According to a CB Insights report, 42% of startups fail because they try to solve problems that they might think are interesting instead of ones that the customer is struggling with. A good way to remedy this is a Go-to-Market strategy (GTM). With a go-to-market strategy, businesses can understand the challenges that customers face and develop solutions to address them. Moreover, it helps businesses to achieve their end goals and boost revenue generation. But how to create a go-to-market strategy? Every marketer, both aspiring and professional, struggles with this as it involves a thorough understanding of the target market, the customers, and their pain points. This article can help you navigate the topic and gain a better understanding of how to implement go-to-market strategies.
What is a Go-to-Market Strategy?
A go-to-market strategy is a plan of action that outlines how a business can connect with its target audience and gain a competitive advantage. It serves as a guide to deliver the right products and services to customers and enhance their overall experience.
A strong go-to-market strategy often identifies a target demographic, incorporates a marketing plan, and provides an outline of a sales strategy. It can recognize the challenges that customers are facing and help businesses to launch a new product as a solution to those challenges in the market.
Go-to-Market Strategy Examples
Before exploring the steps of how to create a go-to-market strategy, let’s first understand it better with the following examples.
Known for creating interesting content such as video tutorials and courses on graphic design, Canva’s design school uses this content to help users to learn graphic design in a simple way. It then allows the users to remain connected with the brand, ultimately, boosting its revenue.
GumGum, a U.S.-based contextual intelligence, and advertising optimizing company, used an Account Based Marketing (ABM) go-to-market strategy to close one of the biggest business deals with T-Mobile. They wanted to acquire T-Mobile as a client, and some surfing on the internet informed them that the CEO of T-Mobile was a die-hard batman fan. GumGum then created the iconic T-Man and Gums The Girl Wonder ad just to capture his attention!.
The Components of a GTM Strategy
A go-to-market strategy encompasses four major components: product-market fit, the target audience, competition and demand, and distribution. Let’s understand each component in detail.
1. Product-Market Fit
The company that product launches in the market should solve a specifically identified problem. For example, Google developed an algorithm called PageRank that helps users to determine how authoritative and legitimate a webpage’s content is on a specific topic after analyzing that webpage’s backlinks.
2. Target Audience
Who will be using the product? Do they have purchasing or decision-making authority? Who are the actual buyers? All important questions must be asked before creating the GTM strategy.
3. Competition and Demand
Be aware of who the competition is and develop strategies to beat them. Analyze customers’ interest in the product and take note of and avoid the mistakes made by the competition.
Formulate a sales and marketing strategy. This helps in determining the optimal pricing for the product and the packaging in order to generate the highest possible revenue.
Why do You Need a GTM Strategy
The purpose of a GTM strategy is to provide an outline of how to deliver products or services that customers require. With a GTM strategy, you can understand the reason behind the launch of particular products and services and know who are their prime users. This, in turn, helps to create a strategy to engage with these target customers and convince them to purchase those products or services. Besides this, a GTM strategy is also required for the following purposes:
- Launch new products or services
- Introduce the existing products to a new market
- Relaunch the company
How to Create a Go-To-Market Strategy
Now that you have a clearer understanding of what is a go-to-market strategy, let’s look at some of the steps involved in how to create a go-to-market strategy.
- Identify the Target Buyers: The first step to designing a successful go-to-market strategy is to identify who the buyers are, who has the buying authority, and who is the actual purchaser.
- Construct a Value Proposition: The value proposition for a product explains why the target customers should buy the product. A clear understanding of the value proposition of a product can enable the design of a suitable go-to-market strategy.
- Identify a Suitable Promotion Approach: Create a strategy that outlines step-by-step guidelines to reach its customers and promote the product. The promotion or marketing strategy should be tailored to the product or service.
- Set up a Sales Process That Works: To create a robust go-to-market strategy, a company should set up guidelines. These should describe how its sales team will move potential customers through the sales funnel using target buyers’ information and value proposition.
- Select a Strategy to Increase Product Demand: There are two kinds of strategies to boost product demand—inbound and outbound. Inbound strategy is when customers contact the company inquiring about their products or services. Outbound works the other way, in that marketers reach out to potential customers to create interest in their company’s products and services.
GTM vs. Marketing Strategy vs Marketing Plan
A go-to-market strategy is not the same as a marketing strategy or a marketing plan. All three, in fact, are different.
- A marketing strategy is for the long term (often over the course of many years) that outlines the overall marketing goals of a business.
- A marketing plan, on the other hand, is a list of the concrete steps that need to be taken to start a marketing campaign.
- A go-to-market strategy is a plan for the steps and factors that are needed to bring a new product into the market.
Let’s understand this differentiation by an example.
Imagine a set of three Russian nesting dolls. The smallest and innermost doll is the GTM strategy, which is a set of rules for launching certain products. This is usually a short-term or time-limited project with specific success metrics for each offer.
The next doll immediately outside this innermost doll is representative of the marketing strategy, or how the overall campaign works. This is over a longer term than a GTM strategy and has higher measures of success. It will be changed or rebuilt as needed over time.
The marketing plan is the largest and outermost doll. It tells what the company needs to do to be successful and make profits. The plan is expected to be updated relatively infrequently, typically only in the event of a major business event such as a merger, acquisition, or bankruptcy.
Additional Considerations (Budget, Metrics, and Resources)
There are other important factors that a company should consider before designing a strategy.
- Budgeting: A business owner should make a budget and think about everything, such as product development (if needed), staff, research and development, warehousing, and marketing. A plan should be in place for future cash flow and events.
- Metrics: Measuring the success of a product launch is an important part of a go-to-market strategy. The metrics should be realistic and measurable.
- Resources: Resources include manpower and suitable technologies. With the right resources, a business can design a suitable strategy for its growth before it even starts.
A go-to-market strategy ensures you have a detailed plan to launch a new product successfully. Without a GTM strategy, you might focus on the wrong type of customers or try to sell your product in a market that’s already too crowded. A good GTM strategy makes it less likely that you will waste valuable time, money, and resources on a product launch that doesn’t work. If you want to learn more about how to create a go-to-market strategy, and dive deeper into understanding other marketing strategies, enroll in the online sales and marketing courses offered by Emeritus. It’s a great way to enhance your knowledge and build a career in the marketing industry.
By Riku Ghosh
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