Congratulations. You’ve built a fantastic product and are hoping that customers will love what you’ve made.
But instead of hoping, which is akin to shooting in the dark, you’d be better off studying your intended market thoroughly before you launch. Of course, taking a new product to market or launching an existing product in a new market is risky, but a well-thought-out Go-to-Market Strategy can lessen the risk.
Before we get our hands dirty with building a Go-to-Market Strategy, let’s first define what it is.
In its most basic form, a Go-to-Market Strategy lays down the plan for introducing a new product to the market and delivering it successfully to prospective customers. It seeks to achieve product-market fit within a specific niche and establish its presence in the market.
A winning plan underlies the primary reason your customer is likely to buy and should account for the following:
- Value Proposition – This is about your product. What problem are you trying to solve, and how do you solve it?
- Product Market – Does a market exist? Will customers buy, and how much are they willing to pay?
- Customer Acquisition – Your sales and marketing plan. How do customers find you? What is the cost of acquiring these customers?
- Product Delivery – How do you get your product into your customer’s hands? Is it a software download, an app, or a physical device that you’ll need to ship?
At first glance, you might feel you have the answers, but taking these factors lightly or, worse still, ignoring them altogether can cause massive disappointment you’d do well to avoid.
This article includes examples of companies that scaled the pinnacle of success and those that slid into oblivion.
Here’s our step-by-step guide to building a successful Go-to-Market Strategy using many of the tactics we’ve implemented in building companies of our own. This guide applies to regular businesses, startups, or any type of venture you plan on launching.
1. Make your Value Proposition Clear
What problem are you trying to solve?
How are you solving it, and how does your solution benefit your customer?
How are you different from the competition?
Careful research is necessary because what works in one region may not work elsewhere.
Don't end up like Coke, attempting to market two-liter bottles in Spain. Their venture failed despite the brand's popularity because Spanish refrigerators typically couldn't hold such big bottles. Or consider the lesson learned by General Foods in Japan. The company spent millions of dollars marketing cake mixes, yet sales remained abysmal because only three percent of Japanese homes had ovens!
2. Ensure your product is ready for use
A “ready” product can be version 1. It needn’t have all the bells and whistles but should be fully functional and ready for use. You don’t want to roll out something that is broken and needs many calls to customer support to get it to work. Customers can be unforgiving, and you don’t want to make their first experience a regrettable one.
You can iterate and quickly roll out the next bigger and greater version after getting some market feedback.
3. Study the local laws
Ensure you comply with local laws and have all licenses in place before you launch. If starting in a new country, take the time to understand every aspect of legislation related to your business. Certain areas like healthcare might require a more significant amount of compliance and might take you longer to get the necessary licensing in place.
4. Decide on a Market Entry Strategy
Globalization has changed the way companies do business, which reflects how they approach their distribution strategies. For example, when it comes to physical products, manufacturing can happen in cheaper markets worldwide, and delivery can occur as scheduled. Take Apple, for instance, which designs the iPhone in California but manufactures it in China and India.
E-commerce companies have tie-ups with local suppliers and deliver the goods with the help of their well-oiled delivery partner network. When expanding globally, software and technology companies need to comply with local laws and legislation. Learning new languages and understanding HR practices also matter when it comes to hiring. The uncertainty surrounding global expansion necessitates having to choose a distribution channel for your business carefully.
At a minimum, you could choose to:
- Go Direct: Cut out the middlemen and deliver your products directly to your consumers. Going direct keeps you in total control of your operation and helps increase customer satisfaction.
- Go Indirect: Many companies sell to their customers by partnering with third-party companies. Value-added partners can include resellers, brokers, and franchisees. Doing this allows a business to focus on its core strengths while leveraging the market access capability of its partners. Bear in mind that the partnership needs to be well structured else customer experience might suffer.
- Adopt a Hybrid model: Nike is one example of a company that adopts this model of both company-owned operations combined with third-party agreements.
5. Find out who your ideal customers are and build their personas
Personas vary depending upon whether your customers are B2B or B2C. If you’ve done any market research, you’ll already have a good idea of who they are—Segment the customers based on demographics; at the very least, gender, age, family status.
YouTube Analytics, Google Analytics, and Facebook Audience Insights are three good tools I’d recommend getting started. And before you decide to go all technical and dork out digging into tools, you might save a ton of time by just studying your competition.
