Get to Speed Fast and Learn from the People Who Have Done it Before

Speed is a competitive weapon when designing new products or bringing products to new markets. There is no size fits all solution but if you understand some general building blocks you will be able to move much faster: do your homework and begin with the end in mind, take your time to connect the dots, orchestrate and align, build your GTM machine (from 0 to 1 and from 1 to n). If you are new to GTM find all the resources in “Why a Killer GTM Always Wins.”

In order to design a successful Go-to-Market fast, you have to consider all the pieces of the puzzle and create a GTM strategy coordinated with the product, business, and operational functions and aligned with current market situation and customer insights. It seems that the best way to get to speed fast is to learn from people who have done it before. The fastest approach is to start with a hypothesis and validate it or not. And move to the next one. Simply — there are no shortcuts.

A common thread of all GTM myths: “When designing a go-to-market strategy there are some optimal steps I can follow and that checklist of activities can simply be organized chronologically.”

Contrary to the common opinion each Go-to-market is unique such as each company and its product is unique. To make the matters worse there is no clear linear path but rather the overall Go-to-market system is interdependent and if one piece of a puzzle changes that influences the others. It doesn’t really matter that much how you define the pieces of the puzzle for your unique case either market, product, channel, model or value definition, generation, communication, and delivery as long as you consider all aspects in your Go-to-market framework and understand their interdependencies.

Here are 6 myths that you need to be aware of:

MYTH#1 “It is enough to focus only on product-market fit initially”

MYTH#2 “First we build the product and then we design the go-to-market.”

MYTH#3 “We have been so focused on building the product that we did not consider how to build traction yet (and/or we are not sure how to distribute it).”

MYTH #4: “I will build the product and they will come.”

MYTH #5: “I will think about the pricing after the product is developed.”

MYTH #6 “Someone with no prior expertise in our domain cannot help us with our Go-to-Market — our industry is very specific.”

MYTH#1 “It is enough to focus only on product-market fit initially.”

“The SaaS industry has developed tunnel vision and become too focused on product-market fit at the expense of the bigger business ecosystem. You’re forgetting about other important SaaS components that all have to fit together like jigsaw pieces for your whole business to work.” Brian Balfour

Having product first, market second mentality can be a dangerous move. Brian Balfour proposes to start with the market and that will force you to start with the problem — instead of thinking about product-market fit you look for market-product fit. That makes identifying the market that really needs a solution and is willing to pay for the product less difficult.

MYTH#2 “First we build the product and then we design the go-to-market.”

“Your Product Is Your Go-to-Market Strategy.” Scott Maxwell “Get the product right, and it will sell itself — or your customers will help you sell it.” If you have a more intuitive and simple product, you may be able to move all the way to the other end of the spectrum of go-to-market strategies by creating a product-driven strategy.

“In recent years, we saw many Software-as-a-Service (SaaS) companies succeed with what is often called a product-led go-to-market strategy. A product-led GTM strategy is a process of acquiring customers by providing access to your product early in the buying cycle (via freemiums and free trials). You then leverage customer behavioral and product usage data to acquire, retain, and grow customers.” Nick Bonfiglio, Mickey Alon, Myk Pono “Every organization serious about focusing on customer experience has to evaluate and optimize its GTM strategy.”

You can improve your customer experience with a product-let GTM strategy by making your product an essential part of the acquisition process and reducing the time it takes for prospects to access the product. Companies can reduce their customer-acquisition cost, accelerate trial-to-conversion and increase customer lifetime value. Product-let GTM aligns product, marketing, sales, and customer success teams and it provides a clear path to align around the buyer’s journey and full customer lifecycle.

MYTH#3 “We have been so focused on building the product that we did not consider how to build traction yet (and/or we are not sure how to distribute it).”

You are probably aware of the adage if you’re not embarrassed by the first version of your product, you’ve launched too late. Focusing on your product only is probably not a good idea. If you will not be able to orchestrate the rest of the pieces in the puzzle.

