Psychology of Market Entry Analysis (PowerPoint PPT)

For every successful market entry, about market entry attempts end in failure. This failure is attributed to many factors—timing, scale, competition, capabilities, and particularly irrational decision making. The decision to successfully enter a market necessitates detailed analysis. These critical decisions, however, often get tainted by Cognitive Biases—the systematic errors in the way people process information. Cognitive Biases distort executives’ perception regarding their firm’s capabilities, potential market, and competition.

The presentation starts by highlighting a 2-pronged approach to Market Entry Analysis:

1. Develop a Reference Class
2. Remove Bias from Decisions

The deck then discusses the 6 key factors of market entry success:

1. Size of entry relative to minimum efficient scale
2. Relatedness of the market entered
3. Complementary assets
4. Order of entry
5. Industry lifecycle stage
6. Degree of technological innovation

The details of the 5 core issues in removing biases from decisions are then highlighted:

1. Value Proposition and Capabilities
2. Market Size
3. Competition
4. Market Share and Revenue
5. Costs

The slide deck also includes some slide templates for you to use in your own business presentations.