Go-To-Market strategy is fundamentally about resource allocation, with decisions revolving around product features, target market, marketing spend, and sales force hiring. At its core, the choice of target market drives these resource allocations.
The hardest aspect of Go-To-Market development is accepting that there can only be one primary target market.
A target market is a set of potential buyers who have common characteristics that make your product particularly appealing to them (known as the Unique Selling Proposition). Since different target markets have distinct characteristics, attempting to cater to two segments ensures that the offering will fail to satisfy either group.
It’s crucial to understand that the target buyer in the Go-To-Market strategy serves as the initial entry point. Other buyers can be upsold to expand the account.
Here are some common objections to the “pick one” rule:
- My product is good for everybody! While this might seem valid, the most effective way to convince potential customers to purchase your product is by demonstrating how similar customers have benefited from it (known as Lighthouse Customers). This approach only works if new prospects believe their needs and benefits align with those of your Lighthouse Customers.
- My product serves a multi-sided market of buyers and sellers! Even in a multi-sided market, it is critical that the company pick an entry point to bootstrap their Go-To-Market strategy. A straightforward question to ask is “who pays?” to determine which side of the market to focus on initially (the other side of the market begins with a basic MVP).
Case Studies
- BladeLogic’s Shift To SecOps: BladeLogic faced a declining $300 million automation business, dropping over 20% annually due to competition from open-source tools like Puppet. By identifying that the largest BladeLogic customers were using automation for both IT and security tasks, the company pioneered the SecOps category, sending revenue soaring.
- Trash sorting robots: A robotics company’s product had applications across various trash sorting segments, leading their marketing and sales efforts to be scattered across different buyer profiles. Focusing on buyers interested in improving recycling rates gave them a stronger competitive narrative.