When it comes to scaling a business’ marketing internationally, companies are often faced with a few issues:
Hanns Schempp is someone who knows how to build a profitable, sustainable international business.
After setting up the B2B marketing division inside of a major European telco in 2013, his team grew from 0 to over 50 and succeeded in creating over 7 years of consistent business growth and running over €3 billion in annual revenue across 12 countries.
In 2020, he moved on to founding the Frankfurt, Germany-based but globally operating strategic marketing consultancy Miota that repeatedly worked with scale-ups, unicorns and transformational corporates to deliver international business growth using a proprietary marketing effectiveness and management framework.
Jeeves sat down with Hanns to find out:
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While there is no universal definition, scaleups are commonly seen as venture capital-backed companies with 50 to 100 employees and over €100 million of annual recurring revenue (ARR). In such companies, there might be 30 to 40 sales staff, developers, customer success representatives, and other customer-facing functions.
However, there's often less than a handful of marketers and no real lead in the organization.
Often, growth in these companies is driven mainly by digital sales. And in fact, this approach often works well. Hanns calls this the level 1 relationship – a balanced input-output ratio between an intuitive spend on visibility, sales outreach and lead generation.
But over time, these companies have to put in ad spend to get the same number of leads as before. Customer acquisition costs begin to increase slowly, then soar. Leads become more expensive and less qualified, even though performance ad spend grows.
Companies find their initial disruptor impact disappears as other firms start offering similar products and targeting the same user base. The difference is that they have a real brand to fall back on, which makes a positive difference. The initial company’s marketing instead, remains just a sales channel.
This is a structural problem Hanns sees within many fast-growth businesses, which explains why many startups and scaleups struggle to run marketing effectively and especially across several countries.
The premise of this is that if you recruit a local team in another country, they’ll end up getting the same results as in the home country because you don’t have a well-crafted brand, marketing strategy and practice to teach them from your home country. Pure trial and error plays out terribly, if spread across entire regions.
The result is that in the end, most companies in this position outsource and hire expensive consultants to come up with a scaling strategy and structured practice models.
There is a better way. Hanns recommends taking the following three-step approach to scaling overseas.
First of all, you’ll need an experienced Chief Commercial Officer (CCO) for this. A motivated, somewhat seasoned individual to bring about commercial success and will eventually manage overseas marketing expansion inside balanced go-to-market operations.
“Imagine you suddenly pick up a surge of interest in a specific country or region: you won't be able to build up even a linear extension of your business if nobody has a role or time for priming and onboarding these potentials in a locally promising variant of a brand and marketing strategy.” – Hanns Schempp, Miota Founder and CEO
Before scaling internationally, companies should have a proven and effective domestic marketing team and strategy.
Whether you create a team of 4 or 20, Hanns suggests to hire typical marketing team member personality profiles, rather than default functions, to be most effective. For example:
This phase is about a marketing approach that works specifically for your company. And rather by experimentation, than by adopting other firms’ blueprints or whatever the public’s opinion on a marketing strategy de jour is.
People should show a certain agility in thinking and be keen to identify and solve new challenges. That means taking decisions based on interpretation of performance data, competitor actions and user feedback but still evaluated against scientific and practitioning evidence.
Hanns suggests to encourage this without ever assuming that experience, evidence and systematics prevent energy, fun or passion for a company and its business. “Things done solidly are as much a blast on impact, as are improvisations with a lucky outcome.”
Failing to activate such a practice is easily one of the biggest mistakes he sees.
“No matter which approach you take, the more centralised and overarching, or - conversely - the more experimental and layered, the more you should be steering.” – Hanns Schempp
When you have a proven, effective marketing strategy, the decision whether to centralise or localise your marketing effort should come naturally.
If you cannot, it usually indicates that your strategy is lacking. A good strategy should tell you:
“Open your culture to mindsets, methodical awareness, and skills that are not guaranteed to be found in the startup ecosystem”
– Hanns Schempp
In each country you launch, build your local team fast. If it’s not growing fast enough, get help from your People & Recruiting Team above and beyond the bare essentials.
Hanns recommends you give each team time to dig in operationally, though. In the beginning, have them launch experimental digital-only campaigns to bring in initial leads and sales. Move on to have them develop country-specific campaigns which take account of linguistic, cultural, and legal differences and a new set of competitors.
Naturally, your CCO should have overall responsibility for your company’s marketing efforts at home and abroad. That said, when overseas teams take more experimental marketing approaches, the CCO should be there to help them and layer the results they generate.
This means involving local teams in later revision of the overall marketing strategy, but not immediately. A good time would be after they have a full understanding of local product-market-fit. Also, passing on more budgeted responsibilities to local efforts as results improve is a great way to motivate the initial experiments if successful.
And while building up local independence is a good investment, it also pays off to send support fast from the home country HQ if the local team isn’t getting results as planned. This, however, works both ways: a local expert who carries operational experience back to helping the HQ team build, say, a region-wide marketing asset platform can be a game-changer mid-game.
Founders and CCOs should also look beyond digital marketing, even if they feel that their product or service is disruptive and comes with so-called first-mover advantage. Hanns cautions that, over time, any product will simply become another choice.
Competitors will target your market, by which time you should be able to multiply impact – by already having greater brand awareness and availability than new market entrants. Not only awareness of your product and some of its specifications.
If you invest in brand building over time, your name and business benefit will come more quickly to your potential customers’ minds the moment they are looking to solve a problem or satisfy a need — perhaps months after their contract with a competitor expired.
Brands that take this approach make it easier to buy their product through better distribution. In retail terms, this would be a prime shelf spot in a supermarket with little check-out hassle.
In the digital era, Google, Amazon and social media can be the supermarket shelves of today. While brands do everything to be found easily online, they often still struggle when it comes to offering an attractive store interior, customer experience and seamless utility.
Response-generating marketing action, including advertising, is good, but it’s not enough. You need to invest in building your brand awareness and availability. Like your competitors, you’ll eventually be able to scale and leverage your multiplying impact from country to country.
Start, if you will, by creating distinctive brand assets like a well-designed product, a catchy slogan, a unique and appealing visual style, or an easily identifiable logo.
But then be sure to use a well-strategized balance of inbound, outreach and proper advertising plus partner with companies in affiliate schemes or strike distribution deals to increase availability.
For example, with Jeeves you get access to specific distribution partnerships when you sign up, including services such as Superscript and SendGrid or access to Levitate Foundry, an ecommerce agency.
Whichever way you multiply impact: your marketing team needs to find a model that’s right for your company through evidence and experimentation. Don’t just follow marketing models that were successful for other companies.
It’s fine to draw evidence from established marketing principles like 95/5 or 60/40 (referring to the - very general - ratios between non-addressable and addressable category shares and optimal effectiveness between brand building and sales activating marketing activity).
However, only stick with them if your own evidence shows that they can also be successful regarding the go-to-market maturity and regional footprint development your company is standing at.
The most proper marketing and path to scaling, according to Hanns, may just be experimentation, evidence-based work and not looking for binary solutions.
Especially if you’re going to market to other European countries, Hanns suggests to:
To get in touch with Hanns or to know more about him, you can find him on:
Written by Mark Fairlie