Crafting A Go-To-Market Strategy: Core Components And Common Pitfalls
In a world teeming with competition, innovations, and changing consumer behavior, penetrating the market requires not just tactical execution but a thoughtful Go-to-Market (GTM) strategy. However, even with the most meticulous plans, many GTM strategies fall short of their goals. Why? It's not often due to the tactical execution or the tools employed, but deeper foundational issues.
In this article I’ve included three case studies to give a better understanding of how a well-executed GTM strategy works to create a new product launch that takes off. I’ve formatted it to display core foundational information first, showcase the foundations in a case study second, and then build on those foundations. All together, the points in this article create a great go-to-market strategy template. My goal is that these examples help RevOps professionals such as yourself maximize your marketing efforts!
The Five Foundational Steps Of A GTM Strategy
In my experience, the five points below are the foundational pieces of a good GTM strategy. Without taking each piece into account and ensuring budget, people, and time are allotted, your model won’t be able to stand on its own.
- Operating Model: This is the blueprint defining what you do and how you think. Many B2B companies, knowingly or otherwise, lean on the Sirius Decisions Demand Waterfall (2012) as their primary operating model.
- Data Model: This dictates the vital data points used to determine if the strategy is on track. Typically, B2B firms utilize Lead, MQL, SQL, and SQO as their core data model. This model, however, is not standardized and varies from company to company.
- Revenue Strategy: Here, the goal is to outline actions to achieve the core KPIs identified in the data model. It's where the executive team crafts a plan to boost lead generation.
- Tech & Tools: To successfully implement and measure the strategy, the right technology is paramount. Marketing and sales teams often collaborate to identify these tools, ensuring more effective lead generation and conversions.
- Tactical Execution: This involves the actual implementation of the strategy to achieve the core key performance indicators (KPIs).
Case Study 1: Foundations - Apple AirPods
When Apple decided to remove the headphone jack from their phones, they launched the AirPods, marking their entry into the wireless earbuds market, a new product to complement their existing ecosystem. Their go-to-market strategy centered around a unique value proposition: seamless integration with all Apple devices and high-quality audio (operating model).
Apple's marketing plan honed in on their target market—existing Apple product users and discovering their past customer experiences. The messaging focused on the convenience and technological advancement of the AirPods. Recognizing the pain points of tangled wires and interrupted listening due to battery issues, the product highlighted solutions to these problems (data model).
Personas were developed for typical Apple users, which influenced advertising on social media platforms where these users were most active. Their sales strategy incorporated their sales team in Apple stores worldwide, emphasizing hands-on onboarding for potential customers, and the ease of connecting AirPods to their iPhones (revenue strategy).
Post-launch, Apple tracked metrics to gauge the product's success, from customer acquisition rates to retention (data model). Case studies were published, detailing users' positive customer journeys and reinforcing brand awareness. As a result, the AirPods became a successful product, enhancing Apple's competitive position in the existing market (tactical execution).
Building On Foundations: Refine The Details
It is easy to give Apple and their superb understanding of their customers as an example but if you’re just starting your journey of this process, you need to understand that to develop a world-class GTM plan, the entire organization will need to deeply understand your customer.
It will all lead to an in-depth grasp of the psychology underlying decision-making processes, both within your organization and among potential customers. Here's how you can begin:
- Understand Your Target Market
Before launching any product or service, you need a crystal clear understanding of your target customers. Without an understanding of your ideal customer’s demographics, you have no idea how to measure the success of your product or service.
- Who are they?
- What are their pain points?
- Where do they hang out online?
- What are their purchasing habits?
The more detailed your buyer persona, the more targeted and effective your GTM strategy will be.
- Define Your Unique Value Proposition (UVP)
Determine what makes your product or service unique. Why should your target audience choose your offering over competitors? Your UVP should be compelling, clear, and resonate with the needs and desires of your target market.
- Select the right distribution channels
Your distribution strategy should align with where your target audience is. For instance, if you're selling a B2B software solution, LinkedIn might be a more effective platform than Instagram. Consider both online and offline channels, depending on your product and audience.
- Price Your Product Right
Pricing can make or break your product's success in the market. It's a fine balance between understanding what the market is willing to pay and ensuring profitability. Find the right software to optimize your pricing strategy.
- Implement a Sales Strategy
Align your sales and marketing initiatives to ensure a seamless process. Consider investing in sales pipeline management software to keep track of leads, progress, and conversions.
- Foster Relationships
Building and nurturing relationships is crucial. Engage with potential customers, industry influencers, and even competitors. Attending conferences for sales leaders, webinars, and workshops can also be beneficial.
- Collect Feedback and Iterate
Once your product is out in the market, gather as much feedback as possible. Understand what's working and what's not. Use this feedback to refine and improve your GTM strategy continually.
