In the highly competitive SaaS economy, marketers and revenue leaders are tempted to focus on demand generation and marketing strategies when planning a new product or service launch. After all, foundational marketing is fundamental to driving revenue.
But a sound go-to-market strategy (GTM) cannot be overlooked when planning your product or service release. An effective GTM can be fairly straightforward, but it should always provide the strategic underpinning on which future marketing efforts rest.
Table of Contents:
- What is a Go-to-Market Strategy (GTM)?
- Go-to-Market Strategy Framework
- Go-to-Market Plan Methodologies
- Marketing Strategy vs. Go-to-Market Strategy
- Key Elements of a GTM Strategy
- 7 Steps to Building a GTM Strategy
- Examples of Go-to-Market Strategies
- Conclusion
What is a Go-to-Market Strategy (GTM)?
A go-to-market (GTM) strategy is an action plan that defines how a business positions its products or services in the marketplace. It provides a blueprint for reaching and serving customers, often outlining a unique selling proposition (USP), customer personas, competitive landscape, and marketing and sales strategies.
A GTM strategy is a pivotal aspect of your business plan. It aligns the organization's goals and resources with its marketing and selling tactics, ensuring a seamless customer journey from awareness to conversion. Without a GTM, businesses risk launching products or services that don't meet market needs, resulting in wastage of resources and potential failure.
Go-to-Market Strategy Framework
A GTM strategy should address four key points:
- Product-Market Fit: What problem(s) does your product solve?
- Target Audience: Who is experiencing the problem that your product solves? How much are they willing to pay for a solution? What are the pain points and frustrations that you can alleviate?
- Competition and Demand: Who already offers what you’re launching? Is there a demand for the product, or is the market oversaturated?
- Distribution: Through what mediums will you sell the product or service? A website, an app, or a third-party distributor?
Go-to-Market Plan Methodologies
There are two major methods for developing a GTM strategy, the funnel and the flywheel:
- The traditional funnel method focuses on attracting leads and nurturing them into sales, while
- The flywheel approach uses inbound marketing and other strategies to build long-lasting customer relationships.
Marketing Strategy vs. Go-to-Market Strategy
Before we dive in, let's get on the same page regarding the difference between a marketing strategy and GTM:
- Marketing strategy involves increasing revenue by identifying buyer personas and understanding the target audience. It focuses on generating demand and increasing brand awareness.
- GTM strategy involves creating an execution plan for how the product or service will be sold and implemented. It involves pricing, packaging, distribution, sales operations, and a deep understanding of the competitive landscape.
Therefore, GTM should be integral to any product or service launch plan. It helps create a roadmap for increasing revenue and achieving sustainable success by considering the total buying experience, from initial contact through post-sale customer service. A GTM strategy should include a detailed plan for understanding the target market, segmenting customers, and pricing and packaging products or services to maximize revenue and market share.
GTM strategy also helps ensure that all business activities are planned, coordinated, and executed promptly. It's important to ensure that the launch is well-run and meets all expectations to leverage increasing revenue opportunities fully.
Key Elements of a GTM Strategy
An effective go-to-market strategy should be tailored to the target audience and incorporate product market fit and positioning, pricing strategies, sales enablement, digital marketing tactics, and partnership development. It should also be agile enough to adapt to changing customer preferences and market conditions. Finally, the strategy should focus on increasing revenue through increasing product adoption from existing customers while simultaneously acquiring new customers.
By taking a data-driven approach, leveraging automation tools and measurement techniques such as A/B testing or personalization technology can help ensure that your campaigns are optimized for success. Implementing a comprehensive GTM strategy alongside your marketing strategy can maximize customer engagement and drive revenue growth and ROI for the long term.
While the level of complexity and detail can vary, along with the format of the documentation, here are the fundamental components you'll need to include in your GTM documentation:
1. Market Intelligence
To know how to introduce a product to a market, you need to understand the market you’re entering. The best way to gain that understanding is to conduct market research.
Many resources are available to help you gain insight into your market, from publishers like IDG to research companies like Gartner. Additionally, tools like the Ansoff Matrix can be effective frameworks for vetting your research. The Ansoff Matrix was developed by a mathematician and breaks product market introductions into four paths:
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Market penetration, where you sell an existing product to an existing market
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Market development, where you sell an existing product to a new market
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Product development, where you sell a new product to an existing market
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Diversification is where you sell a new product to a new market.
Understanding not just the market but also how your product relates to it is essential to developing your GTM and guiding your research and your messaging later on. Additionally, it is essential for your GTM documentation to contain a thorough competitive overview, including points of competitive differentiation. These can range from differentiated features to pricing or functionality. Challenging yourself to create a simple answer to the question of "What problems does my product solve" will pay significant dividends in your longer-term sales and marketing strategy.
