07 Go To Market Strategies
Tactical components for a great GTM plan
In this video workshop (2 hours and 9 minutes), we dive into different strategies to get your product or service to market. It is critical for this lecture to be reviewed in conjunction with your business model. For example, it’s vital to work through the ultimate Customer Acquisition and Retention Cost (CARC) and Life Cycle Value (LCV) to develop a strategy for going to market that is consistent and profitable.
In the second video (1 hour and 53 minutes) of this session, you’ll learn the tactical components for a great GTM plan. In particular, we’ll cover the critical elements of a marketing and sales cycle. Learn the basics of inbound marketing, outbound marketing, sales funnel design, and optimization, and lastly, the importance of customer engagement and validation. Included in the session are case examples from two companies that detail how they have built their tactical go-to-market plans: Hubspot and Unidesk.
Video Workshop: Go-to-Market Strategies
On the go? Listen to this workshop on SoundCloud:
How Small Companies Can Get Big – Fast!
Contributed by Michael Skok
How do small companies get big? It’s a question that gets asked a lot. It’s also a hard one to answer. Great execution is always key, but if I were to share a growth hack to multiplying that execution it would be to figure out strategic partnerships with companies larger than your own. To borrow a phrase from Isaac Newton:
“If you can learn to stand on the shoulders of giants, you can get bigger, faster.”
As a small company, you often need to zero in on a narrow product (MVP) or just as importantly a matching target market so you can achieve good product-market fit and sell repeatably into a minimum viable segment.
As a result of this focus, your product or service may be quite valuable to customers but one thing you can’t often provide from the get-go is a true end-to-end solution. If you sell a piece of software, for example, it’s unlikely you can also offer the hardware, implementation, and services as well. You’re just not big enough yet to do it all.
By engaging a larger company in a “Whole Product Strategic Partnership,” however, where you complete a bigger company’s value chain by integrating your company’s offering into their solution, you can create a win-win scenario where you both go-to-market together.
Consider the example of Unidesk, a virtual desktop management provider based outside Boston. Unidesk has put its growth on the fast-track in part because of a partnership with Dell. But why would Dell, a very large company by any measure, team up with Unidesk, a rapidly growing startup? Because for every dollar in revenue Unidesk earns on a sale, Dell earns $10. That’s quite a multiple – and it hasn’t gone unnoticed. In fact, with that much to gain, Dell has begun to send referrals to Unidesk, one in three of which typically turn into customers for Unidesk.
As a result, Dell and its sales and marketing department play a role in essentially pre-screening sales leads for Unidesk, because they know that when Unidesk closes a deal, Dell is going to sell a lot of their product. That’s a great way to build a go-to-market partnership around product integration.
And it’s precisely how small companies can get big, fast.
The Benefits of Partnering
It might, at first, seem counterintuitive that innovative and disruptive small companies stand to benefit from partnering with larger but oftentimes slower-moving firms. Aren’t they the kinds of competitors they’re trying to take down? While that can be true, small firms can also stand to gain through such partnerships for reasons that include:
- Increased revenue as a result of being able to offer customers a fuller and more complete solution. Potentially one that incorporates best-of-breed elements as well.
- Expanded reach and market share resulting from access to the larger company’s sales force and channels.
- A boost in credibility. As a small company, it can often be difficult to stand out in a crowded market or to get your calls returned. If you’re working with a firm with an established brand, on the other hand, it tends to grease the wheels.
- Faster time-to-market and reduced development costs. Imagine the amount of time and money a small firm would need to invest in order to develop an international whole product and sales campaign, for instance? It might take years. But your firm could be selling globally tomorrow via a single strategic partnership.
Assessing the Right Partner
Given what can be gained – how should smaller firms look to determine who the right kind of big company partner might be? They should begin by asking questions like:
- What are the elements of the complete solution or “whole product” that involve other larger companies?
