The Super 7 GTM Strategy Plans
A Go-to-Market or GTM strategy defines how your company will reach and establish a competitive advantage in your target market. It is an important part of, and needs to fit, your business plan. That’s true whether you’re leading a startup or a mature business. Seven times out of ten, when reading or listening to different go-to-market strategies, I get the sense that decision makers, a) haven’t done much research, or b) are only getting a part of the picture. It’s not surprising then that most businesses fail to achieve financial viability with their mobile ventures.
Go-to-market strategies are complex. They require intimate familiarity with your target market and serve as the basis of your marketing plans. GTM strategies must also factor in product development, launch, distribution, promotion, monetization, and really – every part of your business plan. Since every business is unique, there’s no one-size fits all GTM plan. But we’ve defined seven major go-to-market strategies that you should consider:
- “Go Big”
- Testing the Market
- Internal Launch
- Strategic Partnering and White Labels
- Incubators and Accelerators
- Crowdfunding and Pre-Orders
- The Springboard
Why Have a Go-to-Market Strategy?
Without a GTM strategy, you may never actually get to the market and probably won’t last very long if you do. A GTM Strategy must consider the state of your business, the venture or project it is launching, and its target market.
The customer always comes first, so the core objective is to deliver a product that provides real value to end-users and that they’ll love to use. Product-wise, it’s knowing why your idea is better than what your competition offers. Business-wise, it means knowing where your business stands, the resources it has, where it’s going and how it’ll going to get there.
Advantages of Having a GTM Strategy
- Consider all of your available options and contingency plans.
- Know up front where you need to concentrate your efforts.
- Know who you’ll need to work with to develop your product or build your app.
- Rapidly find a good product-market fit.
- Keep your resources and efforts focused, avoid scattering energy.
- Focus on the one reason why people will use your app instead of your competition’s – for more useful end-user and market feedback.
- Bring your product to market more rapidly.
- Avoid the four main reasons why mobile apps fail:
- Bad apps – from poor design and execution to broken features.
- Poor product-market fit.
- Insufficient monetization potential.
- Poor product release or distribution plans.
Start by Identifying Your Strengths
What do you have? Let’s keep this simple for now, but with the understanding that whatever you have can be used or converted into obtaining anything you don’t have. That’s what strategy is all about. What you have goes a long way toward defining your starting options. Take a moment to write down each strength that you have to help with quick referencing strategies.
- Funds – you can finance the cost to build, market, and operate your venture with minimal outside assistance.
- Access to funding – Everyone has this – consider this a freebie, the only question is your awareness about who to approach and how to approach them.
- Technical Expertise – you can code or engineer anything, blindfolded, and with both hands tied behind your back.
- Time – when needed, you can commit to working 12-hour days, seven days a week.
- People – your business already has employees or you have friends willing to volunteer time to help you out.
- Creativity – you can generate graphics, videos, and other multimedia presentations at will.
- A Solid Social Network – you or your team have connections with a lot of people who are favorably inclined to anything you might send them.
- Industry Expertise – your team knows everything about your industry, its associations, and publications.
- Multilingual Capabilities – you and members of your team have native fluency in at least one language other than English, and its corresponding culture.
- Strategic Thinkers – someone on your team is capable of sifting through absurd amounts of Data to find opportunities and/or reliably extrapolate the future – the kind of people who invested in Microsoft, Google, Facebook, Amazon, Paypal, etc., before their IPO’s.
Quick Reference Guide
To make it a little easier and faster for you to find a go-to-market strategy suited to you. Compare your notes from above to find GTM Strategies that depend upon the strengths you have while not necessarily requiring those you don’t. Then you can go straight to the corresponding GTM without having to read through all seven strategies.
Your Strengths & Resources
|1 – Go Big||Funds, Tech, Thinkers|
|2 – Testing the Market||Time, People, Tech|
|3 – Internal Launch||Funds, Industry, Tech|
|4 – Strategic Partners and White Labels||Industry, Tech, Thinkers|
|5 – Incubators and Accelerators||People, Creativity, Time|
|6 – Crowdfunding and Pre-Orders||Social, People, Creativity|
|7 – The Springboard||Multilingual, Thinkers, Social|
The “Go Big” GTM Strategy
Strengths: Funds, Tech, Thinkers
As it infers, the “Go Big” approach means a massive commitment to a new venture – as much money, time and energy as you can bring to the table and a willingness to take on huge amounts of debt to capture market share before anyone else. Consider it the early-Amazon and ongoing Uber strategy. Bezos started fairly small in the early 1990s with a $300,000 loan from his parents. 25 years later – he’s the richest man on the planet with his own spaceships. Then there’s Jack Ma who started Ali Baba with a loan of 500,000 yuan (about $70k) around 2000, and now he’s the richest man in China.
