Go to market factor, pt. 2

There’s no other way around it, go to markets for new products are really hard.

Here, we are describing GTMs in the context of products that, when successful, will significantly move behaviors in users and markets. On one hand, it is very tempting to wave hands and claim that the new technology will create a paradigm shift and therefore is futile to define. This would be a mistake. Even if the end state may very well be a complete transformation, the metamorphosis still needs to start somewhere. In these cases, the GTM strategy will evolve as the market transitions (and the company matures as well).

I think more specifically, taking a technology that has yet to mature, like Augmented Reality for example, for AR to find success within a specific audience and market, we will need to be start by convincing people in that market to see AR as a viable alternative. Some of these people will take the plunge and prove the value, and the rest of the market will follow. The GTM strategy in the context of a new company entering this space is the transfer of belief and the materialization of vision from the founding team.

The book crossing the chasm provides the classic treatment of this replacement effect. As an example of failure, the book discusses how Segway, the beloved scooter product, was unable to find a market as it was unable to find a prior market where the new product can supplant existing solutions. It was neither a great bicycle or car replacement, and walking ended up costing way less than owning a Segway (or rather Segway could not make a convincing pitch that riding a Segway is preferable to walking).

A couple of thoughts rounding things up: I’m firstly reminded of how distribution channels are massively changed by the presence of the Internet. It used to be such that to sell a new widget, the producer will have to secure a physical distribution channel to the customer. Physical distribution channels are expensive, inefficient and mediated; it can vary from very expensive options of finding floor space in physical retail to the very inefficient ways of finding customers through direct mail orders or an army of door-to-door salesmen.

The Internet disintermediated all these players. Distribution and marginal costs for digital goods across the Internet is effectively zero and cuts away all the inefficiencies of, for example, inventory management. There are a lot more ways to market and get the word out, and thanks to the hyperlinked nature of web pages, whether through ads or organic word-of-mouth can lead producers directly to customers. In fact, it is very much possible to invert the process of inventing a new product. Some entrepreneurs build unfinished products and landing page and use them to measure interests from potential customers. They can gauge demand to a product before writing a single line of code.

I don’t think it needs to be taken this far. However, given the relative approachability of finding a way to the customer today, and it remaining one of the hardest problem to crack for startups building new, innovative products, it would seem imprudent to not consider the go to market factor in early stages of the product process. The success of the product will involve getting a quorum of people becoming users and customers of your product, it is therefore useful to figure out the fastest way to get there.

I want to do a thought experiment. Consider that there is a team that believes that there is a market building voice-activate devices with intelligent assistant and video conferencing capabilities for older grandparents. User research shows that a large portion of these people dislikes using current technology since they are too complex, but desire to have easy and accessible ways to keep up with their children and grandchildren. The team thinks that it has a decent shot at completing the technology and Ux that can facilitate this interaction.

What is a good go to market for a product like this? We should consider that while grandparents may be the target audience for this device, it is a device that potentially requires multiple copies of the device for it to work. Are the grandparents most likely to purchase these devices, or adults with newborns who desire to pick up a couple of these to keep their grandparents close? For these people, where are they most likely going to discover the product? It does feel like this is a new category of products enabled by recent development in technology and may not be something that occurs to consumers naturally, so there needs to be a way to make them aware. Once they are aware, how do we get them to purchase them? Do they walk into a gadget store, or do they do direct purchasing through the website?

These are likely a series of questions that most startups don’t have time to really think through. However, like I allude to earlier, it is probably the set of questions that startups need to develop a conviction as soon as possible. Allow the go to market to direct the product development cycle and lead the product into the hands of those who need it the most. Even on the best day, startups are at best a hypothesis with some validation data. On the worst it’s merely optimism.