Ditch the guesswork: how to do proper market validation

Entering a new market shouldn’t be a gamble.

It’s a calculated move that requires thorough research, strategic planning, and flexibility.

Now, too often, companies attempt to expand their ‘playground’ based on gut feeling, past successes, or incomplete market knowledge, only to be faced with roadblocks and, ultimately, failure.

On March 11th, 2025, we hosted a fantastic event during which Petri Rinne, Enterprise in Residence at Coventures, shared a few thoughts on international market entry validation and strategic learnings from failed expansion plans.

Table of contents:

• What market entry validation is (and ISN’T)

• Why market entry validation matters

• Common market entry mistakes

• Successful market entry validation boils down to 6 key principles

• How to get started with market validation

Psst! Request our 14-step framework for market validation!

What market entry validation is (and ISN’T)

Simply put, market entry validation is the process of assessing the feasibility and potential success of entering a new market with a product or service.

This involves evaluating various factors such as market demand, competition, regulatory environment, and consumer behavior to determine whether the market presents a viable opportunity for the business.

In other words, market entry validation is about doing your homework to identify potential risks and opportunities, ensuring that you can achieve your strategic objectives in the new market.

Now, before diving into specifics, I believe it’s crucial to state what market entry validation is not:

• It’s not gut feeling: decisions should be based on data and structured analysis, not assumptions.

• It’s not a one-size-fits-all solution: each market has different customer behaviors, competitors, and legal landscapes.

• It’s not reactive decision-making: expanding because of past success or external pressures without validation leads to failure.

To be fair, the above-mentioned applies to anything strategic, really.

Why market entry validation matters

Market entry validation is all about reducing risks. And, right now, reducing risks might be your best chance to succeed in your strategic endeavors.

Now, what we observe is that companies skipping structured validation expose themselves to wasting valuable resources, financial losses, and significant strategic setbacks.

What’s more, success in one market doesn’t guarantee success in another. Having said that, PwC reports that approximately 80% of Finnish software firms look to Sweden as their first point of expansion.

For some, it could be the right move.

But there’s also a strong chance that it’s not.

In any case, you can’t know for sure without proper market entry validation, for each region has unique dynamics you must understand before committing significant investments.

Common market entry mistakes

Companies often make similar missteps when expanding internationally:

• Over-reliance on past wins: again, what worked in one market won’t necessarily work in another. For instance, your messaging might hit differently in some regions due to local competition, cultural misfits, or simply product market fit.

• Ignoring local market conditions: failing to analyze competitors, pricing structures, and regulations can be costly.

• Skipping structured research and planning

Overall, a lack of preparation will lead to making assumptions.

And assumptions lead to uncertainty.

Uncertainty leads to higher risk.

And risk leads to a high chance of failure.

So, what is a proper market validation process, then?

Successful market entry validation boils down to 6 key principles

You probably gathered it at this point, but expanding into a new market is a high-stakes move that requires careful planning, execution, and continuous adaptation.

Here are Petri’s must-follow six core principles that drive effective market entry validation.

Market intelligence, local insights & competitor landscape

Understanding the market dynamics is the foundation of any successful expansion.

Without deep insights into the target market, businesses risk misalignment with customer needs, regulatory missteps, and underestimating competition.

Suggested actions:

• Conduct thorough market research to identify demand, target customer behaviors, and industry trends.

• Gather local insights on cultural, economic, and regulatory factors affecting business operations.

• Analyze the competitive landscape to assess existing players, market gaps, and positioning opportunities.

• Utilize data-driven decision-making, leveraging AI, analytics, and real-world feedback from industry experts.

Tailored offering & stakeholder-centric value propositions

A one-size-fits-all approach rarely works in international expansion.

Successful market entry sometimes requires adapting products (or specific product features), services, and messaging to resonate with the local target audience.

Suggested actions:

• Customize your product or service offering to meet local regulations, ideal customer preferences, and industry standards.

• Develop a stakeholder-centric value proposition, ensuring each decision-maker (buyers, partners, regulators) sees tangible benefits.

• Refine pricing strategies to match purchasing power, competition, and perceived value.

• Adapt branding and marketing to align with cultural expectations and local nuances.

