Planning is bringing the future into the present so that you can do something about it now - Alan Lakien
Without proper planning, a business is bound to fail. It becomes impossible to know if you are targeting the right audience, if the market is filled with similar solutions that you are offering or if you are way too early in the market. This is where the go-to-market strategy comes in. A go-to-market strategy is simply defined as how you bring your product to market. It includes target audience research, a marketing plan, and a sales strategy.
Eric Vest, a serial entrepreneur and M&A advisor, specializing in laboratory informatics shared his insights on the ways to bring your product into the market and how creating a go-to-market strategy can help immensely.
Let’s talk about go-to-market strategy in detail:
Go-to-market strategies anticipate the challenges of this competitive space by thoroughly identifying the target market, articulating the product’s value proposition, crafting a marketing plan, and developing a strategy for its sales and distribution channels. Some of the most common benefits of compiling an effective GTM strategy include:
● Gaining a comprehensive understanding of the marketplace, the target market, and the proposed product’s place in it.
● Keeping marketing costs down by identifying promotional channels with the highest return on investment (ROI).
● Troubleshooting product positioning and messaging before going to market.
● Concretely defining the logistics of distribution and sales channels before launch to ensure maximum market impact.
Go-to-market strategy benefits:
In addition to helping you launch a product successfully, compiling an effective GTM strategy can benefit your business in several ways, including:
Clarifies the business mission
Creating any sort of business strategy, including a GTM strategy, is a great opportunity to review your business’ mission and make sure your product efforts are in alignment. Why does this exist? What will it achieve for its employees and customers? What values drive this mission? How do new products support this mission?
Understanding the market
Compiling a GTM strategy involves gaining a comprehensive understanding of the marketplace, the target market, your competitors, and the proposed product’s place in it. With more insight into customers and the market conditions, your organization will have more tools to thrive in all areas of business, from product launches to introducing a new brand identity to the world.
With a solid GTM strategy, you can keep marketing costs down by identifying promotional channels with the highest return on investment (ROI) and developing marketing messaging and content that will resonate with your target market.
Reducing time to market
GTM strategies also help you launch products more quickly in the following ways:
● Prioritizing tasks that are essential for a product to enter the market
● Troubleshooting product positioning and messaging before going to market
● Concretely defining the logistics of distribution and sales channels before launch to ensure maximum market impact
Depending on the kind of product you are launching, you might consider the minimum viable product (MVP) approach: making sure the product has enough features to attract early adopters, validating the product, and learning what product updates or improvements could improve customer experience.
Building more brand awareness
With the launch and promotion of a new product, you have an opportunity to bring more attention to your brand as a whole, and even attract new niche markets, thereby expanding your customer base.
Increasing growth potential
Overall, a GTM strategy, when skillfully executed, can increase your organization’s growth potential. With access to new niche markets, organized market data, and an efficient process for launching products, you can seize growth opportunities more easily than without a GTM strategy.
How to create a go-to-market strategy:
A go-to-market strategy compiles several other strategies and marketing methods to ensure a product enters the market with the best possible chance of success.
To help you better understand what goes into compiling a GTM, the following guide includes key elements you should develop throughout the process.
Identifying target market.
The customer is the centerpiece of any marketing strategy.
As a result, whether you are bringing a new product to market or refreshing an existing one, it is imperative that you first research and identify the target market that will be most interested in purchasing it.
As you identify your target market, answer these questions:
● Is your product being sold to everyday consumers (B2C) or to other businesses (B2B)?
● Will you use demographic, psychographic, or other types of segmentation to define your target market?
● What are the pain points of your target market? What problem are you solving with your product?
Clarifying value proposition.
A product’s value proposition is the benefit it provides consumers and the problems it solves. In other words, your product’s value proposition articulates why the target market should purchase the product.
As you are preparing your go-to-market strategy, you should have a clear understanding of the value proposition that your product provides in order to direct your marketing efforts.
The exact value proposition that your product or service will provide is dependent on what it is and who its target market is. To define your product's value proposition, answer the following:
● What pain points does your product remedy?
● How does your product stand out from your competitors?
● What unique features or experience does your product or service provide potential customers?
Defining pricing strategy.
Price is an important factor for any product. You don’t want to sell a product for too much or too little. If you do, you’ll risk either not moving enough product or eating too much into your profit margin.
Now that you have an understanding of your target market and the value that your product offers, you have a better understanding of what price a consumer might be willing to pay for your product.
A good price is one that fits your business objectives, matches your customer profile, and makes you competitive in the marketplace.
Crafting promotion strategy.
Your promotion strategy is your action plan to promote your product to your target customers. Here, you should craft a marketing plan that outlines the exact steps you will take to reach your customer base.
The techniques you use to promote your product will depend entirely on the product or service you are selling. For instance, while one business might use a sales team to pitch its product to other businesses, another might instead focus on social media marketing to raise brand awareness and draw in potential customers organically.
Choosing sales and distribution channels.
Sales channels are where consumers can purchase your product, while distribution channels are the ways that your product actually gets to your customer.
Often, sales channels and distribution channels can be the same, such as when a consumer buys directly from a manufacturer. In other instances, distribution channels can be much more complex, such as when a producer sells to a wholesaler, who in turn sells to a retailer who then finally sells their product to a consumer.
Whether you decide to sell your product in-person or online, directly to a consumer or to a wholesaler, or some other variation, depends on the unique needs of your product. Whatever you pick, the buyer’s journey should be as seamless as possible to reduce friction and increase sales.
Setting metrics to monitor performance.
The success of your go-to-market strategy is completely dependent on the goals that you set. In setting these goals, you are also identifying the metrics you will use to measure your success.
As your GTM strategy goes from idea to reality, it is important to keep track of your metrics and to make any necessary adjustments as you go along. For example, if it turns out that you are paying more to acquire customers than they are paying for your product, then you will need to adjust your strategy to reach a better customer acquisition cost.
About the speaker:
Eric Vest is a strategic and M&A advisor, specializing in laboratory informatics and all technologies related to biotech, pharmaceuticals, clinical trials, public health, and healthcare. He works as an advisor or board member, mainly assisting private equity firms, their portfolio companies, and other growth-stage organizations who are trying to plan for an exit, raise capital, or make acquisitions.