A strong, well-executed go-to-market strategy is critical to startup success. A business may offer the best service or product in the world but it will likely be unsuccessful if it doesn’t reach the right consumers. Experienced entrepreneurs know that in maximizing the chances of business success, they will have to identify and focus on their target markets and more importantly, how to deliver their products and services through the right distribution channel. A go-to-market strategy is the roadmap that outlines that pathway.
This is the basic premise of the go-to-market strategy. In simplest terms, a go-to-market strategy is an action plan that details how a business will be able to reach out to and engage its customers. It outlines how a business will be able to deliver its products or service to its target consumers considering factors like distribution and pricing.
On the surface, a go-to-market strategy can be mistaken for a marketing plan. The main difference, though, is that the latter is broader in scope. A marketing plan emphasizes broad strategies and channels while a go-to-market strategy emphasizes specific actions and timelines.
Here are some of the steps that budding entrepreneurs can follow in developing a go-to-market strategy:
Get to know your customers.
The first step in developing a go-to-market strategy is to get to know your customers. Founders will have to know key information about their customers such as what they buy, where they buy, and how they buy. Customers vary not just in their profiles but also in their buying habits or behavior.
For example, a young professional who is too busy with work will more likely buy a book or DVD online. He or she is different from a student who probably has more time to go to a retail store. The student also doesn’t have as much money as the young professional, so he or she will try to scout as many retail stores as possible before making a purchase.
Identifying the appropriate sales channels.
There are numerous sales channels that businesses can tap into to reach their target clients. There are direct channels like websites, sales representatives, shops, exhibitions, and mail order. There are indirect channels like sales agents and franchisees.
It would be impractical for a business to use the biggest or the most widely-used distribution channel. In developing a realistic go-to-market strategy, a more pragmatic approach is to tap a distribution channel where the identified customer is likely to buy.
All sale channels have its pros and cons. For example, direct emails have a notoriously low response rate. But it is very inexpensive compared to trade shows.
Once a business has identified the right distribution channel, it has to promote it to its target customers. After all, if customers don’t know that a product is being offered in a particular channel, how would they be able to buy the product?
The business will also have to measure the number of inquiries and sales that it has gotten from each of the distribution channels. This will enable the company to identify which distribution channel deserves further promotion, and which have to be dropped.
In conclusion, a go-to-market strategy is critical to the success of any business, whether it is a startup or an established one. But for startups, a well-developed go-to-market strategy is essential—especially if you are seeking funding from investors or lenders. Failure to develop a clear market pathway is common among new founders. Don’t make the same mistake and be sure to invest plenty of time in developing your go-to-market strategy. Looking for more guidance? MaRS has a great discussion outlining 7 steps to developing a powerful go-to-market strategy.
Want to learn more about how I can help you avoid these and other common startup mistakes? Contact me today and let’s talk!