Step by step, I will take you through the journey I went on with my clients to enter the South Korean market.
Step 1: Market Research
We began by deeply understanding the potential of the market. Research was conducted on two levels: indirect and direct.
Indirect research focused on analyzing specific information about the market. Some key criteria included:
- Market size and growth: Understanding the overall size and projected growth of the Korean IT services market.
- Target audience: Identifying key customer segments requiring IT services.
- Competitor analysis: Studying the landscape of existing IT service providers in Korea, including their strengths, weaknesses, service offerings, and client base (yes, we discovered who they work with, who they’re prospecting, and their methods).
- Market trends: Spotting emerging trends and technologies shaping the Korean IT services sector.
- Pricing: Understanding pricing models and regulatory considerations for IT services in Korea.
- Opportunities and challenges: Evaluating potential opportunities and risks associated with entering the Korean market.
Direct research involved sending team members to Korea. Their objectives were:
- Conducting interviews and focus groups with salespeople, industry experts, and network connections.
- Gaining a deeper understanding of specific client needs and cultural preferences.
Step 2: Market Entry Plan
With detailed research completed, we identified our Ideal Client Profile (ICP). We defined:
- Target segments: Which industries and verticals to focus on.
- Approach channels: How to reach clients (e.g., direct campaigns, LinkedIn, or email).
- Service offerings: What to offer based on market demand.
Step 3: Testing Initial Assumptions
This is where things got exciting! We started putting our research into action.
- Confirmed our focus segment and best approach for converting cold leads to warm leads.
- For our targeted client segment, the most effective channels were direct campaigns (meeting offline after an initial email) and a LinkedIn-based approach.
Step 4: Offering & Business Etiquette
Korean clients have unique business practices. Here’s what we learned:
- Provide a company profile before the meeting: This saves time during the meeting as introductions are not required.
- No small talk: Korean clients prefer to get straight to the point in initial meetings.
- Build trust: Koreans don’t trust easily. Ensure your website and sales materials are flawless. Bring a translator to the meeting, and choose a professional venue to leave a strong impression.
- Provide guarantees: To remove risk, offer guarantees that demonstrate your commitment and reliability.
Step 5: Proposals & Interviews
Once we started generating leads, we faced our first significant challenge during team interviews. Despite a strong proposal, we failed because of translation issues. Our translator lacked technical knowledge, leading to poor communication between our developers and the client.
Lesson learned: Always ensure you have a translator who understands technical terminology.
Step 6: Scaling
Once we had all the pieces in place (client profiles, approach methods, offerings, and trust-building strategies), we decided to scale.
- Focused resources on activities that worked.
- Allocated more budget and shifted resources from other markets to Korea.
- Sent our top team members to Korea for a business trip.
Key Lessons and Summary
- From the beginning, have someone fluent in Korean on your team.
- Conduct thorough research to understand the market.
- Designing the right client profiles and approach channels is a game-changer.
- Learn and respect Korean business etiquette.
- Build trust with professionalism and guarantees.
- Once confident in your approach, scale up and maximize market potential.
- Korean clients often prefer project-based models over long-term contracts.
- Ensure you have a translator with technical knowledge during crucial meetings.
The South Korean market has significant potential for IT services if you approach it strategically and with cultural sensitivity.