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Researching New Markets: A 3-Step Guide

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Researching New Markets: A 3-Step Guide

This post is in English
Elena Kozlova
This post is in English
Researching New Markets: A 3-Step Guide

Analyzing a new market may sound like an overwhelming task. However, like many other challenges, it is not too hard to do. Based on best practices and functionalities of the brand new SEMrush Market Explorer tool, we have created a comprehensive guide that will help you analyze a new market in three big steps.

Step 1. Industry and Market Overview

Before you step into uncharted territory, there are some things to consider. First and foremost, make sure there is any market at all. Look at businesses like yours to estimate its size and composition, note the most visible trends, and outline the market segments to make your further work easier. Among other things, this information can help you persuade investors that you are aware of the environment you are competing in.

Reveal the Key Players

Companies that have already succeeded in the target niche can become your main informants. So, start by identifying key businesses in the industry. If you can name at least one, Market Explorer will help you expand the list. Type a key player’s domain into the box and look at the Market Relevant Sites section. There you will find the 20 sites SEMrush associates with the queried domain. Check how many big companies are out there or find out if the market is dominated by one company, like in the screenshot below.

Researching New Markets: A 3-Step Guide. Image 0

Domains on the top of the list should be of special interest to you. By traffic volume, you can estimate their approximate market shares and make a shortlist of businesses whose strategies you should study closely. For each of these players, you can reveal audience characteristics, traffic sources, and traffic trends — all with the help of the Market Explorer tool.

Detect General Market Growth Dynamics

Hopefully, you have found a market that is perfectly balanced, meaning there is competition, and an empty field at the same time. Now, to decrease future risks, it is important to understand whether your target industry/niche is thriving or falling into decline, how big it currently is, and how quickly it is changing. Here, you can use Market Explorer again — just filter historical data for the market traffic.

Researching New Markets: A 3-Step Guide. Image 1

Analyze Industry Trends

There are highly volatile industries like hospitality, where seasonal trends strongly impact demand. If the same happens in your niche, you would like to know how these industry dynamics will impact your business. Pick your own or a big rival’s domain and check how well its traffic trend is aligned with the general trend of the market. If the lines you see are parallel, then the business is following the trend. It is not necessarily good or bad — it is simply a fact that you need to consider in further research.

Researching New Markets: A 3-Step Guide. Image 2

Outline the Product Offer and Business Development Direction

To create an effective business plan, collect more data on the core products/services they are offering, the business models they are using, and the stage of company development. For this, analyze primary sources, such as companies’ official websites and social media profiles, as well as authoritative industry reports and stats.

This information will help you understand the volume of similar goods and services that are sold in your market right now and make predictions. To speed up the process, you can use news aggregators and content analyzers, like Feedly. If you crave business information, such as revenue, investments, and the number of employees, go to platforms like Crunchbase and Craft. 

Take Threats Into Account

Next, try to figure out if there is a threat of new entrants or substitute products/services. Remember that at this stage, you are painting the competitive landscape in large strokes, so you don’t have to dive deep into social mentions and press releases. Just find out if there are any easily accessible gaps in the product — if there is one, you can bet that sooner or later a competitor will fill it.

Highlight the Barriers to Entry

There are high chances, though, that your niche will happen to be empty. This can especially be the case if you’re looking at a new geographical market. Ask yourself: why are global players not active in this particular region yet? The answer may lie in political risks, an unstable economy or volatile market situation. Emerging countries may sound like a profitable option sometimes, but consumer habits there may turn out to be too particular. Other barriers to keep in mind include expenses of language localization, online/offline preferences, and restricted payment and delivery solutions.

Now that you are familiar with the market situation from a businesses’ point of view, you can take a closer look at consumers and their needs and interests in detail.

Step 2. Target Audience Analysis

Knowing your buyer persona is one of the key elements of any marketing strategy. You are supposed to have a clear understanding of who, where, when, and how you can reach, and what can be done to maximize the outcome. Market Explorer and Traffic Analytics offer a variety of reports to answer the most important questions related to your target audience.

Measure the Market Size

While the industry size is usually measured in dollars (or any other local currency), the market size counts in the number of potential customers. In the Market Overview report, you can find the overall amount of traffic the specific market is getting and its rate of growth over the past periods. You can use this data for calculating the budget and forecasting the revenue.

Researching New Markets: A 3-Step Guide. Image 3

Look at the User Demographics and Psychographics

Even if you don’t sell cosmetics or apparel, your customers’ age and gender can make a serious difference to the market positioning of your product and promotional campaigns you are planning. You should make the personas of a typical and desired customer clear. You can see an overview and compare their characteristics for multiple players with Market Explorer.

Researching New Markets: A 3-Step Guide. Image 4

Topics that interest your audience are also much more than just website categories. These topics are related to your perfect customer’s lifestyle and personality and reveal the potential for future expansion. 

Estimate the Potential of the Location

Targeting a new location may turn out to be risky due to seasonal demand and supply fluctuations and cultural specifics, among other reasons. Compare the demand peaks that tend to happen in November–December in Western e-commerces to the more stable dynamics of Eastern traffic in the same period. The reason is simple: different holiday calendars mean different seasons when consumers are most active. And this is just one example.

