Which market is worth entering first?

The largest market is not automatically the best place to begin. A smaller market may offer a more accessible customer group, a better fit with the company’s capabilities or a useful opportunity to learn. A large market may still deserve priority when its strategic value justifies the difficulty of entering it.

The market worth entering first is the one where the business can reach customers it has good reasons to win, and where that first market can do the job the company needs from it. Market-entry research should make that choice clearer by separating the size of an opportunity from the conditions under which the business could capture some of it.

A country total can hide the opportunity

Size is persuasive. In Harvard Business Review, Pankaj Ghemawat warned that “companies routinely overestimate the attractiveness of foreign markets,” and that the sheer size of an untapped market can distract from the difficulty of entering it.

Potential customers do not all need the same thing or have the same ability to change. A broad category estimate may include people who are poorly suited to the offer, outside the company’s reach or unlikely to reconsider their current arrangement soon.

That doesn’t make the total useless. It changes how it should be used. The next question is which parts of the market are relevant to this proposition, and what would have to happen for those customers to choose it.

This may lead to a comparison of particular segments across countries, in place of countries treated as single opportunities. The right first step could be a defined customer group in a large market or a wider introduction in a smaller one.

Assumptions that can be examined

An outdoor equipment maker had several professional markets, across six countries, where it could take a new mowing technology. Size alone could not choose a market, so we built the market-size model from the ground up, satellite measurement of the land included, and went to the people who manage and buy the mowing.

Each market was read through what pushes a buyer toward change and what keeps them where they are. Putting the measured size of each market beside the buyers’ own view of change meant very different professional markets could be compared on the same terms.

Portfolio leadership came away with one consistent basis for weighing where to go first, in what order and with what product: a market-size model built by country and segment. The work is described in Choosing where to take a new mowing technology first.

A model is more useful when its assumptions can be challenged than when it supplies an impressive total that no one can explain.

What the first market is for

A first market may have several jobs. It may need to generate meaningful near-term revenue, establish credibility, test the proposition, develop a route to market or create learning useful for later expansion.

Those objectives can point in different directions. The easiest place to launch may teach little about the markets that matter most. A strategically important market may require more investment and patience than the business can support at that stage.

The criteria therefore need to reflect the company’s circumstances. There is no universal scoring system in which attractiveness and ease of entry always deserve the same weight. A ranking should express the agreed judgment, rather than conceal it behind a calculation.

The uncertainty that could change the order

Some gaps in knowledge matter more than others. If a market looks attractive only under an optimistic assumption about customer adoption, examining that assumption may be more useful than refining a well-understood category total. If access to customers is the main constraint, more research on stated product interest may do little to resolve the decision.

The work can also start after a country has already been chosen. Then the useful questions may concern which customers to pursue, how the proposition should work locally and what would support a credible introduction. Reopening the entire global ranking would miss the brief.

Research helps a team distinguish a large theoretical opportunity from one it has reasons to pursue. The recommendation should explain who the opportunity is for, why the business could serve them and what remains uncertain. That gives the first market a clear role in the company’s growth, and a more defensible reason to begin there.