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EU Expansion: How to Expand into European Regions

New regions, new opportunities and the potential to make the big bucks.

There’s a lot to be won by expanding your business into new countries. But nothing worth having tends to come easily…

Language barriers, legal differences and cultural conundrums - there’s a lot to consider and unpack when you’re thinking of expanding into Europe. So we’re going to do it for you!

Keep reading for our deep dive into how to effectively expand into Europe 👇

EU expansion challenges

Unlike somewhere like America (where there’s a large population all speaking the same language with relatively similar cultures and histories across states), Europe is a collection of smaller countries, each with a different language (24 official languages to be exact), distinctive culture and slightly different ways of operating.

It’s much easier to say, ‘let’s expand into Europe’ than it is to actually do in practice, because you can’t blanket the same strategy and messaging across each of these countries. They’re too different.

Just because your GTM strategy worked in one territory doesn’t mean it’ll work in another.

We’ve all heard the Mcdonald’s example, where they initially struggled to break into the Indian market due to a lack of cultural understanding. American fast food culture wasn’t instantly appealing in this new location.

Another example is the Chevy Nova - a very popular car in the States. So Chevrolet decided to bring the car to a Spanish-speaking audience.

What they hadn’t considered, however, was how the car’s name translated into Spanish…

No = No

Va = Go

It’s unsurprising that this car wasn’t hugely popular in Spain!

Now, you might think that’s a silly reason for a car to fail in a market - and who knows if that’s really the reason the car didn’t perform well.

But the main point here is that many cultural nuances can impact the success of your EU expansion, depending on native perception.

You can’t make assumptions about what will or won’t work in a new environment.

Are you ready to expand to the EU?

When do you know if your business is ready to expand into a new region?

A few signs can signal you might be ready to start your expansion, such as:

  • You have a significant or growing portion of your conversions coming from an international audience.
  • The domestic market is becoming saturated and growth is plateauing.
  • You’re in a healthy financial position, with strong profits and positive cash flow (expanding requires upfront investment, and having financial stability will be crucial for navigating initial challenges!).
  • Your current operations are running smoothly and efficiently - your existing business is well-established and can handle the additional demands that come with growth.

Liam Bartholomew, Cognism’s VP of Marketing, said:

“The main thing to look for is demand. Before we expanded into new regions, we’d be noticing a percentage of our opportunities and inbounds were coming from this place.”

“It was slightly different when we first expanded into France. We purchased Kaspr, which was an already established business in France. So we knew that they had demand there already.”

“And when we decided to move into DACH, one of the main motivators was a lack of competitors in the market.”

“But as soon as there’s a sign that there’s demand, that’s a big reason to look into moving.”

Liam suggested a way to test out a new market before making the jump:

“We sometimes run ‘R&D spend’ - as we call it - in different countries and when they hit certain benchmarks, i.e. x number of opportunities from a country based on the small amount of spend then that’d trigger a threshold for expansion.”

When expanding into the EU, you need to take several factors into account:

  • Is your business ready?
  • Is the market ready?
  • Is there enough indication in other markets that it can support your expansion?

That’s where on-the-ground research in new regions comes in.

What market research and analysis do you need to do?

It’s easy to say you’re going to move into a new region - but where? And once you’ve got a new country in mind, how do you confirm it’s the right choice?

At this stage, thorough market research is your best bet.

Liam said:

“There’s loads of research that should be carried out before you make the leap to expand.”

Here are some important areas you need to deep dive into:

Opportunity analysis

Is there a genuine opportunity in this region? Can you be successful by putting resources here?

Do the people in this new region operate in the same way as your ICP at home? Do they have the same pain points? Would they use your product for the same use case?

Liam explained with this example:

In DACH, you need double opt-in consent to email someone. Therefore, the email data available in the Cognism platform isn’t compliant for them to email to.”

“Pushing how Cognism has email data in DACH wouldn’t make any sense. So it makes more sense to focus on phones, mobile data and enrichment.”

Another example:

You could use the Cognism product for a demand gen approach by creating lists of contacts for targeting your ICP with relevant content.

However, if marketers in Germany or France are still more focused on lead gen, then messaging about demand gen wouldn’t make much sense there.

