on surviving the consequences of the pandemic, “which has become the number one objective for most emerging technology investments”, according to KPMG’s research. For others, it’s an opportune time to shift to a more digital business model and accelerate their digital transformation.
Nevertheless, while benchmarking and taking note of emerging IT trends help your organization to measure business performance against other companies, the global situation and market uncertainty are still expected to significantly affect information technology investments.
The important thing is to have a solid focus on your strategic IT priorities, adopting agility and adaptability for business continuity, and making smart investments to prevail in the long term.
There comes a point for most businesses regardless of the industry, when they strive to expand beyond their home markets. Some are looking to attract different audiences by introducing new products, others are looking to reach new geographical frontiers.
While the ambition to grow is only natural, market penetration is becoming more and more challenging given the rise in competition, constantly changing customer behaviour and demand for better and faster services and products, and the rapid growth of technology forcing companies to be more innovative and disruptive in entering new markets. It is therefore important to understand and evaluate your company’s strengths and weaknesses, as well as determine key opportunities and risks in order to help you gain a broader sense of where you stand against your rivals and which market penetration strategy would be best for your business.
Analyze your company
It is best to start with self-reflection – take an objective look at your company and try to determine whether you are ready to expand, and what could be the areas you may want to strengthen. Here are some relevant questions that can help with the analysis:
Define your new target market through research
Should you sell to the same target group but in a different location?
Should you change the target group?
What is the demand for similar products and services in this new market?
Is there a need to glocalize your product?
Is there sufficient demand for your products and services in the new market?
Define your competitive advantage
How long has your business operated in the industry?
How long has your average competitor been in the industry?
Where can your product add more value than your competitor product?
In what aspects are your products or services weaker than those of your competitors?
How do your competitors price their products and services?
A detailed market research will give you solid background information to decide if market expansion to this specific location is the right decision at the moment.
Let’s assume you’ve done your due diligence, and you’re sure it’s time to expand.
Below you will find a few market penetration strategies to choose from, as well as pros and cons of each.
Gaining New Audiences With Penetration Pricing Strategy
As businesses continue to grow, there is greater competition to enter a new market. That being said, the penetration pricing strategy is one of the standard approaches adopted by companies to boost their initial sales.
Fundamentally, penetration pricing strategy is an act of reducing product and service prices as you enter a new market with the objective of attaining new customers quickly. The entry price is always relatively cheaper compared to the average market price. This gives customers the ability to try your product with less financial risk
This strategy focuses on gaining market share over profits until the business is perceived to have matured in the new market. The cycle is: start by generating demand, create customer base and eventually maximize brand loyalty over time. Many large businesses have used this tactic to revolutionize and become market leaders today.
For instance, Netflix, an online video streaming service originally started in the US, has successfully penetrated the markets of 190 countries since its first year of going international in 2010. Although it has multiple international expansion strategies, Netflix started in the new markets with a relatively low price with significant benefits considering subscribers have access to more tv shows and movies compared to renting videos. With an ever growing subscribers of 167.1 million across the world, they just recently announced a price increase in the monthly subscriptions as the company is deemed as matured despite multiple new players competing in the market, like Amazon Prime Video, Hulu, and Disney+.
Benefits
Easier customer acquisition
Entering the market with prices that are significantly lower than the competition will undoubtedly attract the attention of potential customers. You’d be able to achieve a large number of initial sales to start making the product or service profitable
Reduced Competition
Penetration pricing can help you compete against other market players at below-average market price until you gain brand recognition and customer loyalty. You’d be able to eventually increase your price again once your brand has matured in the market.
Risks
Price war
There is always a chance of starting a price war with your competitors if they decide to undercut you on pricing.
Damage to brand image
Penetration pricing has the possibility of impacting your brand reputation. The low price of a product can often be associated with lower quality, and with penetration pricing strategy you are risking to start off with positioning yourself as a cheaper brand in a new market.
Getting On The Inside With Strategic Partnerships
Entering strategic partnerships with other companies is another approach to take into account if you want to penetrate a new market effectively. You’d be able to grasp first-hand essential knowledge about the market in all aspects like cultural, social, business, language, and more. Few types of strategic international partnerships would be joint venture, acquisition, franchising.
