For launching any new product or for expanding into a new market, having the right go-to-market (GTM) strategy is a must. For a startup, it would mean finding the right audience for its product and reaching them with the right message at the right time. Since 2020, the adoption rates of digital or digitally enabled products have accelerated by seven years1. Customers are moving online; their expectations and needs are evolving due to this shift. A startup’s GTM playbook must consider these changing market and customer buying dynamics to succeed globally.
At a panel discussion on the GTM Strategy for a Global Market at the T-Hub Innovation Summit in 2022, executives from startups and venture capital background shared their thoughts on this topic. Raviteja Dodda, the co-founder of MoEngage Inc, said that his company first aimed to serve consumer brands with a digital presence. However, as a part of its GTM strategy, the startup spent over nine months understanding its customer profile. Their patience paid off; the market research helped them realise that companies in the e-commerce segment were the best fit for them as customers. It helped them finalise their business model and sales processes. Having a GTM helped them define their goals scaling up.
Understanding the business environment
Startups must understand the business environment in which they will operate. The world has become small thanks to the digital age, but it has also become more complex with geopolitical uncertainties and volatile economies. Building a dynamic, global GTM strategy thus becomes a critical factor. Startups should understand their customer base and how it’s different from country to country. Factors such as pricing, customer support and sales processes differ based on region. An effective GTM will help the startup adopt the right marketing approach, be it through retail stores, online selling or using influencer marketing tactics.
In the case of DarwinBox, an HR technology startup focused on mid-to large enterprises competing with legacy software providers, the startup’s co-founder Rohit Chennamaneni, says it was challenging for them to prove to their global customers that their product was better than others in the market. Their GTM strategy entailed building customer trust and confidence in their product. The startup first focused on the Indian market at the time of its launch. They eventually expanded to Southeast Asia, the Middle East and are now entering the US market.
The startup learnt that the behavioural patterns of their customers varied from country to country, but their competition was the same. They took the learnings of their GTM strategy and replicated it. They also tweaked it was necessary to succeed globally and meet stakeholder expectations.
In evolved markets, adapting their GTM strategy involved gaining the trust and confidence of several C-level executives who were involved in the decision-making processes. “The CFO is trying to save money, the CXO is focused on improving customer experience, the CIO is ensuring that any new system being introduced has to integrate with their existing systems; all these interests have to align,” adds Rohit. DarwinBox’s GTM strategy considered the alignment of all these stakeholder interests as they turned global.
Adopting a market driven GTM strategy
Startups in India can sell to small companies globally in a self-service mode, where they can provide a service without having a field sales force in the region, they are operating in says Sashi Reddi, Managing Partner, SRI Capital. Indian startups can reach these small companies using marketing-driven sales, which is a massive opportunity to be leveraged. “We sure have seen some great success from the enterprise to big market sales where you establish a foothold in one country and then expand. That model is now well-understood, but there is scope for startups to provide Server Message Block (SMB), self-service SAAS opportunities as a service for enterprises,” says Sashi. It’s a whole new GTM strategy, completely market-driven, with no salespeople involved, he adds.
Avoiding mistakes in the GTM strategy
Often, a young startup makes the mistake of not taking a proactive approach to understanding the market it will be operating in, says Rohit. It tends to hire a sales team early in the startup journey. In the early stages, the startup co-founders should take a proactive lead in trying to sell their products themselves to better understand customer objection points. Rohit adds that investing in a sales team without a first-hand understanding of the market is a common mistake young startups make.
Establishing a broad market fit for the product is critical before investing in growth as the venture capital investments come in. Focusing on the GTM strategy in the initial stages can help startups build great products and improve their marketing strategies.
It’s important for a young startup to not spend its capital until it gets its product-market fit., says Sashi. Indian startups tend to underprice their products and services. The mentality is that being cheaper is good; however, it’s not. A startup should not hesitate to price its product like a premium service. “Go out there as if you bring a lot of value and don’t be afraid to charge for what you bring to the table,” he adds. Young startup entrepreneurs need to stay tuned to market developments and focus on developing a dynamic GTM strategy. It helps them understand the market, and their customer, achieve better price realization and more importantly grants them the adaptability required to scale across global markets.