Thanks to EdWeek Market Brief this report was originally publish on July 8, 2022 and was authored by Ruksana Hussain.
4 Essential First Steps Before You Jump Into a New International Market
Education Companies Need to Think Carefully About How They Structure Teams and How They Protect Their Materials
Many markets such as China, India, and Brazil, have attracted scores of businesses from the U.S. and other countries over the past decade. But so have smaller ones in the Middle East, Latin America, other regions.
Companies that are either looking to make the leap abroad for the first time, or that have a foothold internationally but want to branch out into new markets, need to first engage in deep research and market evaluation.
Seamless customer support, weighing language considerations, and pricing must all be taken into account when moving into a new foreign market.
The interest in international markets has grown as the profusion of ed tech has lowered the cost and complications of shipping physical products across borders.
Even so, there are several important factors company officials with experience working across markets, as well as consultants and others with expertise in international sales, on how an education business can know if it's ready to enter a new international territory. They spoke about keys to success and red flags that can scuttle a provider's ambitions.
Be Especially Thorough in Researching Product-Market Fit - Impero Software CEO Justin Reilly says companies can't overlook a basic step in researching international markets: They should look first at countries that share the language that is used for their product. That will greatly ease the entry into a market, without their organizations having to go through the added step of translation.
Then they should make sure that there are established playbooks for sales and marketing in shared languages. Because those materials will serve as playbooks for resellers of their products - basically, people on the ground in those targeted countries that a company counts on to reach out to buyers.
"They all need to understand what collateral is, what the product proposition means, and all that needs to be well understood before you start venturing somewhere else," said Reilly, whose company was founded in the United Kingdom.
The single biggest mistake I see when I'm talking to young companies that are trying to move internationally is they haven't articulated, written down, translated, digested and understood what their go-to-market looks like. - Justin Reilly, CEO Impero Software
To often, it's an opportunistic rather than a deliberate strategy and that's never going to translate," he said.
Working in multilingual environments puts a burden on education companies delivering software and other products, said Mike Harper, chief product, engineering, and marketing officer at California-based zSpace, a U.S.-based organization.
Education companies often mistakenly think that working abroad is just a straightforward "translation job," but it's more complicated that that, said Harper.
"It's nut just a translation of the word but it's an understanding of how they use their words in the educational context," he said. "Often it involves a little bit more diligence from a translation validation perspective."
Once a company has established it product in its base market, it needs to consider a variety of factors in deciding which markets to target abroad. Those include market size and opportunity, readiness for technology, and regulatory conditions, said Harper. whose company provides virtual and augmented reality lessons in science and other subjects.
Another vital factor to consider are cultural differences across nations.
"We ran into certain cultures that don't dissect animals certain way," said Harper. "The ability or lack of ability ot show different genders or different dissections is very relevant in their world where they a different approach to how they educate people about anatomy. Understanding that and doing it well often requires a partner in that culture.
2. Resist the Instinct to Over-Generalize - and Pay Attention to Pricing
Companies are wise to do in-depth research on the landscape of the education markets they want to enter, including the mix of government and privately run schools, said George DeBakey, Strategic Advisor for International Businesses at Advancing Global EDU.
Through his company, DeBakey International, and his work with Advancing Global EDU, Mr. DeBakey has focused for the last 25 years on the Middle East, which has a large market for the international private schools. There are about 13,000 of those schools globally, according to ISC Research.
It's market that "surprises people," he said, "They don't realize how big it is."
He encourages companies to focus on that market mainly because many of the schools are independent and can make decision more quickly than government bureaucracies.
DeBakey also advised against generalizing about a region, and instead recommends researching each market segment as a unique prospect. This will also help businesses understand pricing as some countries can accept pricing at higher levels for the same product. An experienced reseller in a country can help a company think through those issues.
"Do your due diligence - how well[the reseller knows] the market, can they market and also implement your product, do training, do more than just selling, many products need good training and follow up?" said DeBakey.
Understanding the pricing environment in different countries is critical, agrees Ashley Senkarik, the vice president of marketing at Luxembourg-based OAT Testing.
"Make sure that the offering is in ling with what other competitors are offering, too, because you don't want to come in too high or too low," she said. "Validate your pricing strategy and model."
3. Skimping on Customer Support Is a Huge Mistake
Having the capacity to support the international customer is particularly important.
For instance, the Middle East observes a different weekend schedule so one o f the first things Reilly did at Impero, when it began working in that region, wat to create a 24/7 help desk to cater to those clients. While chatbots and e-learning guides can assist to some extent, ultimately, clients will want to speak to a human so centralizing all those teams is important.
"If you're talking more of an enterprise level product," he said, "you are going to need somebody in the market that is connected, understands that landscape and helps you with that international penetration."
In the case of zSpace, several resources are dedicated to the Chinese market alone, says Harper. This includes product experts who are native speakers, providing sales and partner support, ensuring that the partner has the resources, knowledge, information and are their liaisons to the market.
Additionally, zSpace has a full-time person in the U.S. who is focused on the China market and in touch with the on-the ground team to make sure that as new products are introduced, there is a roadmap coming together considering the needs and requirements of that market, and delivering a product that world work for them.
Rhys Spence, head of research at the European ed-tech venture capital fund Brighteye Ventures, said while it's important for companies to build an in-country staff, they have to think carefully about how they go about it. First, hire a country manager instead of a head of sales because the head of sales is inclined to immediately focus on reaching targets that have been set for them - as opposed to taking the time really understand the market.
4. Ignore the Risk of IP Theft at Your Peril
Depending on the product and how it's delivered, intellectual property rights and data privacy are concerns that companies cannot ignore.
When it comes to protecting their IP, companies need to make sure they're protected even before they consider a marketing strategy in a new country, said Senkarik, of OAT Testing.
That means having IP policy woven into any contracts and making sure your policies clearly spell out the parameters around sharing of your resources, and where your company has trademarks and copyrights. The policies also need to spell out rules on outside entitles repurposing your resources, and when trademarks are required, she said.
"All that, upfront, is important to have in place because it's a little bit of a beast," she said.
Just as important is having a sharp understand of the dat-privacy landscape in the nations you're targeting, said Senkarik. She pointed to Europe's sweeping data-privacy regulation, GDPR, as a policy any education business working in that region needs to fully grasp. (European regulators recently gave tentative approval to another policy, the Digital Services Act, that has dat-privacy implications for education companies.)
Data privacy concerns in the U.S. and other markets are only going to get more strict, Senkarik predicted. Having strong data-privacy and IP protections work together, she said, so that it's not overly easy users who are not your core audience "access your product."
If you or your organization are considering expanding into the US markets or expanding globally our advisors at Advancing Global EDU would be happy to discuss strategy with you and your team.