Playing To Win
The Downside of Go-to-Market Strategy
I am deeply suspicious of the term ‘Go-to-Market Strategy.’ The way I see it practiced suggests it is not helpful in nurturing a winning business strategy. To explain my view, I am dedicating my 38th Year III Playing to Win/Practitioner Insights piece to The Downside of Go-to-Market Strategy: Sounds Sexy, but Not Helpful. You can find the previous 148 PTW/PI here.
Sexy Business Terms
Go-to-market (GTM) Strategy is one of the business terms that has become super-sexy. I find it interesting how the phenomenon works. Somebody stumbles onto an evocative term to describe a business activity that has gone on forever and the thing suddenly becomes super-cool. Companies have been going to their markets forever. But GTM Strategy sounds exciting and new! And it is action oriented — involving going from here to market. It is practical sounding — simple words, and good ones like ‘go’ and ‘market.’ Businesspeople love it — especially in technology companies.
It is much like DevOps. People have been coding software for decades, but now the coolest thing is DevOps. It’s not just software development. It’s not just in operations. It’s DevOps! I watch people puff up their chests when they tell me they are in DevOps. It would ruin their day completely if I were to ask: what’s DevOps anyway?
I know GTM Strategy is getting to peak sexy when a new board member on a one of the start-ups in which I have invested is introduced in an email to shareholders as: X is a go-to-market (GTM) executive who specializes in helping B2B SaaS companies create and scale a repeatable sales and marketing motion. It was, in fact, a two-bagger. Not only was she a ‘GTM executive,’ she can ‘create and scale a repeatable sales and marketing motion.’ ‘Sales motion’ is the latest super-sexy business term. If ‘GTM Strategy’ is Facebook, then ‘sales motion’ is TikTok.
The earliest reference I could find to ‘go-to-market’ was in a 1990 Harvard Business Review article (Managing Hybrid Marketing Systems) and it was in quotes, which perhaps meant that the authors felt they were coining a term. I don’t know if that was its original use, but I couldn’t find any earlier reference. A decade later in 2002, there was a book on GTM strategy called, of course, Go-to-Market Strategy.
Sales motion is sexier still. I can’t find a reference to it before 2020 — so it is smoking hot and new. I hear it all the time. It is hard to figure out what it really means — and the multiplicity of definitions reinforce why. From what I can tell, it basically means anything cool and successful relating to customers buying stuff from providers. It is one of those retrospective terms like entrepreneurship. We only call someone an entrepreneur after the fact when they have been successful. People who fail miserably trying something that would be defined as ‘entrepreneurial’ if it had succeeded are called failed businesspeople, not entrepreneurs. When sales are going great, it is because of great ‘sales motion.’ When sales results are dreadful, by definition there wasn’t a ‘sales motion.’ But I digress…
What is GTM Strategy?
As with sales motion, there are numerous definitions of GTM strategy. I pulled out a couple.
One is from Jargonism.com:
A company’s strategy on how to sell their product or service. This includes the decision between using a salesforce or a self-serve sales process, which is where the buyer can buy the company’s product without ever interacting with a sales rep from the company.
Another is from Gartner Group, an influential observer and categorizer of businesses:
A go-to-market (GTM) strategy is a plan that details how an organization can engage with customers to convince them to buy their product or service and to gain a competitive advantage. A GTM strategy includes tactics related to pricing, sales and channels, the buying journey, new product or service launches, product rebranding or product introduction to a new market.
Clearly, the Gartner folks haven’t listened to my A Plan is not a Strategy video!
Why I am not a Fan of GTM Strategy
GTM Strategy purportedly determines, for the business in question: to what customers to sell the offering; through which channels; at what price; with what branding/advertising approach; launched/introduced in what way; and more. That is a lot of stuff — a lot of the core strategy levers. That is virtually all the Where-to-Play (WTP) and lots of the How-to-Win (HTW). That is why companies are so keen to find a highly strategic GTM Executive — like the board member that the company above was so excited about. “Gee, if only we had a great leader of GTM, we would ramp up our anemic sales growth.” Sadly, the number of these uniquely capable people that are sought far exceeds the number found.
But if that long list of activities is GTM Strategy, what is the rest of strategy and how does that happen? Pretty much the only way you can do it is to have somebody as head of ‘Product’ and somebody else the head of GTM. In this construction, the Product head is notionally responsible for making all the choices on Product and none of the GTM choices. And the GTM head is responsible for exactly the opposite.
A version of this structure is found in lots, if not most, of west coast technology companies. But they tend to be fuzzy in their definitions of the roles of Product and GTM, respectively. Sometimes Product bleeds into GTM territory and other times GTM bleeds into Product. Depending on which side is given the bigger share of the aggregate responsibilities, the company looks for a ‘strategic’ Product head or a ‘strategic GTM head. My experience is that the failure mode is more prominent than the success mode.
But the structure is handy in one respect. When failure happens — as it often does — the GTM head can assert the product was unsellable and the Product head can counter that the GTM was terrible. Both are likely to be right. When you dis-integrate strategy, bad things happen. That is why I don’t like GTM Strategy. I know I am going against something super-sexy and super-cool. But sometimes I have to be non-sexy and uncool to be useful!
What do I Like Instead?
I like integration not dis-integration. Every business — whether a product, a category, a sector, or a company — must define the answers to five questions:
Somebody has to be responsible for determining that critical integrated set of choices. These choices can’t be split up and doled out to separate people/organizations. If you split them up, you will end up with a strategy not worth having. There can be choices at lower levels nested within this integrated set of choices, as I have written about previously, but without an integrated set to guide your actions, you are in trouble.
That is why I believe that an organizational split of Product and GTM is a flawed approach. The aspects typically under their individual and discrete control must be integrated. It is far too late to wait for the GTM head to decide ‘with this product, here is how we are going to GTM.’ One person has to toggle back and forth between potential Product possibilities and potential GTM possibilities in order to jointly optimize. That is strategy!
Do I object to the presence of a GTM Executive (like the new board member of my portfolio company)? No, but only with a very narrow mandate, which is to figure out how to sell the product that the strategy specifies, to the customers that the strategy specifies, at the relative pricing that the strategy specifies. That is still an important job with lots of important questions to answer.
Depending on the company and the business situation, the exact responsibilities of the GTM Executive will vary. But it shouldn’t be as constructed as broadly as above. If you think your GTM Executive is awesomely talented — put that Executive in charge of strategy for the business in question and have your head of product report to that Executive. But then you will have to change the title from GTM Executive to Business President, so it is a pyrrhic victory for the notion of GTM Strategy.
In the modern world of business, you will find sexy terms coming at you, left and right. You will be told that you need an awesome GTM Executive to create and oversee your GTM Strategy. And part of that task will be to define your sales motion, which is a must-have! If you are a software/Internet company, you will be told to treat your head of DevOps as a demigod. And regardless of what company you are at, you should invest in data analytics and hire lots of AI scientists. If you don’t go along with all of this sexy stuff, it is prima facie evidence that you are neanderthal.
Don’t buy it. Trendy is not inherently meritorious. Those trendy things may or may not be components of your unique strategy. Don’t ignore them, but don’t hop mindlessly on bandwagons either. Remember that doing the same thing as everybody else while expecting a different outcome is the manifestation of delusion in business.
To Play to Win, you need to determine an integrated set of choices that is distinctive and will compel customers to take the action you want. Your organizational structure and division of responsibilities needs to facilitate that happening rather than inhibit it.