- Monitor KPIs
Tracking KPIs will help you understand if you're on the right track. Metrics like Customer Acquisition Cost (CAC), Lifetime Value (LTV), conversion rates, and churn rate can give you a comprehensive view of your strategy's effectiveness.
The more detailed your buyer profiles are, the more targeted and effective your GTM strategy will be.
Case Study 2: Detail Oriented - Tesla’s Innovative Distribution
Like Apple, Tesla’s rapid successful rise isn’t a mystery. They refined the fundamentals of a good GTM strategy and incorporated incredible customer feedback throughout their entire product iteration process. This process has helped Tesla become one of the most valuable global companies.
High-End Market Entry (UVP): Tesla's initial go-to-market strategy was to target the high-end market with the Roadster, a luxury sports car. This allowed Tesla to establish a brand image of exclusivity and innovation. The high price point of the Roadster also helped fund R&D for future models.
Reinvestment into Lower-Cost Models (collect feedback and iterate): Profits from the Roadster were reinvested into developing the Model S, a slightly more affordable luxury sedan. This was followed by the Model 3, a car aimed at the broader market, and the Model Y, a compact SUV.
Direct-to-Consumer Sales (revenue strategy): Unlike traditional automakers that rely on dealership networks, Tesla opted for a direct-to-consumer model. This allowed them to control the buying experience, maintain higher margins, and ensure consistent brand messaging.
Supercharger Network (Foster Relationships): To alleviate 'range anxiety'—a major barrier to EV adoption—Tesla developed its Supercharger network, ensuring that Tesla drivers could quickly charge their vehicles and travel long distances.
Tesla's refined approach, starting with a luxury product and moving to mass-market vehicles, allowed them to build brand prestige and generate the necessary capital for R&D.
Their direct-to-consumer model and Supercharger network further differentiated them from competitors. Today, Tesla stands as a dominant player in the EV market, with its go-to-market strategy playing a pivotal role in its success.
Build On The Experience Of Your Team For Successful GTM Strategies
Experience is the most important asset when executing a GTM strategy. I talked to my team at Profit Launchpad who’ve been responsible for dozens of successful GTM projects. Here are the three most effective pieces of feedback the group gave back.
- Reconsider the Operating and Data Model: Everything stems from the Operating Model, it is your team’s roadmap. It shapes what KPIs you measure, the tools you invest in, and the tactics your teams use. The typical pitfall for many businesses is the allure of new tools or outsourcing to agencies rather than addressing the foundational issues.
- Incorporate Feedback Loops: Current models lack feedback from Tactical Execution back to Operating Models. Analysts, while brilliant in crafting models, often remain detached from ground-level execution. Ideally, your GTM strategy should adapt daily, not once every few years.
- Standardize the Data Model: As of 2023, we should aim for objective, standardized data models. Relying on subjective determinations, like a marketer adjusting the MQL definition whenever they feel like it, hinders the potential for quantitative analysis and genuine growth breakthroughs.
Bonus: Implementation of an effective meeting system is a great way to ensure no one is siloed or making priority decisions without the appropriate accountability or oversight. Try the L10 meeting method from EOS if you haven’t already.
Case Study 3: Microsoft's Transition To A SaaS Model with Office 365
When Microsoft saw the shifting dynamics in software usage, they realized their existing product, the standalone Office suite, needed an overhaul (reconsider the operational model). They identified a new market strategy – converting their product to a SaaS model with Office 365.
Their go-to-market plan began with extensive market research to understand customer needs and the buyer's journey in this new domain. Recognizing the target audience as both existing Microsoft users and potential new customers from businesses of all sizes, they crafted a messaging strategy focusing on constant updates, cloud storage, and cross-device functionality (incorporate feedback loops).
Developing many marketing channels like: content marketing, webinars, referrals, and SEO strategies, the marketing team amplified the product's value. The sales process was refined, with salespeople trained to understand the nuances of a subscription business model and how to sell these new products to key decision-makers. They assumed, correctly, they’d get some pushback on the new pricing strategy but layered on many new pieces of tech and service to reduce the objections from new customers.
KPIs were established, measuring everything from customer acquisition to retention rates. The transition not only maintained Microsoft's existing customer base but also expanded it, showcasing a successful go to the market with a product-led approach (standardize the data model).
The Way Forward
When pinpointing root cause issues in your GTM, leverage the framework mentioned above. More often than not, especially for startups, the primary culprit is the Operating Model. Remember, it's not just about creating a strategy that describes a product launch; it's about implementation that's both flexible and robust, adapting to market changes while keeping its core principles intact. If you and your company master implementation, they’ll find their competitive advantage. Finding experienced employees or senior advisors is a key to a young company’s success.
So, as you craft your GTM and RevOps strategy, understand your target audience, define your value proposition, choose the right channels, price your product appropriately, and maintain a focus on building relationships. And, to boost your efforts, consider the best pricing software solutions and the top sales pipeline management tools. With the right strategy and tools, your product or service can achieve the desired market penetration and revenue growth.
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