Leaders Attack Abroad, Followers Defend at Home

The optimal international strategy depends on whether a company is a market leader or a follower.

The Leader's Strategy: Attack Abroad

If your company is a technology or market leader, the primary battle for the international market must be fought abroad, in the competitor's home market.

• Preemption: By being a strong supplier in all foreign markets, a leader can preempt the need for local suppliers to emerge.
• Containment: Even if strong local competitors do develop, attacking them on their home turf keeps them weaker and makes it less likely that they will be able to encroach on your other markets.

The Follower's Strategy: Defend at Home First

If your company is a follower, the optimal strategy is to develop and defend your domestic market first.

• Home Field Advantage: It is easier to succeed at home. Local customers are more tolerant, and the government may even provide protection and support.
• Build a Base: This protected home market allows the follower to build the strength, volume, and expertise required to eventually launch an export campaign.

This "defend at home, then attack abroad" model has been used successfully by Japanese companies and is a common strategy for countries and companies attempting to enter a market dominated by a foreign leader.