In the super-competitive international business environment of 2024, increasing your speed to market is more critical than ever. Here we look at the benefits of speeding up your product or service launch, with a special focus on international expansion.
What Is Speed to Market?
Speed to market is the rate at which a company can develop, produce, and deliver a new product or service to the marketplace. This concept encompasses the time taken from the initial idea inception to its availability for consumers. Increasing speed to market means being faster at every stage of development.
The benefits of accelerated time to market/speed to market are not just anecdotal: In a 2005 study of 652 New Product Development (NPD) projects, it was confirmed that a faster time to market was strongly correlated with project success — especially where development was occurring under conditions of uncertainty. A fact which is backed up by the common “fail fast” startup mantra.
Decreasing time to market is something that can be applied to every stage of the product or service development lifecycle, from idea inception, to market analysis, to product development, launch and product scaling.
Video: Amazon Web Services on Speed to Market
What Are the Benefits of Accelerating your Speed to Market?
1. Enhanced Market Share
When you improve your speed to market, you may be able to get that crucial first-mover advantage: This means you can establish strong brand recognition and loyalty before competitors enter the field. This advantage can lead to higher market share and can be difficult for competitors to overcome.
In some cases, by being first to market (particularly in a new location), your company may be able to ‘set the industry standard’ that all other products must meet. On a regulatory level, this could mean stopping some of your competitors before they get established.
More generally, being able to adapt more quickly means being able to better respond to market changes, customer needs, and technological advancements. This agility means you can stay ahead of trends and respond to challenges more effectively than slower competitors.
2. Revenue Acceleration
Being faster to market allows companies to generate revenue from new products or services sooner. This early cash flow can be reinvested in further innovation or used to capture additional market share.
More specifically, being first to market may allow for premium pricing, especially if the product is innovative and meets previously unaddressed customer needs. This can lead to higher profit margins.
3. Cost Minimization
Rapidly capturing market share can lead to economies of scale, where the average cost per unit decreases as production volume increases. This makes you more competitive by allowing you to offer lower prices or enjoy higher margins.
Speed to market can also mean more efficient use of resources. Companies that can quickly develop and launch products may spend less on prolonged development and marketing campaigns, reducing overall costs.
4. Risk Mitigation
Accelerating time to market can mean better risk management. Moving quickly, companies can reduce the window of time during which their ideas are vulnerable to being copied by competitors. This rapid closure from concept to launch helps safeguard intellectual property and first-mover advantage.
Quick to market strategies can also help reduce the uncertainty associated with new product launches. By entering the market swiftly, companies can quickly gauge product viability and market interest, allowing for swift adjustments to minimize losses.
5. Utilize Tech Solutions
Even in 2024, there are far too many businesses slowing their entry-time to market by doing things manually. For example, to hire employees in a new location you might use international HR software to speed up onboarding. Or, to use the example of a specific industry, an international brewery might quickly use brewery management software to quickly introduce new beer styles or optimize production.
6. Enhanced Brand Image and Reputation
By bringing products more quickly to market you can be perceived as the leaders in innovation. This perception can enhance the brand image, attracting customers and talent who want to be associated with a forward-thinking and dynamic organization.
Furthermore, rapid response to market needs and customer feedback with new or improved products can increase customer satisfaction and loyalty. Customers who feel their needs are being promptly addressed are more likely to remain loyal to the brand.
Tips for Improving Speed to Market
1. Carry Out a Thorough Market Analysis
To improve your speed to market, it is crucial to have a data-informed understanding of your market. This includes:
- Data Collection. Gathering quantitative and qualitative data on market size, growth trends, and consumer preferences.
- Taking stock of the competition. Assessing the strengths and weaknesses of existing market players.
2. Allocate Resources Efficiently
Improving your speed to market means allocating resources where they need to be to get your products and services out there.
For any specific product or service launch you will need to consider which distribution of resources makes sense — there is no one-size-fits-all solution.
For example, if your product is innovative, you will inevitably need to sink more resources into product development. By contrast, if you are entering a crowded market, a large marketing spend will be crucial.
3. Conduct a Risk Analysis
Risk management is vital for anticipating and mitigating potential deployment impediments.
You need to determine potential threats that could affect market entry and develop mitigation strategies to limit the adverse effects of those risks.
Possible risks with respective mitigation strategies include:
| Risk Type | Mitigation Strategy |
|---|---|
| Political Instability | Diversifying market entry points |
| Supply Chain Disruption | Crafting flexible supply agreements |
| Currency Fluctuation | Implementing financial hedges |
| Regulatory Changes | Engaging local legal experts |
Regular risk audits and updates to mitigation strategies are essential to account for changing market dynamics.
4. Improve your Operational Agility
Operational agility means implementing flexible production processes and adaptable supply chains can more efficiently meet the varying demands of different geographical markets. For instance, utilizing cloud-based systems for data management enables real-time decision-making across different regions.
Relatedly, having multi-skilled staff who can be rapidly deployed to different functions is an important part of responding rapidly to a scenario.
The only sustainable advantage you can have over others is agility, that’s it. Because nothing else is sustainable, everything else you create, somebody else will replicate.
5. Create Local Partnerships
Creating local partnerships accelerates market entry into overseas markets and reduces risks associated with unfamiliarity. Partnering with local firms can provide key insights into local consumer behavior, legal requirements, and potential barriers to entry. A multi-national corporation could, for example, collaborate with local distributors to streamline logistics and enhance market reach. For a good example of this, see our case study showing how one wine distributor in China benefited from local partnerships.
Another option is to engage with a global expansion partner with a local entity in the country of expansion.
6. Measure and Adapt
Measuring performance and adapting strategies are crucial for ensuring the success of global expansion efforts. Companies must establish clear metrics and continuously refine their approaches to maintain competitiveness in new markets.
For sustained success, businesses must commit to iterative learning and improvement. This focuses on:
- Assessing outcomes against the initial goals using established KPIs.
- Soliciting customer feedback to understand market reception.
- Implementing A/B testing to optimize market strategies.
Organizations should consider establishing a cross-functional team responsible for reviewing metrics, collecting data, and recommending course adjustments to strategies by doing it manually or by solutions such as Microsoft Power BI Services. Regular review meetings ensure that everyone is aligned and can respond to market changes promptly.
Improve speed to market business expansion experts
As market-leading international business and hiring consultants, we have supported 1000s of businesses to speed up their entry into new international markets. Whether in China, India, Sweden, Australia, or 180+ countries and regions, Horizons has a team on the ground to support a fast market expansion.
Get in touch to learn more about how Horizons can support you in becoming leaders in your industry.