This is where ICP interviews in your new region become imperative. There’s no space for assumptions.

How would your product fit into their working lives, and does that match how you currently market your product?

Is there a way to market your product so that it does appeal to their particular circumstances?

Liam gave us some questions you should ask your ICP during these exploratory interviews:

  1. If you’re having a problem with (insert problem you solve here) where would you go for your information?
  2. What tools are you using for x, y and z?
  3. What does your current workflow look like?
  4. What content do you like to consume?
  5. What are the main challenges in your role?
  6. How do you like to be marketed to?

He added:

“You need to build your ICP in this region from scratch.”

If the results from your interviews indicate demand for your products or services in this new region, and there’s a gap in the market that your company can fill, it’s a positive signal for EU expansion.

Competitive analysis

As briefly touched on above, you’re looking to find a gap in the market. Hopefully, that means there’s not a lot of competition - but in an increasingly competitive world, having no competition is becoming increasingly rare.

Liam said:

“You should look to pin down the other competition in the market. What are they charging? What do they offer? Who are they targeting? How could you position yourself in the market next to them to stand out?”

Here are some steps you can take to deeply understand the current players in the market:

1. Identify key competitors

Begin by identifying your direct and indirect competitors in the European market. Look for companies offering similar products or services within your industry.

Create a list of ones you’re going to keep an eye on. And continue to keep your eyes peeled for future market entrants.

2. Understand market dynamics

Analyse the market dynamics in the European countries you want to expand into.

Consider factors such as market size, growth trends, and any specific challenges or opportunities unique to the region.

3. Segmentation and target audience

Break down the market into segments and identify your target audience within each segment.

Take the time to deeply understand the preferences and needs of these segments. Then you can tailor your marketing strategies effectively.

4. Product or service differentiation

Evaluate how your products or services differ from your competitors. Identify unique selling propositions (USPs) that can give your business a competitive advantage.

How can you make yourself different from others in the market? In other words, why would customers choose you?

5. Pricing strategies

What prices are your competitors charging? Do they have similar products for a similar price point? How does your pricing compare, does it align with the market norm? 

6. Marketing and branding

Study the marketing and branding strategies your competitors use. Examine their online and offline presence, messaging, and positioning. What are the strengths and weaknesses in their marketing approaches?

Also, study successful marketing in this country in general. What are the common themes of things that work?

Talent analysis

Arguably, one of the most important things you need when expanding into the EU is local knowledge and industry-specific talent.

If the McDonald’s and Chevrolet examples have taught us anything, it’s that it pays to understand the local culture and language.

Jonathon Ilett, VP Global Sales at Cognism, said:

“Your base should be around the available talent pool. Where are the hubs for talent in those regions, and are they accessible? That’s the key one for me.”

And we don’t just mean local tour guides or translators who know the area.

We mean local experts in your niche. You need someone who understands your target market, their problems and needs. Who can advise you on whether or not your messaging will resonate well in the region?

If we hadn’t had this local expertise early on in our expansion into Germany, for example, it would have taken us a lot longer to realise that the German B2B buyer journey was a few years behind the UK in terms of development.

We were able to adapt our marketing strategy to reflect this from the beginning. Saving us a lot of time, resources and stress!

So the first thing on your list should be ‘can we get the right people on the ground to get our GTM motion off to a solid start in this region?’.

Jonathon said:

“Focus on the skills they have rather than the title; people who do similar jobs and have similar responsibilities might be called something different to what you’ve heard them called.”

In other words, job titles might not match up to titles you’re used to. For example, CROs are super common in the States, but are only just starting to pop up in Europe.

Jonathon added:

“A top tip for hiring in Germany: almost all first-time hires in entry-level positions are all still doing their degree. So if you’re hiring SDRs in a new region, it’s good to partner with universities to get the talent.”

What this boils down to is doing your research and being prepared before you start your expansion to the EU. You want to understand the region you’re moving into as much as the one you’re moving from.

How do you make sure you’re legally compliant?

This is a super-important bit to get right when you’re considering EU expansion.

