Go-to-market strategies are very distinct from marketing strategies in terms of where they fall in a product’s lifecycle. A go-to-market strategy (GTM) is the planning and preparation for introducing a new offer (product or service) to a market. A marketing strategy is the ongoing programs and campaigns that you’re running to drive demand for that offer after it’s been introduced to a given market.
GTMs are more concrete. You only use them until you achieve product-market fit, whereas marketing strategies are more prolific, getting refined over time as you learn how your buyers get value out of your offer.
The following are the essential elements of a go-to-market strategy.
Define Your Market Conditions
What market growth strategy do you fall under?
In 1957, a mathematician introduced four categories of product-market introduction methods called the Ansoff Matrix.
Go-to-market strategies apply to two of those pathways: Product Development, where you are introducing a new product into an existing market, and Diversification, where you are introducing a new product into a new market.
Thinking about where your product-market fits in will help you define who you’re selling to and what you’re selling to them.
Who are your buyers?
Are you selling to businesses or people? Defining your buyers for your GTM is the same as developing your buyer personas for your marketing strategies. You want to understand what the day-to-day life of your ideal customer is like so you can understand their challenges and determine how your offer will alleviate their pain points.
That knowledge will set you up for success when developing your go-to-market strategy because it’ll help you develop the value proposition of your offer.
Who are your competitors?
Who are the other key players in the market you’re entering? How will you differentiate yourself from them?
If your offer is completely unique you want to capitalize on that, but if competitors are offering similar products or services to you, you need to find a niche that you can dominate.
Determine Your Selling Strategy
Value and price are the two main factors that determine whether a prospect will buy your offer. So as part of your value proposition and go-to-market strategy, you need to think about your pricing strategy.
A potential jumping-off point for this is analyzing the pricing strategies of competitors with similar products. Ultimately, your pricing strategy should be centered around your value proposition. Identifying that core value of your product allows you to define what your pricing strategy should be and build out your pricing model around that.
When deciding on a pricing model, consider whether you want to introduce your product or service through a freemium model or have customers start by purchasing your product or service outright.
Freemium involves offering consumers a free, lightweight version of your offer to penetrate the market quickly, and then offering paid upgrades to gain access to the full breadth of your offer.
This can be extremely effective if you have a strong understanding of your core values. For example, the core value of video-hosting solutions is the number of videos you can host. On a free version, you may be able to host up to 10, but as you use the product and want to host more than 10 you need to start paying.
Freemium is built on the principle of product-led growth, where the value of the product will sell itself and customers will inherently purchase because they love using your product or service so much.
Purchasing Up Front
The alternative to freemium is having a purchase be the only way to access your offer. If you use one of these models, you’ll need sales and marketing efforts devoted to driving purchases.
The actual purchase process should vary depending on your buyers. You can have online or eCommerce options, where buyers purchase a service or software through a website or order a product to be shipped to them. Another option is physical storefronts, where the buyers purchase your offer from your store or an authorized retailer.
New Breed uses an assessment and evaluation process, where customers can’t purchase frictionlessly but rather enter the sales process through an assessment, consultation or demo and then a salesperson walks them through the rest of the sales process.
Another potential selling strategy is using service-oriented channel partners to sell your offer on your behalf (with you or for you). As part of the development of your go-to-market strategy, you need to make sure your service partners are up-to-date on your offer prior to it entering the market so your partners know how to talk about it ahead of time.
Deciding on what pricing model and selling strategy works best for your offer and your buyers is an essential part of developing your GTM.
Market and Promote
The final part of your strategy is deciding how you will market and promote your offer when it launches.
If you’re launching your offer into an existing market, you should start doing your promotion with consistent customers. How you do that outreach — calls, emails, etc. — should be decided as part of your strategy.
If you’re entering a new market, you’re trying to reach people that you never have before, so you need to create a means through which they can discover your product. Examples of this include paid promotion through channels like AdWords and new content creation to bring inbound traffic.
Finally, if you have channel partners, you have to equip them with the information they need to sell to their customers.
Your go-to-market strategy lines up with the introduction phase of the product lifecycle and its main purpose is to get you through the introduction stage and into the growth stage.
More often than not, you’re going to have high costs and low traction when you first start out until you find product-market fit, which is where the market you identified has begun purchasing your product, gaining value from it and begins growing from there. Once you’re in your growth stage, it’s time to start implementing a marketing strategy that’s informed by the things you learned about your product and buyers in the process of achieving product-market fit.
Topics: Demand Generation