This is our 7 part guide with everything you need to understand the basics of go-to-market (GTM) and increase revenue globally. You’ll also find links to useful content from our blog throughout, so you can forge your own path to GTM mastery. Here are the chapters:
What is a go-to-market strategy? (You are here)
Continuous improvement in go-to-market (coming soon)
Let's get started!
A go-to-market strategy is a plan that outlines how a company will bring its product or service to market and attract customers.
Imagine you have a lemonade stand business. Your go-to-market strategy would be your plan for selling your lemonade.
This could include things like where you will set up your stand, how you will price your lemonade, who your target customers are, and how you will promote your business (e.g. flyers, social media, etc.).
A go-to-market strategy helps you focus on reaching your target customers effectively. This means you can differentiate from competitors, optimize pricing and profitability, and measure success through data-driven decisions.
To start planning your go-to-market, you can ask the most critical question of all:
How big is your market?
This is, literally, the billion-dollar question.
Bragging rights aside, the bigger the market, the faster you can grow. There are simply more people for you to try to sell to.
It also means that you can focus on a segment of the market and still have enough prospects to go after.
To measure the size of your market, we turn to a concept called total addressable market, known as TAM for short.
What is total addressable market (TAM)?
Your total addressable market (TAM) is the total revenue potential for a particular product or service, assuming that there are no constraints on your ability to capture that revenue.
The TAM includes both current and potential customers. You typically calculate it by multiplying the total number of potential customers by the average revenue per customer.
For example, if a business sells a SaaS product that could be used by businesses with 50 or more employees, their TAM would be:
TAM = number of businesses with 50 or more employees x average revenue per customer.
Not all of the TAM will be accessible to the business due to factors such as competition, market saturation, and other constraints.
To take this into account in our GTM strategy, we can consider two deeper ‘layers’ of our market size: SAM, and SOM.
Serviceable Available Market (SAM) is the portion of the TAM that a business can realistically target and serve with its products or services. It considers factors such as the business's market position, competition, and geographic reach.
Serviceable Obtainable Market (SOM) is the portion of the SAM that a business can realistically capture within a specific time frame, like this quarter or this year, given its resources (e.g., marketing budget) and constraints (sales headcount).
While these terms look good in a board deck, what we really want to do is to execute correctly based on our understanding of our TAM, SAM and SOM.
How to use data to understand the size of your market?
Data plays a crucial role in determining the size of your market.
Market research reports, industry publications, government statistics, and other sources can be used to estimate the size of the TAM.
Firmographics, technographics and business model data can be used to identify the SAM – everything that our data marketplace offers.
In all three cases, data is used to estimate market size, identify potential customers, and assess competition. This then helps you refine targeting and positioning strategies to optimize conversion rates.
Now that you know how big your market is, let’s find a way to reach them and close some customers.
What is a typical GTM strategy?
There are many elements to a GTM strategy, put simply into these 9 points:
Target Market: Figure out who your customers are.
Value Proposition: Explain what makes your product or service special.
Positioning: Show how your product or service is different from competitors.
Pricing: Decide how much to charge for your product or service.
Channels: Choose the best way to sell and distribute your product or service.
Marketing: Create a plan to let people know about your product or service.
Messaging: Come up with a clear and simple message that your customers will understand.
Sales: Provide your sales team with tools to help them sell your product or service.
Metrics: Track how well your strategy is working.
Who works on the go-to-market strategy?
A go-to-market strategy typically involves input from multiple departments and stakeholders within a company.
Here are some key roles involved in a go-to-market strategy:
Marketing creates demand and captures it as leads. To this this, marketing teams identify the target market, define the value proposition, develop the messaging, and create the marketing plan.
Sales takes these leads and closes them. They provide input on the most effective sales and distribution channels and develop sales tools and resources.
Product Management is responsible for understanding the customer needs and translating them into product requirements. They provide input on product positioning, pricing, and differentiation.
Finance provides input on pricing, profitability, and revenue projections. They help ensure that the pricing strategy is competitive and that the company can achieve its financial goals.
Operations helps with supply chain management, logistics, and fulfillment. They help ensure that the company can deliver the product or service to customers efficiently and effectively.
The executive leadership team provides oversight and guidance for the go-to-market strategy. They ensure that the strategy aligns with the company's overall goals and objectives, and that it is feasible and sustainable over the long term.
How does data play into go-to-market planning?
Data plays a critical role in supporting a go-to-market strategy in several ways.
Identifying the target market
You use data to identify your ideal target market by analyzing customer demographics, behavior, and preferences. You then use this analysis to tailor your messaging and promotions to the right audience.
Understanding customer needs
Data can help a company to understand what its customers need and want, and how they use its products or services. This can help the company to improve its products and services to better meet customer needs.
Determining pricing strategy
Data can help a company to determine the right pricing strategy by analyzing costs, competitor pricing, and customer willingness to pay. This can help the company to set prices that are competitive and profitable.
Measuring marketing effectiveness
Data can help a company to measure the effectiveness of its marketing efforts by tracking key performance indicators (KPIs) such as website traffic, lead generation, and conversion rates. This can help the company to optimize its marketing tactics and improve its ROI.
Optimizing sales and distribution
Data can help a company to optimize its sales and distribution channels by analyzing sales data, customer feedback, and channel performance. This can help the company to allocate resources to the most effective channels and improve the customer experience.
How does a GTM strategy increase revenue efficiency?
A go-to-market (GTM) strategy increases your revenue efficiency by enabling a crisp understanding of your target customers, the most effective ways to reach them, and the best pricing strategy to win customers over.
In other words, you don’t waste time talking to customers that don’t need your offering, sending messaging on platforms that don’t get replies, and pricing that is too expensive.
By focusing on the most effective channels and tactics, you can maximize your revenue ROI and grow your business more efficiently.
Additionally, a well-crafted GTM strategy can help you differentiate from competitors with the right unique selling points. This attracts more customers and builds longer relationships (= higher customer lifetime value), leading to increased revenue and profitability.
Knowing the size of the market is important for businesses to make better decisions, spot trends, and focus resources.
TAM (Total Addressable Market) is the total market opportunity for a product or service, which is determined by considering the entire market for the product or service, including both current and potential customers.
Common elements of a GTM strategy include identifying the target market, defining the value proposition, developing a messaging strategy, creating a promotional plan, and tracking how well the strategy is working.
The team involved in designing a GTM strategy typically includes marketing, sales, product management, finance, operations, and executive leadership.
Data plays a critical role in supporting a GTM strategy by identifying the target market, understanding customer needs, determining pricing strategy, measuring marketing effectiveness, and optimizing sales and distribution channels.