- Which of these companies do they complement in such a way where they, like Unidesk and Dell, create mutually beneficial win-win scenarios for each other?
- Specifically which areas are complementary such as product, distribution, or market positioning that leads to a sum greater than its parts; i.e. where 1 + 1 = 3?
- Which potential partner would help drive both increased market share while also helping knock mutual competitors out of the market simultaneously?
The devil is in the details of the deal, as you don’t want to build unnatural partnerships or dangerous dependencies. So here are a few examples of things to consider:
- Will the partnership justify and tie the incentives of the larger company’s sales force to selling the smaller firm’s products/services.
- Do you have upselling opportunities?
- How can you ensure you get help with Support but don’t get isolated from your end customers?
- How will you protect your brand while the larger partner provides the credibility to help you close deals?
What’s in it For Them?
One mistake small companies make when they get the chance to approach a larger company is that they make the conversation about them, the little guy. They begin by asking how the large company can help them sell their product or service when it should be the other way around. The best way to make a partnership pitch is by approaching a company and telling them what you’re going to do for them.
So flip all the points above and ask yourself how you’ll pitch to your potential partner to ensure this is a must-have partnership for them.
Usually, one of the key benefits a large company will want to realize is the competitive advantage from faster time-to-market and more nimble development. Start there and figure out how you can build out things like opportunities to increase average revenue per user or ARPU for them. But be prepared to prove it and don’t rush it. Like any relationship, it needs to be two-way.
Partner for mutual success and you’ll be able to multiply your resources with a strategic partner’s involvement. Find a way to execute on it that is a self-reinforcing win-win and it will accelerate your growth. Happy partnering!
This article originally appeared in Forbes.
Services as a Competitive Advantage: 7 Golden Nuggets and 7 Deadly Sins to Get You Thinking
Contributed by Michael Skok
One of the most controversial subjects I hear raised between Entrepreneurs and Investors is the use of Professional Services in a product company. Why?
Because both sides of the argument are right for why you should or should not consider the use of Professional Services (PS) in your Go To Market (GTM) Strategy. But there’s no reason to be afraid of employing a services model in your startup. If you can be informed, you can be empowered to put them to use to your competitive advantage.
So here are my 7 golden nuggets and 7 deadly sins to share learnings from my principally B2B software companies, and I welcome other’s experience and feedback.
7 Golden Nuggets
1. Pre-sales facilitation
- Services people are a non-threatening (non-sales) means to educate your customers on your solution.
- Professional services and even telephone support services can, therefore, accelerate your potential customer’s understanding in that part of the sales cycle. See diagram
2. Post-sales implementation & support
- After you’ve closed the deal it’s critical to ensure early & continuous referenceable customer success
- So you don’t get hooked on a services model, PS can enable knowledge transfer to your customers and ultimately make them self sustaining and self-servicing
3. Customer breadth of deployment & growth
- PS can enable and ensure your customer continue to get repeat success and scale of initial deployment,
- In the end, this increases the customers’ Life Cycle Value (LCV)
4. Predictable revenue and contribution
- PS is usually billed over a project lifetime, in a pre-agreed fashion, providing startups with some predictable revenue during otherwise unpredictable early sales cycles
- PS revenue is a welcome contribution to the Cost of Acquiring and Retaining a Customer (CARC)
5. Free Product Management
- One of my favorite value adds of PS is the direct feedback to R&D on product experience
(My personal recommendation is actually to even consider rotating engineers through services so they get the direct feedback on the implementation and usability of the products they are developing. It can be very empowering all around and customers and engineers love it if handled correctly)
6. Best practices buildup
- PS is one of the best ways to build up your internal best practices and knowledge base for training of new hires, as well as for external training of Developers, Customers & Partners. Per the point above this can be ultimately used to achieve self-service for your stakeholders
7. Upgrade acceptance, deployment
- With non-SaaS/Subscription products it’s vital to get customers to upgrade the latest releases and deploy them across the enterprise. It not only helps them but it reduces your support matrix and also justifies maintenance payments. And even if you have a SaaS model, ensuring your customers learn to use upgrades and new features is vital to them staying productive and you being competitive in their referencing in the market.
