The key steps to entering the luxury market
The prospect of entering the luxury market is an exciting one for many business owners. Identifying new sources of revenue is a vital way to speed up the growth of your organisation.
If you’ve spotted a gap that you think you can fill, the temptation to jump in as quickly as possible to take advantage can be strong. But you’ll only get the most out of your move if you think it through thoroughly, lest you leave room for someone else to see what mistakes you’ve made and capitalise.
Research
The first thing to do is confirm your evaluation of what the luxury market can do for you – and you for it. It’s time to do your research, using as many tools as you have at your disposal.
By comparing data from market research, industry reports and trends, you want to be able to show clearly the needs of customers, as well as the shortcomings of the current offering. Part of this process should involve loading up with information about your would-be competitors so that you can see what you’re trying to beat.
The other side of the coin is to clearly show what unique value your business can bring to the market, to illustrate what makes you well-positioned to meet those customer needs. You’ll need to be able to communicate that USP to those customers pretty soon, after all.
Set goals and objectives
It’s all very well to simply enter the luxury market but it’s important to know what you intend to get out of doing so. Clearly set out how far you aim to get before you begin. What are your revenue targets, in the short, medium and long term? What level of market share represents success? Your research should help you set realistic goals here, and those goals will enable you to track performance.
Settle on an entry strategy
What does it look like for your business to enter the luxury market? You’ll need a clear idea of what actions are required to bring your services to your target audience.
Will you partner with wholesalers or distributors to put products on shelves, or will you sell directly to customers? Will you need to acquire a physical presence – be that offices, retail units or manufacturing spaces – or can you extend the reach of premises that you already have? Perhaps your plan is to operate entirely online. Again, this should be informed by your research into the expectations of your market.
Finances
Expansion into new markets can often be a complicated process, even if the goals – reach more people and make more money – are simple. As part of your preparation, it might be wise to speak to consultants with expertise in this new field or region for a clear picture of how you’ll need to make the numbers sing. You may need to consider regulations or compliance questions that wouldn’t have been part of your considerations before, especially if you plan to employ new distribution methods.