“The number-one corporate objective, when crossing the chasm, is to secure a distribution channel into the mainstream market, one with which the pragmatist customer will be comfortable. This objective comes before revenues, before profits, before the press, even before customer satisfaction. All these other factors can be fixed later — but only if the channel is established.” Geoffrey A. Moore

“Above all, we look for compelling and contrarian insight into how the world works. What do you understand about a market or a need that no one else does — that other companies in the space get wrong?” FirstRound FAQ “Second, if you have a product in a market, a small group of passionate early customers is a strong indicator for us.” “We reached out to the company and invested. If there are people using your product or service who wouldn’t know what to do without you, we want to hear about it. That’s one of the strongest data points you can offer. As an extension of this, we want to see creative thinking around go-to-market strategy as well as product. The best startups take both seriously.”

First Round team explains how they make a decision to invest in a product — one of the most compelling signals is that if people are using your tool or service who would not know what to do without you, that is a very strong signal for them. Besides the product and the market, building initial traction is important and so is a creative thinking around Go-to-market strategy.

“The number one reason that we pass on entrepreneurs we’d otherwise like to back is their focusing on product to the exclusion of everything else. Many entrepreneurs who build great products simply don’t have a good distribution strategy. Even worse is when they insist that they don’t need one, or call [their] no distribution strategy a ‘viral marketing strategy.” Marc Andreessen “The general model for successful tech companies, contrary to myth and legend, is that they become distribution-centric rather than product-centric. They become a distribution channel, so they can get to the world. And then they put many new products through that distribution channel. One of the things that’s most frustrating for a startup is that it will sometimes have a better product but get beaten by a company that has a better distribution channel. In the history of the tech industry, that’s actually been a more common pattern. That has led to the rise of these giant companies over the last fifty, sixty, seventy years, like IBM, Microsoft, Cisco, and many others.”

As a startup, you just cannot rely upon great PR in place of your distribution strategy, even if the product is awesome. There are numerous products that failed since they did not have the access to the right distribution channel.

“Design your go to market before you build anything and test it.” Bram Kanstein

“This is not something you figure out after you built (now I do mean code and design) a product, you can do this right now. Where does your target group — the people with the problem — consume their content about the subject of the problem? Find those channels, and talk to them. The business plan has been replaced by the Business Model and Lean Canvas, but you still need a strategy. A lot of early-stage startups’ products can be dismissed by asking the above questions.”

Why would you invest energy and resources into the development of a product, instead of doing research and coming up with a solid strategy for going to market. Try to test out as early as you can what is your strategy to reach the people who have the identified pain and see, if they are willing to pay for your solution.

“One of the major challenges startups face is having a great product that people love but not getting enough traction. This is why it is important to focus 50% of your time on developing your product and the other 50% on testing different traction channels (The 50 percent rule).Justin Mares and Gabriel Weinberg “Most founders only consider using traction channels they’re already familiar with or think they should be using because of their type of product or company. This means that far too many startups focus on the same channels (search engine marketing, public relations) and ignore other promising ways to get traction.”

The authors of Justin Mares and Gabriel Weinberg Traction, A Startup Guide for Getting Customers have interviewed more than 40 startup founders to find out how they got traction. They came up with a list of 19 customer acquisition channels named traction channels that are either marketing or distribution channels through which your startup can get traction — real users and customers. It’s hard to predict the channel that will work best. They realized that founders have been quite biased in traction channel selection so they design a methodology how to run tests to figure out which channel is best one for you right now.

Working on your traction and developing the product simultaneously has two major benefits: you will get a large amount of feedback that will help you further refine the product and your messaging and by testing different channels and learn what works and what does not you can move full speed ahead when launch time comes.

“At some point, there is a shift from being a product focused company to a company that is about distribution.” Elad Gil “The best companies actually focus on aggressive distribution early and often you see a company that taps out and market cap or market size because the founders weren’t aggressive early about distribution and then later, other companies caught up to them.”

There is a critical shift that happens when a company mover from zero to one from one to n according to Gil. The goal of the business in the second phase is to create scalable and repeatable growth and that means distribution system. If you look at the businesses that are prospering today, they have very powerful distribution engines and their number is by surprise quite limited.

MYTH #4: “I will build the product and they will come.”

“It starts with the CEO and their appreciation of what it’s going to take to go to market and win. What I see a lot of is “I’ll build the product and they will come.” They wait too long to understand what it takes to “go to war.” You have to have boots on the ground. Big incumbents wake up and stomp down with their deep pockets because they have account control and deep relationships. If you don’t recognize this, you’ll be late and slow. Other things in a long list include the quality of the sales team and the competitive position. This is the secret sauce.” Mark Cranney

MYTH #5: “I will think about the pricing after the product is developed.”

