- note to self
- Posts
- Go To Market Motions 🪃
Go To Market Motions 🪃
Go to market strategies and motions.
Hello!
Welcome to "note to self" #8 focused on marketing in web3. 💻
If you haven't already, join other readers in understanding how web3 is changing marketing, growth, and our future, by subscribing below:
Today we're discussing go-to-market. Let's dig in 🍽
Go-to-market - an overview
At a high level, go to market ( GTM ) can be defined as a step-by-step plan to launch a new product or existing product into a new market, including how a company will go after that market and acquire users.
GTM obviously differs depending on what your goals are, but I’m going to discuss GTM for startups here. I think GTM strategies can be visualised through a three-step framework. Who is your ideal customer? How are you going to reach them? How are you going to scale?
I have read a number of blogs related to GTM in web2 and web3. Whether you define your GTM as a web2 or web3 strategy, I think both can complement each, but I’m going to discuss web2 strategies here frankly because they ( still ) make more sense.
Go-to-market motions:
1. PLG ( Product Led Growth )
Product-led growth is great. Your CAC is low and you don’t need to hire costly salespeople to lead your go-to-market. So why wouldn’t everyone start a PLG to go to market? Because different criteria apply. Data actually shows from startup to series D, PLG makes up the minority of go-to-market motions.
For an effective PLG, marketers need to work closely with the product team, to ensure a great onboarding flow, to ensure inviting others to use the product is seamless, to ensure finding the core value proposition ( once usage occurs ) of your product is easy, and of course to ensure your product is easy to buy.
TAM must be taken into account. If you know that potential buyers are experiencing the problem that your product solves then PLG is most suitable. Keep in mind that the product must hold a fast time to value and the average selling price should be low.
It’s important to note that PLG will work better when the buyer understands and has the issue that your product is trying to solve. The buyers should understand their need for the product well.
A freemium version or free trial is now a must-have for PLG businesses, and trying before you buy is becoming more and more important in a PLG go-to-market strategy, in showing potential customers the value of your product. But do note that conversion from free to paid must be effective too.
2. SLG ( Sales Led Growth )
Sales-led growth actually makes up the majority of go-to-market motions ( 61% at seed to 71% at Series D vs. PLG )
In short, you need to educate your buyers and market and build awareness of your product. If your time to value is high, your customers aren’t proactively seeking a solution and you have a high average selling price, a sales-led go-to-market is likely to work better than a PLG go-to-market.
Starting with your market is important. Who am I selling to? Utilising a sales team who have identified folks who have the need your product is solving, then educating them around this need. Hiring a sales team is not cheap so SLG operating expenses for your startup need to be taken into account early on.
TAM must be taken into consideration here also. Sales-led growth is likely going to be more suitable where your target market is a small TAM. Your product might solve a complex problem that customers in the TAM hold, but that product has a slower time to value and the average selling price is high.
Product-Led Growth Case Study: Slack
Slack is a great example of a self-serve product with fantastic user onboarding. They are one of the best examples of a PLG company, and part of the reason they sold to Salesforce for $27B in 2020. Slack was founded in 2009, and in 2016 had a valuation of $4b. They didn’t hire one salesperson in that 7-year period.
In other news: 📰
-> Blog/Pod/Video of the week: The four kinds of luck by Marc Andreesen
Next time: ⏭️
Next week I will discuss a three-part growth framework that all consumer products have to deal with/create ( before you think about product virality ).
Have a great weekend!