Entrepreneurship 101: Module 4

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Module 4: Go to market strategy

With the problem and the solution defined and early validation of problem-solution fit established, you are ready to think about your go-to-market (GTM) strategy. Simply put, this is the process with which you will bring your product or service to end customers. You will find that the process of developing your GTM strategy closely mirrors how you develop great solutions via design thinking or user-centered design: You have to start with humans.

The difference here is that rather than only talking to end users, you need to find and build knowledge about ALL of the stakeholders who are involved in making a purchase decision for your product or service. In this module we will cover the following key topics.

  • Buyer personas and the buying process: We will explain how you might map and build personas for each of the stakeholders involved in the buying process.
  • Funnel metrics and growth hacking: We will discuss the sales funnel and explore options for awareness generation & the use of data to drive sales.
  • Channel strategy & GTM: We will pull it all together and show you how to develop a go to market strategy for your venture.

Buyer personas and buying process

Stakeholder Mapping & Buyer personas:

For most products and services, there are multiple people involved in the “buy” decision. For consumer products, the economic buyer is often the same as the end user. This simplifies things to some extent – and yet, there are usually other people involved who influence the decision making process of the economic buyer. For B2B, it gets complicated since the economic buyer is almost never the same as the end user and there are often 6 or 7 personas involved, with a relatively more complex buying process. In this section, we will start with mapping the stakeholders and building buyer personas – which follows a similar process as primary market research for product development, but the focus is on the buying process, not the way the end user uses the product.

Buyer personas or decision making unit (DMU)

The stakeholders in a buying process are all the people who are involved in making a “buy” decision. These stakeholders are commonly called “buyer personas” or the “decision making unit” (DMU). Following are the most common primary buyer personas and decision making unit (DMU)s.

  • End user(s): The person who uses the product or service (who may or may not be the economic buyer). For some enterprise products there can be more than one type of end user.
  • Economic Buyer: The person who ultimately authorizes the purchase
  • Champion:  The person who advocates for buying the product or service
  • Influencers: People who influence how the champion, economic buyer and end user(s) think and feel about the product and service.
  • Veto power: People who can veto a “buy” decision made by the economic buyer.

Mike McCausland, founder & CEO of the Leadership Institute for Entrepreneurs, has a great article that demystifies this concept.

Developing a buyer persona

The process for developing a buyer persona is similar to the process of developing an end user persona – only the focus on the person’s behaviors and need/goals are laser focused on their purchase behaviors and needs/goals for acquiring a solution to solve their problems.

Jennifer Doctor has a timeless article titled “Flat Stanley doesn’t live here” that explains how to use primary market research to develop an actionable buyer persona.

[VIDEO]: Professor Bill Aulet on the Decision Making Unit (DMU)

Buying process & customer journey map

Once you understand the buyer personas / decision making unit (DMU), you will need to map the buying process for your product or service around the economic buyer. There are several stages in the buying process, starting with the economic buyer and/or end user realizing that they have an unmet need. They then start exploring options. They find a few, and they may test them out for a period of time. If one of the solution works, they will pay – converting to a paying customer.  If they love the solution they may buy more options and tell their friends. Mapping this process for your specific business is key, since it then gives you a roadmap to focus your sales efforts every step of the way.

Using customer journey maps to visualize the buying process or decision making process (DMP)

According to a great Hubspot article, the customer journey map is defined as follows:

“A customer journey map is a visual representation of the process a customer or prospect goes through to achieve a goal with your company. The goal may be making a purchase, signing up for a newsletter, joining a loyalty program, or anything in between. With the help of a customer journey map, you’ll get a better understanding of what will motivate your customers to achieve these goals.”

The article includes a very simple example of how to create a customer journey map for the buying journey. 

Click here to read the full article.

[VIDEO]: Hubspot on how to create a great buyer's journey
Developing a buyer persona

The process for developing a buyer persona is similar to the process of developing an end user persona – only the focus on the person’s behaviors and need/goals are laser focused on their purchase behaviors and needs/goals for acquiring a solution to solve their problems.

Jennifer Doctor has a timeless article titled “Flat Stanley doesn’t live here” that explains how to use primary market research to develop an actionable buyer persona.

[VIDEO]: Professor Bill Aulet on the Decision Making Unit (DMU)

Sales process & growth hacking

Thus far we have been mapping the customer’s journey and the buying process or decision making process (DMP).  This is a pre-requisite to developing a sales process designed to reach your economic buyers, champions, end users and other stakeholders within the window of opportunity during which they are searching for solutions and are open to considering your solution as an alternative.  With that data in hand you are ready to develop a sales process. In this section we will discuss best practices for awareness generation, developing effective ways to track prospective customers as they move through your sales funnel, and using data to optimize your funnel to increase sales.

The sales funnel

Entrepreneur.com has a good article explaining what a sales funnel is and why it is important especially in digital marketing. The simplest version involves just 4 steps (although there are many variants – just google “Sales funnel” on Google Image search.)