A quick search will turn up all kinds of advice from both Bezos and Ma, suffice that it helps to have the intestinal fortitude of titanium – and to be relentless in pursuing your vision and mission. Try that link – or type in relentless.com and see where it takes you.
Go Big = Know Your Funding Strategy
If you’re planning to Go Big, it’ll pay to have some friends in financial services, venture capital firms, and probably a few good lawyers. Be prepared to offer them a seat on your board of directors. Bezos was in financial services, and very successful at it, before launching Amazon – after his parent’s loan, he raised about $1 million in seed money and only needed one $8 million Round A before Amazon’s IPO. But, Uber went through 22 rounds of funding before its IPO; Facebook – 14; Airbnb – 15. You’ll need to steadily expand your market while “mitigating” your burn rate, over potentially a dozen or more stressful funding rounds.
Other Major Core Components of the Go Big Strategy
- Focus on achieving an Economy of Scale and steadily growing it to beat your competition out of the market with the death of a billion one-penny cuts.
- Fanatical devotion to the customer – in every possible way.
- Make it very easy for just about anyone to obtain Real Value by participating in your business – like affiliates and third-party sellers.
- Aggressive continuous product development and continuously reinvesting in your business.
- Extremely aggressive use of data – especially with A/B and multivariate testing of user’s purchasing habits.
A Cautionary Note
A while back, we did a blog post entitled, “Why Startups Fail – A Matter of Process?” There, we compared how tech companies used to launch in the Y2K era and during the early Mobile era with the Minimum Viable Product process that’s become frequent today. The Go Big – “All In” GTM Strategy can be very expensive and painful unless you know with a high degree of confidence that you have an excellent product-market fit. The key to achieving that is by asking end-users all of the hard questions first – before you invest anything. Do people like your idea? Will they buy it? How much will they pay for it?
Simply put, you don’t have the Next Big Thing until your customers prove it to you. You can Go Big with a Minimum Viable Product, the two are not exclusive.
Testing the Market GTM Strategy
Strengths: Time, People, Tech
There are a lot of times that you don’t want to “Go Big” – and Testing the Market is the approach most entrepreneurs and businesses will adopt for their venture. Not everyone wants to be the richest man in the world or have the stress of dealing with the expectations of numerous, or large, investors. Sometimes, the tech is so new or the idea so novel as to be merely “theoretically possible” or “ahead of its time” relative to public consumption. We’ve certainly seen a variety of wearables, VR, human augmentation, and other technologies ramp up much slower than projected.
This GTM strategy is the perfect fit for a minimum viable product and possibly a “minimum viable investment” for a tech product. Again, some of the most important questions to answer with an MVP very early on include whether people like your idea, will buy it, and for how much? Forget about any non-essential features, and focus on what makes your idea unique to focus the feedback you receive, instead of hearing about how much they don’t like other features.
The cost to develop a mobile app can vary quite dramatically depending on its complexity and features. However, you also need to figure that if what you want developed will cost $200,000, you’ll need another $200-400k to cover your operating and marketing expenses. That money will either need to carry you through the time you start making a profit or attract additional investment capital.
That’s likely a viable figure for most SME’s, but more than most entrepreneurs can put on the table just starting out. You are not out of the ballgame as you are free to borrow from any of the other GTM strategies presented here – like using the crowdfunding strategy, strategic partnering, and springboard strategies, together or in distinct stages. Both the crowdfunding and strategic partnering approaches can help you acquire the funding or resources you need. The springboard strategy with third-party app stores, can help you save money in developing traction after you launch.
Leastwise, after testing the market you’ll have the data you need to make a decision.
- If you’ve applied to creating an MVP – and failed to find any kind of product-market fit, you can drop your venture with nearly no financial pain because you were smart and didn’t invest until people liked it.
- If people liked your idea, you should be generating some revenue and be more confident about investing some of your own into developing your product. Or, you’ll have more data with which to go shopping for a strategic partner.
- With an actual product on the market, generating revenue – you can re-evaluate your options. You might be happy with the results and content to see your own business thriving in the digital world. You might see the potential to offer your app as a platform, “X as a Service” or “White Label” software.
