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Product_Market_Fit

Building your go-to-market strategy after achieving product market fit

Steve Eveleigh

Everything about go-to-market comes back to product market fit. What separates a go-to-market strategy from standard sales and marketing processes is the focus on how your product, marketing and sales functions operate within the wider context of your business. You need to think about what your product is, who will value it, the channels of communication that they will find compelling, and how all of this impacts pricing, marketing and sales.

Start by creating a core value proposition and then expand to develop target personas — each of which with tailored messaging that speaks directly to their needs and how they relate to your product. No matter how you end up communicating with your target audiences, the first critical step is to make sure that you have identified the right audience(s).

1. Align your strategy with pricing

So many of your go-to-market choices will be impacted by pricing. The more expensive your product, the more you will be able to invest in customer acquisition. Equally, however, the harder it will be to convert leads into customers and the smaller your customer pool will probably be. No matter what, you need to make sure that you do not spend more on customer acquisition than you earn from your average customer.

For more expensive products, your main customer base will be enterprise organisations, and hands-on sales techniques will need to play a significant role in your sales funnel. For low-cost products, you will likely want to target end-users directly, within a self-directed, freemium-based and marketing-led sales funnel.

Disruptive Growth Strategy

By looking at your product market fit within the context of pricing, you will also be able to identify if your product fits within a dominant, differentiated or disruptive growth strategy. We've written another article which details how to pick the right growth strategy. This is another crucial aspect of determining how you need to approach leads and where your investment strategies should sit.

 

2. Revisit your target market in even greater detail

Where-are-your-competitorsYou will have already thought about your ideal customer profile, buyer personas and target market audience — all effectively terms for the same thing at different levels of granularity. But, you can never take these calculations too seriously, and it is important to look at them in the context of your pricing.

Different sized companies will have different pain points that will attract them to different product features. When selling to a small company, you’re likely to be selling directly to someone who can buy your product. Whereas with enterprise, your entry point into the business may not be the person in control of buying new tools.

The price of your product will likely dictate how you approach these organisations and the people within them. But, the size of the organisation will dictate the end goal that you need to strive to create. Fundamentally, however, you don’t need to be limited to one choice or the other. But, you do need to account for these differences when approaching each target market individually.

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3. Invest in marketing first

Focus-on-KeywordsNo matter what strategy you choose, marketing will play a critical role in your go-to-market strategy. Even enterprise products, with a heavy face-to-face component within their sales funnel will rely on quality product trials and content marketing to capture initial leads and fuel positive interactions. These are two facets that you need to nail from the beginning — in addition to developing a quality and functional product.

Marketing teams should be your high-level visionaries. They will help you identify a product market fit and keep your processes and investments aligned with that larger vision of the role your product should play within the market. Sales teams operate on a much more granular level and will be far more likely to be swayed by the desires of an individual client. Both roles (and perspectives) are important. But, the latter has the potential to throw you off course if operating without a counterbalance.

 

4. Take analytics seriously and create a review process

Get-DataAny proper sales and marketing strategy depends on analytics. Without the ability to track what you are doing, you will be unable to improve. Building analytics capabilities should be one of your first priorities. You need someone on staff who can use tools such as Hubspot, Convertro, Google Analytics, Infer, Optimizely and DemandBase. To start with, this person can undertake different tasks as well. But, these are critical skills that you should look for in early sales and marketing hires.

The reliance on inbound and automated retargeting in much of the SaaS market makes this essential to improving sales processes. You need to be able to quantify and understand impressions, and categorise those impressions into effective and ineffective sales journeys. There is no ‘gut’ that sales reps can rely on to improve their meetings.

Invest early and invest heavily in analytics capabilities so that you understand what works and improve as you grow. Decide on the metrics that matter and determine a process for interpreting and discussing these metrics within every arm of your business.

 

5. Learn from your first customers

 

Everything about a successful business is a process. You need to learn as you go and account for the feedback you receive. Start small and grow. Trial your product and sales process, take on feedback and perfect the system before ramping up to a full-blown campaign.

You will learn a lot from your first customers. You will learn about what customers will and won’t accept. Specifically, how far you can push in terms of price point but also the way in which you package up your different modules or services. You don’t want to lose perspective on the hard work you put in creating a product market fit. But, you need to recognise that you will not have been able to foresee everything. It is important to be humble and learn.

 

6. Remember that sales does not end with a sale

Evergreencontent

You need to continue to invest in your customers and realise that your go-to-market strategy does not stop when a deal is signed. As an ‘all arms’ approach to growth, a go-to-market strategy looks at all options for continued development. That means paying particular attention to the lifecycle of customers, grabbing opportunities to up-sell, re-sell, cross-sell and, above all, maintain a customer contract.

Most SaaS businesses operate on subscription models. A customer is as valuable as the length of their contract. Fundamentally, if you can keep average churn rates low, you will open up the possibility for greater sales investments even for a low ACV product. It is still risky to overspend when selling a low-priced service. But, the longer businesses stay customers, the greater return you will receive on any customer acquisition investments. The fastest growing and most stable SaaS businesses invest in customer retention and up-selling — you should too.

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And finally...

Success comes from aligning Sales, Market and Product under a single banner that takes into account a business strategy and pricing model. You need to take a holistic view of your product, your customers and your market to build a process that fits your ACV (annual contract value) and can scale. Then, target your efforts on people who need and can afford your product. Build your team around these outcomes.

Everything relies on a deep understanding of your own product. That is the secret to understanding your market and buyers. Once you understand all three of these factors, you will be able to craft a go-to-market strategy that will reach your target market audience and convert prospects without overspending.

As founder, you have the intangible piece — you understand your product. Within you is the vision that willed this business into existence. That is the key to turning your idea into a scalable success. It all hinges on what your product delivers. That tells you who would buy it, why they need it and the value of that outcome.

Your first step, however, is to identify and write down that value proposition, develop and target market audience and begin thinking about your buyer personas. Everything stems from here. Start planning and good luck!

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Originally published on 01/07/19 08:48

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