go-to-market strategy - entrepreneurship 101 (2012/2013)
DESCRIPTION
Provides practical tips on how to prepare to enter the marketplace with your product. Relevant for all start-ups that are still in a development phase and contemplating the various pieces that need to be in place for product launch.TRANSCRIPT
Entrepreneurship 101!
Presented by: !Murray McCaig!! !Managing Partner!! !MaRS Cleantech Fund!! [email protected]!
!! !Twitter: @murraymccaig!
Go-To-Market Strategy
Pg 3!
4 quadrants of a successful go-to-market strategy!
What Who
How Where
Go-‐To-‐Market
Developing a go-‐to-‐market strategy is an itera7ve process as each component impacts the other
What are you selling?!
How will you reach your target market?!
Who are you selling to?!
Where will you promote your product?!
¨ Ultra low cost meter for measuring energy usage in buildings at the circuit board level!
¨ Cloud based data analytics and customizable user interface!
¨ Revenue grade!
Case Studies!
Pg 4!
¨ Electric bike that is ultra lightweight, foldable, and provides a unique ergonomic sitting position (e.g. its cool)!
¨ Premium priced!
Example MaRS clients for go-to-market case studies!
Pg 5!
What Who
How Where
Go-‐To-‐Market
What are you selling?!
¨ What is the whole solution to the end user?!
¨ What portion of the whole solution can you deliver?!
¨ Are partners readily available for delivering the whole solution?!
Whole Solution!Example!
CircuitMeter!
Core Produ
ct
Services
So>ware/Firmware
Data Analy7cs
Installa7on
Service & Support
Tenant Billing System
Value Added Services
Cloud Based UI
What part of the whole solution are you selling? Can you sell?!
Hardware
¨ Value proposition MUST be based on the part of the WHOLE SOLUTION you intend to sell!
¨ What UNIQUE benefits does your product/whole solution provide in comparison to other competitors?!
¨ Typically compete on either (1) cost or (2) differentiation!– Same value, <= price!– Greater value, >= price!
¨ Costs include:!– Risks (high when dealing with a startup); switching barriers; others?!
¨ Building your value proposition is a continuous process!
Value Proposition!
Pg 7!
What are your unique product BENEFITS?!
Value = Benefits - Costs!
Example Value Proposition!
Pg 8!
Focus on benefits, NOT features!
Features Benefits
Independent crank system Safe and comfortable riding posi7on
Low, ergonomic riding posi7on
18.5 lbs, carbon fiber frame Portable and compact for easy storage
Lithium ion baQery powered Be green … Don’t sweat
Defining Unique Benefits!Example: LifeBike!
Pg 9!
What Who
How Where
Go-‐To-‐Market
Who are you selling to?!
Market Segmentation
Pg 10!
Think about segments, NOT market size and share of market!
Market! Market Segments!
1%!
Market Segmentation
Pg 11!
Use easily identifiable criteria to segment market!
Age Demographic?!Urban Core?!
Male!
Female!
Yes!
No!
No!
Yes!
Sex?! Market Segments (Size)!
Determine Segment Fit with Benefits
Pg 12!
Compare NEEDS of each segment with your primary BENEFITS!Po
rtabl
e / E
asy
Stor
age!
“No Sweat”/ Safe Riding Position!
Segment Needs vs. Solution Benefits!LifeBike Example!
Compe77on
High!Low!
Low!
High!
Refining the Target Market
Pg 13!
Other factors beyond fit with benefits must be considered!
Market Segment
Retirement Homes
Apartments
Multi-tenant Buildings
Tenant Owned Buildings
Market Size Needs/ Solution Fit
Propensity to Spend
Market Concentration
Market Access
Overall Segment
Attractiveness
Low High
Fit with Value Proposition Ease of Selling
Segmenting Beyond Fit with Value Proposition !CircuitMeter Example!
Beachhead Strategy
Pg 14!Point of Attack!
Today!
Tomorrow!
!Retirement
Homes - Toronto!
!
Retirement Homes –
Major Cdn Cities!