Depending on the type, partnerships can go beyond sharing market knowledge and also include sharing branding efforts, resources, marketing, and distribution channels.
Kroger, an American retail company, is one of the companies that chose to expand by partnering with Alibaba, China’s e-commerce giant. Kroger brought their products to Alibaba’s platform aiming to meet the growing demand for high-quality organic food among Chinese consumers. Eventually, Kroger has managed to scale up quickly to reach new customers and markets. Shortly after this massive announcement of Alibaba partnership,shares of Kroger Co. were reported to spike by 2.8 percent.
Benefits
Speed up entry into a new market
You can easily reach customers and avoid initial challenges and hassle of establishing new business by getting into alliance with already existing companies that have their own pool of loyal customers in the market.
Organizational learning
Knowledge sharing is usually an essential part of strategic partnerships. Your company gets to know about your partner’s best practices and vice versa, so both businesses benefit from collaboration.
Risks
Conflicts
There is a risk of various conflicts that can arise between partnering businesses at different stages of their relationship. It could be conflicts based on cultural differences or conflicts of interest – in any case these should be considered at the stage of discussion of partnership terms and necessary precautionary measures should be put in place.
Loss of autonomy
Shared decision making and wider accountability with more partners and stakeholders need to be considered, as well as information sharing – with more people having access to your sensitive information, the risks of data leakage is increasing.
Getting Brand Exposure and Credibility Through B2B Events
Another strategy worth considering is to partner with a B2B event relevant to your product or service. This is a shortcut to introduce your business to a new market and to meet your target audience directly.
Businesses often sponsor events such as trade shows, exhibitions, networking events organized by associations or nonprofit organizations to attain specific business potential and increase their competitive advantage. Presenting your company and product or service at these events can help effectively introduce your brand to the new market and allow you to get a better understanding of your target audience’s needs and challenges.
Take a look at Benify, an HR tech company based in Sweden, that met one of their big clients, Lidl Sweden, at Management Events 600minutes Executive HRand after successfully completing a project in Sweden, has expanded into The Netherlands and is now looking at another contract with Lidl in the US. Benify had the opportunity to meet targeted prospects, like the HR Director of Lidl Sweden, through Management Events’ B2B networking platform in a series of matched 1-to-1 meetings. The meetings allowed them to gain a deeper understanding of their prospects’ challenges and at the same time to showcase how their solution can help. Such personalized networking and 1-to-1 communication can establish a stronger connection between the solution provider and their prospects potentially leading to years of fruitful collaboration
Benefits
Build awareness
Partnership with a B2B event could expose your business to a wider and more relevant audience and create a positive association with your brand. It is an additional benefit when event organizers provide exposure of the partner companies in their official website and across social media channels, giving you a wider digital outreach.
Meet the right people
Knowing your target market is the core of your marketing strategy, but once you’ve identified your “ideal prospects”, it can be a challenge to reach them. If you partner with a relevant industry event that is likely to attract your ideal clients, it can be a great opportunity to directly connect with your niche target audience.
Gain exclusive audience insights
Partnership also gives you audience insights that include, but are not limited to, insights during, pre-and post-events. For example, with an established event provider such as Management Events, the sponsors are provided with trend reports prior to the event with an outlook on the issues facing the attendees. This knowledge may be of benefit to your representative in order to customize solutions and determine the correct approach to the sales pitch.
Become a knowledge leader
Often, event partners have the opportunity to deliver a presentation during the event and share valuable insights about the latest technology solutions. Through a presentation like that, you can establish a stronger perception of your brand and company representatives and solution experts and knowledge leaders in the field.
Risks
Power of first impression
Trying to impress a potential client at a B2B networking event means you will have only one opportunity to make the right impression. Even if you have a 1-to-1 meeting scheduled with the prospect, there will be time constraints, which means you need to do your research and make sure you thoroughly prepare for the pitch. Luckily, some event organizers can help. For example, at Management Events we always provide an industry report to our partners that identifies investment priorities of our participants and helps both event partners and attendees to have a meaningful conversation.
No guaranteed returns
Of course, partnering with an event doesn’t guarantee you closing a big client right away. However, you will get great brand exposure, extensive networking opportunities within your target industry and high-quality leads that could potentially turn into strong connections and long-term business relationships. Particularly for a company that is not known in a new market, this could be a great first step to venture in.