6. Study your competition
Competitive analysis should be at the top of your to-do list (although the numbering is in no particular order).
Having no competition might not always be a good thing. There might be a reason why no one plays there. However, it could work to your advantage where you unearth an undiscovered, greenfield segment and reap the benefits of being the first mover.
Having a ton of competition is also not always a bad thing. If this is the situation you find yourself in, it could still work for you, provided that the existing players have what I call “RLM” (relatively lousy marketing). I’ll tell you what this is in a second, but if you do find evidence of this, all you need to do is market better than they do, and you’ll rake in the rewards.
How to study your competition:
- Facebook (FB) Ads Manager is a valuable tool to study the competition. For example, you can see all the ads they’ve rolled out, for how long they’ve been running, what their existing ads are, and so on.
- Check if the messaging is relatable to what they’re selling and if it evokes interest. Most importantly, check for a well-defined and visible CTA (Call to Action). If that does not exist or there is no easy way to purchase what they’re advertising, that’s “RBM” right there. You could also use ‘Adbeat’ instead of FB Ads Manager, but that’s a paid software.
Next, find the Ads your top competitors are running and funnel-hack them. The logic behind this is simple: your competitors are at the top because people are buying from them. Therefore, they are giving “your” customers what they want. That gives you tremendous insight into what you should be doing instead of possibly going with your natural tendency to reinvent the wheel.
How do you funnel hack your competition?
Click on one of their most successful Ads, and their funnel should open up. The first page should have an introductory offer with a “Buy” button. Then, take out your credit card and make an actual purchase. If you don’t do this, you won’t know what comes next in the funnel.
Once you make the purchase, an order bump should open up. Purchase that as well and go on to the first upsell. If you buy that, you might get taken to a second and last upsell. You now know what the highest converting sales funnel looks like, and you’ll have all the information you need to draw customers away from there and into your funnel.
I’ll stop here because this is not a discussion on sales funnels, but this should hopefully give you enough ammo to inflict serious injury on the size of your competition’s customer base.
7. Find which Customer Acquisition Channels work best for you
Remember what Peter Thiel, the famous investor, said about the power law for distribution channels?
“Most businesses get zero distribution channels to work. If you can get one channel to work, you’ve got a great business. If you try several channels but don’t find one that works, you’re finished”.
What he says is dead right. 90% of your results will come from one channel. The rest don’t matter. So, doing a mix of AdWords campaigns, FB Ads, Email Marketing, YouTube videos, and flitting from one to the other is not a good idea. See what works for you, and then stick to that one channel. (The power law describes an exponential distribution where a few individual points account for a majority of the value in the population).
How do you find this one channel that works? I go through a three-step exercise to find out. Let’s walk through it now.
Step 1: You start by evaluating your core constraints
Let’s brainstorm a little. You are a newly launched startup, and your one and only one intention should be to get paying customers as quickly as possible. The faster, the better, but here’s the catch. Regardless of whether you are bootstrapped or have funding, you shouldn’t spend a ton of money acquiring these customers. Use investors’ cash for scaling the business and expanding the customer base, not throwing it away on advertising if it isn’t yielding the right kind of results.
E.g., say you run FB Ads. It wouldn’t make sense to spend 1000$ for a customer whose lifetime value is 100$. What you pay to acquire the customer is called Customer Acquisition Cost or CAC. So that should be uppermost in your mind.
Next, you need to decide how many customers you need. Getting 100 customers is a different ballgame from getting 10000 customers. You should be able to hustle and get your first 100 customers through word of mouth, but that strategy will not work when you need to scale to 10000 or even 1000 customers.
And then, you need to know who you are targeting. Reaching teenagers requires a different strategy than going after people over 50 years of age. They hang out in various places on the internet and off the net, so you need to have a pretty good idea of where and how to find them.
To sum it up, your core constraints would be the cost of customer acquisition, the size of your customer base, and where these customers “live.”
Another way to think about this would be:
- Who – Who is the person you want to serve?
- Where – Where are these people?
- What – What is the bait I am going to use to catch them?
Step 2: Consider all your options and converge on the Top 3
Start by making a list of all the distribution channels that exist. There are easily more than 25 channels, and new ones keep popping up all the time.
Some of them are:
- Facebook Ads
- Facebook Organic
- Twitter Ads
- Twitter Organic
- Instagram Ads
- LinkedIn Ads
- Blog Posts
- Email Marketing
- Exhibiting and speaking at trade shows and conferences
- Outbound sales
- Affiliate Marketing
- Word of mouth and customer referrals
Spend a few minutes brainstorming each one to see if it’s a fit. Here is a worksheet that can help.