Liam said:

“Like I mentioned earlier about how our email data isn’t compliant in DACH due to their strict double opt-in rules - there might be ways in which you’re operating in other jurisdictions that you can’t do in this new region.”

“You need to make sure that you comply with all the local regulations before you start selling.”

There are a few legal practices you need to keep in mind here - as often, each country in Europe has slightly different applications of these regulations.

Such as:

GDPR

The GDPR is very important to understand as it can land you in serious hot water if you don’t comply.

While GDPR laws apply to all EU countries, how the GDPR is interpreted across those countries can vary, emphasising the need for local legal knowledge.

This is especially important for those organisations hoping to build local sales and marketing teams in new regions, as you may not be able to operate in the same way as you do in your HQ country.

Arguably the most important compliance consideration, however, is where your data is hosted.

If you’re operating in Germany, for instance, you’ll need to guarantee that your customers’ data never leaves the country.

Employment legislation

Employment law can also be complicated and is far more likely to vary from EU country to country.

Liam advised:

“You should get professional advice before you hire in a new place. Some countries have much stricter rules on what you’re allowed to do regarding hiring and firing.”

For example, in the Netherlands, ending a permanent employment contract unilaterally is not allowed.

As a result, the majority of employment agreements in the country are typically agreed as fixed-term contracts rather than indefinite ones.

And in the UK, notice periods for terminating employment are generally shorter than in other European countries. It’s common for employers and employees to provide one to three months’ notice.

Whereas in Germany, notice periods can be longer, with a standard notice period of four weeks, but this can extend based on an employee’s length of service, reaching up to seven months for long-term employees.

Another thing to take into account is that in some countries, like Germany, employees can set up workers’ councils.

Jon explained:

“Employees can set up workers councils if there’s enough people in the region and you have a German entity (five or more fully employed staff).”

Essentially, a workers’ council is elected members of staff who have a say in influencing workers’ rights and compensations. Such as increasing wages, workplace conditions and more.

Employers are legally bound to give these workers’ councils information, and they have a right to negotiate new terms.

Corporate taxation laws

This is a biggy, which if got wrong can lead to financial penalties and other punishments that we’d all rather avoid!

Each European country will have its own rules and regulations for businesses operating within them, leading to different tax rates.

Portugal, for example, had the highest combined corporate income tax rate in 2023, reaching 31.5%.

Whereas Hungary had the lowest combined corporate income tax rate, reaching just 9% in 2023.

Liam said:

“Even if you’re selling remotely into a region, you might be liable to pay VAT or sales tax.”

Engaging with legal professionals who are familiar with the specific jurisdictions you’re entering is essential to ensure a smooth and legally compliant expansion into Europe.

What are the cultural considerations you need to think about?

Culture can be so nuanced and isn’t necessarily written down in a textbook for someone to learn. So arguably, this is even more complicated than the previous points.

Cultures are important to understand if you want to avoid accidentally alienating people in a new region, whether it’s those you wish to employ or those you hope to sell to.

For example, if you’re doing outbound sales - communication styles in Germany and Switzerland often lean towards being more direct and to the point.

However, in France and Spain, a more indirect and nuanced approach is more common. And British audiences generally appreciate a process that builds on relationships.

Realistically, this is something that takes time to learn - however, you can speed up this process by bridging the gap with native speakers.

Jonathon said:

“Whenever we have expanded into a new country, we have always had a leader on the ground who has experience selling into that region. Rather than trying to cookie cut what we have working in the UK or US.”

“In other countries, people have different workflows and different ways of communicating. And the whole buying process is just different. So you need that local expertise.”

When it comes to becoming an attractive place to work, it can help to understand where you stand within the cultures in the workplace.

For example, most businesses in Spain will shut down for the whole of August, and employees are expected to take the bulk of their holiday dates within this month.

So, a company offering more flexibility with holidays has an advantage in attracting talent.

There are so many cultural considerations to consider - and each will vary from country to country in Europe. So we can’t cover all of them here.

Our best advice is to have people on the ground from the beginning who understand the landscape, language and culture so that they can help you learn fast.

How do you localise your marketing strategies?

The most crucial aspect of localising your strategies is this:

It’s about more than just translating your content into another language.

