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How Do Market Entry Challenges Vary Between the UK and the US?

UK vs. US Market Entry

We recently had a chat with Joanna Dodd, market entry expert with UK-based Rochester PR Group about UK vs. US market entry challenges: which are common and which are different.

First we started with whether the huge differences in country size mean companies face different challenges.

Although the UK is small, Joanna warns against underestimating the size of the opportunity or the competitive marketplace that you are entering and therefore the complexity of getting it right. Clients often describe the UK as a great “test” of their brand with a “if it can succeed in the UK, it can succeed anywhere” mentality.

Sophie: "In the US, start small, learn, correct, repeat"

On the other hand what we often see at GCE is that because the population of the US is so large, many foreign companies think “all I need is to get 1% of the market”, and they assume that a tiny market share means minimal effort and investment. But that is not how it works, it’s not a linear correlation. The added complexity when thinking of the US market is that it cannot be approached as a single country; it is almost more like the European market in that each State in the US may have its own regulations, taxation, laws, and then also its own culture and business practices. One option to consider is to focus on just one local market, perhaps even smaller than a State. Start small, learn, correct, repeat.

Joanna: "it never seems to work exactly the same

as it does in the company's home territory"

On the subject of learning Joanna doesn’t think she has met a company who has not enjoyed trying to expand into the UK but a typical comment is that they lacked understanding in terms of the right route to market for a particular brand or service. One thing we can say with some surety is that it never seems to work exactly the same as it does in the company’s home territory and we hear of many who give up because they simply fail to make the right connections in time.

As for the US, there are many different strategies to enter the market but most clients only consider a couple of them and thereby miss out on some options that would be less costly, less risky, have a higher chance of success and be faster. For example, rather than first hiring a sales person it may be much more effective to enter an alliance with a company that is already in the market with a complementary product. With the partner’s existing client base and trusted sales force your sales can take off much faster.

We are overwhelmingly in agreement on one point

which is that companies should start the market entry “journey” earlier,

in other words, do more homework.

We both see so many companies under-prepared. And many who have simply not worked out their messaging for the new market. Joanna advises, and I fully agree, that there are loads of networking and event opportunities to hook into in both countries so try and work out before you land which ones are really going to deliver the right results otherwise you will fill your diary ("calendar" for US readers!) but not your pipeline.

In terms of the lack of a language barrier, the biggest misconception for companies coming to the US from the UK, Australia or even Canada, is that just because we have a common language and some shared history, the differences won’t be that big. In reality the culture and business practices are vastly different and it may be even more dangerous to make assumptions because the differences may not be immediately apparent.

In terms of US to UK, Joanna sees other elements of language and business behavior that trip people up in the UK. Apparent enthusiasm or politeness does not mean people are definitely going to do business with you. In the UK, we’re just very good at being polite!

When clients are asked what they would have done differently, both Joanna’s and our experience is that they wish they had tapped into local knowledge and experience more than they did as it could have saved them a lot of time and headaches!

If you are considering the US and/or UK markets and would like to hear more from us or from Joanna, get in touch and enquire when we will next be hosting a joint seminar in Europe or the US.

For lots more conversations about international trade, cross-border business, market entry and other fun topics, please join our LinkedIn Group.

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