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Home Product Expert Opinion How do You Sharpen Your Go-to-Market Strategy with Segmentation

How do You Sharpen Your Go-to-Market Strategy with Segmentation

April 30, 2022 Edwin Kooistra

Over the last decade, only a handful of successful tech companies have brought products to market that virtually sold themselves. Apple, for example, didn’t need to do much to acquire large batches of new customers for any new product they released, it was relatively simple.

But, that’s not the case for most tech companies, especially those with products that typically address complex problems with equally complex solutions. Those businesses require a go-to-market strategy to quickly and strategically decide where, when, and how to target their best potential customers. Yet, many of those businesses seem to ignore the need to do that and impede growth.

To scale efficiently and effectively, customer segmentation is the way. To help you get there, here’s a summary of Richard King’s articleHow do you sharpen your go-to-market focus with customer segmentation?

The first concept King points out is the shift in the sales funnel from the traditional sales and marketing dynamic that reinforced mass marketing and undifferentiated markets to prioritize the value of leads rather than the volume.

Today, the definition of selling has become helping your customer achieve a goal, solve a problem, or satisfy a need, and no longer about handling objections and closing the sale.

Business leaders, including CEOs, heads of sales, and heads of marketing, are now more deliberate to drive revenue growth and typically ask questions like:

  • Who’s the ideal customer and client profile?
  • Which market segments to target?
  • How do we maximize win rates and deal size to hit the quota?
  • Are we getting the right customers that will tick for a long time and be profitable to the business?
  • How do we improve customer acquisition cost, payback period, and customer lifetime value?

So, as product marketers, how can you help answer the key go-to questions for your companies to help drive success and growth?

Before you even begin designing a go-to-market strategy, you must first assess the company’s market clarity, a metric to determine how clearly a business understands:

  • Biggest needs and pain points of the target market.
  • Who the influencers are in shaping opinions and decisions.
  • Touchpoints that have the most significant chance to deliver the message to your target market’s needs successfully.
  • Sticking points that keep the customers engaged with the business.

The better your market clarity is, the greater your ability to cut through the noise will be, and this is achieved by starting with your TAM, ICP, and personas.

Total addressable market (or TAM) stands for the total market possible for a product, and it is reflected by an estimate of a specific market’s revenue potential. It is essential because it gives you an objective sense of market size without going through this exercise of how many customers might purchase the product. The result is more clarity for companies on where to invest time and money or what plans to discard.

An ideal customer profile (or ICP) describes the customers that would realize the most value from your product and generate repeatable, scalable business.

Use the TAM to see how big the pond full of potential fish is and the ICP to identify the best fish for you to catch.

An ICP is defined using attributes like industry, geographic location, company size, estimated annual revenue, technology, etc.

Buyer personas dig a bit deeper into the individuals behind the purchase. They are more like examples of people within those ICP accounts—their motivations, pain points, buying habits, online activities, etc.

Defining your buyer personas improves audience targeting and the resonance of campaigns, content, and messaging to help close and renew deals repeatedly.

Once you have thoroughly studied your market participants, you should be able to glean unique insight. From here, your go-to-market strategy will be all about zeroing in on one specific customer segment to determine the leverage points that give you the best chance to influence behaviors.

Remember, the market and competition dynamics are forever changing so it is important to measure the right success metrics actively and iterate regularly.

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Edwin Kooistra - Product Marketer & Founder

Technology can be a huge differentiator but leveraging emerging technologies can be challenging. After my degree in Business Information Technology I decided to work on the provider side of Technology, because I believe Technology providers play an important role in guiding enterprises on their digital journey. Besides helping tech businesses to optimize their growth and go-to-market strategies, I also like to write about the topic. I hope you find it useful!

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