We've spent the last month offering advice on expansion into another of our core European markets, the DACH region — Germany, Austria, and Switzerland. As consistently the largest economy in Europe and now fourth in the world, Germany is a particularly good target for the European expansion of your tech company.
Across the board, the German government has prioritized technology innovation and adoption. Its continued focus on the digital infrastructure, economy, workplaces and public administration across all parts of society, makes it a strong foothold for any European takeover.
Furthermore, Germany has a stable economy with tech-savvy, eager customers with good budgets. But that doesn’t mean closing deals there is a given. Read on to learn what works and what doesn’t when you’re heading to Europe’s wealthiest area.
Some of the evergreen industries for the German market will not surprise. It continues to be the best audience for technology geared toward its $22 billion automotive industry, which includes some of the most exciting use cases in autonomous driving, customer experience and edge computing.
Both Germany and Switzerland are also known for their banking and financial services. With everyone looking to stay competitive in response to ever-changing customer demands, innovative fintech has a very receptive audience. Note that this quick growth in financial services often relies on existing customer relationships with the DACH region’s largest banks and insurance firms.
And then there’s telecommunications, which, while being one of the most high-tech markets, trends towards the traditional. Across Europe, telcos expect long-standing relationships with in-country sales reps, who understand the in-company politics and can identify the often many stakeholders and decision makers. The same is true from connected devices and IoT, which need channel sales partnerships.
While Germans evaded the energy crisis by quickly moving from Russian to other European natural gas suppliers, like the rest of Europe, Germany is experiencing a massive push toward greener energy with a goal of 65% renewables by 2030. That means anything that measures carbon footprint and any GreenTech reaches an eager DACH audience.
Cybersecurity also finds an apt German-speaking audience, as attack vectors become increasingly sophisticated.
As markets tighten, anything that reduces risk, increases sales — like proven Martech — or automates areas that are short-staffed are very welcome too.
Also with Germany being the largest ICT market in Europe, any technology targeting technical decision makers — like infrastructure and AI — find eager prospects. In fact, the German government plans to invest $5 billion into a national AI strategy by 2025. It also features an impressively updated infrastructure, including 5G available in about 95% of places. The IT sector continues to be an essential economic driving force in the DACH region, making it evergreen with tech-savvy buyers.
At Sales Force Europe, we’ve been privileged to be yearly mentors at several startup incubators in DACH, including the Swisscom Third Party Services program and the Zurich Innovation Championship. We witness the uniquely German appetite for and grasp of technology and are confident it’ll continue.
But just because they are open to tech adoption — and have the most stable European economy — doesn’t mean it’s easy. Indeed, Germany is probably the strictest enforcer of GDPR and keeps a keen eye on SaaS companies and their data usage, preferring to trust locals with sales and marketing. This also means, at the very least, all your European customer and prospect data must be stored within a European Union country. If you cannot prove your compliance, your B2B lead generation will not go far in DACH.
Germany already has a thriving tech market. If you want to thrive there too, you need proven use cases and customers. If your testimonials come from outside the DACH region, it’s essential they be localized into German. German speakers are known for their business skills and efficiency, which means directness and clear benefits must be integrated across all messaging. Integrate metrics — including percentages gained — within your marketing.
You don’t just need native German speakers calling prospects, but sales reps and BDRs need a strong presence with a large network on both Xing (DACH’s number one business social network) and LinkedIn.
Even post-COVID, Germany maintains a heavy trade show culture. Events like it-sa and Embedded World can’t be missed — you better have skilled sales reps on the floor networking and behind booths.
Likewise, German trade associations make for incredibly powerful partnerships. If you’re targeting telcos, you need contacts at Bitkom and VATM. Anything around cybersecurity must build relationships with the folks at Teletrust and NIFIS. Being a member of or having a trusted partner in Bitmi is a strategic win if you’re a SaaS company targeting medium-sized businesses.
You really need dependable advisors on the ground in the DACH region. This market takes effort to reach, but that effort has paid off year after year. With a trusted German sales outsourcing partner, you can go far.
Bonus, once you’ve proven your tech’s value and sustainability in Germany, you can start to build your local headquarters, filling it with well-educated German talent.
Have any more questions about expanding into the DACH region? Contact us! Viel Glück!
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