Any entry into a new market needs to be taken in steps – the first of which is brand advertising. You need to build brand awareness and demand for your products long before you make your first sale. This can be costly, but not nearly as much as a premature product launch.
Previously, I talked about brand advertising. It is an absolute necessity when you begin to build any new brand – even when you intend to re-release an existing brand. Brand advertising builds a public knowledge of your project and creates anticipation of your product release. It is easiest to enter a market when people are already waiting for you.
A good example would be the fast food chain Sonic. For the longest time, there were no Sonic locations near where I live – none in this part of the state at all. However, Sonic still advertised on local television networks. When there was a commercial, everyone would gripe about the lack of availability of their food. They would promote their newest milkshake – the closest imitator we could find, though was Burgerville.
Then Sonic started opening locations in the area, and business is booming.
Sonic built a customer base in a new geographic market without actually having a presence there. Imagine how hard it would have been to gain new customers without this existing interest in their food. Chances are good that Sonic would have struggled to cover its costs in the first year, and most of the people I know might never have patronized their restaurants.