- This again increases the and extends the usage and Life Cycle Value for you and your customers (See blue circle in the Diagram)
That all sounds good, but there are also 7 deadly sins that I think can be argued against Professional Services.
7 Deadly Sins
- Customers get angry, thinking your product should work without services
- You start gouging customers for extra revenue
- You get lazy in fixing product issues in the product versus covering them up with PS
- You become so proud of the revenue PS is adding to your top line, that you forget to pay attention to your business model which may be dragged down by lower PS margins and higher fixed people costs, with lower multipliers
- You Lust after acquiring more customers instead of partners. Ultimately partners that can take services on for you are a much more scalable way to grow your business. But you need to time this. If you haven’t learned the experience directly, you aren’t ready to have a partner take it on.
- Envy between sales and services builds divided loyalty. Be careful to find a way to present an integrated sales and services front to customers to enable their success, and set up appropriate motivations and rewards for your teams to share in that customer success.
- You get hooked on a services model. This is a real risk that I’ve seen from startups who get too used to the predictable services revenues. But remember point 4, put your pride behind you and balance your business model.
In the end, my experience has been that as a startup, your initial customer success and reference ability is so critical, that developing a services-supported model can be a great approach for many initial go-to-market models, so long as you take heed of the principles I’ve outlined above.
So don’t be afraid of services, be aware of them and look to use them to your competitive advantage.
Brand Fundamentals for Startups
As a startup, Branding is all about YOU, the founders and what you have as a vision and want to make as a brand promise.
The Startup Secret here is simple but powerful – “start how you mean to end”
That is to say, think from the outset of your startup what you want to be recognized for and imagine what you want your legacy to be. This is vital because Brand needs to be consistent to be effective and though it will undoubtedly evolve, it’s tough to change.
As an example, we talk about Apple whose brand and even icon has barely evolved in 35 years since Mike Markulla defined it with Apple in Jan 1977. In the video above we talk about Apple’s brand and products “imputing value.” Also in this short segment from the full Go-To-Market session, we discuss what the key elements of your brand are and how to think about them. We cover brands as varied as Apple, Nike, Nordstrom, Puma, and Zipcar and what they stand for. And Students give their view as to why Dell, Coke, and Moleskin stand out for them.
Case Study: Unidesk and Guerilla Marketing
Startups invariably have very few resources for early marketing, and it takes creative “guerilla-style” marketing to be effective, as highlighted by this case example from Tom Rose, VP Marketing of Unidesk, and featuring the founder Chris Midgley.
Case Study: Apperian
Written by Mark Lorion
There’s lots of attention on inbound marketing these days, and rightly so, because it’s a powerful approach that can find engaged people when/where/how they want to engage you. It’s genuine and much more representative of how most of us want to be “sold” now. Unfortunately, the increasing emphasis on inbound marketing has many people thinking that outbound marketing is, and should be, completely dead. While I agree that the relative mix of tactics is swaying significantly toward inbound, I do believe there is a role for some outbound marketing in companies – even startups.
Inbound marketing involves creating content-rich websites, blogs and social media content that helps customer prospects find your company and product when they are actively involved in searching and seeking information. In order for inbound marketing to be effective, there must be keyword-rich content and links so that search engines find and rank your website. This obviously requires content as well as time so that the search engines may find the content and rank it in their search results.
In contrast, outbound marketing tactics may include any number of methods when the company initiates the conversation and sends out a message. For B2B marketers this may mean sending emails, making cold calls, using appointment setting agencies, buying contact lists, attending tradeshows, sending “clutter buster” direct mail, advertising, or “retargeting” programs. These tactics are initiated on your schedule.
