Primary Reasons Companies Fail To Enter USA

It’s hard for USA companies to be successful in the USA market. It’s even harder for companies based in Europe, Asia, and other continents to achieve sustainable profits in the USA. Competition is fierce, costs are expensive, and consumers are uncompromising in their demands for technology products and services.

“If you’re considering USA expansion, you need to thoroughly research and analyze the market & validate your product market fit” said Christophe Garnier, Managing director at Spark Labs.

Here are our top five reasons why foreign companies fail in the USA market:

1) Same “Old” Formula

You can’t assume the marketing and sales strategies that work in Europe and Asia will work here. In fact, the USA market and consumers are so different that it almost always requires a new approach. To avoid this error, we recommend working with local experts who can help you navigate the best course.

2) Targeting the Wrong Market

The USA is not one market, but hundreds of market segments with unique attributes, needs, and requirements. Since there are so many options here, consumers will only purchase products and services that are great matches. Therefore, it is critical to carefully target the right market segment.

3) Inappropriate Message and Materials

Too many times, foreign-based companies try to avoid costs by using the same marketing materials and sales presentations. Even if the English is correct, the message and content needs to address the USA market. Again, we recommend using in-market experts to craft the right marketing and sales materials.

4) Incorrect Pricing

Most companies struggle to price their products and services to maximize profits and revenue. It is especially hard for foreign-based companies who are not attuned to the competition and market demands in the USA. Unfortunately, it is never easy to raise prices once they’ve been introduced into the market.

5) Being Outside the Center

San Francisco and New York City are clearly the USA hubs for technology. These cities attract the best talent, support, and opportunities for collaboration. They also offer relatively easy and cost-effective ways to get started and expand. For example, there are many good NYC co-working spaces, including Spark Labs, which enable foreign-based companies to quickly and easily be in the center of the NYC Tech community.

For more information or just to discuss, please contact us.

Matthew SawyerComment