Go through each channel and see if it makes sense. For example, if you want to run FB Ads, see the value that each customer of yours will bring and then decide if your budget allows you to pursue that option. On the other hand, you might decide that you want leads for free, to begin with, and that too is possible.
If you want to do content marketing or SEO, ask yourself how that might fit in. “How would we do that?” “Can we wait for three to six months for this to pay off?” After you’ve evaluated all or most of the channels, narrow it down to a list of three of your top channels.
Here are a few pointers to get you started.
There are three main types of channels:
- Outbound – Paid Ads
- Inbound – Content Marketing and SEO
- Product – Viral, Word-of-mouth Referrals
Outbound channels work best when you are just starting. You get results quickly, but they can get prohibitively expensive as you scale. FB Ads and Good AdWords are paid options, but they will get you results and quickly put you in front of customers. However, they can get costly as you start to scale, and you might then want to begin moving over to an inbound strategy like SEO. Your competition can also latch on pretty quickly to what you are doing, and it’ll be easy enough for them to spin up similar advertising.
Content marketing and SEO will take a few months to generate meaningful results for you, but the library of assets that you build up doing this will not only pay off in the long run but will also help you keep competition away.
Product-based channels work well if you already have a significant customer base.
Step 3: Rapid and Quick Testing
Once you’ve got your top 3 channels, you need to validate whether they will work for you or whether you need to reconsider your choice. E.g., if you chose FB Ads, you could run campaigns on a minimal budget (say 5$ a day) and drive traffic to a simple landing page you create. That landing page would probably be a lead-gen page that collects emails. Running the campaign for five to seven days should give you sufficient information to calculate CAC, CPC (cost per click), and CPL (cost per lead) and tell you whether running FB Ads makes financial sense.
If it’s outbound sales you want to try and are just starting, you’ll probably have to cold call your customers. It’s tough initially, especially if you’ve never done it before but stick with it; you’ll quickly get better. Fix a couple of in-person appointments a day and demo your solution. In a couple of months, you’ll have a pretty good idea of what your customers think about your product.
Here’s where you define your product pricing.
Things to consider are:
- Price Expectations of your target customer
- Prices charged by your competitors
- How to fix your worth relative to your competitors
9. Plan for how you are going to deliver your product or service to your customers
In a brick-and-mortar business, this would involve customers walking into your store and picking up the goods themselves or shipping it to them. However, the ubiquity of e-commerce has necessitated transforming the physical model into an omni-channel distribution model, with storefronts sometimes acting as the gateway to internet transactions.
But with businesses born in the cloud, many options exist depending upon the type of product. In addition, with an ever-increasing variety of offerings like software downloads, app installs, Ebook downloads, membership areas, among others, things can quickly get unwieldy if not appropriately managed.
Your aim should be to make the customer experience as transparent and seamless as possible. Make it easy for them to get access to the product once they make the payment. Give them clear instructions on what they should expect to see. Remember, “A confused customer is an unhappy customer.”
10. Be prepared to accept popular modes of payment
If you are launching globally or in a foreign country, ensure that you are ready to accept popular payment types.
E.g., in the United States, most people pay by credit card. In China, most people pay by a digital wallet. In Germany, it is a bank transfer; in India, it is a credit card and digital wallet. So not being in tune with what the local market wants will cause you to lose revenue.
11. Create a system for growth that allows you to reach product-market fit quickly
Automation becomes the oxygen your business needs if it has to survive the growth phase. From customer acquisition to onboarding to retention, automation drives every process and makes results predictable and repeatable.
Take the example of Netflix. They have a vast library of assets that they use to attract people to sign up. The more people that sign up, the easier it becomes for Netflix to add to their library, attracting even more customers. A loop system is driven that automates user sign-up, access, payment, subscription tracking, and much more.
There can be all kinds of growth loops, but there are only six growth systems. Those systems are:
- Growth Engines – To drive traffic.
- Sales Funnels – To convert traffic to sign-ups.
- Retention – To keep customers delighted.
- Conversions – This is what gets people to move from one step to the next in your growth loop. You need to write good copy and have an effective branding strategy in place to make this happen.
- Strategy – A high-level design is essential to know where you are going and your ultimate objective. Without a good plan in place, it is easy to get derailed.
