GTM Level 2
From GPWiki
Friday 10 of September, 2010
This article is divided into the following sections . . .
Go to Introduction . . .
Go to Level 1 Go-to-Market . . .
Go to Level 2 Go-to-Market . . .
Go to Level 3 Go-to-Market . . .
Go to Level 4 Go-to-Market . . .
Go to Which is the right one for you? . . .
Level 2: Solution
A Level 2 go-to-market strategy moves the focus from engineering, manufacturing, and selling products and services, to selling and configuring solutions. The process of explicitly linking, integrating, and configuring products, services, and experiences to help customers solve problems and meet bigger objectives is the hallmark of a Level 2 strategy.
The Level 2 solution focus is built on understanding the customer’s current and future needs, understanding the processes that cause the problems or power the successes, and supplying solutions to ensure the customer achieves his or her objectives. Implicit in a Level 2 strategy is a price point and margin that supports the higher cost of sale associated with both the demand and supply sides of this value proposition. In turn, this implies customers who have problems and opportunities that merit this level of cost and the presumed return on investment received through your solutions. Here are the other factors to consider if you intend to implement a Level 2 go-to-market strategy:
Demand
- Marketing identifies segments, develops the core value propositions and messages, and builds awareness. Sales creates and fulfills demand through direct contact with the customer.
- Unlike Level 1, education should be built into your sales process and controlled by your marketing and sales teams. Their job is to bias the decision criteria in favor of needs your solutions uniquely fulfill.
- The Level 2 customer owns a process or function and buys based on improving the performance of that process or function. They may or may not understand the problem or opportunity. They’re interested in vendors putting in the time and effort to offer innovative solutions.
- These customers don’t want to buy stuff. They want to improve performance. Your people shouldn’t talk about features and benefits, but about problems and opportunities and how you can help.
- There may be a formal buying process and multiple customers representing different points of view—financial, use, and technical could be three typical roles.
- Level 2 sales people need to analyze customer processes and performance and then recommend a competitively differentiated solution. They need strong product knowledge, process knowledge, and industry knowledge.
- You should have a sales planning process. Your people need to know how to use it to produce better strategies and more effectively use your sales resources.
- Your people need standardized sales tools to uncover the insights required to create a winning proposal and to present killer value propositions.
- Sales collateral and other support materials should be standardized yet easily customized to meet the needs of the sales pursuit.
- Your Web interface needs to signal your deep expertise and competency in delivering solutions. The information needs to be substantive and valuable. Your on-line tools must help customers begin the process of understanding that they have problems and opportunities and that you can help.
- The sales process is usually comprised of six to nine steps aimed at multiple buyers. Once you identify a qualified opportunity, you don’t stop until you win, lose, or disqualify the deal.
- Your Level 2 sales process should be built for effectiveness: fewer deals, larger deals, higher cost of sales, larger deal size, higher profit margins, and higher win rates.
Supply
- The dominant requirement of a Level 2 go-to-market is the ability to effectively configure and integrate whole solutions that pay-off the promises made by the demand side of your business. This suggests many things, not the least of which is that the supply side needs to be tightly aligned with the demand side.
- Solution selling often requires the integration of partners into both the sales process and the fulfillment process.
- The hand-off from the demand side to the supply side needs to be seamless and transparent to the customer. The customer expects that all the information given and collected, and all the time spent through the sales cycle, will pay off in the build up and delivery of the solution.
- Your services and service organization (or your partners’ if that’s who does your configuring and customization) need to be connected to your R&D and engineering functions. This is often your best laboratory for new products and upgrades. In turn, customers want to know that their custom configuration is supported and upgradeable.
Infrastructure: Human Factors
- Hiring, training, and coaching should produce people that are knowledgeable of customer processes, functions, and best practices. They also need to be fluent in solution selling, and the benefits and value of your offer.
- Sellers usually carry the sale for most of what should be a medium-cycle sales environment (90 days from qualification to close). They should be able to function semi-autonomously but within the boundaries of your sales process. They must be able to use your information tools and technology to collaborate on deals, share best practices, and leverage your marketing tool kit. They need to know when and how to wrap in people with specific expertise needed to build a compelling value proposition and to close the sale.
- Your sales people should be skilled at using your process and tools to: (1) uncover previously unseen process-related problems and/or opportunities, (2) suggest previously unconsidered process-related alternatives, and (3) recommend solution configurations that meet the customer’s specific situation.
- Your sales teams should be skilled at building financially driven value propositions that answer three key questions for the customer: (1) why buy, (2) why buy your solution, and (3) why buy now? This is especially important in an RFP process.
- You need competitive intelligence and your sellers should know when and how to access and use that insight and resource. Build these steps into your sales process. Get the competitive insights flowing early in the deal, and keep them going right down to the time you sign a deal.
- Your sales compensation, rewards, and recognition should be tied to metrics like sales, deal profit, and the quality of the customer experience.
- Finance and legal will need to produce standard contract templates that can easily be modified to reflect the specific requirements of the customer. If you need to do business on the customer’s master service agreement and work schedules, you need to build contract review and negotiation into your sales process.
Infrastructure: Information Technology
- If your company is of any size, you should have some sort of CRM software to help manage opportunities and pipelines, store customer information, manage distribution of sales materials, and to manage the reference process (both to make sure you get the right stories to the right customers and to ensure you don’t abuse your good customers with a barrage of requests).
- Your technology platform should also power outbound marketing, permission marketing, and any other kind of direct campaign your marketing people can imagine.
- A Level 2 strategy is based on expertise. In a small group, deploying that expertise is relatively simple. Everyone knows everyone. In a large firm it’s much harder. You’ll ultimately need some sort of knowledge base that you can search for case studies, work product, methodologies, and discussion threads on relevant topics, archived Web casts, and other forms of expert knowledge.
- Your fulfillment resources need access to the technology we’ve just described so the handoff from sales is seamless.
- If you go-to-market through channels, you’ll need partner relationship management software. Those partners will have the same needs that your employees have for customer information and collaboration. Fully integrated CRM software suites offer partner portals that allow you this type of access while offering the ability to gate certain views and functionalities.
Customer Experience
- In a solution game, wow is necessary, but what customers respond to is “expertise.” Your sales process should convince the customer that you have deep knowledge into what makes the customer’s processes, problems, and opportunities. The ability to deliver wow plus expertise consistently is the differentiating organizational competency. It should be the essence of your brand promise.
- Expertise is a knowledge of how things work. It’s what the customer wants at Level 2, and it’s what you need to deliver. Some of that is communicated by your trained people. Some of it through tools that are structured to map to customer processes. Some of it comes through attention to how you stage critical parts of your sales process: bringing in experts, use of white papers and other authority sources, reference selling, etc.
- As was the case with Level 1, it is desirable to have some sort of customer experience manifesto to the decisions you make about, on behalf of, and in front of customers.
Value
- Utilization creates customer value and satisfaction. If the customer buys and doesn’t use your solution, neither the customer nor your firm gets full value. If the customer uses your solution, you get the opportunity to sell more and deeper into the relationship.
- Part of what drives utilization is accurate diagnosis of customer problems and opportunities. The other part is your ability to effectively customize and configure your solution to promote full use and reuse.
- Your offers have to produce measurable results. How much performance improvement you’ll deliver, at what cost, by when, and how sure is what creates real value for the customer and pricing power for you.
- Use mechanisms like customer satisfaction surveys, customer case studies, user groups, and early adopter groups to involve the customer and continuously find ways to raise the bar. This will create the foundation for a long-term relationship and uncover opportunities to sell more and sell deeper.
