Many digital go-to markets fail. In my experience, one main reason is that organisations focus on too big a piece of the market. With baseless statements like “ We want to achieve 15% of XYZ market”, they don’t understand how market segmentation and value creation work. In this blog, I will share my five steps to have a successful Digital Go-to-Market strategy.
The first thing you need to let go of is the concept of a market segment as a piece of the pie. It is not. Every market is part of small market segments. So first, let’s understand what Go-to-Markets really are.
Understanding Go-to markets
An old definition defines a Go-to-market as: “channels the company will use to connect with its customers, business, and the organisational processes it develops”.
But go-to-markets are far wider than that. It is not just about the channels and product quality. It’s also about how good and how fast you are at moving merchandise.
So, a more accurate definition is:
“Go-to-market is about pushing the full value and offering to the market in a unified way and putting the client at the centre.”
One analogy I like to steal from the book “Rich Dad, Poor Dad” is that Mcdonald’s is not the best restaurant for the best hamburger. But what sets them apart is that they put their clients at the centre of what they do. They optimise their internal systems, and their fast food is available in the proper channels and can be found at suitable locations at the right time. So, even if they serve a medium taste hamburger, people will still buy it. Why? Because it’s sold at precisely the right price, time, and place, the customer wants the hamburger. The same applies to the full value and offering of a good Go-to-Market.
This resonates with Geoffrey More’s Crossing the Chasm theory with the famous bell curve describing innovators, early adopters, reaching early and late majority and laggards in the market. It’s about “Thinking from the buyer’s perspective and not the products’’. Buyer needs may change as the market matures, so learning to innovate is essential, so you don’t get left behind. Before you set your digital product in the market, you must reach that innovator’s state first.
Five steps to a successful digital Go-to-Market
I’ve launched many digital products in my career. Some Go-to-Market strategies were huge successes, while others were great learning opportunities. So, without further ado, here are the five steps I advise for a successful digital go-to-market strategy.
Step 1 — Define your value proposition.
To start, define who you are: what you do and what desired business outcome you aim to achieve for your customers or users. These should describe the customer pain points that your product will alleviate as well as the value it creates.
Writing down these questions will help you position yourself in the market and see how you compare with your competitors.
Once that’s settled, you should be able to create your value proposition in one statement like the following example:
[Your digital product or service] offers [what product/service] primarily for [ target market ] with the compelling reason of [ unique value proposition] unlike [competitors].
Step 2 — Research and find your target market and segmentation.
Once you have defined what business you’re in and what makes you competitive, it’s time to deep-dive into your target market. In this step, you will determine who your customers are.
Define the target buyer
First, define the target buyer for your product. Think of a specific industry, niche, or persona that is best suited for your value proposition.
Do you sell part of or the complete solution?
Secondly, decide if your product or service is a complete solution for your target market or just a part of it. For example, If you’re renting out hotel rooms, is the need just a hotel room, or is the need an all-out holiday trip with restaurant advice, travel etc.? Defining this helps you to create value later in the process.
Who are the decision-makers?
Next, get to know the key players in your target market. Does it involve an approver or decision-maker, an advertiser or influencer? Take the same hotel room example. Are you focusing on the person searching the internet for hotel rooms? Do you need to convince their partner and kids as well? Or maybe your rooms can be rented through a recommender such as a travel agency or an influencer? Factor this aspect into the decision-making process.
What are the average selling price and sales cycle?
Knowing the sales cycle and average selling price or price point is essential. This will help you define and compare with your competition. For instance, if all competitors only focus on low service and the lowest price, there may be a market for a more upper-class service. Additionally, the average selling price defines the duration of your orientation and decision-making funnel. Higher prices tend to have a longer decision time than shorter ones.
Create a list of market segments
So, now that you have decided on your target buyer, decided if your product provides a complete solution or just a part of it, got to know the decision-makers for your product, and pinpointed your average selling price; you can create your market segmentation.
One example of such an segmentation could be based on: Country > Urban core > Age demographics > family composition > etc. For example, these could be high-income urban couples from France.
Before you enter the next step, don’t just write down one of these segmentations. Write down 15–20 and try to quantify the sizes to decide which segments are most interesting to approach first.
Step 3 — Beachhead strategy
Now you are ready to get into action. One successful go-to-market strategy that’s also used by Apple and Microsoft is the beachhead strategy. The term beachhead is derived from a military strategy. It says that as you are approaching an enemy territory, you should plan and focus all your resources on winning a small border area. Then, that small area becomes a stronghold from which to advance into the enemy territory.
So, in go-to-market terms, win a small segment before advancing to the next. In the computer business, for example, they targeted smaller segments such as programmers, students, or creatives before hitting the mass market with their products.
Step 4 — What is your distribution & marketing model?
It’s only now that we’re ready to talk about channels. This needs to cover not only the channels through which your product or service will be sold, such as direct sales, inside sales, online sales, and indirect channels. It should also include the marketing channels that raise awareness about your offerings and create demand.
1. Awareness campaigns
How do you make your target segments aware of your offerings when it’s just been launched? Can you find ways to target specific customers?
These channels could be websites, social media platforms, radio ads, search engine advertising, whitepapers, speaking events– you name it. Other than awareness, this creates a credibility shield so people will buy your products.
2. Demand generation
Once you have created awareness about your product, it’s time to create demand. Digital marketing, email blasts, warm & cold calls, and support from partners could all help in this. The right promotion plan for initial customers is integral to getting the ball rolling.
How to Create a Go-to-market Strategy for Digital Products
Last but not least is the distribution model. Which channels will you use to sell your offerings? These could be websites, sales agents, resellers, individual stores, etc. These should be based on where your customers are looking, the cost, and the additional brand representation.
Step 5 — Make it a lean start-up.
Most Go-to-Market strategies end with a distribution model. But it shouldn’t. A strategy is a living work. Writing down and defining steps 1–4 will help you be more effective on your first try. But some learning cycles are still necessary to become successful.
My first advice is to follow the lean start-up strategy and experiment with several variations of your offerings, quick and dirty. The sooner you launch it to the market, the faster you will see if it’s effective and get feedback. Don’t spend too much money trying to make it perfect in this phase. Keep it small first and see what works. Then, perfect it and make it bigger; a bit like the beachhead strategy,
And the last tip I’d like to share is one of the ideas described in the Lean Startup book by Eric Ries: create a VIP treatment for your first customers. What he means by this is to make your first customers’ journey as perfect as possible. So, if you rent out a hotel, pick the person up from the airport and bring him to the hotel yourself. If you are selling a digital service, check in with your customer personally with an email or a call to check if everything was experienced to satisfaction. By doing this, you will hear what went well, why they chose you, and what could be improved for the many customers to follow.
Conclusion
Bringing your product to the market could be very challenging, but it’s also very exciting. Often, companies have little resources but need results quickly. Even so, I would recommend not skipping these five steps. This will help you achieve more in the future. In my experience, doing it right is just as important, maybe even more, than doing it quickly.
If you have any specific questions about the Go-to-Market strategy for your company, I’d be happy to answer those for you. Don’t hesitate to reach out.
