uk strategy

Why the UK?

By Justine Cross, Director and co-founder, EMEA Channels.

The UK is often the first port of call for a US vendor looking to commit to an international expansion for the first time and has many factors that make it an attractive choice over other markets.

Perhaps the most obvious benefit is the language factor. Despite the often-repeated witticism that the UK and US are two countries separated by a common language, the fact that both markets speak English saves a huge amount of time and effort.

The lack of a language barrier makes the job of assembling both in-house teams and third-party partners much easier and makes it much more viable to send over staff from the US office if that is your preferred route.

Sharing a common tongue also removes the mammoth task of having to translate all of your marketing and sales collateral. Translation can be extremely time consuming, especially if you have a large portfolio of products and services to launch. It’s also especially tricky in the cyber security market, with a long list of technical terms and phrases that have to be translated precisely or risk becoming nonsense.

The UK is an extremely open market for cyber vendors, with a high level of demand for security solutions and services. In particular, the EU General Data Protection Regulation has spurred further growth in the market as organisations of all shapes and sizes seek to invest in solutions to help them become compliant. It’s also a somewhat more accessible market than many others, particularly in Europe. Even without the language barrier, some countries such as Italy and France tend to heavily prioritise domestic vendors and avoid foreign suppliers.

However, it would be a critical mistake to assume you are the only security vendor planning a move to the UK – as the vast majority of your competitors will have the same idea. The UK’s clear advantages for initial expansion, as well as its own burgeoning local security community, means that the market is flooded with vendors from around the world. This means that it’s more important than ever that a new product launch has to be done right and go well, particularly for a new and untested technology or a start-up without the resources to weather a failure.

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Where to start?

The challenge of standing out from the crowd, combined with high cost of failure, means that it is imperative that a vendor is well prepared before entering the UK market. There is a lot of groundwork that needs to be completed for a successful go-to-market strategy, and it is vital that proper research and planning is done in advance.

Lack of patience is a fatal flaw that has scuppered numerous attempted launches in the UK. A common mistake is for a vendor to enjoy a high degree of success in their home market and come in expecting to replicate the same success in short order. However, simply copying and pasting your existing strategy and applying it to a new country will rarely work out.

Many vendors – particularly more successful ones – will enter the UK and expect to immediately begin seeing orders flooding in, but the reality is that a proper launch will generally need at least 12 to 18 months to build momentum.

One of the most important things that must be established as part of the go-to-market strategy is defining how your product fits into the new market, as this will inform the rest of your strategy, from channel to marketing to PR.

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Defining your market strategy

Central to defining your approach is being able to outline what your typical customer looks like in terms of size, vertical and spend. While it sounds straightforward, you’d be amazed how many companies I come across on a regular basis that cannot do this. This tends to be a problem for smaller start-ups, particularly those that have developed new technology that does not yet have a defined place in the market.

Once you are confident in your market profile on your home turf, you need to discover how it compares to the UK market. You need to establish the landscape for companies that fit your ideal customer profile, as well as other factors that might influence your opportunities. The adoption rates for technology and services can vary greatly between different countries for example, so your solution may not be as readily received as it has been at home. Similarly, the competitor landscape will go a long way to shaping how the market should be approached.

Ultimately, you need to take this knowledge and establish how your offering will be presented and sold in the UK. Are you coming in as a mass-market commodity in a crowded space, or are you selling a niche solution with a more limited scope for specific verticals or company types?

The answer to this question will help you decide what kind of market strategy you should launch with. The difference between selling a commodity and a niche product will extend all the way through to how you describe your solution and company at large, and how prospects are approached and engaged with. If your market is full of competitors with similar offerings, it will put increased pressure on differentiating yourself, especially if the competition is local. Conversely, if the market is largely unfamiliar with your type of solution and there is no competition, you will need to do much more groundwork around explaining the concepts around what you do and why it matters. This will need to be reflected throughout your marketing and PR activity.

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Deciding on your channel strategy

Your methodology will also be a major influence on whether you should sell directly or go for a two-tier approach. A two-tier channel model will see the vendor sell to distributors, who will in turn provide products to channel partners, such as resellers, and is usually a good choice for vendors that anticipate a large order volume. Those that are likely to see a smaller number of orders, such as start-ups and those with more niche products, may be better off selling directly, at least until they are more established. A vendor may also decide on the middle ground, going for a single tier model that sees them work with just one or two resellers directly.

Whatever model you eventually decide is right for your business, it’s very important to establish a clean channel structure with clear boundaries. If you decide to go for the two tier mode, you need to ensure you fully support the sales efforts all the way through the model.

One of the biggest mistakes I come across is for a vendor to set up a two-tier channel, but then fail to sync up their direct activities with their partners. It is absolutely expected to support the channel with direct marketing activities and create leads directly to help drive demand for your technology through your resellers. However, I have often seen cases where leads are taken directly or even worse a partner has registered a deal and then the vendor takes this information and sells direct.

From the reseller’s point of view, this essentially constitutes the vendor stealing a sale from them – including the margins they would have earned from closing the sale themselves. A vendor that is inexperienced with the channel is also more likely to make mistakes in the process of closing the deal themselves, which will lead to more work for the partner to fix.

