innovateedu bootcamp: 7 questions investors will ask about your gotomarket strategy

Saturday, February 11, 2017 Katie Martell @ InnovateEDU

7 Questions Investors Will Ask About Your GTM StrategyAnd How Not to F*ck it Up

@KatieMartellEmerson IMC

AAF (Century Council), EmComm, troublemaker

8+ years startup marketingNetProspex (12-125 employees + exit)

Version 2.0 Comms (TechCrunch, 25+ product launches)Aberdeen Group (30+ y/o brand/product overhaul)

EntrepreneurCintell co-founder, CMO (MassChallenge finalist, $1M raised)

On-demand marketer, blogger, speakerMany early-stage companies + big tech brands

Engagio, Allocadia, MarketingProfs, Building Engines, Mirakl, Influitive, Evergage, MarcomCentral, Aptitude Research Partners,

CabinetM, Codeship, Verndale, Influitive, RedSwan5

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1. It’s Saturday2. Boston rocks for startups3. Tangible vs theoretical4. Resilience (this sh*t is hard)

Why you’re awesome

*This slide is using Font Awesome

Today:1. Kickstart your GTM plan

2. What investors look for

3. Entrepreneur fails

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No product-market fit.

The #1 reason

startups fail to launch?

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What many think GTM is:

your date here

A GTM Strategy is a blueprint.It’s an action plan.

Like a business plan, but specific to marketing and sales.

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1. Who is the customer? 2. What is the problem you’re solving? 3. How are they solving it today?4. What is your brand promise?5. What are your customer acquisition numbers? 6. What tactics will you use to acquire customers?7. What are your goals?

7 Questions to Answer:

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1. Who is the customer? 2. What is the problem you’re solving? 3. How are they solving it today?4. What is your brand promise?5. What are your customer acquisition numbers? 6. What tactics will you use to acquire customers?7. What are your goals?

7 Questions to Answer:

…it’s easy to lose sight of who this is all for in the first

place.

In a world of more…

Most companies are the center of their own

universe.

“The aim of marketing is to know and understand the customer so well the product or service fits him and sells itself.”

- Peter Drucker

The startup that understands their buyers best, wins.

Entrepreneur fail #1

They don’t know their buyer.

(This is about empathy.)

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Clearly define your buyer (s):

Profile (demographic, geographic, psychographic, behavioristic)

Personality (e.g. “Big Five”) Pain points (what is preventing them from reaching

goals?) References / influences / watering holes A day in the life Jobs to be done

1) Who is the customer?

TAM

SAM

SOM

TAM Total available market Total market demand for product or service

SAM Serviceable Available MarketSegment of TAM that is within your geographical or other reach

SOMShare of Market portion of the SAM that you can capture with existing resources

TAM 1.9 Billion

SAM 532 Million

SOM 10.6 Million

TAM Total available market Trips booked worldwide (1.9 Billion)

SAM Serviceable Available MarketBudget and online (532 Million)

SOMShare of Market Trips with airbnb (10.5 million)

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You need to find a market that is LARGE ENOUGH to grow in, and who have the PAIN that motivates them to take action (buy), and have the FUNDS to do it.

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1. Who is the customer? 2. What is the problem you’re solving? 3. How are they solving it today?4. What is your brand promise?5. What are your customer acquisition numbers? 6. What tactics will you use to acquire customers?7. What are your goals?

7 Questions to Answer:

Entrepreneur fail #2

Vitamin, not a painkiller.

“nice to have” vs “need to have”

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2) What problem do you solve?

REMEMBER,YOU ARE HERE TO SOLVE A PROBLEM.

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3 big motivators

PAIN FEAR GAINsomething I

currently experience and

need to get away from (most compelling)

A future pain I want to avoid

A future state that I see as better that I

personally want to attain

!

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Buyers are 3X more likely to move away from pain than move towards potential gain. - Tim Riesterer

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Gain is a leap of faith

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1. Who is the customer? 2. What is the problem you’re solving? 3. How are they solving it today?4. What is your brand promise?5. What are your customer acquisition numbers? 6. What tactics will you use to acquire customers?7. What are your goals?

7 Questions to Answer:

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TRUTH BOMB:

Often, your biggest competition is the status quo.(The way things are.)

Entrepreneur fail #3

Misinterpret your true “competition”

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Hint:

DON’T UNDERESTIMATE THE STATUS QUO

(Nobody actually likes change.)

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If you do have competition:Learn as much as you can about them. 

Company information (mission, organization, size, growth, funding)

Target audience (size, definition) Pricing Products and services Distribution / partnerships Messaging Product feature comparisons How they go-to-market (events they’re at / influencers

they work with / publications they’re in) Strengths & weaknesses

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1. Who is the customer? 2. What is the problem you’re solving? 3. How are they solving it today?4. What is your brand promise?5. What are your customer acquisition numbers? 6. What tactics will you use to acquire customers?7. What are your goals?

7 Questions to Answer:

Entrepreneur fail #4

Unclear / inconsistent brand + value proposition

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4) What is your brand promise?

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Today, consumers are more likely than ever to be swayed by emotion rather than logic.