To be on the safe side, you can follow two scenarios. First, get to know the regions where your competitors are present, and especially those where they perform best; this will help you make a shortlist of geographical markets for your business expansion. Check the Geo Distribution report in Traffic Analytics for different key industry players’ domains and see what location promises the most customers.

Researching New Markets: A 3-Step Guide. Image 5

Second, if you already have a particular country in mind, you can go straight to analyzing the market there. Filter the Market Explorer reports by region to get a versatile overview of the competition and consumption in particular areas.

All this data can help you split the market into specific consumer segments for more focused analysis and detailed elaboration of your strategies.

Understand the Audience Behavior

It is not enough to know how much of the audience is potentially interested in a product/service like yours; it is far more insightful to know what websites they visit and how they switch from one platform to another. Luckily, there are ways to find this out.

Take the top player in the target market and research its audience overlap with other competitors in the SEMrush Traffic Analytics tool. You will get to see how many of the unique visitors consider offers from other companies. If you are checking the potential of media placements, this feature will help you compare a company’s audience with publications’ readership too.

Researching New Markets: A 3-Step Guide. Image 6

Need more insights about user behavior? We’ve got a complete guide on what audience overlap can reveal.

Step 3. In-Depth Competitor Analysis

The more details you learn about your competitors’ product marketing, the easier it will be to gain an advantage. Start by analyzing your direct competition, then switch to those who offer alternative solutions. Proceed from the consumer’s problem your product/service helps to fix; your closest rivals may belong to a different category and offer something less innovative, but engage well with the audience and pose a real threat in marketing.

We suggest you do two main jobs in this step.

Carry Out the Product Research

Answer the main “why” questions behind the product:

  • Why do people need it in general?
  • Why do people buy it from this particular company? (The answer may be anything from the price to the design)
  • Why do you believe you can compete with them?

One way to get into the head of a competitor’s customer is to become their customer yourself. At least for a trial period. This way, you will get the most practical insights:

  • What features their product/service includes.
  • How much it costs.
  • How easy it is to go through the customer journey — from discovering the company to actually becoming a client.
  • How easy it is to use the product/service.
  • How easy it is to get support or contact the company at all.
  • How they handle interaction with their clients  — you may get subscribed to the company’s newsletter and get an inside look at their communication style.
  • How well they actually solve the problem.
  • How they could improve (and if they show any potential to improve).

Finally, write down how you are better than them in each of these points — or just different; in some markets, tweaking your offering just a little bit is enough to succeed.

Analyze Their Marketing Strategies

Now, it is time to discover how the key competitors managed to broadcast their product values and brand ideas and win the audience.

With SEMrush Traffic Analytics, you can build a simple competitive matrix of up to 5 units. Pick 5 domains and have them compared by traffic, traffic sources and distribution, and user behavior metrics.

Researching New Markets: A 3-Step Guide. Image 7

Use this data to find the most effective marketing ploys to make prospective customers buy from you, not them.

Hint: look at the Destination Sites where users went after visiting your competitors’ domains. You have a  high chance of hooking the right audience on these platforms.

The last but not least step will be to uncover the best promotional channels to attract the ready-to-buy audience. Do you still have your key industry players list built with Market Explorer? Look at the traffic sources of leading businesses to see if you have chosen the same promo strategy.

Researching New Markets: A 3-Step Guide. Image 8

Concluding Remarks and Last-Minute Advice

This market analysis guide is designed to answer any business needs. However, you can follow its steps as separate instructions at different stages of your research or add more SEMrush tools at each step to customize the guide for your own needs. A larger dataset will never hurt — remember that competitive intelligence is to inform, not to determine your roadmap.

Reveal benchmarks on any industry

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Elena Kozlova
SEMrush

SEMrush employee.

Online researcher, offline traveler. Passionate writer and story listener.
How SEMrush helps:
Competitor Research
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Comments

2000
Expert

Provides valuable insights and adds depth to the conversation.

Thanks for the great tips! Research can certainly be the most challenging part of developing a marketing strategy. I would argue that, in addition to new markets, these tips could be applied to keeping up to date on a current market.
Elena Kozlova
SEMrush

SEMrush employee.

Alison Ver Halen
That's a wise point, given the speed at which things change on the market. Thanks for adding, Alison!
Paul Lovell
Master

A veteran community member.

Thanks for sharing Elena, this is bookmarked for a much more in depth read
Elena Kozlova
SEMrush

SEMrush employee.

Paul Lovell
Thank you, Paul!
Sebastian Hovv
Helper

An experienced member who is always happy to help.

Hmm. Might need to try this. Thanks Elena!
Elena Kozlova
SEMrush

SEMrush employee.

Sebastian Hovv
If you come up with any more tips or additions, feel free to share with us!
Hamza Ali
Pro

Asks great questions and provides brilliant answers.

This is great!

I have a question from our employer branding and marketing point of view.