It could be possible, especially if you moved fast enough and acquired confidence to make the decision to “Go Big” early enough that it, too, is an option. However, the tech world is very competitive. If people see that what you are doing is successful, you’ll have competition even if what you are doing is totally new. If what you are doing is really cool and profitable, you can expect someone else to jump in with a “Go Big” strategy of their own – just need to look at Uber, Lyft and all the other “apps like Uber” to see how that works.
Internal Launch for Productivity and Efficiency
Strengths: Funds, Industry, Tech
The Internal Launch is the simplest GTM strategy of all because it requires the least “sales” effort. Your sales effort here will likely focus on getting your employees and contractors to use your app. In some cases, that may extend to your customers, too. This shouldn’t be confused with an app that people or businesses need to buy or spend money on – so if monetization is a factor, you can probably ignore this GTM.
Most apps in this category are all about improving productivity and efficiency which you can measure against the way it’s currently being done. If you’re a regular reader, you know I love to harp about Amazon as being so efficient in their business practices that they’re evil. They have an SOP, schematic, and performance metric for everything – including the process for and tracking of time lost for papercuts. I’m not exaggerating.
If you’re looking to automate you need to be doing the same. If you aren’t, then you absolutely need to get these details – SOP, workflow schematic and performance metrics, before making the leap. You need these to have something to compare against or run the risk of adopting a system that makes the job harder, longer, more tedious – and generally piss off everyone who has to use it.
A relatively simple mock-up or simulation exercise can be set up to validate whether what you are proposing is better or not – and if so, how much better. There’s a good chance that your productivity app may rely upon IoT devices, so you’ll need to look at whether they can fit to your present floor plan and possibly factor in any changes you’ll need to make. You’ll be able to calculate your ROI in advance with a fairly high degree of accuracy and confidence.
Does it make the job easier? Faster? Does it address negative feedback about the inefficiencies of your current process offered by your employees or contractors? When you explain the app or system, and walk them through the process, do they appear to like it? Will it save you money over time? If the app handles other factors like security, safety, data collection, and the like, to your expectations, then your GTM work is more or less done.
Strategic Partnering, Platforms and White Labels
Strengths: Industry, Tech, Thinkers
Strategic partnering can be a GTM Strategy of its own when your venture includes a “contracted” companion product; a public-private partnership (3P); a White Label product; and generally speaking any B2B Platforms or “X as a Service” models. There are more similarities than differences. The core difference is that with White Labels, Platforms and “X as a Service” you have a heavier go-to-market focus on B2B marketing.
The Strategic Partnering approach, more than any other, requires knowing how to navigate bureaucracy to reach agreements. This might be a serious talk with a CEO, a presentation to a corporate board of directors, submitting detailed and competitive proposals to procurement departments, or convincing your local municipal government that you can do something important for the community.
- A “contracted” companion product involves having an agreement to produce a new app, software, plug-in, or extension for another business with hardware or software of their own. Winning a request for proposal (RFP) to develop an app or contests like those run by DARPA can also fit in here. This is fairly common with success leading to some acqui-hires that can be found in the Alphabet and Facebook lists of acquisitions.
- A 3P, as used here, is a long-term arrangement to provide support for a government agency – typically in areas of infrastructure, similar to the $10 billion JEDI contract between Amazon Web Services and the Pentagon. Simply speaking, the U.S. Government (Federal, State or Local) is not allowed to engage in commercial business activity. It depends upon private businesses and entrepreneurs to invent and operate what it needs to do… everything else “government” does.
- White Label products involve software that you create, own, and manage, but license out or charge royalties to other businesses to use with their own branding, like Opera Mobile Store (now Bemobi) did for Yandex. The White Label approach often arises out of a realization that your software product is (potentially) bigger than your business – and so in a sense, it becomes your business.
Your GTM could simply consist of one successful presentation to the right party. That might be a slight exaggeration, but that’s actually a big part of how I got my start in “tech.” Back in 1996 while working for Continental Satellite Co., selling Primestar Satellite TV, I asked our general manager why we didn’t have a web site – and if he wanted one. Two weeks later, we had a prototype that he, the VP of our division and five other regional general managers really liked. And then I was told to get a business license for accounting purposes.
The critical issue here is that if you can land one big customer right out of the gate, your chances of landing others increases exponentially. If you can land a project with one county or city, you increase your chances of landing future projects with the state and/or different federal agencies.
