In the first two posts of this series we talked about three of the biggest growth challenges faced by emerging brands and how to use customer analytics to help you know exactly where to open your next location in your existing markets. And that brings us to the next piece of the expansion equation – how do you know which market to enter next?
The principles behind successfully entering a new market are actually incredibly similar to what we discussed earlier regarding where to open your next location in an existing market.
By using big data and analytics to define your core customer, you’re able to understand the likes and behaviors of your best customers and then use those insights to help you define what the opportunities are in new markets.
It’s going back to the idea that it’s not location, location, location, but instead it’s customer, customer, customer.
Profiling the behavior of your best customers allows you to map other households that look like those individuals in other markets.
Then by identifying high density clusters of your best customers in a particular market, you will understand which market presents the biggest opportunity and how many additional locations you can open within that market that will meet your success criteria. That knowledge will allow you to prioritize where to plant your flag next and be proactive in your decision making.
By prioritizing your next market and next location based on customer potential and customer demand, you’ll also be able to forecast what the revenue runway is for a location you have your eye on in the new market.
The Bottom Line
Finding the best markets to expand into next comes down to knowing how your best customers behave, not just where they live.
If you can define who your target customers are from a behavioral or data standpoint, you better the odds of overcoming the three core challenges that we discussed in the first post of this series – investing the limited dollars available, proactively scaling your brand, and increasing cash flow so you can find the best real estate and truly out-maneuver the competition.
If you’re having trouble deciding where to plant your brand’s flag next, let’s talk about how Buxton’s Emerging Concept Solution can help you make that decision with confidence.