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Key in your market entry strategy is some market research. Of course there are reports on market size and market growth, but often these are general. Specific knowledge on how your product is perceived and what your competitions is, is harder to get but more valuable.
Our local consultant can advise you on the best way to enter the market, based on market and competition research.
Spain is a vibrant and diverse market where you have good chances of introducing a new product. As of the latest data, Spain has a population of approximately 47 million people. According to the World Bank, Spain’s GDP per capita was about $30,370 in USD as of the last reporting year.
Most businesses have their headquarters in or around the capital Madrid, or in Barcelona, in the Northeast. For consumer goods, Mercadona, El Corte Inglés and Centros Comerciales Carrefour were the largest retailers in value terms in Spain in 2017. Within grocery store-based retailing the competitive environment is quite concentrated, with Mercadona having by far the largest share, followed by Centros Comerciales Carrefour and then Dia. For B2B distribution channels may be much longer, with many middle-man in place.
To find the right agent or distributor, it is important to have knowledge of the Spanish language, since many people don’t speak English. Knowledge of the local culture and business habits is also important.
The best preparation for doing business in any country is visiting it. This way you can experience the culture, check the shops and build your network.
Where it comes to hotels, research shows that if you check these platforms, in 80% of the cases you have the lowest room rates.
If you have a consumer product that you can’t sell directly from your home country to your end customer, you need at least one step in between. This can be a distributor (who also acts as wholesaler or importer), a big retailer directly, or it can be a large web shop. Let’s look at the pro’s and con’s of each option.
For a B2B product that is not a commodity or for customized solutions the story is different. Here sales needs to be done in alignment with the department that actually delivers the service or that determines the price case by case. Also then you have three different options.
As counts for any country: you first have to define the target group that you want to sell to. If these are businesses, then you can reach out directly through emails and targeted advertisements, e.g. on LinkedIn. If this arouses interest and gives a sufficient response rate, then you may have found an easy way to get the market’s attention.
If your target group is more diffuse, or is a consumer group, then you have to rely more on advertising such as on Facebook or Instagram.
With the tooling of our partner Instantly.ai you can define your target group, whether it’s 50 or 50.000 people. Send them a sequence of emails, directly in their inbox, for typically under 10 dollarcents per persoon.
First determine who are the end-users of your product or service. And where do they buy it now? The best way to determine the right entry strategy is to approach these parties. Would they consider your product or service as an alternative? Do they agree with the positioning that you have in mind? And what competitors are they buying from now? These data will help you determine the right strategy.
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