Liam said:

“Translating content will only get you so far. It’s about creating regional-specific content. Content that’s written specifically for the needs, pain points and circumstances in that place in the language that they speak.”

In other words, you’re not just publishing the same things that you did back home. There’s no guarantee that what worked there will work in the new country.

Instead, you need to refer back to your research before the move. What did you find out about your ICP in this country?

Then create dedicated content and marketing strategies to reach those people.

Yes, it’s more work - but you’re far more likely to succeed when you make an effort to speak directly to the people you want to target.

In that same vein, you equally can’t just assume that the channels you used before will be the right channels in this new country.

Liam said:

“Different countries will have different variations of channels. For example, in DACH, there’s Xing, which is a competitor to LinkedIn.”

“Some countries use different search engines. Google isn’t as dominant as it is in the UK.”

“Again, speak to customers. Find out where they get their information and content. Where do they spend their time inside and outside of work?”

How do you get started with EU expansion?

So you’ve decided which European country to expand into, and you’re ready to put out some digital feelers to see if it’s a viable plan.

Here are some steps that Cognism’s Senior Demand Gen Manager, Jamie Skeels, suggests for dipping your toe in the water.

1. Validate demand with Google Ads

Set up Google Ads campaigns targeting high-intent keywords (competitor terms and keywords with clear buying intent for your product).

Jamie says:

Google Ads is a bottom-of-funnel, demand capture channel. By targeting these keywords, you’ll reach a problem-aware or solution-aware audience, likely with buying intent.”

You can use these Google Ads to:

  • Gauge if there is pre-existing demand to be captured.
  • Understand what degree of product and message market fit you have in that region.

2. Expand demand capture efforts with LinkedIn retargeting

If you have a large enough retargeting pool for this region, you can start serving them tailored retargeting ads on LinkedIn.

Jamie says:

“You can retarget in different ways. Common audiences include previous website visitors, previous engagements with other ads or video views.”

This is another ‘safer’ way to test the waters via paid ads with a warmer problem or solution-aware audience.

This will help you to validate if there is pre-existing demand to be captured.

It will also help validate that there are multiple online channels where you can easily reach buyers in this new region.

3. Experiment with cold LinkedIn Ads campaigns

If your Google Ads and retargeting campaigns are performing well, we’d recommend then building out some cold audience campaigns.

The goal is to build your retargeting pool and grow your awareness with a wider audience in the region.

Measuring success

How do you know if you’re on the right track with your EU expansion?

No doubt senior leadership and other stakeholders will be keen to see this venture succeed… so how can you measure performance to report back?

Liam said:

“The hardest part is setting yourself benchmarks to begin with - but you just have to estimate what success for you might look like at each stage of your expansion.”

“Look at the market’s maturity, how many competitors are there, whether or not people are solution-aware and problem-aware.”

“From that - if you have one to compare to - compare it to a market you’re already in. And work out your best guesses on your cost per SQO and cost per lead. Then what your targets should be.”

Essentially, what pipeline and revenue targets are realistic based on all the related factors?

Liam added:

“Then it’s pretty similar to your measurements back home. Looking through the funnel. How many inbound demo requests are you getting? How many meetings are booked and attended? And then also looking at your engagement metrics.”

Another vital thing to measure when trying to establish a brand in the EU is brand awareness, recognition and what that brand is associated with.

Drew Leahy, Head of Product Marketing at HockeyStack, said:

“If you have, say, five associations you want people to hold with your brand, and you want to find out how you measure up to them right now. Go out and find a baseline.”

Ask your customers and your prospective buyers questions about:

  • What they think you sell.
  • What words they’d use to describe your business.
  • What reasons they think someone might buy from you.
  • What content or adverts they’ve seen from you that they recall.

Use this to help you build a brand campaign to improve any areas that are lacking.

Then ask them again in 6, 9, or 12 months to see if you discover anything different.

EU expansion: the last word

Expansion into any new region isn’t easy - but success in Europe really just comes down to being prepared.

Doing deep research into the marketplace and ICP.

Creating dedicated content and campaigns that speak directly to those target segments.

And bringing in the expertise you need to learn fast and stay compliant.

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