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Your buyers care about WIIFMWhat’s in it for me?

It’s not all about you:

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1. Who is the customer? 2. What is the problem you’re solving? 3. How are they solving it today?4. What is your brand promise?5. What are your customer acquisition numbers? 6. What tactics will you use to acquire customers?7. What are your goals?

7 Questions to Answer:

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3 numbers to know

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1. Price2. Customer acquisition

cost3. Lifetime value

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Pricing model: The $100M questionWhen you eventually become a $100 million dollar company, what will your customer base look like?

Will it be:

1 customer paying you $100 million dollars a year10 customers paying you $10 million a year100 customers paying you $1 million a year1,000 customers paying you $100,000 a year10,000 customers paying you $10,000 a year100,000 customers paying you $1000 a year1,000,000 customers paying you $100 a year10,000,000 customers paying you $10 a year100,000,000 customers paying you $1 a year

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Customer acquisition numbers

CACCustomer acquisition cost

What is your cost going to be to acquire a customer?

Entire cost of sales/marketing functions (salaries, marketing programs, etc) and divide it by the number of customers.

E.g.

$1m total marketing spend 1,000 customersCAC = $1,000

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Customer acquisition numbers

LTVLifetime value

What is the lifetime value of a customer?

Gross margin associated with the customer. Net of all installation, support, operational expenses.

• If your product is a one-time fee, this is simple.

• For businesses that have a recurring revenue model, take monthly recurring revenue and divide it by monthly churn rate (% by which customers stop subscribing to a service)

Entrepreneur fail #5

Too expensive to acquire new customerscompared to their value.

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One simple rule:

The CAC must be less than the LTV.

YOU HAVE TO acquire customers for less money than they will generate in

value over the lifetime of your relationship.

Don't skip this.

CAC < LTV

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One simple rule:

• VC will dig into this and they will call you out. Your business model does not work unless CAC is less than LTV. 

• Recover CAC in < 12 months

• CAC less than LTV by 3X – 5X

CAC < LTV

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1. Who is the customer? 2. What is the problem you’re solving? 3. How are they solving it today?4. What is your brand promise?5. What are your customer acquisition numbers? 6. What tactics will you use to acquire customers?7. What are your goals?

7 Questions to Answer:

Entrepreneur fail #6

Overly optimistic about how easy it will be to acquire customers. “If we build it, they

will come.”

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Diffusion of innovation.

your date here

How new ideas / technology spreads.

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7) How will you acquire customers?

• Or, how will you distribute your product?

• Draw on learnings from research you did in step one.

• Tactics should be: Cost-effective Relevant Tested and continually optimized

(lean)

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Be prepared at each stage:

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Awareness

Consideration

Purchase

Awareness of the problem. Your job is to help them understand they have a problem. Educate them. They’re looking for help to solve their problem – so talk about their problem.

Understanding / engagement with your solution. How do you differentiate against the competition, or the status quo?

Late-stage. What success have others had with a solution like yours? (case studies). Can I try the product before I buy?

Post-sale: How can you continue to make me successful? How can I advocate on behalf of your brand?

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Big list o’ tactics to consider• Partner programs (with programs who offer complimentary products/services,

using joint marketing and co-branding)• Inbound + SEO strategy (links on other sites, keyword analysis)• Direct mail (yes it still works!)• Thought leadership (bylines / speaking / be a trusted advisor in your field)• Content marketing to attract leads

• eBooks• Webinars• blogging • Podcast• Infographics

• Targeted email / nurture program• High-conversion website• Influencers (paid and free)• Referral channels (incentivize existing users to be advocates)• Live events• Social media (highly targeted paid ads + content sharing)• Professional associations• PR + content amplification

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Big list o’ tactics to consider• Partner programs (with programs who offer complimentary products/services,

using joint marketing and co-branding)• Inbound + SEO strategy (links on other sites, keyword analysis)• Direct mail (yes it still works!)• Thought leadership (bylines / speaking / be a trusted advisor in your field)• Content marketing to attract leads

• eBooks• Webinars• blogging • Podcast• Infographics

• Targeted email / nurture program• High-conversion website• Influencers (paid and free)• Referral channels (incentivize existing users to be advocates)• Live events• Social media (highly targeted paid ads + content sharing)• Professional associations• PR + content amplification

Tactics should be:

Within budget Relevant to your buyer Tested and continually

optimized

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1. Who is the customer? 2. What is the problem you’re solving? 3. How are they solving it today?4. What is your brand promise?5. What are your customer acquisition numbers? 6. What tactics will you use to acquire customers?7. What are your goals?

7 Questions to Answer:

Entrepreneur fail #7

They do not plan for growth.

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Have a game planWhat are your goals at each stage of your life-cycle?

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1. Who is the customer? 2. What is the problem you’re solving? 3. How are they solving it today?4. What is your brand promise?5. What are your customer acquisition numbers? 6. What tactics will you use to acquire customers?7. What are your goals?

7 Questions to Answer:

Easy, right?Told you this stuff was hard.

Do it anyway. Just, do it right.

katie@katie-martell.com