Robert Ochtel’s Blog

An Experienced Approach to Venture Funding

A Go To Market Strategy, and Associated Product Line Objectives and Tactics are Often Missing from a Start-up Company’s Business Plan

I have read and reviewed many business plans developed by first time entrepreneurs. While all of these plans focus on their technology, product or service offerings, many of these same plans leave out their start-up company’s go to market strategy. The lack of a go to market strategy within your start-up company’s business plan represents a glaring hole to potential investors.  After all, developing your technology product or service offering addresses only half of the problem.  The other half of the problem is getting your product to market, securing paying customers, and acquiring market traction and revenue in a timely manner.  Anything less will result in a failed start-up company. This article addresses the need for all start-up companies to have a go to market strategy, as well as associated product line objectives and tactics in their business plans.  Doing so, will allow these same start-up companies to delineate to their investors how and when they expect to secure paying customers, associated revenue and positive cash flow.

Do You Have a Go To Market Strategy?

As the entrepreneur of a start-up company you are necessarily developing a technology, product or service offering to sell into the market.  Therefore, you need to determine who your customers are and how you are going to gain access to these same customers is a cost effective, timely, and efficient manner.  To do this, you must develop a go to market strategy to address the customers within the target market(s) of interest.   As such, your start-up company’s go to market strategy must take into consideration the following:

  • What are the defining characteristics of your start-up company’s technology, product, or service offering for the target market(s) of interest?
  • Which target customers are market leaders and most important to the acceptance of your company’s technology, product, or service offering?
  • What is the “value proposition” of your company’s technology, product, or service offering to your customer base?
  • How do you plan on selling or promoting your technology, product, or service offering to the target customers of interest?
  • How can your company’s technology, product, or service offering best secure significant market share?
  • What are the costs associated with your go to market strategy and various sales channels?

By addressing all of these issues, you can develop a go to market strategy that uniquely fits your technology, product or service offering. This go to market strategy must be included in your start-up company’s business plan, as it is essential to secure customers and at the same time potential investors expect to see this as part of a complete, investor focused business plan.  So, spend the time to think through and then delineate your start-up company’s go to market strategy in your business plan. This will help you achieve success in the market.

What are Your Product Line Market Objectives?

Once you define your go to market strategy for your technology, product or service offerings, you need to develop product line market objectives for each product offering.  These product line market objectives are to be developed in congruence with your start-up company’s overall market strategy and need to have the following characteristics:

  • Align with your go to market strategy,
  • Address all aspects of the target markets and customer base,
  • Are attainable over a defined timeframe, and
  • Have several measurable tactics associated with them.

Therefore, your start-up company’s product line objectives, as defined, need to follow your start-up company’s go to market strategy and address the key issues regarding the implementation and execution of this strategy. 

As an example, let’s assume your start-up company’s go to market strategy is to become the market leader within a defined target market segment.  As such, an associated product line objective could be to: “Secure two tier one customers by the end of year one of operations.”  This objective, as defined, is commiserate with your start-up company’s go to market strategy.  In addition, from your market research and due diligence, you have defined your targeted customers and developed a list of the tier one and tier two customers within this target market segment of interest.  Therefore, having defined your objectives and developed a list of target customers, you can then easily develop a set of tactics that work in conjunction with your defined product line offering market objectives.

Develop Measureable Product Line Market Tactics?

Product line market tactics follow your company’s product line market objectives. Unlike a product line market objectives, previously outlined, a product line’s market tactics should provide definable tasks in order for your company to achieve the objectives of your product line that are in line with the overall go to market strategy. In addition, market entry tactics should also have a time frame tied to them. This provides one more dimension of measurable performance that is tied to meeting the overall corporate market goals and objectives of your company and its technology, product, or service offering.

Product line market tactics need to be definable tasks that are measurable both quantitatively (e.g., revenue growth, customer agreements) and in time. The underlying reason for this is that the business plan your start-up company has developed is based on distinct market objectives, with a time table that reflects a specific return on investment criteria for your company’s technology, product, or service offering. By developing measurable market entry tactics, one necessarily supports the requirements of the resultant objectives of the business plan.

Continuing with the previously outlined example, your start-up company’s product line market tactics could include:

  • Set up meetings with five tier one customers by month three,
  • Secure letters of intent from two targeted tier one customers by month six, and
  • Obtain a signed licensing agreement from two tier one customers by month 12.

These market entry tactics follow the company’s overall strategy and are in compliance with the associated objectives for its technology, product, or service offering. By executing these product line market entry tactics in a defined and commensurate time frame, one can be assured to meet the overall objectives of your start-up company’s business plan.

 First time entrepreneurs often over look the need to develop a clearly defined market entry strategy with associated product line objectives and tactics.  By doing this, you are effectively not addressing half of the problem associated with developing your start-up company’s technology, product or service offering — getting your product to market, securing paying customers and acquiring market traction and revenue in a timely manner. By developing a well defined go to market strategy and the defining the associated product line objectives and tactics to support this overall go to market strategy, you can set your start-up company on its road to success in the market.  Therefore, spend the time to develop your start-up company’s go to market plan. By doing so, you will facilitate both your start-up company’s short term and long term success in the market.

This information was taken from Robert’s new book: “Business Planning, Business Plans and Venture Funding – A Definitive Reference Guide for Start-up Companies”.  Available at www.amazon.com.  For more information on the book go to www.carlsbadpublishing.com.

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August 10, 2009 - Posted by | Business Planning, Business Plans, go to market strategy, Market Traction, product line objectives, product line tactics, Target Markets, Venture Capital, venture finance, Venture Funding

3 Comments »

  1. Robert,

    I’ve screened at least 1000 business (do not qualify as marketing plans) plans over the past thirty years and it never ceases to surprise me how many (90%+) of them are missing this piece. To investors, it’s all about valuation. How can prospective investors possibly reach a decision without this piece of strategy and tactical approach? I’m glad that you have given this the importance it deserves.

    Joe

    Comment by Joe Barr | August 10, 2009 | Reply

  2. Some very interesting points have been made here, it is refreshing to see that your site gets quality visitors.

    Comment by top digital | August 12, 2009 | Reply

  3. yeh right.. great post, Thank You

    Comment by Generic | August 27, 2009 | Reply


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