“Drill down to see what customers are willing to pay early on. It’ll drastically increase your odds of success.” “But the root of all innovation evil is the failure to put the customer’s willingness to pay [WTP] for a new product at the very core of product design. Most companies postpone pricing decisions until after the product is developed. They embark on a long, costly journey of hoping they’ll make money rather than knowing they will,” Madhavan Ramanujam “You can ensure your product not only stays alive but thrives, by talking with customers early in the product development process. If you don’t, you won’t be able to prioritize the product features you develop, or know whether you’re building something customers will pay for until it’s in the marketplace.”

“So, rather than ask how much a product is worth, ask these questions: At what point is this way too expensive that you would never consider purchasing it?, At what point is this starting to get expensive, but you’d still consider purchasing it?, At what point is this a really good deal? (You’d buy it right away.), At what point is this way too cheap that you’d question the quality of it?” Patrick Campbell

“After getting your product live, pricing is one of the toughest challenges for startups. Don’t risk the consequences of getting it wrong, give yourself the best chance of finding the right price for your early customers.” Ash Rust “Starting with customers who have low budgets makes it hard to appropriately price your product. Even if they use your service regularly, you won’t know how valuable it is to budget customers, because they can’t pay.”

““Need More Time” or Lack of Product-Market Fit?” Martin Cascado “Going to market early changes everything about building a company.” “In fact, the majority of the go-to-market ecosystem around enterprise software and hardware — VARs, resellers, distributors, OEMs — is geared towards large, existing markets. No amount of business development meetings, relationship touch-points, cross-logo posting, or integrations will create the behavior you want from a partner as much as dangling a big market in front of them will. Pre-chasm companies have to create a pull-based market — not a push-based one — before they can truly engage the benefits of such partners.”

Cascado explains what to do when you are going to market and no market exists. It is hard to figure out if you just need more time or the market does not actually exist. Cascado shares five possible signs from his own experience: #1 Getting stuck in the ‘innovation friend zone’, #2 Even if customers are ‘sold’, they still can’t buy, #3 Your biggest competition isn’t another company..it’s the status quo (or is it?), #4 The paradox of pricing when you know what the value is… but not what the people will pay for #5 No startup is an island, and there’s no ocean of partners around your platform. Pre-chasm enterprise startups throw time and resources at indirect sales channels (including OEM). It is still important to foster ecosystem relationships early since strong business goes hand in hand with strong partnerships but you cannot jump ahead and skip the first step of creating a pull-based market.

MYTH #6 “Someone with no prior expertise in our domain cannot help us with our Go-to-Market — our industry is very specific.”

Designing a creative go to market strategy lies in strong generalist skill set and the ability to go deep where it matters. A successful go to market does not always start with building a great product first — you can build a community and then launch a great product on the top of that.

With the emergence of marketplaces, platforms and ecosystems it is vital to keep very broad (not just industry or business specific) perspective. That can give you an extra competitive advantage when entering the new market, designing a new business model or launching a new product.

Just like “classical crossover” happened in the music industry in the 1980s — classical musicians playing pop music — something similar is going on in the go-to-market strategy — there is no tight boundary between B2B or B2C anymore — marketers or founders are “crossing over” and bringing the value with a diverse background either from consumer markets or enterprise markets. That trend has initially started a few years ago with companies adopting software differently — individual users are picking out products they want to use and then they eventually spread through the entire organization.

Omnichannel customer experience adds another layer of complexity and emergence of digital-first products has taken the world by the storm. The brick and mortar businesses who have not been able to digitize at least a part of their user experience are going out of business. This phenomenon has been going on in gaming a while ago (land and online casinos) and the storm is raging in the retail at the moment.

“And we’re seeing kind of this huge shift, especially in SaaS and in open source where companies establish massive market presence and brand and growth using these kind of more traditional consumer-ish growth motions. And then that very seamlessly leads into sales, and often a very different type of sale. And so I think a lot of people in the industry are on their heels, both investors and people that have started companies in the enterprise before, they’re trying to understand exactly what’s going on.” Martin Cascado

“Dropbox is the fastest SaaS company to $1B in revenue run rate with 600+ million users. This is just an example showing that companies are adopting software in a completely different way in recent years — we have individual users/developers picking out products that they want to use, and then it eventually spreads inside the organization.

