Is your company ready to target new markets? How can you gauge the viability of expanding your business reach? What product marketing strategies can you use to increase your chances of success?

To answer this, let’s explore:

• What a market development strategy is.
• Common methods companies use to enter new markets.
• Real-life SaaS examples of successful market development attempts.
• A step-by-step process to build a viable market development strategy.

Summary of a market development strategy

• A market development strategy is a growth strategy that aims to introduce existing (or new) products or services to new markets.
• Let’s explore the most common market development strategies and when they might be ideal for your business:

1. Market penetration: Increases the market share of your existing products or services within your current market.
2. Market expansion: Involves entering new geographical areas or demographics with your existing products.
3. Product development: Focuses on creating new products or enhancing existing ones to meet the needs of your current market.
4. Diversification: Introduce new products to new markets to spread risk and reach new audiences.
5. Strategic partnerships: Collaborate with other companies to enter new markets or strengthen market position by leveraging partners’ strengths.

• Let’s explore four real-life examples of how top SaaS companies implemented market development strategies to expand their reach and grow their user base.

1. Slack localized its product for international markets, boosting its global user base.
2. Canva launched a tailored product for educators, expanding its reach into the education sector.
3. HubSpot broadened its product range to cater to more business needs, becoming an all-in-one customer platform.
4. ProductLed grew rapidly by forming alliances with influential SaaS leaders and establishing itself as a go-to resource for PLG companies.

• Let’s review the essential steps to build an effective market development growth strategy.

1. Conduct market research using surveys, behavioral data, interviews, and industry analysis to identify new growth opportunities.
2. Set goals using frameworks like SMART or OKRs to set clear, measurable, and achievable goals for market expansion.
3. Develop a comprehensive go-to-market strategy involving customer personas, pricing models, marketing channels, and messaging.
4. Execute your GTM strategy by properly allocating resources, assigning responsibilities, tracking progress, and managing your product launch.
5. Measure and analyze key metrics like conversion rates and revenue growth to compare results with your goal and refine future strategies.

• If you’re a product marketing manager who needs to set up a custom market development strategy, book a Userpilot demo to see how you can collect user feedback and promote new products or features within your app.

What is a market development strategy?

A market development strategy is a growth strategy that aims to introduce existing (or new) products or services to new markets. It involves identifying and targeting untapped geographical areas, new customer segments, or different distribution channels to expand the market base.

Common market development strategies

When it comes to expanding your business into new markets, there are several strategies you can employ.

That said, let’s explore the most common market development strategies and when they might be ideal for your business.

Market penetration

Market penetration involves increasing the market share of your existing products or services within your current market. And it’s ideal when the market is still growing, and your product still has room to capture a larger audience.

This can be done through competitive pricing, increasing marketing efforts, or improving product features to attract more customers. For example, if your product is not competitive enough due to annual subscription plans, you can revamp your pricing model to make it more attractive in your market.

Market expansion

Market expansion (also known as market development) involves entering new geographical areas or demographics with your existing products. It’s a good strategy when there’s a clear opportunity in an untapped market, and your product can potentially appeal to it.

For example, if your product has succeeded in one region, expanding to a new region with similar market dynamics could be profitable.

Product development

Product development focuses on creating new products or enhancing existing ones to meet the needs of your current market. It can be a great strategy when you can leverage your brand loyalty to upsell new products to an existing market.

For instance, if you notice that your customers are looking for additional features that your current product doesn’t offer, you can consider developing features that help you attract and retain more customers.

Diversification

Diversification involves introducing new products to new markets. It’s the best-suited strategy when your business is looking to spread risk across different markets or when you identify a complementary product that could appeal to a new audience.

For example, if your company currently appeals to marketing teams, developing a product for sales or product teams could open up new revenue streams.

Strategic alliances or partnerships

Forming partnerships involves collaborating with other businesses to enter new markets or strengthen your position in existing ones.

This strategy works well when leveraging another company’s market presence, expertise, or technology. For instance, partnering with a company that already has a strong foothold in a market you’re interested in can help you enter that market with less risk.

Market development strategy examples in SaaS

Now, let’s explore four real-life examples of how top SaaS companies implemented market development strategies to expand their reach and grow their user base.

Slack – Expanding to new markets

Initially, Slack was launched in 2013 in the U.S. market by Stewart Butterfield as a team-messaging product tailored to business culture and needs.

But, in 2017, it recognized the potential in international markets like Europe and Asia. And to expand, Slack achieved market development by not only offering the product in local languages but also creating region-specific landing pages, adapting to local customs, and considering cultural preferences.

This allowed Slack to increase its global user base significantly and establish itself as a leading communication platform worldwide.

Canva – Targeting different user groups

Canva started by targeting small business owners and individuals looking for a simpler alternative to complex design software like Adobe’s suite of tools.

As Canva gained popularity, the company identified a new opportunity within the education sector. In response, Canva launched “Canva for Education”, a product tailored to the needs of educators and students.

After targeting brand marketing campaigns to this new niche, Canva successfully expanded its user base and solidified its position in the education industry.

HubSpot – Adding new product offerings

HubSpot initially gained traction with its core set of tools for inbound marketing, which included features like SEO optimization, blogging, lead tracking, and marketing analytics.

