Go To Market Strategy Ch 3 Slides (Steve)

Ch3:TargetingtherightmarketsGoToMarketStrategyOverviewI.ReviewofChapters1&2II.Chapter3:targetingtherightmarkets1.CommontargetingpitfallsWhatnottodo:Enconix2.SixstepstosuccessfultargetingWhattodo:MarriottInternational3.Whatwelearned4.Critique5.QuestionsReview:(Ch1)Go-to-marketStrategyChoiceandalternative:increasingchannelavailability(P.7)Today,it’snolongerjustaboutwhatyousell;it’salsoabouthowyousellitGo-to-marketstrategy:Agameplanforreachingandservingtherightmarkets,throughrightchannelswiththerightproductsandtherightvaluepropositionTotalCustomerExperiencePurpose•Attractandretainthemostdesirablecustomer•Increasesaleswithlowercost4ingredientsofawinninggo-tomarketstrategyCh6:TheproductandThevaluepropositionCh5:ChannelsandPartnersCh3:MarketCh4:CustomersReview:(Ch2)ThetencommandmentsofgoingtomarketI.Go-to-MarketstrategymuststartwiththecustomerExactinformationcangatherfromcustomer:product,channel,valueproposition,marketsII.Aggressiveuseoflow-costchannelswillhaveadramaticimpactonprofitsIII.HowyousellhastofitwithwhatyouaresellingCustomer,Economics,ComplexityIV.ThereisAlwaysatradeoffbetweenmarketcoverageandcontrolThehigh-controlstrategyvs.Thehigh-coveragestrategy3reasonswhy‘e-channel’isnotworkVI.GettingchannelcooperationismoreimportantthanpreventingchannelconflictVII.YoucannotbeeverywhereatalltimesforeverycustomerVIII.Thebusinessmodelhastobesoundforago-to-marketstrategytosucceedV.NotEverygo-to-marketsolutionhasan‘e’initIX.Ittakestimefornewchannelstobecomeproductive.Patienceisnecessary12to24monthstobuildandrolloutanewgo-tomarketstrategy:X.Towinbigago-to-marketstrategymustbeinnovativeanddifferentTargetingtherightmarkets“It’simpossibletochooseasuccessfulmixofchannelsuntilyoudeterminewhichmarketsthosechannelsaresupposedtoreach.”–Pg73Chapter3:TargetingtherightmarketCh3:MarketPickedthewrongmarket:Enconix(1998)246employeeandover$55millioninsalesDisciplinesandsavvybusinessdevelopmentfocusNicheofsmall-to-midsizedindustrialmanufactureswith$50to250millioninrevenueDevelopedunderstandingoftheneedsandinformationtechnologyrequirementoftheirmarket:(1990s)ERPSCMCRMDevelopednewsoftwareandservicetomeettheexpandingneedsWhatnottodo:Enconix(1998)Changethedirection:Y2KfocusSoftwaredevelopersY2Kspecialist•LessimpactofY2K:thefailureofY2Kfocus•ERPbusinesshadchangeddramatically•CustomersreducetheITspendingduetoEconomicslowdownChangethedirection:PRMfocusY2KspecialistsPRMconsultants•Consumergoodsmanufactures•Fooddistributor•ComputerhardwarevendorsInsignificantandbiasedmarketingresearchNewtargetmarkets(Aug2001)Sales:$28M=NoexperienceNounderstandingTheFourPitfallsofMarketTargeting…andHowtoAvoidThemTrap#1:Chasinguntriedandunproven“bluesky”markets…andneglectingsolid,availablebusinessthat’sclosetohome(p.81)Trap#2:Puttingtoomuchweighton3rdpartymarketresearchreports,whichoftenhaveinaccurate,agenda-drivenestimatesTrap#3:Assumingthatmarketscanbe“good”or“bad”,outsideofthecontextofyouruniqueofferingsandyourbusinessgoalsTrap#4:IgnoringcrucialinternalsourcesofinformationwhenevaluatingnewmarketopportunitiesMarkettargetingtrap#1Chasinguntriedandunproven“bluesky”markets…andneglectingsolid,availablebusinessthat’sclosetohomeUsually,thepursuitofentirelynewmarketopportunitiesistheslowest,mostexpensive,leasteffective,andleastcertainwaytoincreaserevenues-ReasonsWhy???1:Customers:Newcustomersinnewmarketsaredifficulttoreach2:Products:NewproductsaremuchmoredifficulttosellthanexistingonesCompaniesfallintotwobasiccamps:1:The“BlueSky”approach(e.g.Enconix)Fromtheestablishedtotheuncharted2:The“Buildonyourstrengths”approachGrabthelowhangingfruitfirst,thengohigherToavoidthistrapremember:MostCompanieshavemorepotentialbusinessthentheycouldeverhandleMarkettargetingtrap#2Puttingtoomuchweighton3rdpartymarketresearchreports,whichoftenhaveinaccurate,agenda-drivenestimatesRecently,manymarketresearchfirmshavebeenpublishinghighlyinflatedestimatesAttheminimum,getmultiple,independentsourcesofinformationwhenevaluatingamarketTakethetimetolearnhowtheseconclusionsarebeingmadeIntheend,youcaneliminatetherisksofover-relianceon3rdpartymarketresearchbydoingsomeoftheworkyourselfThebottom-lineisthatyoushouldnevermakethedecisiontoparticipateinamarketbasedsolelyonthebasisof3rdpartyresearch,Markettargetingtrap#3Assumingthatmarketscanbe“good”or“bad”,outsideofthecontextofyouruniqueofferingsandyourbusinessgoalsJustbecauseamarketlookspromising,doesn’tmeanitisagoodopportunityforyouTherightmarketdependsonwhatyou’retryingtosell,andifthatnewpotentialmarketfitswithinyourbusinessgoalsExample:Steadygrowthvs.maximumsalesgrowthToavoidthistrapremember,thereisnosuchthingasa“good”or“bad”market,eachshouldbeevaluatedwithrespecttoyouruniquebusinesssituationConsiderthecosts,risks,andthetime-horizonofthemarketentryMarketingtargettrap#4IgnoringcrucialinternalsourcesofinformationwhenevaluatingnewmarketopportunitiesWithinmostorganizationsliesawealthofinformationaboutopportunitiesandrisksinthemarketplacewhichmostchoosetoignoreToavoidthistraplooktothreesourcesofmarketinsightwithinyourcompany:1.The