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Market Entry Strategy
Market Entry Strategy
Market Entry Strategy
Q2 2008
2
A sound market-entry strategy gives an operator greater control over
its market introduction and launch expectations, thereby ensuring
financial targets are met
Pressures faced by new entrants
A well-founded market-entry strategy minimises the uncertainties faced
by new entrants Internal constraints
Analysys Mason has developed a systematic approach to market-entry and expectations
strategies, allowing us to create well-supported and objective plans that Time constraints:
extract maximum value from internal assets and investment, and
ultimately increased competitiveness and secured revenue rapid deployment is crucial to avoid rise in market share cost and to
deliver predicted financial results
We have used this approach to:
decrease the financial uncertainty that derives from lack of Resource limitations:
comprehensive market analysis and a structured strategic plan core launch teams are often rapidly assembled, and specialist
enable business plan collaboration and financial planning expansion is done gradually, creating a large resource gap during
the implementation phase
initial business case assumptions need to be revisited to
better correspond with market conditions and chosen Financial pressure:
market position
as financial targets and expectations have been set prior to launch,
create launch efficiency by delivering a framework for any unpredicted market activity and launch delays will disturb initial
subsequent planning of tactical launch activities, coordinating customer take-up and revenue generation
and prioritising tasks for launch team
enable risk management and market perception control through
contingency planning External constraints
and expectations
Launch organisations face immense pressures on market entry, created
by internal and external expectations: Market data:
in many instances organisations lack in-depth understanding of
some of these pressures can be eased by developing a clear
market drivers or have limited access to market data
and structured market-entry strategy and effective functional
plans Competition:
competitors will plan pre-emptive, disruptive action to improve their
own positions and secure their customer base prior to new entry
3
Analysys Mason’s structured approach to developing an entry
strategy begins with a comprehensive analysis of the market, based
on market data or tailored research
Market analysis
Our approach to developing a market-entry strategy follows a proven and Macro- Internal
structured process, based on extensive industry experience and in-depth Market Competitive Regulatory
economic assets /
understanding of all aspects that feed into a commercial launch dynamics landscape environment
outlook Technology
A comprehensive analysis, using market data and tailored market research,
allows us to assess all areas affecting the operator’s strategic direction:
Internal SWOT Identified strategic risk areas
– market dynamics: detailed consumer and business market
segmentation and analysis of market drivers will be undertaken to
identify the most valuable target segments and underlying reasons for Summary and conclusions
market growth. Specific target areas are evaluated to provide key
inputs: retail structures, financial transactions systems and Internet
usage provide input to sales and distribution planning Market opportunity description
– competitive landscape: extensive competitive profiling in areas such
as positioning, brand, target segments, value proposition, market Market entry strategy
offer, pricing, customer care, sales & distribution, coverage, network
& support systems enable assessment of competitors’ strengths and Vision and Mission
weaknesses Objectives
– macro-economic outlook: analysis of relevant macroeconomic data Overall Strategy
determine market and segment growth Positioning
Value proposition
– legislation and regulatory framework: description of limitations or
possibilities within the current regulatory environment that affect Brand
market and segment growth Target segments
– internal assets/technology: analysis of all internal assets including Strategic directions
technology, brand, partnerships will be done to clarify which
sustainable competitive advantages the company holds Pricing Products and services
Brand and communication Customer service
An internal SWOT highlight areas of valid advantages and disadvantages,
Sales and distribution Launch phasing
providing input to market entry positioning and value proposition
Identification of strategic risk areas at an early stage enables preparation Tactical launch plan Contingency plan
of mitigating actions prior to market entry
Products & services
Conclusions from the market analysis together with internal SWOT and Pricing Internal and external
identified strategic risk areas form the basis for describing the market Brand and factors
opportunity communication
Sales & distribution
channels
Customer service
4
Analysys Mason’s overall market entry strategy statement and
market position clearly demonstrates which main directions are
necessary to reach market objectives
Market analysis
A description of the company’s vision and mission statements as well as
financial objectives form the starting point for the market entry strategy as they Macro- Internal
set the framework in which a new entrant will function Market Competitive Regulatory
economic assets /
