Using Technology to Reach New Markets

Before starting off in pursuit of new markets, it is important to be clear about your objectives. Often the reason for wanting to enter new markets is to help your company grow and/or improve profitability. Moving into new markets may require investment for new tooling, packaging, advertising maybe even different paths to market. It is necessary to realize that it may require these start-up costs in order to capture that new market. This is dependent to a large degree on how close this new market is to the existing markets that you currently serve.

On this last point, one example could be if you have a retail art supplies store. A logical expansion might be regular painting lessons taught by a professional as a way to grow your clientele. Or, to expand along another dimension, classes on how to use digital art tools to make fantasy art or videos. Other groups could be mother/daughter classes, corporate team building, or seniors classes. Any of these could be a group that might have an interest in painting as part of a group activity.

Once you have a few ideas gathered together, you will need to put together your offer. It’s probably best to test the market with a specific group first. Hopefully you have been collecting email addresses so you can send out an invitation for a specific date and to describe how the class will be run. You can also test pricing to learn where the sweet spot is. If your standard price for a one hour class is $30, you might offer a first time discount of $25 to a portion of the class. Or you could offer “materials provided” free for the first lesson, but $5 for subsequent lessons. You also would want to talk to the students after the class about their price sensitivity. Maybe your customers would gladly pay $100 for five lessons. What you’re aiming for is a price model that meets your profitability targets, taking into account your expenses. This could be summarized in a simple table as shown in the example below.

This simple assessment points toward $25 a lesson as the pricing to maximize the profit, provided you can keep the class full with every lesson. You might be able to achieve that by offering something as an incentive to sign up for multiple lessons. For example, a set consisting of a few brushes if they sign up for five lessons.

This is a fairly simple example, but not unrealistic. Regardless of what your business is, you can follow this step-by-step process as a way to expand your offering, add more value for your community and create other revenue sources for your business.

Now, not everybody is comfortable with brainstorming. What to do in that case?  Imagine you have a small body shop and you want to start selling your service to some adjacent market, but nothing comes to mind. Here are some places you can look to help in stimulating your thoughts.

Explodingtopics.com, search by the keyword “travel”. Searching this subject I ran across ceramic coatings used as a polymer topcoat that adds extra protection to a car’s body paint.

Trends.google.com search under “paintless dent repair” Shows a map of the US where this is a popular regional topic.

Chat GPT Use the power of AI to help with your brainstorming. Prompt: "What adjacent services can a car body shop offer to grow revenue in a suburban market?" came up with the following list: Paintless dent repair, Auto detailing and Ceramic coating, Mobile scratch and touch-Up, Fleet and commercial contracts, Vehicle customization and restyling, and EV-specific body services.

So even if you need a little help imagining growth directions for your business the available resources of the internet just might have the next big thing for your business. And now you have a template of how to get there.