- Process – You can never overstate the importance of function. You don’t want to end up building something that no one wants.
The critical thing to take away is that growth does not happen automatically. You, as a founder or growth marketer, need to make it happen. It is your job to design the growth systems that will make your growth loops run automatically. Building these systems is your responsibility as a founder, so don’t outsource it. And if you build it well enough, you will make money—even when you’re asleep.
12. Craft compelling messages that get your customers hooked and get you to repeat sales
If you aren’t getting enough sales or are unable to convert leads to subscribers, it could mean only ONE thing…there is a problem with your messaging or the way it presents itself to your prospective customers.
Good copy is at the heart of every message and every form of advertising that compels people to buy. You should tell the customer what’s in it for him and how your product will solve his burning problem. Anything less, and you’ll have lost the customer.
The HOOK, STORY, OFFER formula might make it easier for you to craft persuasive copy that sells.
Grabs your readers’ attention, makes them stop scrolling, and focus on your Ad. You’ll only get a couple of seconds at most, and a great hook will buy you that time.
Here are a couple of examples of good hooks:
- “How to provide your employees with quality healthcare for less than $1 a day without having to employ a team of doctors.”
- The “How to provide your employees with quality healthcare” is not that exciting in itself, but when you add the “$1 a day” and “without having to employ a team of doctors,” it grabs attention quickly.
- “Go from 0$ to profitability in 6 months even if you are bootstrapped and don’t have a marketing team in place already”.
- “Go from 0$ to profitability” is cool but doesn’t grab eyeballs. Still, when you add, “even if you are bootstrapped and don’t have a marketing team in place already,” it gives readers hope that they can achieve the impossible even without much money and experienced resources on their team.
Who doesn’t love a good story? Facts tell, but stories sell something I firmly believe. A well-told story is guaranteed to make you forget you are reading a sales message and keep you reading until the end.
Experts believe our brains are hard-wired to listen to stories, but regardless, everybody loves a good yarn. So startup founders need to get good at writing persuasive copy or hire someone else to do it for them. Either way, they cannot afford to ignore it.
There are two ways to structure your offer, so people are willing to buy:
- Price your offer lower than your competitors. This will put you in a race to the bottom, so don't choose this option unless you want to scrape the bottom of the barrel.
- Increase the value of your bid so that it becomes the highest priced of all available options. Sounds counterintuitive but makes excellent sense. Don’t just give customers what they want; give them much more, and at a price that is way less than the value you are providing them. Doing this allows you to break free from the shackles of competition and stay far ahead of the pack.
13. Excellent Operational support
What’s ‘Operations’ doing in a GTM plan, you might ask?
You cannot overestimate the importance of support in keeping things running smoothly. Earlier in this article, we spoke about growth systems and how vital they are in automating the various processes in your business, from outreach, sign-ups, onboarding to engagement and retention. If something breaks, you must get it fixed asap.
Supporting customers at every stage of their buying journey is also important. You should generally expect the most questions in the pre-sign-up phase, and answering those quickly and accurately will reassure the customer that he is making the right choice in signing up. There could be other customer-related issues like payments not going through, availability of discount coupons, or even refunds if it comes to that. Ongoing support is needed to ensure that customers have smooth access.
14. Risk Mitigation Strategy – Risk Roadmaps
Things don’t go according to plan, and despite your best motives, everything you’ve worked for could come unstuck, which is why a risk mitigation plan should be a part of every GTM strategy. In addition, laying out a contingency plan in case you find it challenging to get things back on track should also be given due focus.
No matter how comprehensive and well thought your Go-to-Market plan is, there is always the risk of you not achieving product-market fit. Here’s where Risk Roadmaps and Lean Philosophy can come in and save the day for you.
Here are the steps involved in building a successful Go-to-Market Strategy:
- Make your Value Proposition Clear
- Ensure your product is ready for use
- Study the local laws
- Decide on a Market Entry Strategy
- Find out who your ideal customers are and build their personas
- Study your competition
- Find out which customer acquisition channels work best for you
- Plan for how you are going to deliver your product or service to your customers
- Be prepared to accept popular modes of payment
- Create a system for growth that allows you to reach product-market fit quickly
- Craft compelling messages that get your customers hooked and get you to repeat sales
- Excellent Operational support
- Risk Mitigation Strategy – Risk Roadmaps (Additional)