Go-to-market strategies for startups can be confusing. Every product is unique (isn’t it?), so their routes to market should also be specialized, right? Sort of. There are actually three major go-to-market (GTM) strategies to explore, but the key is to make them your own. If you read up on actual go to market strategy examples, […]
Go-to-market strategies for startups can be confusing. Every product is unique (isn’t it?), so their routes to market should also be specialized, right?
Sort of. There are actually three major go-to-market (GTM) strategies to explore, but the key is to make them your own. If you read up on actual go to market strategy examples, you’ll notice that many of them have a certain twist. They might target a unique customer, or set up an original pricing plan. But they all had to start somewhere, and that’s by choosing which of the three biggies would be their mainstay.
What Is a Go-to-Market Strategy for Startups?
Whenever a company enters the market for the first time, or starts off in a new market, or introduces a new product, a GTM strategy is required.
There are various time-consuming steps involved in building a GTM strategy. But it doesn’t matter if this is your first or fiftieth time going to market– you still have to proceed through the motions. That’s because a company evolves every day, as does its market and end user. Blockbuster didn’t learn this lesson in time, but you should, startups included.
Perhaps the most crucial choice that a company makes is what channels it will use for sales and marketing. Let’s look at the three basic ways to go about it. Startups, you should note, can rely on more than one of these concepts to get the job done:
Outbound. If you’ve got a strong sales team that knows their stuff, and you need to build a client base quickly, outbound is for you. Outbound means cold calling, email marketing, trade shows, and advertising. A good sales enablement setup will give you the tools for identifying targets, while an omnichannel approach will maximize your chances of getting the message across. This is a common go to market strategy for B2B.
Inbound. Through creative tactics related to SEO, marketing collateral, sales funnels, social media, and so on, inbound strategy inspires prospects to come to you. This one might be best for startups that have an easy-to-understand value proposition and a large potential customer base. Branding is essential here, and it can take time for the word to get out.
Account-Based Marketing. This is like an inbound-outbound hybrid. At first, you approach the customer, and then, they tell you what they want. How does it work? Once you’ve got a prospect interested, account-based marketing (ABM) is used to customize an offering for specific clients. This is great for deals of relatively high value and for products that can be adjusted without significant redesigns. ABM can be an effective go to market strategy for SaaS companies that want to prove their worth through initial sales to key customers.
How Do I Build a GTM Strategy for Startups?
Even after choosing a GTM strategy, startups have a whole bunch of special factors to keep in mind, and evolution is the watchword. For a startup, nothing is set in stone, and their GTM strategies need constant updates to reflect the discoveries made as they grow up. These issues include:
Pricing
This is a huge challenge for startups. Sure, they can go for what their competitors are doing, but where’s the fun in that? All kinds of factors come into play here, such as unique features, great service, and customer budget. If there are significant material or manufacturing costs, will you eventually get to economies of scale? Will your suppliers cut you a break if you seem to be killing it? It all stands to change over time.
Lots of companies shift their pricing, and even their pricing strategy. Believe it or not, Google had no real pricing strategy until it launched AdWords in 2003 (just can’t remember what happened to them after that…).
Customer Personas
Another fluid issue is the question of who actually buys your product, and it can mean a total revision of your basic marketing strategy. Your team might take quite a while to understand the purchasing process of their target market, especially if it involves large corporations or the government. It might even happen that your first idea about who your ideal customer is turns out to be off the mark.
Look at Uber, for example. This is a fascinating company for many reasons, including that it has two customer groups – riders and drivers. You might assume that a typical Uber rider is somebody who can’t afford a car. But actually, their largest customer group earns over $90,000 per year on average.
Product
The things your customers want might not be what you had planned. Almost every company goes back to the drawing board to make at least minor adjustments, and sometimes, a major overhaul. It’s only after market exposure that you get a real idea of optimal features, user experience, and most importantly, “core competence”. Core competence is the thing you are really good at, and knowing what that is can lead to a much wider product line.
The perfect example is Amazon. It started as an online bookstore working out of a rented garage. But Jeff Bezos and his team realized that their core competence was actually shipping and running an online marketplace. Today, they are no longer working out of a rented garage.
Branding and Positioning
This is about waaay more than a logo and tagline. When you’re a startup, you are virtually unknown (unless you have a famous founding team). You need to figure out how and why prospects will answer your phone calls or sign up for your white paper.
That’s why branding and positioning are last in this list. In terms of GTM strategy, branding and positioning (AKA messaging), happens about halfway through the process. This is because you can’t really decide on your message to the market until you know what you are selling and to whom you are selling it. Once you have ventured forth and received some feedback regarding customer personas and product, you can tweak the messaging part of your GTM strategy to reflect these changes.
Maybe the most famous rebranding story of our times is McDonald’s. Once regarded as a hangout for people with the munchies, McDonald’s went for healthier menu choices, better coffee, and a family-oriented vibe. It even provided a green option for its logo background to signify this earthier positioning.
Key Takeaways
Startups need to pick a basic GTM strategy
Over time, they learn more about their business and can adapt the GTM strategy accordingly
Special areas of attention include pricing, personas, product, and positioning