A GTM Strategy with Incubators and Accelerators
Strengths: People, Creativity, Time
I’m going to keep this one short as we’ve covered it in some depth with Startup Accelerators and Your First $100,000 and the Top Five San Francisco Startup Accelerators. The TLDR; here is that investors are always looking for innovative teams with great products to invest in… and help them in just about every way imaginable. They can provide training, critiques, technical resources, discounts or deferred payment options, seed money and access to Angel and VC investors.
In practical terms, if you have a great idea and a kick-ass pitch, they’ll provide you access to everything you need to help you take it as far as you can take it. The number one thing to know upfront is that if you are accepted by an accelerator program, your physical presence is required – and their ~3 month programs are pretty intense. The second thing to know is that all accelerator programs are not created equal. The best ones are in Silicon Valley, and some have offices in other major hubs, like New York City.
Crowdfunding & Pre-Orders – “Wisdom of the Crowd”
Strengths: Social, People, Creativity, Time, Industry
Can your idea sell itself with little more than a landing page? Crowdfunding will help you find out. If people like your idea, they’ll back it with $1 to $100 or more. The average pledge on Kickstarter is about $71. Crowdfunding is a perfect match for a “minimum viable product” as it immediately gets you on the way to generating funds and getting end-user feedback. Fundable’s Guide to Crowdfunding and the Small Business Administration’s crowdfunding video can introduce you to the world of crowdfunding if it is new to you. Crowdfunding is its own huge topic.
A variant on the crowdfunding theme, if you have something for show – a prototype, proof of concept, or early beta, is the Pre-Order. Both share the idea of marketing a product that hasn’t been released yet. And… well, both run the risk of never actually getting released.
Crowdfunding can be a good GTM strategy if you have a large social network or can enlist friends or celebrities who do. Add cool creatives (especially videos), and if your product is something people need or really want, you can achieve your funding requirements. A lot of work goes into any successful crowdfunding campaign – product presentations, images, videos, customized email campaigns, creating awesome funding options, updates, press and strategic networking efforts. So, if you have a lot more time than money, this could be your best GTM option.
Which crowdfunding platform (CFP) you select deserves its own research as relates to campaign options, promotion mechanisms, terms and conditions. How well does the CFP match your target audience? What percentage will the CFP take from what you raise?
Crowdfunding Platform Options
While narrowing the field down to what I think are your “best” options here, do your own research to validate the best fit for your GTM strategy.
- Kickstarter – Probably your go-to CFP for all of the reasons that matter (brand name recognition, volume, campaign options, etc.), unless you can find a strategic advantage by going with a different CFP.
- Indiegogo – A major CFP in its own right, shares offices with Y-Combinator – the #1 startup accelerator if measured by billion-dollar unicorns. That could be a strategic advantage.
- Other Crowdfunding Platforms – Simply too many to name, including equity crowdfunding and niche options where an IoT hardware venture could fit well on CrowdSupply or Techmoola.
- Grinding Gear Games ran their own independent crowdfunding campaign, without relying upon an external CFP, to raise $1.2 million for Path of Exile – purchased in 2018 by Tencent for an undisclosed amount.
More Advice on Crowdfunding
At one point, simply launching a campaign on Kickstarter was sufficient basis for a press release. One of our most successful clients, Looksery launched on Kickstarter with a $30k goal and raised $46k. For serial entrepreneur Victor Shaburov, that mostly qualified as chump-change compared to the value of the publicity he raised on the likes of TechCrunch, Business Insider, Geakbeat, and others. Almost straight out of launch, Looksery was snapped up by SnapChat for $150 million!
Some may not like the “middle-man” approach of CFP’s. You do all the work and promote the hell out of your venture by sending the people you know to someone else’s web site to pay them for your product. The advantage of this approach is when the CFP has greater recognition and trust than your business. It’s also an advantage if you don’t want to be responsible for returning everyone’s money if you fail to meet your funding target. They’ll take care of that. If these are not concerns for you, then an independent crowdfunding campaign or a pre-order marketing campaign could potentially let you have your cake, and eat it, too.
The Springboard GTM Strategy
Strengths: Multilingual, Thinkers, Social
This GTM strategy may raise a few eyebrows, and to be certain, it’s not for everyone. It focuses upon becoming a big fish in a small pond – whether a third-party app store or lower tier geographic market. A lot of apps start out this way, as most of the world’s population doesn’t live in North America or Western Europe.