dynamics landscape environment
Short-term objectives, sales targets, market share and brand awareness, will be outlook Technology
set against the market opportunity and supplied as input to the business planning
team
Internal SWOT Identified strategic risk areas
Analysys Mason will develop an overall market entry strategy statement,
clearly demonstrating which main directions are necessary to reach stated
objectives Summary and conclusions
The positioning statement visibly describes the company’s strategy in relation to
competition and the value proposition captures the company’s differentiating Market opportunity description
advantages and their benefits to potential customers
Market position
Organisational management
Launch support covers a range of activities that will enable the successful launch of the business in an aggressive timescale
Determining the exact role of different entities needs to be undertaken in an implementation planning phase that will balance the cost of external resources with the speed of
launch, based on intensive, short-term external team effort
8
Case study: Fourth entrant market entry strategy and detailed
launch plan
Business challenge
Our client had acquired a mobile license for Afghanistan, entering as the fourth operator in an extremely difficult market with regards to economic
and social structures, security issues, geographical accessibility and lack of reliable market information. Furthermore, our client did not have a
separate Programme Management Office (PMO) to oversee launch implementation, increasing the demand for a clear and structured market entry
strategy and subsequent tactical plans
Analysys Mason was hired to undertake development of a market entry strategy and detailed launch plan to steer the launch team and contracted
suppliers towards a successful market introduction. In parallel, Analysys Mason developed a long-term business plan and detailed operating model
/ budget
Approach
Conducted a comprehensive market analysis Q1 – Q6 objectives Market position
Developed a robust market entry strategy Residential
Subscribers (thousands)
Market share
Developed detailed tactical plans for each functional area
– Recommended segmented market offers for launch and post-launch, Price Quality
Segmented packages
Small
Analysys Mason produced a complete market entry strategy and detailed tactical P2
distributors
P1 P3 P4
launch plans, allowing our client to formulate a clear and differentiated market
position with aligned market offering, pricing, communication, customer service Tailor- made approach Points of
sale
and sales & distribution structure. This enabled complete stakeholder buy-in and Base
efficient launch plan execution Authorised
retailers
Residential
market
Business
market
One- size-fits- all
Unique product
9
Analysys Mason has assisted several new entrants worldwide in
developing their market entry strategies
Development of a mobile strategy (including North African alternative Analysys Mason developed a robust strategy for entering the mobile market by developing alternative
UMTS, CDMA 2000 and WiMAX fixed and mobile operator service propositions and marketing strategies and analysing different technology options (UMTS, CDMA
technologies) 2000 and WiMAX), roll-out approaches and handset strategies. Analysys Mason has also developed high
level financials for the various options in order to make a detailed recommendation. Our conclusions were
accepted by the Board and we were praised for our clear reasoning and innovative approach
Launch support Asian wireless operator Analysys Mason worked as part of a wider team to support the launch of a new mobile operator in a
developing Asian country. The task consisted of business planning, international connectivity assessment
and program management support
Assessment of a mobile entry strategy North African fixed operator Analysys Mason provided insight into successful market entry strategies employed by late mobile entrants
offering limited mobility services and examined markets and operator performances where spectrum obtained initially or permanently
constrained to offer limited mobility services
Development of a mobile business strategy Western European fixed Analysys Mason worked as part of a wider team which included the client's senior bid team, a technology
for a new entrant operator vendor and other parties. The client recognised that coming late into the market as a 3G operator, and
being one of numerous infrastructure-based operators in that country required an innovative approach to
the market. Analysys Mason produced a credible bid, financial model as well as a solid mobile business
strategy taking into account 3G technology, network planning, local planning and network build issues, the
local mobile market, product propositions and channels to market
Development of a strategy for the smaller Investment bank Analysys Mason carried out a comprehensive market and technical due diligence, covering all elements of
mobile operator in a market of four operators the core business of the operator, including operations, technology, sales and marketing, information
as part of an acquisition process technology systems and human resources. Analysys Mason developed a growth strategy for the acquisition
target, using the outputs of its due diligence, as well as those from the financial and legal ones. On this
basis, Analysys Mason built a business plan and subsequently contributed to the preparation of the bid
book