A go-to-market (GTM) strategy is the plan a company uses to bring a product to market. GTM strategies are typically developed as a collaborative effort between marketing, product management, and sales. Marketing is commonly tasked with implementation and execution. As you will see, the GTM strategy is actually a plan made up of plans.
Anatomy of a GTM
- A market analysis to describe the state of the market. The business case for the product should be used as a reference for this analysis. Basic financial calculations such as IRR will provide volume, cost, and pricing estimates for the product. Balance this data against customer needs and use case, taking demand expectations into account. Market dynamics will determine if the need for the product is increasing or declining. Review the price elasticity — if not for the specific product, then comparable alternatives. Competitive products and alternate solutions have to be evaluated (and it would be prudent to analyze the conversion cost for the customer to switch from their current product).
- A market selection plan to identify which segments or customers will be targeted. You will have to pick and choose your target market segments carefully because you can’t afford to address the whole market. Market segmentation will determine the segments of the total market that can be addressed with your product or service. Depending on where you are at in your buyer’s journey development, this would be a good time to develop personas for prospective buyers. Once these details are understood, the product positioning can be developed to align the value proposition with customer expectations.
- A marketing plan to address how you will sell the product. Here, it’s time to consider the 4P’s of the marketing mix: Price, Product, Place, and Promotion. To these, we can add two more P’s: The sales Process and the People involved in getting the product to market; sales and support.
- Your pricing model should follow a strategy that primarily depends on the maturity of your product and the market. New products may follow a market penetration strategy to gain entry. Mature products may take a value or premium approach, depending on the goals of the business — going for market share or revenue.
- Place refers to your method of distribution, as well as the Process and People. Consider the cost and benefits of distribution through direct channels or distribution channels. Many companies have a hybrid approach, choosing to sell some products directly, some products exclusively on-line, and using distributors for selling products in areas that they cannot service efficiently.
- Your product has to be competitive. If it’s not competitive, no amount of marketing can fix it.
- Promotion has to be budgeted to adequately support the product — either to build a name and get brand recognition or to support sales efforts.
- A customer acquisition plan to explain how you will attract and retain customers. This plan basically applies the buyer’s journey to the product. How can you build awareness, develop interest, get commitment, and retain/re-engage the customer through the lifecycle of the product?
The go-to-market strategy is a big concept that encompasses a lot of thought and planning. While typically applied at the product level, a GTM strategy can be applied to a company or a brand as well. It’s important that company employees (especially those in sales and marketing) understand the GTM strategy, and that they are trained on using this strategy to spot opportunities in the market based on how the company’s products fit in the market. Your GTM strategy should be evaluated for each product you bring to market to ensure it will deliver the best results in today’s dynamic marketplace.
If you need help developing a go-to-market strategy, contact us for a 30-minute consultation.