2. Market Segmentation
The second element in a successful GTM is market segmentation. The findings from the market research you completed in the market intelligence phase determine who will most likely purchase your product, solution or service.
The market segmentation phase takes your market research one step further to help you understand the decision-makers within that market. Rather than defining your target market as CMOs at mid-sized SaaS companies, use your market research to create a buying center and buyer personas.
The B2B buying center consists of the various roles involved in a purchasing decision — from research and evaluation to actual purchasing. Understanding each buyer's role enables you to craft messages that appeal to the right person.
If you’re following the product development path, conduct research on your existing customers so you can best speak to their pain points. If you’re following the market development or market penetration path, survey your current customers about their experience with your product to inform how you frame your value proposition.
Developing buyer personas and ideal customer profiles (ICPs) will enable you to segment your market to target the best-fit customers. For example, instead of simply targeting CMOs at mid-sized SaaS companies, you’re targeting CMOs at mid-sized SaaS companies who are struggling to set up a reporting structure to prove the ROI of their marketing efforts.
3. Product Positioning
The final component of your go-to-market is how you convey your key value proposition. The value proposition is the unique blend of product features, advantages, and insights that your company offers. It explains why customers should choose your product or service over others.
You understand the market you’re entering and who your customers are. Develop your product positioning and messaging strategy to stand out from your competitors and resonate with buyers.
When creating your product messaging, ask yourself:
- How does your offer address the need in the market?
- What supports your claim that your solution will fulfill their need?
- Why should your target market believe you?
Positioning is often considered a "marketing function." However, the most effective GTM strategies build cross-functional alignment on core product messaging long before marketing activates campaigns and sales initiatives, so building positioning into your GTM strategy early will benefit your entire business.
4. Pricing Structures
When it comes to pricing structures, there are a few key things to keep in mind:
- First, consider the market dynamics, including factors like supply and demand, competition, and the overall economic climate. This can help you determine the optimal price point for your product or service, taking into account how much customers are willing to pay and what your competitors are charging.
- Next, you'll need to think about your cost structures, which can include everything from production and manufacturing costs to marketing and sales expenses. By understanding your costs, you can ensure that your pricing structure is sustainable and profitable over the long term.
- Finally, determine how much value customers perceive in your offering. This can be influenced by a variety of factors, including the quality and uniqueness of your product or service, the level of customer support and service you provide, and the overall customer experience.
By understanding what customers value most about your offering, you can ensure that your pricing structure reflects that value and encourages continued loyalty and engagement.
Other Factors to Consider
In addition to the main components of a GTM strategy, there are several other factors to consider when launching a new product or service in the SaaS and subscription economy.
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Digital Presence: A strong online presence includes having a well-designed and user-friendly website and activity on social media platforms that are popular with the target audience. Utilizing search engine optimization (SEO) tactics can also help improve the visibility and ranking of the website in Google.
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Strategic Partnerships: Identifying and building partnerships with complementary businesses or organizations can help increase reach and exposure for the product or service and provide access to new customer segments.
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Lead Generation: Lead generation involves attracting and cultivating potential customers for a product or service. This tactic can be done through tactics such as creating marketing materials and utilizing social media and lead nurture strategies to increase visibility and drive conversions.
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Sales Enablement: Sales enablement involves providing the sales team with the necessary resources and training to sell a product or service effectively, including sales collateral and training on the product or service and the sales process. Sales enablement helps improve the overall customer experience and drives revenue growth by ensuring that the sales team has the tools and knowledge they need to sell the product or service.
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Customer experience and support: Providing a positive customer experience and offering high-quality customer service and support can help increase customer satisfaction and loyalty, leading to increased retention and potentially even upselling opportunities.
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Data and analytics: Regularly tracking and analyzing key performance indicators (KPIs) can provide valuable insights into the effectiveness of the GTM strategy and help inform future optimization efforts.
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Marketing Mix: The marketing mix refers to the various elements that can be controlled in promoting a product or service. These elements include product, price, place (distribution channels), promotion, people, process, and physical evidence. The marketing mix should be considered when developing a GTM strategy to ensure that all elements are effectively aligned to achieve revenue goals.
7 Steps to Building a GTM Strategy
Step 1: Identify the Buying Center and Personas
Understanding your customer is crucial when preparing your product for the market. The "buying center" refers to the group of decision-makers involved in purchasing a complex B2B solution. Identifying these individuals and understanding their roles can help tailor your product to their needs.