Robust sales engine & local resources

Sales success depends on a well-structured go-to-market (GTM) strategy that includes the right team, processes, and resources.

Suggested actions:

• Define a sales model that aligns with the target market (direct sales, channel partnerships, online distribution).

• Hire local sales talent or partner with local representatives who understand the business culture and potential customer expectations.

• Build an efficient sales process, including prospecting, lead qualification, and conversion strategies.

• Train teams with localized sales enablement materials to ensure effective communication and positioning.

Strategic partnerships & ecosystem engagement

Market entry isn’t just about selling a product—it’s about embedding your company within the local ecosystem to build credibility and accelerate growth.

Suggested actions:

• Identify strategic partners such as distributors, resellers, or industry associations to amplify reach.

• Engage with local influencers, business networks, and government bodies to build trust and authority.

• Co-create value through joint ventures, affiliate programs, or licensing agreements.

• Leverage industry events, forums, and B2B collaborations to gain visibility and early traction.

Crystal clear market entry objectives & execution roadmap

Without well-defined objectives and a structured plan, market entry efforts risk becoming disorganized and inefficient.

Suggested actions:

• Set clear goals and KPIs for validation (e.g., customer acquisition, revenue targets, partnership formation).

• Develop a detailed execution roadmap outlining timelines, key activities, and success milestones.

• Allocate resources effectively, ensuring team alignment and accountability.

• Stay flexible but focused, allowing room for adjustments while maintaining strategic direction.

Monitoring & adaptive strategy

Market conditions evolve rapidly, and successful companies continuously monitor performance and pivot when necessary.

Suggested actions:

• Implement real-time tracking of sales, customer feedback, and market response.

• Use data-driven insights to refine messaging, sales tactics, and operational decisions.

• Continuously test and iterate pricing, positioning, and marketing campaigns.

• Remain agile and adaptive, adjusting the go-to-market strategy based on real-world results.

Now that you’re up to date with the stakes, let’s get you started.

How to get started with market validation

With so many moving pieces and things to figure out, I understand how overwhelming this must feel. Having said that, feeling overwhelmed is a good sign. It means you’re ready to not make assumptions and understand a lot of work goes into market validation.

Below are Petri’s recommended steps to ensure a strategic and well-executed expansion.

Research your target market

Leverage your network: Connect with industry experts, local partners, and potential users or customers.

Test market interest digitally: Use content marketing, landing pages, and social media to gauge demand.

Use data-driven insights: Explore databases, AI tools, and competitive analysis to map the landscape.

Craft a detailed plan

Define your Ideal Customer Profile (ICP): Identify key decision-makers, pain points, and buying behaviors.

Fine-tune your value proposition: Adapt your messaging to resonate with the local market.

Design your sales process and team: Determine whether you need direct sales, partnerships, or a hybrid model.

Onboard your GTM team

Develop sales and marketing materials tailored for the new market.

Provide training to ensure your team understands local nuances and buyer expectations.

Set clear targets and feedback channels to measure progress and make data-driven adjustments.

Engage with the market & adjust

Start outreach early: Test messaging, collect feedback, and iterate quickly.

Capture real customer insights: Adapt based on market reactions and objections and refine your strategy based on concrete feedback, not assumptions.

Plan your market entry

Define a clear budget: Considering everything you know and expect from the target market, ensure you have a clear understanding of your budget and a plan to scale operations and support your GTM strategy.

Be ready for plans A, B, C … D: Ensure your movements aren’t set in stone, and be ready to adjust based on insights from early validation.

Define responsibilities: Strengthen your team and chances of success by ensuring the right people and processes are in place.

And, when you’re ready … go!

Of course, there’s always a risk with such ventures. But if you wait for the perfect window to get started, the train will leave the station without you. If you cover all the bases, you should have enough of a safety cushion to rebound each time you face a new challenge in the target market.

Psst! Request our 14-step framework for market validation!

Market validation is about strategy

It’s not about luck or assumptions.

Of course, there will always be counter examples of companies doing everything right and failing to succeed. But what we know for sure is that companies that succeed invest time and money in conducting market validation and careful execution.

Market expansion is not about moving fast; it’s about moving strategically to cover as many corners as you can to mitigate risks.

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As always, if you need expert guidance, we’re ready to help.