Third-Party App Stores
It can be very difficult to stand out among the millions of apps on Google Play and Apple’s App Store, so I’ll briefly cover the third-party app store approach. Obviously, you (and everyone else) wants to see their apps in the top app lists of these two behemoths. Many devs and app owners stop there, figuring everything else is a waste of time. That’s actually scary – as marketing and distribution go hand in hand with the ultimate (often unattainable) goal of having your product everywhere your target market might be. It’s like saying, “Hey, our product is in Walmart, we’re done!” It’s dismissing Krogers, Safeway, HEB, 7-11, mom and pop shops, etc.
Considering the amount of effort that goes into developing physical distribution networks and get into store shelves makes the two hours of adding an app to a third-party store quite trivial. Yes, it does involve extra work to manage accounts and distribute updates – but its a minuscule fraction of the effort and cost that went into developing an app in the first place.
The benefit of third-party app stores comes via increased exposure for competing against fewer apps. Sure, they receive less traffic, but that means more exposure for you – a greater chance of being featured in their top app lists. Some stores may be willing to sell you a slot in their top app list while others might be willing to work out an arrangement redirecting anyone wanting to download your app to your page on Google Pay or the App Store.
Second Tier Markets
Everyone sets their sights on the North American, especially the U.S. mobile market. That’s because, on average, Americans are more likely to spend more than mobile users in most other markets. That’s true, but it’s only one prong of analysis. AppBrain breaks Android CPI costs down by country – $1.45 in the U.S.A, but just $.16 in Mexico and $0.12 in China.
Let’s get a little extra perspective Belgium, a small European country of about 11.4 million people, has profitable apps of its own that started out in Belgian. To the other extreme, Shanghai, the largest city in China, has a population of 34 million – and has profitable apps of its own, too. In both cases, the number of geo- and/or culture specific apps are minuscule in comparison to what’s available on Google Play.
If you can be successful in Belgium, you have a springboard for jumping into the native German (82 million), French (67 million), Dutch (17 million) and yes, even the exclusive Luxembourg (600k) markets. Conversely, if your app makes it to the top list in Shanghai, you could expand the scope of your venture to reach the 1.2 BILLION people who speak Mandarin Chinese.
The Strategic Thinkers out there will want to back up… back to the $.16 CPI for Mexico with its population of 129 million Spanish-speaking people. They’ll be pointing out that there’s another 41 million Spanish-speaking Americans, plus another 190 million native Spanish speakers worldwide, and another 40 million speaking it as a second language. The only counterpoint here is that there are several dialects of Spanish requiring extra finesse and attention to detail in app localization efforts. Twenty countries have Spanish as their official language.
In the Springboard GTM Strategy, these are mostly superficial statistics – but they illustrate the potential of focusing on success in a smaller market as a springboard to success in potentially much larger markets. Population size, concentration of those speaking a certain language, accessibility of the market, average wages, spending habits of user segments, platform distribution, and a host of other factors also need to be considered. Sure, China might be a huge market, but unless you are able to navigate it socially, legally, and otherwise – it is not very accessible. But, if you can – and have a good product-market fit in other respects, Chinese Purchasing Power Parity is expected to be around US$19,700 in 2020 compared to $60,100 for the U.S. So, what’s better – paying $1.45 for one US install backed by $60k in purchasing power, or $1.44 for 12 China-based installs backed by $240k in purchasing power?
I’m not implying that there’s a right answer to that question, not without knowing a lot more – but it’s another illustration of the strategic thinking that needs to accompany the Springboard GTM Strategy.
Conclusion: Tip of the Iceberg? Or, Tip of the Spear?
The goal of this article is simply to introduce you to the need for a go-to-market Strategy and the different approaches that are available. Each GTM encompasses many things like target market research including demographics, platform usage, usage habits, spending habits. This and much more can be found in our list of Strategic Resources.
The goal of your GTM strategy is better likened to the “Tip of the Spear.” Afterall, we are talking strategy. The goal is defining when, where and how you will achieve “market penetration” – to achieve a “breakthrough” to reach your destination and continue on. After achieving initial success, you can revise your marketing plan to better suit your new position. A successful crowdfunding campaign could cover your operating expenses and open the door to tackling a strategic partnership, or serve as a springboard into successively larger springboard markets.
We may explore more of the details involved in go-to-market Strategies in the future, but if you have any questions – we’d love to hear them!