How focusing on the right GTM and sales strategy can impact startup success rate
The Indian startup ecosystem is recognised as one of the largest startup hubs in the world. According to estimates, 41,061 startups were recognised by the government as of December 2020.
Furthermore, in the first nine months of 2021, the total number of unicorns in India reached 71, with 33 new startups entering the unicorn club in 2021. Every startup that becomes a unicorn has worked on formulating a robust sales strategy to achieve business success.
However, for most startups, the biggest challenge remains selling the product and creating a sustainable revenue stream.
In India, founders have excellent technical skills and make great products, but many founding teams lack sales skills and struggle to take their products to the market.
As a result, many promising companies never reach their full potential or fail in the market. Below are some of the areas founders should focus on from beginning to significantly increase their chances of success:
Why a go-to-market (GTM) strategy is important
Unveiling a product in the market without having a clear GTM strategy should be the last thing a startup should do. Early-stage startups often make mistakes in the planning phase itself.
They chase the wrong audience, go after too wide or too narrow a market segment, use undifferentiated tactics to tap the audience in a saturated market, and make many similar mistakes.
The potential hitches while unveiling the product to the market can be addressed by defining a clear GTM strategy. It is a step-by-step plan of action created to launch the product in the market. It includes identifying the target audience, positioning the product correctly at the right price, creating a robust marketing plan, and developing a sales strategy.
A clear GTM strategy also plays a crucial role in driving efforts in one direction rather than spreading them thin all over the place. Founders who have not acquired significant funds usually have limited resources at hand. However, a scientifically designed GTM strategy can help the startup reach its target audience and acquire customers in the most efficient way possible.
A robust GTM should be defined basis the startup's aspirations, core strengths, and external competitive landscape. It should cover the geographical coverage, target customer segment, sales channel selection, positioning, and product pricing.
How revenue/sales growth influences success rate
Focusing on sales and revenue growth is essential because it determines the sustainability of a startup in the long run. Moreover, traction and sales are the primary criteria that investors look for while making a funding decision. So, a startup without a good track record of growth is unattractive to investors.
To create an efficient sales engine, startups should first build a demand generation engine to create a funnel. The next step is to develop distribution channels in the form of the company's own sales force, resellers, partners, or direct-to-consumer models. Subsequently, a comprehensive sales process should be defined to stitch all the ends.
B2B sales process is more complex than B2C sales process, and there are many pitfalls that founders should avoid. Many startups try to sell at the wrong pitch to customers. They continue to push their case to non-decision makers, resulting in wastage of time and effort.
Startups must understand the decision-making process in the customer-facing organisation and the roles of various individuals in the account (business buyer, financial buyer, influencer, gatekeeper, coach, etc) and should find a way to navigate through the maze to reach decision-makers in the shortest possible time.
Most decision-makers are CXOs/VPs level people. Direct access to such levels is never easy, so startups should take help from their mentors who have such access.
Taking a deal from lead to closure is an art that startup founders should learn. They should seek outside help if this is not the core capability of the founding team.
Driving sales in the digital era
Technology-driven sales and digital-first sales are now a necessity. Unlike old sales methods, it accelerates the sales cycle of the startup and significantly brings down the cost of customer acquisition.
Tools like CRM and lead generation tools are essential requirements, but data warehouse, CDP, marketing automation, clubbed with advanced analytics, can be a game-changer for a startup. These tools can help in targeted reach, leading to an exponential jump in sales performance.
Tools can enable real-time data availability resulting in an increased pace of decision making and quick course correction. Good quality data can also help in identifying white spaces and low-hanging fruits for the startup.
In addition, startups should define correct measurement matrices. The startup should track these matrices using the above-mentioned analytics tools and well-designed growth experiments to crack open the next level of growth.
One challenge startups may face is that there are way too many tools, each claiming a panacea. So startup founders should very carefully evaluate them before deciding. Again, they should take the help of experts if they don't understand it themselves.
(Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views of YourStory.)