Apartments, Toronto!Market
Penetration (Needs-based!Segmentation)!
Market Expansion!
Tenant Owned Bldings,
Major Cdn!
Multi-tenant Bldings, Toronto!
Tenant Owned Bldings, Toronto!
700!Bldings!
5,500!
109,000!
4,500!
91,000!
Apartments, Top 10 US
Cities!
Retirement Homes –
Top 10 US Cities!
Apartments, Major Cdn
Cities!
3,000!
117,000!208,000!
A beachhead strategy is a leveraged approach to market rollout!
Beachhead Market Rollout Strategy!Example: CircuitMeter!
Pg 15!
What Who
How Where
Go-‐To-‐Market
How will you reach your target market?!
Channel(s) Strategy
Pg 16!
Many options for reaching your target market!
Customer You
Customer You Salesperson/Reps
Customer You Retailer
Customer You
OEM
Distributor/ Reps Salesperson
Customer You
Channel Options!
e-Commerce!
Direct!Personal Selling!
Retail!(on/offine)!
Indirect!
Component or Private Label!
¨ Deal size / Product margin !
¨ Percent of whole product!
¨ Solution complexity!
¨ Credibility/brand!
¨ Importance of local knowledge!
¨ Time to market!
¨ Number of target customers!
!
Channel(s) Selection!
Pg 17!
Factors to consider in channel selection!
¨ Recruit the best … pay for performance!¨ Top guns follow great managers!¨ Industry experience!¨ Be a leader … get involved!¨ Align with business targets!¨ Manage to targets/activity … yearly, monthly, weekly, daily (track it!)!¨ Be aware of salespeople chasing the “big fish”!¨ Fire fast … spend time with top performers!¨ Training and knowledge sharing!¨ Tweak the compensation plan!¨ Inside sales team!
Direct Sales!
Pg 18!
Key points to consider in building a high performance sales team!
¨ Reps or Distributors!
¨ Selection!– Alignment with target market!– Reputation/brand!
¨ Management!– Legal agreement (targets, pricing/commissions, information sharing, …)!– Market/account split (house accounts) … customer ownership?!– Training!– ‘Drive-a-rounds’!
Indirect Sales!
Pg 19!
Factors to consider in developing an indirect channel strategy!
Pg 20!
What Who
How Where
Go-‐To-‐Market
Where will you promote your product?!
¨ Align your promotion plan with your target market!
¨ Focus on reaching decision makers!
¨ Types of promotion!– PR (mass, specialty)!– Word-of-mouth!– Social media!– Trade shows!– White papers!– Product demos!– Gorilla/shock/…!– …. and finally, advertising (print, tv, internet)!
Promotion Plan!
Pg 21!
Where will you communicate to reach decision makers!
Messaging
Pg 22!
Spend time getting the message right for the market segment and DM!
LifeBike is… [what]!
… a revolutionary lightweight electric bike with an easy riding position … !
…primarily for… [target market] !
… safety conscious urban commuters who don’t want to “sweat it” on their ride to the office.!
The compelling reason to buy [benefits] …!
… unlike [competitors] …!
LifeBike Positioning Statement!
• Portable and compact for easy storage in your condo;!• Comfortable and safe riding position;!• Cool!
• Traditional e-bikes that are uncomfortable and difficult to ride in a congested urban environment, and!
• e-Scooters/Mopeds that are heavy, slow and very ‘uncool’!
Summary
Pg 23!
What Who
How Where
Go-‐To-‐Market
Crossing the Chasm
Pg 24!
Jump the chasm with a focused go-to-market!
Crossing the Chasm !
Area under curve represents number of customers!
Do not require full solution and are less price sensitive!
Focus on needs of the Early Majority!
1. Whole solution!
2. Value proposition!
3. Market segmentation!
4. Target segment!
5. Beachhead strategy!
6. Channel(s)!
7. Promotion plan!
Go-to-Market Summary!
Pg 25!
7 steps in developing a powerful go-to-market strategy!
What Who
How Where
Go-‐To-‐Market
Murray [email protected]!Twitter: @murraymccaig!