The problem is more prevalent amongst newer companies who have not worked with a channel before. It’s particularly common early in the launch, when the vendor is liable to get caught up in the excitement of closing its first deals in a new market. That said, I’ve also seen the same behaviour from larger and more established vendors who are unaware of how the UK channel operates, or else simply don’t think it’s important.

However, it comes about, few things are more frustrating for a reseller, and this kind of practice will very quickly sour relations in your channel. Repeated issues, or an especially bad case, could lead to resellers severing their contracts and refusing to work with the vendor again. Worse still, the fallout can also impact your future channel relationships. Word spreads quickly among resellers, and repeated bad practice will soon lead to a reputation as a vendor to avoid.

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The in-house team

Alongside your channel strategy, it’s also vital that your in-house representation for the new market is well chosen. Vendors will sometimes try to launch in a new market remotely using staff based in their home offices, and while it is possible to secure a few sales this way, you really need feet on the street if you are going to get anywhere.

The time difference is one of the biggest barriers to attempting to manage a UK launch from the US, particularly for vendors based on the West Coast who will have to contend with being eight hours behind. Having a high level of support for your channel is crucial, particularly early on in a launch, and your partners will really struggle if they must wait an entire working day every time they need something. Attempting to sell directly across the time difference presents an even greater challenge unless your team is happy to work very unsociable hours on a regular basis.

One thing that is often overlooked is that the representative may not need to be in the UK itself, as long as they are in a similar time zone. A channel manager based in Dusseldorf, for example, could do the vast majority of the work of someone in London, and this can be a useful approach if you’re intending to launch across the wider EMEA region in the near future.

Your in-house team is hugely important to the success of your launch, and it is essential that you pick the right person to head everything up. A fatal mistake I encounter all too often is for a vendor to send over a senior representative from their US office based on their previous performance, rather than how suitable their experience is for the UK market.

It may seem like a safe move to rely on an experienced and trusted executive to handle the launch – and this can also double up as a nice promotion for the individual. However, it’s far more important that they are familiar with the UK market in particular, as well as being equipped with the skills and experience needed to launch and maintain brand new sales operations in a new market.

The easiest way to ensure your representative has local knowledge is to hire in the UK itself. This is likely to be a slower process than promoting or transferring internally but is a more reliable way to access the needed experience and contacts unless you have an ideal in-house candidate with very specific expertise. Depending on your level of commitment, it might be wiser to go with a third-party consultant, as this will cut down on costs and give you more flexibility until you are more established. An experienced consultant will be armed with both knowledge of the local market and a collection of contacts that includes both prospects and channel partners, which can greatly reduce your time-to-market.

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Developing the team

After finding your feet and establishing a presence and a good pipeline of prospects, you can start investing in developing your in-house team. Due to the expense involved it’s best to move slowly with hiring more staff, and I’d recommend waiting until the second year is well under way. When you’re ready, a three-person team is a good initial model to aim for. The ideal team should be a lead development representative (LDR), also commonly known as a business development rep (BDR). Whatever your preferred acronym, this individual will be getting out there to sniff out new opportunities and establish relationships with prospective clients. Alongside them you’ll also want a tag team of a sales executive and a sales engineer to handle the work of securing the opportunities the LDR sets up and processing them through into new contracts.

Some believe this can be achieved by a single experienced salesperson, but I find this both leads to too many spinning plates and is also generally a misuse of talent. If you’re going to invest in an high-end salesperson, forcing them to start cold-calling from day one will be a waste of his abilities. Instead, the lower cost LDR will be doing the initial cold calling work and will be feeding a steady line of opportunities for the heavy hitting salesperson to secure.

One of the most important characteristics for a team launching a new vendor in the UK is an entrepreneurial spirit. They need to be self-motivated, but able to wear multiple hats and take on a variety of roles – being a brand evangelist and a logistics expert as well as handling the hard sell.

They will also need to have channel experience and will have ideally helped to manage channel relationships before. Salespeople who have only sold direct before will often struggle in communicating with the channel, as their instinct will usually be to bypass the partners and go to the end user directly to close a deal.

All of these assets make for a unique and fairly rare individual, but there are plenty of people out there in the market. I find the best approach can be to look for a “serial” salesperson with a history of helping to launch new companies in the UK, and then moving on to a new one once they are established.

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Patience is a virtue

Whatever route you take with your go-to-market strategy in the UK, the most important thing is to be patient and take your time, because you only really get one shot with a new launch. If a launch fails, you will likely need to wait at least two or three years before trying again, which can represent a huge amount of time and lost revenue. Worse, relaunching often presents even more challenges than an initial launch, especially if there were relationship issues with contacts or prospects.

There are any number of reasons a new launch might fail. The in-house team may turn out to be the wrong fit and struggle with the new market. The channel partners too might be wrong for the job, or else the relationship is poorly managed. The timing might be wrong, with the market not yet ready to sustain the number of orders to make it worthwhile, or the vendor itself may not quite be ready to support a new region.

With so many moving parts, it’s vital that a vendor takes its time, rather than trying to rush through or assuming that the US strategy will get the job done. However, with proper preparation and planning, and enough patience, a vendor can unlock powerful new opportunities in one of the most exciting markets in the world – as well as opening the gateway to the rest of Europe.

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