  • Awareness: When your potential customer becomes aware of you (through seeing an ad, reading about you in an article, hearing about you from a friend or coworker, seeing a poster… etc)
  • Interest: When your potential customer decides that your solution might be a fit to solve a problem and they want to learn more.
  • Decision : When your potential customer decides to purchase your solution (but has not actually paid for it yet).
  • Action: When your potential customer actually clicks “Pay” and completes the purchase – converting to a paying customer.

It is important to visualize this funnel and collect all possible data about the number of people who are going through each level of the funnel. This data helps you understand what effects your sales and marketing efforts are having at each level, giving you a platform to optimize (aka do growth hacking). 

Read the full article here.

Developing a sales process

Hubspot has a very good article about the 7 steps in a typical sales process.

  1. Prospect.
  2. Connect and qualify leads.
  3. Research the company.
  4. Give an effective pitch.
  5. Handle objections.
  6. Close the deal.
  7. Nurture and continue to sell.

Click here to read the full article.

Consultative sales

In the past, sales was product and service focused – the customer is “sold to” by the sales representation about the merits of the solution who is then convinced to buy the solution. Today, this one size fits all sales process will not work anymore as customers are far more savvy and have access to all the information necessary to make informed decisions. It is up to the entrepreneur to build a deep understanding of where the economic buyer is at within the buying process. The consultative approach is the best practices way of connecting with the economic buyer and building the knowledge needed to move them along the buying process so they will convert to a paying customer. Hubspot has a good article on the consultative process. 

Click here to read the full article.

Digital marketing

Digital marketing is the discipline of selling products and services through any kind of device. While this used to be focused on B2C solutions, increasingly B2B enterprise solutions can also be marketed effectively via digital marketing.

Neil Patel has a fabulous article about digital marketing. 

Click here to read the full article.

Channel strategy & GTM

Channel strategy

Sales channels can be direct (meaning that your customers contact your company to buy your solution – for example, you may sell product directly on your company’s website) and indirect (meaning that your customers contact a third party reseller / distribution partner to buy your solution – for example, you may sell product on Amazon who serves as your online e-tailer).

Generally, as a startup, direct sales gives you more data to work with in the early days of selling to customers and as non-scalable as it is, it is worth doing for data collection. Over time, however, you will need to consider the suitability of the channel according to your venture type, business model and price point – all topics that we will cover in the next post.

Direct & indirect sales

Sales channels can be direct (meaning that your customers contact your company to buy your solution – for example, you may sell product directly on your company’s website) and indirect (meaning that your customers contact a third party reseller / distribution partner to buy your solution – for example, you may sell product on Amazon who serves as your online e-tailer).

Shopify has a short article that explains the concept of distribution channels.

The blurring of the lines between field sales, inside sales & self-directed sales

10 or 15 years ago, there used to be a clear difference between the various ways a new venture can implement a direct sales strategy.

  • Field sales used to involve having a small army of sales representatives who go on the road to see customers and nurture them into paying customers. This is a very expensive channel due to the cost of travel and the sales cycle involved (typically months if not years). Each newly hired sales person can take months or years to start closing deals. For this reason, field sales used to only be viable when the average deal size (or for a SaaS business, the annual recurring revenue or ARR) exceeds $50,000 or so.
  • Inside sales used to involve having low cost ways of generating leads and having people in the office (the “inside” people) do outreach to nurture and close deals. Since there is minimal travel, this is a lower cost channel that is viable for products and services with lower price points.
  • Self-directed sales is when the customer is able to complete the sales transaction all by themselves, frequently on the internet, without interacting with another person. This is the lowest cost sales fulfillment method and is a good match for B2C products with a low price or low monthly/annual subscription.

However, in recent years the tools used for self-directed sales and inside sales have been increasingly used by economic buyers to help them assess their alternatives during the “consideration” phase of the buying process. For this reason the boundaries are quickly blurring between these three types of sales fulfillment mechanisms. Harvard Business review has a good article that explores this phenomenon.

GTM strategy

With all the pieces in place you are finally ready to put together a go to market strategy. You will need to integrate everything you know about your venture to date: Market segmentation and beachhead selection; end user personas and their needs and wants; a differentiated solution that solves those problems; your unique value proposition and competitive advantage; a deep understanding about your buyer personas and the buying process; and your sales funnel and channel options. You will develop a go to market strategy that integrates all of the above that will guide you as you choose specific channels, generate leads and nurture them into paying customers.

Article: Lean Startup principles

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Article: Why the Lean Startup changes everything

Steve Blank, a serial entrepreneur turned Professor at Stanford University, has a great article on the impact of Lean Startup on Harvard Business Review.

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Video: "The Lean Startup in 5 minutes or less"

Additional resources

Additional Resources

Educational Videos

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Self-Guided Accelerator

Follow the structure of our 10-week-long accelerator and make progress on your venture

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Pitching resources

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Templates

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