However, to sustain growth and cater to a broader range of business needs, HubSpot expanded its product line to include tools for sales, customer service, and operations hubs. It realized that the companies who bought marketing tools also needed a CRM, help desk, and more expansive analytics—positioning itself as the all-in-one customer platform it is today.

ProductLed – Forming strategic alliances

As part of a market development strategy, ProductLed serves as a prime example of forming strategic alliances to expand reach and influence.

ProductLed, led by prominent SaaS leaders such as Wes Bush (Founder of ProductLed), Des Traynor (Co-founder of Intercom), and Elena Verna (Former SVP of Growth at Miro), connects managers and leaders from SaaS companies focused on a product-led growth model.

Through this alliance, companies developing tools for or targeting product-led growth organizations gain branding exposure and networking opportunities, positioning themselves within a key segment of the market. This approach enhances visibility and builds relationships in a highly relevant ecosystem.

How to build a market development strategy

Let’s go over the essential steps to build an effective market development strategy.

Conduct market research to identify opportunities

Research is the foundation of any market expansion strategy. It involves gathering and analyzing data to understand potential markets, customer needs, and competitive landscapes to identify growth opportunities.

Some methods for collecting data include:

• Surveys: Gather direct feedback from potential customers regarding their needs, preferences, and pain points. It helps identify gaps in the market your product can fill.

• Behavioral data: Analyze user interactions to understand usage patterns, common challenges, and areas for improvement—guiding your market development efforts.
• One-on-one interviews: Interview potential customers from your target market to gain qualitative insights into their specific needs, challenges, and expectations.
• SWOT analysis: Evaluate your company’s position in the market and identify external opportunities and threats that could impact your market development strategy.
• Industry benchmarks: Look at metrics benchmarks in your industry, such as market share, customer satisfaction, and product adoption rates to compare with your own.

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Set your growth goals

The next most important step in market development is to set clear growth goals to aim your strategy correctly.

For this, consider the following goal-setting frameworks:

• SMART (Specific, Measurable, Achievable, Relevant, Time-bound): This framework helps you create clear, concise goals that are easy to track and measure.

• OKRs (Objectives and Key Results): OKRs allow you to define broad, ambitious objectives and pair them with measurable outcomes.
• BHAG (Big Hairy Audacious Goals): BHAG is about setting long-term, ambitious goals that challenge your organization to strive for significant achievements.
• BSQ (Beliefs, Strategy, and Quarterly Objectives): BSQ helps align your organization’s core beliefs with strategic initiatives and short-term objectives.
• Goal Pyramid: The Goal Pyramid framework organizes goals into a hierarchy, with long-term goals at the top, mid-term goals in the middle, and short-term actions at the base.

For instance, a SMART goal might be “Increase market share in the Asia-Pacific region by 20% within the next 12 months.” From there, you can now craft a strategy where you can measure progress effectively.

Create detailed market development plans

Once your goals are set, the next step is to build a go-to-market strategy that can guide you through every step of your market development efforts.

For this, you can follow the checklist below:

• Select the most suitable strategy (e.g., market penetration, market expansion) that aligns with your growth goals and the specific market opportunities identified in your research.
• Identify your ideal customers in the new market. Then create customer personas, including their demographics, preferences, pain points, and buying behaviors.
• Define how your product or service will appeal to your target customers. Consider whether you need to adapt your existing product for the new market or develop a new product.
• Determine your pricing model based on local purchasing power, competitor pricing, and perceived value. For example, you might offer tiered pricing or introductory discounts to attract new customers.
• Choose the most effective channels to reach your target audience. This might include social media, email campaigns, blogging, podcasting, or traditional channels.
• Develop marketing campaigns to promote your product. Use clear, compelling messaging that communicates how your product solves your customer’s specific pain points.

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Execute your go-to-market strategies

It doesn’t matter how good your GTM strategy is if it’s not executed correctly.

To avoid a chaotic launch, make sure to keep the following tasks in check:

• Allocate resources such as budget, talent, and tools to execute your market development plan.
• Create a product launch timeline to outline the key milestones and deadlines leading up to your product’s release.
• Choose a project management tool like Asana or Jira to organize tasks, track progress, and ensure that your market development plan stays on schedule.

• Assign specific roles and responsibilities to different teams, such as product development, marketing, and sales.
• Track your progress by monitoring key performance indicators (KPIs) and milestones throughout the execution phase.

Measure impacts and analyze results

After your GTM campaign has been executed, it’s essential to measure its impact and analyze the results.

This involves monitoring key metrics like conversion rates, acquisition, or revenue growth to compare the outcomes with your original goals—and determine whether you’ve achieved your objectives. For example, if your goal was to grow your market share by 20% in the Asia region, you should measure how many new users are coming from this region compared to last year.

As a result, you’ll be able to refine your strategy to remain agile and responsive to market changes.

Conclusion

Ultimately, research is the cornerstone of any market development strategy. Understanding your target market and users’ needs allows you to craft more effective strategies and tailor your offerings.

If you’re a product marketing manager who needs to set up a market development strategy, book a Userpilot demo to see how you can collect user feedback and promote new products or features within your app.