go-to-market strategy - entrepreneurship 101 (2013/2014)

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Entrepreneurship 101 Presented by: Murray McCaig Managing Partner MaRS Cleantech Fund [email protected] Twitter: @murraymccaig

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This lecture provides practical tips on how to prepare to enter the marketplace with your product. It is 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. Case studies are used to emphasize the importance of taking a customer-centered approach to market entry and illustrate the barriers to scaling and selling your product.

TRANSCRIPT

Page 1: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)

Entrepreneurship 101!

Presented by: !Murray McCaig!! !Managing Partner!! !MaRS Cleantech Fund!! [email protected]!

!! !Twitter: @murraymccaig!

Page 2: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)
Page 3: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)

It's hard to tell with these Internet startups if they're really interested in building companies or if they're just interested in the money. I can tell you, though: If they don't really want to build a company, they won't luck into it. That's because it's so hard that if you don't have a passion, you'll give up.

Page 4: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)

Go-to-Market: Old School

Pg 4!

Make the product and then figure out how to sell it!

What   Who   How  

Go-to-Market Strategy!

Where  

Focus on the product, the ‘what’!

Next determine who you can sell it to and how to reach them!

Where to promote it an after thought!

Page 5: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)

Go-To-Market: New School

Pg 5!

Developing a go-to-market strategy is an iterative process!

What   Who  

How   Where  

Go-­‐To-­‐Market  

4  quadrants  of  a  strong  go-­‐to-­‐market  strategy  

What are you selling?!

How will you reach your target market?!

Who are you selling to? !

Where will you promote your product?!

Page 6: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)

  Grey water recycling system for commercial and residential customers!

Case Studies!

Pg 6!

Example MaRS clients for go-to-market case studies!

Pg 6!

  Innovative eBike with a unique ergonomic sitting position (e.g. its cool)!

Page 7: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)

Pg 7!

What   Who  

How   Where  

Go-­‐To-­‐Market  

What are you selling?!

Page 8: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)

 What UNIQUE benefits does your product provide in comparison to 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?!

 What you are selling impacts who you are selling to and how you sell it AND vice versa!

Value Proposition!

Pg 8!

What are your unique product BENEFITS? !

Value = Benefits - Costs!

Page 9: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)

Value proposition!

Pg 9!

Example MaRS clients for go-to-market case studies!

Pg 9!

 Full solution!

 Simple reporting!

 Near zero maintenance!

 Compact!

 Comfortable riding position!

Page 10: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)

Example Value Proposition!

Pg 10!

Focus on benefits, NOT features!

Features   Benefits  

Microfiltra<on  with  auto  flushing   Near  zero  maintenance  

WiFi  connected/remote  monitoring   Report  on  your  savings  

Qualified  installers   One  stop  purchase  

Defining Unique Benefits!Example: Greyter!

Page 11: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)

 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!Greyter!

Core  Produ

ct  

Services

 Installa<on  

Consumables  

Online  Monitoring  

Water  Tes<ng  

Financing  

Smart  City  Integra<on  

Annual  Servicing  

What part of the whole solution are you selling? Can you sell?!

Equipment  

Page 12: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)

Pg 12!

What   Who  

How   Where  

Go-­‐To-­‐Market  

Who are you selling to?!

Page 13: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)

Market Segmentation

Pg 13!

Think about segments, NOT market size and share of market!

Market! Market Segments!

1%!

Page 14: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)

Market Segmentation

Pg 14!

Use easily identifiable criteria to segment market!

Age Demographic?!Urban Core?!

Male!

Female!

Yes!

No!

No!

Yes!

Sex?! Market Segments (Size)!

Page 15: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)

Determine Segment Fit with Benefits

Pg 15!

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!

Compe<<on  

High!Low!

Low!

High!Female University

Students!

Female Bay Street Professionals!

Page 16: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)

Refining the Target Market

Pg 16!

Other factors beyond fit with benefits must be considered!

Market Segment

M.U.S.H.

Corporate, Single Tenant

Multi-tenant Buildings

Hotels

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 !Greyter Example!

Page 17: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)

Beachhead Strategy

Pg 17!Point of Attack!

Today!

Tomorrow!

!MUSH, US

SW!!

MUSH, US SE!

Corporate, US SW!Market

Penetration (Needs-based!Segmentation)!

Market Expansion!

(water scarcity)!

Hotels, US SE!

Multi-tenant, US SW!

Hotels, US SW!

700!Bldings!

5,500!

109,000!

4,500!

91,000!

Corporate, US Midwest!

MUSH, US Midwest!

Corporate, US SE!

3,000!

117,000!208,000!

A beachhead strategy is a leveraged approach to market rollout!

Beachhead Market Rollout Strategy!Example: Greyter!

Page 18: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)

Pg 18!

What   Who  

How   Where  

Go-­‐To-­‐Market  

How will you reach your target market?!

Page 19: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)

How will you reach the target market?

Pg 19!

Which channel? Partners?!

Market Segments!

Page 20: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)

Channel(s) Strategy

Pg 20!

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!

In House!

Outsourced!

Page 21: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)

 Deal size / Product margin !

 Percent of whole product!

 Solution complexity!

 Competition (have they locked certain channels)!

 Differentiation (can different channel provide unique strategy)!

 Credibility/brand!

  Importance of local knowledge!

 Time to market!

 Number of target customers!

!

Channel(s) Selection!

Pg 21!

Factors to consider in channel selection!

Page 22: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)

 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 22!

Key points to consider in building a high performance sales team!

Page 23: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)

 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 23!

Factors to consider in developing an indirect channel strategy!

Page 24: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)

Pg 24!

What   Who  

How   Where  

Go-­‐To-­‐Market  

Where will you promote your product?!

Page 25: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)

 Align your promotion plan with your target market!

 Focus on reaching decision makers!

 Where do the decision makers get their information?!

 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 25!

Where will you communicate to reach decision makers!

Page 26: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)

Messaging

Pg 26!

Spend time getting the message right for the market segment and DM!

Greyter is… [what]! … a grey water recycling system … !

…primarily for… [target market] !

… commercial building owners who want to be water smart and save money.!

The compelling reason to buy [benefits] …!

… unlike [competitors] …!

Greyter Positioning Statement!

• Short payback with water savings;!• Full solution;!• Remote monitoring;!• Near zero maintenance.!

• Low flush toilets that don’t work well; and!• Reduced flow shower heads that disappoint.!

Page 27: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)

Summary

Pg 27!

What   Who  

How   Where  

Go-­‐To-­‐Market  

Page 28: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)

Crossing the Chasm

Pg 28!

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!

Page 29: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)

1.  Value proposition!

2.  Whole solution!

3.  Market segmentation!

4.  Target segment!

5.  Beachhead strategy!

6.  Channel(s)!

7.  Promotion plan!

Go-to-Market Summary!

Pg 29!

7 steps in developing a powerful go-to-market strategy!

What   Who  

How   Where  

Go-­‐To-­‐Market  

Page 30: Go-to-Market Strategy - Entrepreneurship 101 (2013/2014)

thank you            @murraymccaig