A review of key considerations businesses working in IoT must consider when planning for global expansion.
In our increasingly interconnected world, the Internet of Things (IoT) has emerged as a transformative force, revolutionizing industries and enabling unprecedented levels of connectivity and automation.
Statistica data shows the IoT market was valued at around $251.6 billion in 2022 and is expected to rise to more than $621 billion U.S. dollars in 2030, tripling its value in ten years. For companies focused on the IoT, this means huge business opportunities ahead.
Businesses are capitalizing on the IoT wave of innovation, harnessing the power of intelligent devices and data to drive efficiency, improve decision-making, and unlock new revenue streams. As these companies expand their operations, venturing into new markets around the globe, they face a unique set of challenges and opportunities.
Global expansion offers businesses leveraging IoT the potential for exponential growth, enhanced market reach, and a broader customer base. However, it also demands careful planning, strategic foresight, and an understanding of the complexities involved in navigating international markets. In this article, we delve into some of the key considerations businesses working in IoT must consider when planning for global expansion.
1. IoT market research and localization
Thorough market research serves as the foundation for successful international expansion. It involves a comprehensive analysis of target markets to gain valuable insights into customer behavior, preferences, cultural nuances, and competitive landscapes. Each market has its unique characteristics, and customer preferences can vary significantly across regions, so it is critical for companies in the IoT space to conduct market research to determine an accurate target market.
Cultural differences impact consumer behavior and decision-making. Businesses leveraging IoT must consider cultural nuances, values, traditions, and social norms when developing marketing campaigns and product positioning. For example, in France, appearance is of the utmost importance, and dressing down for work on Fridays is not as prevalent as it is in the U.S. In Japan, bowing is a typical way of greeting each other. It’s important to be mindful of cultural variations and business etiquette when doing business outside of your domestic market.
Localization goes beyond language translation. It involves adapting user interfaces, design elements, and user experiences to align with the preferences and expectations of the local market. Suppose a company in the IoT space specializes in smart home automation systems and decides to enter the EU; it would need to have a strong understanding of European consumer behavior, purchasing power, and market trends in order for the product to be well received. For instance, Europeans put a greater emphasis on sustainability than Americans—according to a 2022 report by Forrester, over half of Europe-7 online adults agree that it’s worth paying more for sustainable or environmentally friendly products.
Successful market research and localization lay the groundwork for businesses leveraging IoT to establish a strong presence and thrive in diverse global markets.
2. Customer acquisition strategies
Creating customer acquisition strategies is crucial for expanding globally. It involves identifying the target audience, developing a compelling value proposition, and resonating with the local market.
Digital marketing channels, such as SEO, social media marketing, and paid online advertising, are vital in reaching and engaging the target audience. Developing relevant content to serve different stages of the sales funnel can help direct potential customers to close a deal. The most popular content channels used by IoT-focused companies include blogs, newsletters, videos, case studies, in-person events, and webinars.
Continuous monitoring and optimization of customer acquisition strategies are essential to ensure effectiveness. Tracking key metrics like website traffic and conversion rates through software such as HubSpot or Marketo is helpful to IoT companies, particularly those with long and complex sales cycles. According to HubSpot, the company generates 320% more revenue with automated emails. By analyzing the data, businesses can refine their strategies and allocate resources to the most successful channels or campaigns.
Account-based marketing (ABM) is another valuable tactic for businesses leveraging IoT to expand globally. With ABM, businesses can personalize their marketing efforts to target specific key accounts, addressing their unique needs and pain points. It works by combining first-party data (website actions) with third-party data (intent) to dynamically create and target the right accounts. By delivering highly relevant communications and tailored content, IoT-focused businesses can capture the attention of decision-makers and build beneficial relationships.
3. Convey your value
When selling your product or service, it is important to create a compelling value proposition that highlights the advantages and solves a problem for your customers. Your value proposition is the reason why your customers should buy from you. It’s important to remember that your value proposition may differ in your overseas target market, so localization is key.
For instance, let’s consider Jiobit, a manufacturer of smart tags that enable tracking a child’s location regardless of distance. Their compelling value proposition could be:
“Jiobit: Always Connected, Always Safe.”
Experience peace of mind knowing that you can track your child’s location with ease. Our cutting-edge smart tags provide real-time, accurate tracking, allowing you to monitor your child’s safety no matter how far they roam. Stay connected and worry less with Jiobit.”
In this example, Jiobit focuses on the key benefits that resonate with its customers. They highlight the peace of mind parents can experience by easily tracking their child’s location. They emphasize real-time and accurate tracking capabilities, providing reassurance regarding child safety. By conveying these benefits, Jiobit creates a value proposition that addresses parents’ concerns about their child’s location and offers a solution that adds value to parents’ lives.
Focusing on the benefits that your IoT product or service brings, addressing customer needs, and effectively solving a problem will resonate with potential customers and motivate them to choose your offering.
Expanding globally presents immense growth opportunities for businesses leveraging IoT. However, success requires meticulous planning, an in-depth understanding of target markets, and the ability to navigate the complexities of global business environments. By considering key factors such as market research, localization, customer acquisition strategies, and conveying value, IoT businesses can pave the way for a successful global expansion, unlocking the true potential of their innovative solutions on a global scale.