One reason that I like some mix of outbound marketing in startups is that it can be a fast way to test, learn and jumpstart programs in a way that is tough for inbound marketing while its tactics wait for SEO rankings to kick in. Just pick up the phone and make some calls, walk a tradeshow floor and talk to people, send some targeted emails, and you’ll get some feedback. Outbound tactics can be powerful and quick for testing messages (think A/B testing) against your target segments and provide valuable feedback that can drive some pipeline while also guiding where inbound marketing investments should be made. Outbound messages can also help by increasing awareness and leading prospects to search, thereby driving them into Inbound-ready content.
Aside from testing segments and messages, outbound marketing may have a ongoing role in your GTM mix – particularly if you are selling into a complex internal buying landscape, have high enough prices to offset higher cost/lead, or if you have a field sales organization that needs help working their way into or through specific accounts. Even highly effective outbound programs will still have generally lower response rates than well-run inbound programs. Given the generally higher costs of outbound tactics, startups must carefully watch the lead-to-pipeline “waterfall” to ensure the economics of an ongoing program make sense.
With outbound marketing, one cannot segment too much. The narrower the segmentation, the more likely your program and value-based messaging will resonate with the target market and therefore increase engagement rates. The alignment of the target segment and messages of how your product/service delivers value is a critical success factor.
I believe another critical success factor is to have a rockstar telequalifier, or “business development” person, on the phone contacting customers who respond to emails, register for your webcasts, or simply placing outbound calls to try to set up appointments for your salespeople. This person will command your core messaging, be skilled in qualification, and have a personality fit with your target audience. For example, if you are selling into deep technical areas it will help to have someone comfortable and conversant with the technology. Many people will entirely outsource this function to an agency, which I believe is a mistake. Hire someone or get a contractor in-house and sit near him or her. Listen to what’s working or not working. Ensure they are executing the messages you want and make adjustments to improve their effectiveness.
Outbound marketing certainly won’t address all the challenges a startup faces, although neither will inbound marketing. In all likelihood, there will be a mix of both. As the company, its products, and the market evolve, so will the mix of marketing programs to drive through growth. Diligent measurement and benchmarking will help guide the team on when to switch gears.
Case Study: Unidesk and Distribution Channels
In this section we cover one of the key multipliers in a GTM strategy – distribution channels – brought to life by Brian McDonough of Unidesk.
Case Study: SplashScore
Lyle Stevens, Founder & CEO of Splashcore (now known as Mavrck), discusses how his team focused in on and picked their target segment and what challenges they encountered along the way.
Case Study: PatientPing
Jay Desai, Founder and CEO of PatientPing, describes their value proposition and how they are targeting their market.
Case Study: BrightCove
Personas are an incredibly powerful aspect of any go-to-market strategy. The following presentation describes how they rely on personas at Brightcove to drive the campaign-planning process. You’ll see several concrete examples of personas in action and learn some advanced methods and key considerations to keep in mind as you start using personas.
This presentation answers many crucial questions about personas, including:
- What are the core elements of a persona?
- What’s the difference between a decision-maker and a user?
- How do personas affect message and content development?
- What is the right number of personas to have?
- How can you put personas into practice at the top of the funnel and middle of the funnel?
Case Study: HubSpot
The Marketing industry is evolving – based on a radical transition of how humans live, shop and learn. No longer can marketers focus solely on the tactics of “outbound” marketing. In fact, in many instances, outbound marketing can be viewed as loud and impersonal. This new reality requires a different way of thinking about marketing: Inbound Marketing.
During this presentation, Brian Halligan, co-founder of HubSpot, discusses ways companies can benefit from Inbound Marketing, leveraging important marketing assets such as Twitter, Facebook and LinkedIn communities, as well as the power of website linking – all in a way that attracts people to a brand. Brian also discusses how Inbound Marketing is a particularly appealing solution for small businesses seeking creative ways to build brand loyalty, while keeping marketing costs at a minimum.