CONTEXT:
We're a tech company and one of our team's emerging responsibility is to align with and supplement the efforts of the talent acquisition (TA) team to close open jobs faster by getting relevant applications for that job. Relevant application = has the minimum required skillset and experience in the related field. TA handles the culture and team fit later. We'll have to move into that and get aligned soon enough, but that's for later.

QUESTION:
So, in our case, the market analysis would be for seasonal trends for higher movement of applicants which is usually around annual reviews and appraisals. These differ for companies as some are very organized and get it done asap, while we know of competitors who take 4 to 5 months and then package the appraisals as arrears alongside the updated pay, etc.

The insight i've gained from your post is that we should evaluate and can leverage online seasonal variations on the competitor's website (and on the websites in the industry in general) to find patterns about the movement. We can also find the promotional channels they are using and analyze their messaging and reverse engineer it.

The QuestionS I have for you :D >>

Can we track this trend for specific landing pages? Like the career pages of the competition? Is that possible with SEMrush? And, can we track conversions on those pages? Like a CTR to a thank you page which will show us that the visitor actually applied on the website? Plus, can we get the data on the last website the visitor visited before going to the competitor's website?

Thanks a lot!
Hamza Ali
Pro

Asks great questions and provides brilliant answers.

Hamza Ali
Apologies for the click-bait "I have a question from our employer branding and marketing point of view." as there are MANY questions that popped up when I began writing.

In my defense, the comment editor was showing an error when I tried to edit :D
Elena Kozlova
SEMrush

SEMrush employee.

Hamza Ali
Thank you for such a practical question! It's my pleasure to answer.

I see several ways how SEMrush could help in your situation.

1) You can analyze your competitors' websites with the Top Landing Pages feature of SEMrush Traffic Analytics. There, you can get to see the number of unique visitors that came to "Career" pages or (if the website has such a page at all) to a sort of a "Thank you" page that appears once an applicant has sent their CV. If a page of this type exists at all, and it is possible to track initial visits to it, then you can estimate approximate conversion.
Such pages could be made as subdomains, so make sure to check the self-titled tab in the tool.

2) To determine the websites that users visited before going to your competitors' websites, you could have a look at Referring Sites in the Traffic Sources tab of SEMrush Traffic Analytics.
Another way would be to brainstorm these possible websites that users came from (apart from the use of tools, don't forget about common sense: most likely, a certain part of users visited all the competitors' websites) and prove your hypothesis with the Audience Overlap feature of SEMrush Traffic Analytics.

3) To determine overall trends in hiring, I would recommend you checking traffic to online recruitment websites. For this purpose, you could use our brand new Market Explorer tool: you just enter a domain of the most popular recruitment service and receive not just a list of other websites of the same kind but a comprehensible graph of traffic trends for the industry. If you need to discover seasonality in general, this will be the quickest way to do it.
Then, you could have a look at the Top Landing Pages of this recruitment website and see if your target vacancy's page made it to the list. Filter data by month to find out if when it entered or fell out of the list.

And of course, check the keywords and key phrases with specific job titles in them!
Elena Kozlova
SEMrush

SEMrush employee.

Elena Kozlova
Let me know if I've answered your question or if you need some more guidance from our side :)
Hamza Ali
Pro

Asks great questions and provides brilliant answers.

Elena Kozlova
Thank you for such a detailed reply! Our competitors are basically other employers in the tech industry. Our company's specialty is venture building and over the past 10 years we have 11 successful startups and brands, most of which are SaaS. As our company grows (we're at 550+ right now), so does our need to hire the right talent especially senior cloud engineers, developers, and digital marketers-- and talent is limited. So we're figuring ways to tap into online trends for talent movement in Malta, Dublin, Dubai, and Pakistan where we have offices. By career pages I meant job pages where people can see open positions and apply.

I'll try all these and get back to you. Once again, thank you!
Hamza Ali
Pro

Asks great questions and provides brilliant answers.

Elena Kozlova
I'll try this first and get back to you :)
Elena Kozlova
SEMrush

SEMrush employee.

Hamza Ali
You're always welcome, Hamza! Hope these techniques will help you find new ideas - and new talents!
Astha Upadhyay
Expert

Provides valuable insights and adds depth to the conversation.

Market research is the most neglected part of the marketing journey. Few of us know how to do it properly. Thanks, Elena for reminding us and that too so objectively.
Elena Kozlova
SEMrush

SEMrush employee.

Astha Upadhyay
Thank you, Astha, for recognizing it! I am especially motivated to share publications like this. I know very well how often marketers lack time or resources or experience to do proper research, although in practice it always pays off.
Astha Upadhyay
Expert

Provides valuable insights and adds depth to the conversation.

Elena Kozlova
Yes! You are right. Market research generally pays off in a distant future, but its results are far-reaching. Besides, it is quite helpful in saving us from many losses.
Hamza Hahsim
Expert

Provides valuable insights and adds depth to the conversation.

Wow, it is amazing, thanks for sharing this great article. It is like competitor analysis.
Elena Kozlova
SEMrush

SEMrush employee.

Hamza Hahsim
And even more ;)

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