Step 2: Craft a Value Matrix
A value matrix helps identify the business problems each buying center persona faces and how your product can solve those problems. It also includes a relevant marketing message that ties the problem and solution together.
Step 3: Test Your Messaging
Once your value matrix is in place, test your messaging by advertising on various platforms. This will help you understand which messages resonate with your audience and optimize your larger campaigns based on these insights.
Step 4: Understand Your Buyer’s Journey
Understanding the journey a potential customer will take is crucial. This journey can be viewed from the buyer's perspective and from the perspective of your company. The buyer's journey can be divided into three stages: attract, engage, and delight.
Step 5: Choose a Sales Strategy
Choosing a sales strategy that aligns with your product and business model is crucial. There are four common GTM sales strategies:
- Self-Service model
- Inside Sales Business Model
- Field Sales Business Model
- Channel Model
Step 6: Build Brand Awareness and Demand Generation
Attracting your target audience's attention is crucial for filling your pipeline. This can be achieved through demand generation, which can be facilitated by both inbound and outbound strategies.
Step 7: Create Content to Get Inbound Leads
Inbound leads are generally easier to convert and cheaper to acquire than outbound leads. Content marketing is key to generating inbound interest, as it drives traffic to your site. Your content marketing team will drive this inbound traffic by finding and targeting keywords that your potential customers would search for and then creating and posting related content on your website.
Examples of Go-to-Market Strategies
To bring the concept of a GTM strategy to life, let's explore three practical examples based on New Breed's large arsenal of customized strategies that lead to our clients' success stories. These instances demonstrate how diverse teams have successfully implemented their unique GTM strategies to meet their goals.
Example 1: A SaaS Company Serving SMBs
This SaaS company aimed to boost product adoption and stimulate revenue growth by attracting new customers. Their GTM strategy was multi-dimensional:
- Strategic Partnerships: They allied with business consultancies and small business associations, offering exclusive discounts to their members, thereby expanding their customer reach.
- Risk Alleviation: They introduced free trial periods and comprehensive onboarding support, reducing potential risks and fostering a smooth transition for new customers.
- Credibility Enhancement: They showcased success stories and testimonials from satisfied customers, bolstering their brand's credibility and trustworthiness.
- Targeted Marketing: They launched focused paid ads, personalized email marketing campaigns and dynamic landing pages, effectively reaching small business owners and influential decision-makers.
- Usage-Based Pricing: They implemented a usage-based pricing model, where customers pay only for the features they use, promoting product adoption and driving revenue growth.
Example 2: A B2B Manufacturer of Industrial Equipment
This B2B manufacturer aimed to cultivate relationships with potential customers, enhance customer satisfaction, and boost revenue. Their GTM strategy was comprehensive:
- Industry Engagement: They actively participated in trade shows and industry events, showcasing their products and establishing valuable connections with potential customers.
- Product Mastery: They provided in-depth product training and technical support, ensuring customers felt confident using their products and enhancing overall satisfaction.
- Focused Marketing: They utilized targeted social media posts and email campaigns, reaching industry thought leaders and potential customers.
- Strategic Partnerships: They collaborated with distributors and resellers, expanding their brand's reach and ensuring their products were easily accessible to customers.
- Tiered Pricing: They offered tiered pricing plans, where customers could choose from a range of packages based on their specific needs, catering to each business's size and unique requirements.
Example 3: A B2B Provider of HR and Payroll Software
This B2B provider sought to elevate customer satisfaction, streamline the sales cycle, and drive revenue growth. Their GTM strategy was robust:
- Strategic Collaborations: They partnered with HR consulting firms, offering exclusive discounts to their clients, thereby expanding their customer base.
- Risk Mitigation: They offered free trial periods and onboarding support, encouraging potential customers to adopt the product and reducing the perceived risk of investing in a new solution.
- Focused Marketing: They deployed targeted ads and email campaigns, effectively reaching HR professionals.
Thought Leadership: They developed webinars and educational blogs as part of a comprehensive B2B content marketing strategy, demonstrating the software's value and positioning the company as an industry expert. - Value-Based Pricing: They introduced a value-based pricing model, where the price is set based on the perceived value of the product or service to the customer, ensuring the pricing strategy aligns with the value delivered.
Takeaway
The components of a go-to-market strategy are simple: market intelligence, market segmentation, and product messaging. But, the execution of those steps can be more complex depending on your product and the market you’re entering. Being methodical about each step and doing your due diligence will help set you up for success.
To learn more about the importance of demand generation in the success of a GTM strategy, check out our Essential Guide to Demand Generation.
This post was originally published June 7, 2019 and has been updated and refreshed for relevance.
