Expanding into a new market? Read this before you make costly mistakes.

How Do I Conduct Market Research Before Entering a New Country?

Over the past two weeks, I’ve had conversations with businesses from Germany, Canada, and Colombia—all struggling with the same challenge: How do you successfully expand into a new country without wasting time and resources?

• A company in Germany needed to prepare for a market entry case study for a prospect they were pitching to but had no historical data to guide them.
• A Shopify Partner Agency provider in Canada wanted to expand beyond North America but was looking for a “quick” international solution—without tailoring their strategy to specific markets.
• An Ecommerce brand in Colombia wanted to enter the US market with the same strategy they used for their local market, and they chose the wrong platform, lacked localization, and had no market research.

The common mistake? Thinking market expansion is a one-size-fits-all process. It’s not.

Here’s how I have approached market research for international expansion at Shopify, Optibus and NGOs:

Consider Cultural & Consumer Behaviour:

Canadians and Americans are culturally different. Canadians use an indirect low context approach, and they see directness as confrontational. Their neighbours south of the border are direct, to the point, hands on and practical.

Every country has their own cultural nature, communication styles when doing business, dos and don'ts, and historical factors that have shaped their culture and therefore, buying habits, whether it is for products, services or relationships.

Local trust factors can make or break your success, and this is why you will find that every country has their preferred payment method, logistics provider, processes, etc.

You need to become familiar with all of these aspects so that you can adapt your business to the new market. Please dont expect a country to adapt to your business because you will fail miserably.

Walmart tried to enter the German market in 1997 only to close all 85 stores in 2006. They failed to understand that Germans value quality over price, Germany and the EU has strong labor laws, massive shopping and supply chain formats do not resonate with local shopping habits in Europe and Germans would not smile back at you unless you have previously built a long, stable, lasting relationship; so the American customer service style ended up backfiring at the company.

So, when in Rome…. (Pro Tip) Find a local cultural competence expert to help you build the local target persona and cultural UX needs.

Understand Market Demand:

Following the previous section, your business needs not only to understand the country regulations, legislations and cultural patterns but also the local client himself.

What are local customers actually buying? What’s the demand for your product in this region? Why do they prefer to buy from local or foreign suppliers? Do they buy in bulk, do they do small weekly purchases?

Just as you have built your full buyer persona in your business’ headquarters country, you will need to do the same in every new market you want to go to, and then build your international expansion strategy on the common patterns you can tackle first to make your business locally appealing to a larger audience.

If we continue with the German example, look at these 2 pictures:

On one side North American Sally likes to buy her monthly groceries all together while European Ana prefers to buy small but fresh quantities for the week.

This helped Shopify identify patterns like different icons for a “Shopping cart or bag” and which one would better resonate with each market.

Analyze the Competition:

When done correctly, Competitive Analyses will give you a lot of information about who dominates the market? How do they position themselves? What gaps can you fill? But also about how they do things locally.

Look into their UX, their free trials, their lead magnets, and learn how they connect with the local audience. This will also give you information about what your product is lacking in terms of UX, regulations, or local characteristics.

When I worked on launching Shopify to Spanish speaking countries, I explained with examples that they needed to add longer Address fields for countries outside North America, because many Latin American countries had very long addresses.

Pro Tip:

• Use tools like Google Trends, Ahrefs, or SEMrush to analyze search demand and analyze competitors.
• Read industry reports made by industry associations, chambers of commerce and other local experts.
• Run customer interviews and surveys.

Regulatory & Legal Compliance: This is a BIG one, because businesses believe that Regulation and Legal Compliance is only related to making sales and signing contracts with clients, but expanding without understanding local laws, tax regulations, import/export policies, and compliance regulations is a recipe for disaster.

Starting with your local employees or service providers, labor laws in Europe are waaayy different from North America or Latin America. Working hours are regulated, overtime has to be registered and paid in some countries, and countries like Portugal or France have made it illegal for companies to contact employees outside of their working hours.

Your business needs to understand how much local employees actually cost and how labor law works, even for freelancers or contractors. I was part of a conversation with a unicorn company wanting to acquire a company in a market they were entering.

They considered the product, the company’s finances, and the opportunity to have an office with local employees, but… they did not do proper research on local labor laws, and the 40% percent additional that every employee would cost them. Needless to say, the first year post acquisition was rocky and expensive. 

As per clients, your business should not only comply with local laws but also make sure that your invoicing, payment methods, contracts, service policies and privacy policies will not create any legal issue to your client, like missing information on invoices that must later be handed to the Tax Authorities. 

Pro Tip: Consult with a local legal expert before launching to avoid unexpected compliance issues.

Localized Marketing & UX Strategy:

A translated website isn’t enough—adapt your messaging, pricing, and customer journey to the local market. 

When our team started to work on the international versions of Shopify’s website UX localization played a key role in how the company was able to enter a given market. Germans care a lot about privacy, security and certifications, whether the Japanese market was used to over crowded UX on home pages and very local and Japanese looking images.

For Latin America, images of caucasian North Americans attending Indie boho summer festivals had zero engagement as they felt too distant from the colourful and culture-rich festivities in Latin America.

Even though there is a standard Spanish used by the press that most Spanish speakers understand, differentiating the Latin American Spanish from Spain's Spanish on a website can make a huge difference in terms of engagement and trust.

Look into your pricing, communication styles, customer journey and see what works best for that market.

Pro Tip: Launch country/region specific campaigns and A/B Tests

Test Before You Commit: Pilot campaigns, small-scale launches, and user testing help validate demand before making big investments.

The biggest test for a business and a product is to get feedback from potential buyers, so make sure you run as many tests and get as much feedback as possible before you make the final decision to go all in to a new market.

And here I have to make the biggest emphasis… I repeat BIGGEST emphasis…

If you realize that your business/product has no (or very little) product-market fit with the desired market, you need to make a conscious decision on whether you can afford to make the necessary changes to achieve product-market fit, or if it is better to pivot to a better matching market.

A lot of companies end up being carried away by their egos and they try to force themselves into a market, only to waste millions of dollars in the process before withdrawing from the market. Walmart in Germany is just one of many examples.

If there is no product-market fit, there won’t be a “superstar” salesperson or country representative who will be able to save your business from failure.

Market expansion isn’t about guessing—it’s about strategy. If you’re planning to enter a new market, skip the costly trial-and-error approach and make data-driven decisions. Take the time to learn about the market, and know when it is time to pivot. 

Have you expanded into a new market before? What challenges did you face? Let’s discuss in the comments!

Considering international expansion? Let’s talk. Book a free consultation here.