Plotting a product on this grid is helpful to visualize its comparative strengths and weaknesses, and more so if you do the same for competitors. The grid is typically split into quadrants, to understand who are the closest competitors based on the product-market fit, and which products are likely targeting a different audience (or the same audience, but with a different business case) and so can be deprioritized.
The best go-to-market strategies will go a step further, and articulate ‘attack’ and ‘defense’ positions against each close competitor identified in the value matrix. Often these become fully formed scripts that can be lifted straight into customer pitches and conversations.
Example: Monday.com, a CRM platform, doesn’t leave product-market fit as a behind-the-scenes research project. From the homepage of its website, prospects are able to direct their journey according to the pain they are facing. And not only that - Monday.com also serves up a quick comparison of its platform versus the leading competition.
3. Set the right prices and packages
One of the key make-or-break factors of any new product launch is the price. A great product can be snubbed by customers if over-priced, but if underpriced you could be unnecessarily leaving revenue on the table.
The work done so far on defining your target customer personas and your product-market fit will give you a clear indication of the right bracket to set your price in. Indeed, your research may have uncovered a lack of willingness on behalf of your target customers to pay for the solution you are offering. If so, you may conclude that the product in its current state does not have enough market potential; or you may decide to launch as a free service, with a view to selling higher value product extensions and services later.
As well as cost, a pricing strategy should define how a customer will want to pay. This is partly around consumption - for example, does your target value the flexibility of a monthly subscription, or could they be persuaded to purchase a potentially more lucrative multi-year licence? It is also about cost criteria - in other words, do you charge based on how much (or little) of the service is used, how many users a customer has, or a set price determined by a customer’s perception of the value you bring, and your negotiations skills.
Understanding payment method preference is also important, and very dependent on the market(s) you are targeting. For example, in the US paper checks are still a common way for people and businesses to pay, whereas in Western Europe cards and bank-to-bank payment methods like direct debit are far more popular. And around the world, payment preference is increasingly defined by localized schemes and alternative payment methods (APMs).
Example: HubSpot employs a tiered pricing strategy, designed around the specific needs (and budget) of different customer targets, and as well as offering a free introduction package, it also promotes packages that bundle a range of services together for ease of purchase.
4. Reach (and keep) customers
The final part of an effective go-to-market strategy should take the prospect journey all the way through to sales closure, adoption, and future upgrades and renewals. The core of this phase is the sales and marketing plan, which considers the best channels to reach prospects with the value proposition.
Today, there is an almost unlimited choice of channels - from traditional media and PR, TV and radio, to digital advertising and social media influencers. For some sectors, selling through partners and resellers who are established in a market can be a traditionally effective way of achieving cut-through. The aim of the plan is to predict which channels will produce the best ROI. Depending on the other elements of the go-to-market strategy, ROI may be defined by volume of customers, cost-per-sale, customer lifetime value, or a combination of these and other KPIs.
What happens to a new customer is equally important. A go-to-market strategy should be clear about the level of customer support that needs to be achieved to sustain growth. For example, high-value customers with complex deployments and hundreds of users may expect a dedicated account and support team; whereas that level of resourcing is unlikely to make commercial sense for a self-service customer. That said, well-designed onboarding and a localized response (i.e. that lets a customer communicate in their language and timezone) are important to their happiness, and propensity to upgrade and renew in the future.
Example: Dropbox employed a simple customer referral program as a new sales channel, to go from 4 million to 500 million users in just 7 years. In exchange for a successful referral, customers would receive free storage. Key was embedding the referral program within the onboarding journey to build interest when customers were at their most engaged and excited. The referral program is still running today.
The best go-to-market strategies address all four of these elements in parallel. There's a lot to it, so we've built a template to help you get started.