The impact of economic uncertainty on a business can be huge: reduced customer spending, supply chain disruptions, and ultimately, the reduced ability to do business and be profitable.
However, mitigating the effects of economic uncertainty can be challenging for businesses, since the root causes (e.g. recessions, global crises, market shifts, tariffs) are usually outside a business’ control.
One effective strategy to secure your business during such times is through market diversification.
Let’s look at how and why this approach can work in practice.
Advantages of market diversification
By spreading your business across different markets, you are also spreading the risk, reducing the potential impact of an economic downturn in any one market.
Having multiple revenue streams from various markets also helps to provide revenue stability, since if one market experiences a downturn, others can compensate, ensuring a more consistent financial flow.
Doing business in different markets also means having access to an expanded customer base, with each new market opening up your business to a new cohort of customers.
New markets also bring with them opportunities for innovation and product adaptation.
And, of course, businesses that operate in multiple markets can gain a financial edge over competitors who remain focused on a single market.
How to choose new target markets
Expanding to just any new market will not do; the key is to choose the right new market, and this is where conducting thorough and comprehensive market research is key. Consider the following questions as part of your market research:
- Do local customers actually want or need a product/service like yours?
- Is your product/service a good fit with the local culture?
- What is the size of the market? Is the market expected to grow? Would it be profitable for you to enter?
- What is the competitive landscape like? Is there a gap in the market, or is the market already fully saturated? What sets you apart from local competitors?
- What is the regulatory environment like? Are there any local laws that would mean you cannot sell your product/service there, or would need to make adjustments?
- Are there any emerging shifts in customer behaviours or preferences that could impact the success of your business?
- Are there any risks you should be aware of, e.g. economic/political instability?
You will also need to assess your business capabilities. Consider everything you will need to do to actually deliver your product/service in the target market, and be honest about whether you have the capabilities to do this. Examine whether you have the logistics in place to scale to a new market. If you sell a physical product, for example, you will need to think about distribution networks and supply chains. You will also need to think about whether you have the resources to provide customer service support in the local time zone and language.
Do not scrimp on this step. Conducting thorough market research is essential to ensure you do not choose an unsuitable market – as that would be an incredibly costly mistake.
The secret to success when launching in a new market
Once you have chosen a new target market, what next? The secret to success is to adapt your strategy to the local market. You cannot simply copy your existing strategy into your new market and hope it will work, because the chances are, it will not.
Consider whether your product/service itself needs adapting. Adaptations may be necessary if local customers have different expectations, or if there are local laws or regulations that set out specific requirements.
When it comes to your marketing strategy, consider what online platforms your local customers actually spend their time on. If you have only ever done marketing in a single market, it can be easy to (wrongly) assume that the platforms customers use are the same everywhere – but the search engines, social networks and e-commerce platforms customers use can actually differ widely between markets.
If you are not sure where to start, the Webcertain search and social report 2025 can help. This report covers 57 countries and provides a top-level overview of the most popular search engines, social networks, e-commerce platforms and digital marketing best practices for each market. It is designed to empower businesses to make smarter, data-driven decisions when adapting their digital marketing strategies for local markets.
By being obsessive about adapting every element of your strategy to the local market, you will be setting yourself up for the best chance of success. Businesses that fail to succeed in new markets usually either fail to do proper market research (and therefore choose the wrong market) or fail to adapt their marketing strategies correctly.
Are you ready to explore international markets?
Market diversification is a key strategy to secure your business during times of economic uncertainty, allowing you to reduce risk, stabilise revenue streams and access new opportunities for growth and innovation.
By carefully selecting target markets through comprehensive research and meticulously tailoring your strategies to local conditions, you can foster resilience and carve out a competitive edge in a fluctuating economy.
The Webcertain search and social report 2025 is available now and is ideal for marketers wanting a succinct overview of the digital marketing landscape across 57 countries – I hope it will be useful during your market diversification journey.
If you would like a no-obligation chat with our international digital marketing experts, get in touch with us today!