This is the engine that powers Dropbox, Slack, Asana, and many other new companies. It brings together all the growth levers: Viral growth, performance advertising, consumer growth techniques — but also inbound marketing, enterprise sales, etc., etc.. It’s a great trend that brings together folks with consumery backgrounds (like myself!) and my colleague Martin Casado (prev Nicira, acquired by VMWare).” Andrew Chen

Majority of the go-to-market effort in the early days in the enterprise would be to build a product and that product would be informed by your knowledge of the market. Once the product was ready you would go ahead and sell it by hiring salespeople. A new trend how companies are adopting software has emerged that works well for horizontal products such as collaboration tools — individual users are picking out these products they want to use and then that eventually spreads to the entire organization.

“Virtual spaces are giving way to digitally connective physical places.” Shama Hyder “A fascinating phenomenon is taking place. At the peak of digital domination, at the apparent apex of e-commerce, offline retail is making a comeback, only this time, on entirely different terms. In this retail renaissance, the best of aspects of digital augment a physical environment for a richly sensory, highly individualized, mood-boosting customer experience.”

Shama Hyder believes that resurrection as brick-and-data is just getting started. The digital age brings new value propositions such as exclusively virtual spaces must give way or at least be linked to digitally connective physical spaces. Digital connectivity exists not only to enhance traditional retail but completely re-envisions the brand and guest experience.

“Over the course of years of studying innovation, we’ve found that there’s great power in bringing together people who work in fields that are different from one another yet that are analogous on a deep structural level. Such as makeup and surgical infections, surprisingly. Or inventory management and robot games. Or malls and mines.” Poets, Franke and Schreier “But next time, consider mining distant, analogous fields. Look for creative people who aren’t constrained by the assumed limitations and mental schemas of your own professional world. These are people who, although they know little of your field, may be more likely to come up with breakthrough thinking; indeed, they may be carrying around, in their heads, the germ of the solution you’ve been searching for all along.”

If you can bring ideas from analogous fields that can be a potential source of radical innovation. Authors argue that it can be hard to find that analogs fields initially and propose to apply search methods that have proven successful such as pyramiding (sequentially asking people for referrals until you reached the top of the knowledge pyramid) or broadcast search which refers to actively disseminate a problem to activate a self-selection among problem solvers. In their recent study, they combined roffers and inline skaters to give ideas for increasing comfort and use of carpenters safety gear and each group was significantly better at thinking of novel solutions for the other fields than for its own.

““Gamechangers” are more ambitious, with stretching vision and enlightened purpose. They see markets as kaleidoscopes of infinite possibilities, assembling and defining them to their advantage. Most of all they have great ideas, capturing by brands that resonate with their target audiences at the right time and place, enabled by data and technology, but most of all by rich human experiences. Social networks drive reach and richness, whilst new business models make the possible profitable.” Peter Fisk

Peter Fisk dives deep to study best practices people who have been able to change the game in his book Gamechangers. He sees “gamechangers” as market makers, business innovators, and brand builders that are all shaking up their markets in different ways. They think bigger, learn faster, and they change the game.

“As a result, marketers now get the majority of their “learning” through this hack-tic based content. As addictive as they are, prescription-based tactics and tools won’t solve your problem, and most importantly, help you become an elite marketer. Most real-world work involves a problem that doesn’t have an answer yet, and the biggest growth opportunities are in uncharted territories. More specifically, you don’t figure out the answer by just plugging in the answers that have worked for others in the past. Instead, the biggest upside lies in solving problems that likely didn’t exist before.

As we emphasize continuously in Reforge, becoming an elite growth marketer has nothing to do with the specific hammer in your toolkit and everything to do with mastering the emerging skills, frameworks, and thought processes that enable you to solve new problems, repeatedly.” Brian Balfour

Conclusion

Designing a Go-to-Market strategy is a craft and you have to approach it with the execution in mind. There are no shortcuts, magic growth hacks or pure luck.

If you need more resources to design your go to market strategy faster find them in the deep dive “Why a Killer Go-to-Market always wins.”



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