Looking forward to the second half of 2023, we are recalibrating go-to-market plans for what I call the “next normal.”
Brands were working on transformative GTM efforts pre-pandemic. But then many of them, including startups, simply redlined through the crisis at maximum speed. From my analysis, the significant new GTM investments we saw led to severely diminishing returns. And all this at record high costs.
But then we saw savvy enterprises and startups begin to switch gear. They shared our long-term GTM mindset and that helped to make them resilient through the pandemic. Well-strategized, thoroughly researched and carefully tailored GTM efforts provided greater operational advantages.
But it’s of primary importance to avoid mistakes. Below, I share some of the strategies and tactics that were once popular in a well-funded environment, but which are no longer sustainable or deliver reduced returns.
The category creation aspiration failure
Popularized by evangelists from high-growth point solutions, this advice to create a new category was both the least achievable and most costly. In researching ~15k companies for the martech landscape with Scott Brinker, I saw perhaps one in a thousand successfully creating a new category.
Most startups, for example in the ABM space, were really doing no more than magnifying or repackaging existing categories. Tens of millions of dollars in venture investments and enterprise budgets were wasted on failed category creation.
What to do instead…
Try “problem identification.” Focusing on your serviceable addressable market (SAM) will provide guidance for the best use of your resources. Your SAM is the segment of your total addressable market achievable with your current business model.
Instead of creating clever combinations of terms or names for your offerings, develop narratives that resonate with stakeholders’ identities. If there is a category to be created, let it grow organically rather than try to force it.
Making marketing an afterthought
When marketing is done incorrectly, you can severely injure your brand. When a brand is complacent about marketing, the energy needed to engage customers diminishes. As experiential muscles atrophy, you can see a loss of market share.
Marketing operations has become increasingly critical to a business’s capabilities. It’s not uncommon, however, to target marketing or marketing ops when budget cutbacks are necessary. There’s even an assumption that sales owns enough relationships to sustain a company through hard times.
That’s a very high risk strategy.
What to do instead…
A company’s growth and resilience depend on engagement with the customer. Even if you can’t build extra marketing muscle, you still need to remain toned.
Of course marketing budgets will fluctuate. Establish essential core services and operational teams and set expectations of what can be achieved during cutbacks. Also, consider hiring a sales-aligned marketing leader and establish higher-than-average comp for the long term.
Going all-in on growth hacking
In the service of “growth hacking,” companies with an influx of funds rushed to hire fast and recklessly. They applied agile practices without thoughtful direction. Unfortunately, this wasted development cycles, investment, and, most importantly, time.
An early startup I once worked with thought they had found lightning in a bottle. Thrilled with the flurry of growth, they stayed comfortably in their lane. Unfortunately, they never took our longer-term strategic advice to expand their point solution into a platform. By the time they did, it was too late. While still operating, they never really recovered — even after over $100M in more funding.
What to do instead…
Strategic planning and planning for contingencies are back in fashion. We saw companies recalibrate their strategies post-pandemic. Seasoned peers or cross-industry advisors provided the best guidance to recapture market share. We encouraged investment into reviewing their decision-making through Decision Intelligence practices.
Over-engineering the customer experience
CX is one of the most valued company assets in gaining market share and growing margins. But as brands sped up digital transformation, many advisors and evangelists suggested boiling the ocean on customer engagement. This led to over-engineered journey orchestrations and automation that left customers frustrated.
A recently IPOed company brought me and a few other consultants in to help solve a loss in market share. It turned out that massive endeavors in the field of digital transformation and CX were largely undefined and disconnected from specific business goals.
What to do instead…
It was a good attempt. But the new approaches needed more time to marinate with customers, especially for the brand to be able to understand their responses. The accelerated framework didn’t allow this.
Together with the CRO and COO, we identified over-engineered experiences. We monitored priority use cases and reactivated customer advisory boards. Many loyal customers attempted to navigate these “innovative” experiences, but due to the implementation speed, the duct-taped, ad hoc solutions created experience doldrums.
While customers remained loyal, LTV:CAC ratio plunged. There was also a drop in average contract value and referrals. It was necessary to rethink rushed experiences.
Once inexpensive as a build-awareness resource, third-party data has lost its allure especially as it is likely soon to be deprecated from the last major browser that tracks it (Chrome). We have discovered, however, that some brands are paralyzed in transition away from it. They lacked the capabilities, insights, leadership, or talent to adapt. Many of these brands are in wait-and-see mode.
What to do instead…
On the flip side, losing third-party data can be a ripe opportunity to capture market share from the competition. Brands that built genuine customer relationships — including through first-party data — and gain market trust will see minimal impact. Increase the use of and investment in your customer database; and take a fresh look at contextual advertising.
More GTM tactics to shift away from
Sidelined partnerships. Partners are more than window dressing for your brand. In a post-pandemic era, the return of brand building includes enhancing your ecosystem. Advocates and partners help customers connect with your shared purpose.
Ignoring utilization. Tech stacks matter, but more is not always better. Budget cutbacks are forcing organizations to streamline operations. No more pointless data hoarding or prolific, random acquisitions of technology point solutions.
The single North Star metric. One key GTM metric may have seemed justified when navigating growth at all costs. But the pandemic revealed that dozens of underlying factors could provide good indicators of progress. These also should be closely monitored and managed for sustained growth. Owning these key operational metrics can help avoid being blindsided and support new opportunities.
Random acts of sales. Even before the pandemic, sales could act as an independent fiefdom. Reps used whatever tactics they could to close deals. Of course, sales reps are going to optimize the route to conversion. But teams still need consistent guidance on pricing, tools, narratives, and general intel about products and services. Inconsistent and disconnected sales engagements created enormous gaps in opportunity and growth. Sales is a team sport both within the sales organization and in alignment with other teams.
Winning by checking boxes. Feature lists, in competitive situations, now pale in comparison with value creation. Understanding the customer’s capabilities and use cases across different teams is often necessary.
Customers have the power
When funding was abundant, leaders sacrificed long-term GTM success for short-term gains. Repeating these playbooks was easy as customers had less power. The tables have turned.
Even in the post-pandemic period, marketplace dynamics continue to require investments into ecosystem strategies, right-sized customer engagements, and strong partner relationships. Technology, operational effectiveness, and value creation narratives serve as growth engines as we navigate the global “next normal.”
I’ve only listed a handful of the GTM concepts that are fast becoming less effective in the post-pandemic era. What are some of the other ones you are ignoring or navigating around? Let us know.
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