How to Succeed as a Newcomer in a Mature Market

Opening a business in a new market or launching a new product is fraught with risks and challenges. Doing it when the market is already thick with mature, developed competitors is significantly harder. Yet, people do it every day — to varying degrees of success.

From opening the 30th cupcake shop in a city to introducing a B2B service provider in a 100-year-old industry, businesses need to know how to optimize opportunities without compromising identity and viability. And while it isn’t easy or guaranteed that you’ll succeed, there are a few best practices to follow if you want to succeed as a newcomer in a mature market.

Keep it simple
Big companies have extensive feature sets and product offerings. If successful, newcomers ultimately become big companies and end up with the same array. However, in the beginning it is best to keep it simple — even if the pressure to add new features and products is on in full force.

Instead of spreading capabilities and features too thin by trying to compete on all levels, newcomers need to hone their specific offering and focus on making it the very best laser-focused niche available. Yes, it means leaving some opportunity on the table for now — but by keeping it simple, newcomers can make sure they make inroads in the new market with a superior single product.

Go Big or Go Home
On that note, newcomers won’t succeed in a new market if they don’t bring a big, game changing service or product. Simply showing up in a mature market with another version of the “same old thing” isn’t going to succeed — you have to bring a game changer. Understand the feature set completely — and be prepared to “be everywhere”. While restrictive budgets, if that is the case, may limit the reach of newcomers, focusing on the specific areas where the product or service will be most well received is the best route.

Perhaps the most predisposed target market is early adopters, or small businesses, or mothers — whichever it is, work to be as “everywhere” as possible. This may mean offering free product trials, opening pop up stores in many places, or canvassing a specific neighborhood. In online businesses, this may mean blogger outreach, contextual display ad targeting or a social media blitz.

To get “everywhere”, you’ll need to make as many connections as possible, as quickly as possible. This means outreach to journalists and bloggers, integrated products and vendors, and any brand ambassadors you can think of. Offer co-marketing opportunities if you have any, consider paid opportunities where appropriate, and consider every opportunity, big or small. It may seem tempting to only go after the big blogs if you have limited time or means of outreach, but the smaller blogs may have the niche reach you want and be more open to talking up your company.

If your industry has any relevant verticals, corporate social responsibility initiative options or any other organic relationships, make sure to reach out to every opportunity. Non-profit organizations can be a great way to get your brand extra exposure — and as long as you can swing the responsibility, it may offer you opportunities to make strong connections in the community.

Be realistic about your reach — if you are a small company, going after the biggest charity in the city won’t help — their sponsors are likely much larger corporations that pay large sums to be sponsors. Instead, team up with a similarly sized non-profit, which would be grateful for any support at all, and work to grow together. Not only is it simply a good thing to do, it gives you ample opportunity for PR coverage and extends your brand image.

For your industry partners and integrated verticals, consider teaming up to sponsor events, co-brand where appropriate and leverage your extended networks. Your individual product or service may not get enough traction in the press to satisfy your needs but teaming up with a couple of partners may create a story big enough to catch the attention of more prominent writers and publications.

Compete where you can
Unless you’re a monolith corporation simply entering a new area, you likely won’t be able to compete with the mature companies on every platform. Maybe you can compete on price because your overhead is less or your profit margins are smaller (or you’re willing to make them smaller to get attention for now). Or maybe you can’t compete on price but your quality is ten times better. Or perhaps you have the customer service model to beat all competitors — whichever it is, pay careful attention to where you can compete and continue to push it every day. If you’re not sure where you’re most competitive, consider going after service — there can be considerable opportunities for newcomers to compete on service.

Service, Service, Service
As a newcomer, you can usually find a lot of opportunities to “out serve” your competitors. Often, market leaders get lazy in customer service areas — they forget to take care of their best customers, presenting a major Achilles heel for their company — and a tremendous opportunity for newcomers. Chip away at competitors’ core customer bases by providing top-notch customer service — service their customers aren’t getting from their current provider.

If you’re in a B2C market, you can probably do a lot of research on where you competitors are falling short in customer service simply by visiting review sites and social media platforms. Check Yelp and Angie’s List to hear what customers are complaining about — and then make sure you do (and promote!) the opposite. Do they have long wait times or rude customer service representatives?

Make sure you have the opposite — and put it in your messaging. It may seem like an obvious fix — but few large, mature companies take the opportunity to implement better customer service from their customers’ feedback. Their laziness is a newcomer’s best chance to steal some of the market share. Even large companies that pay special attention to feedback have a difficult time executing quick adjustments — their size makes it impossible to pivot quickly and stay agile. Newcomers don’t have this problem and can maximize these opportunities for very little extra effort or cost.

If you’re in a B2B market, you might see some of the same responses in review sites or social platforms, but consider simply listening to your industry contacts. The right conversation can open up similar dialogue and present opportunities. Have your targets only ever dealt with one supplier?

History can cement B2B relationships until a new company can prove it offers benefits large enough to inspire a company shift. That may mean providing quicker service, being reachable 24/7 or competing on price and features — pain points you can discover through simply asking your prospects about their current relationships. Not surprisingly, it isn’t difficult to get complaints aired if there are any.

Once armed with all of this information, launching a new product or service in a mature market is still a daunting task — and the most important thing is simply to just keep working on in day after day. The amount of effort you put into it will end up directly proportional to the success you get out of it — as long as you’re realistic about your goals and able to pivot as the market responds.