In the early stages, many founders of Software as a Service (SaaS) companies focus all of their time and attention on building a minimum viable product (MVP). There are a variety of structured ways to approach the process, like Steve Blank’s The Four Steps to the Epiphany or Eric Ries’s Lean Startup. However, no methodology avoids doing a lot of heavy lifting, and the process can be totally overwhelming.
Unfortunately, the stress doesn’t stop there. In fact, in many ways it is just getting started. We are in the land of early-stage startups, and nothing is for certain. You have to get up and earn it every day.
Building a successful company is more than just building a great product, it requires a solid go-to-market (GTM) strategy to acquire customers efficiently and achieve traction to take the concept to scale sustainably. This is where some founders get stuck. They may know the term go-to-market, but they don’t necessarily know the core components or how to approach putting a strategy together.
If this is feeling familiar, don’t fret! A strong GTM strategy aligns product, product marketing, marketing, revenue operations, and sales to drive revenue growth. There are very few people that have backgrounds touching on the breadth of subject matter expertise required to put together a strong plan.
While I can’t necessarily make up for the wisdom that comes from experience, this article is designed to break down the core components of a successful GTM strategy. At each step, we will pause to add context on why each element matters, and how they work together more broadly.
Step 1: Defining Your Market: TAM, SAM, and SOM
Understanding your market potential helps set realistic growth expectations and focus resources effectively. There are some variations floating around out there, but the key market sizing concepts to introduce are:
- Total Addressable Market (TAM): The total demand for your product if every potential customer in the world adopted it. As an example, for Asana, the TAM could be all businesses worldwide needing project management software.
- Serviceable Available Market (SAM): The portion of the TAM that your company can realistically serve based on factors like geography, industry, and language. This is important to continuously think about in the context of future strategic opportunities for growth.
- Serviceable Obtainable Market (SOM): The segment of the SAM that you can realistically capture in the short to medium term given your current resources and go-to-market approach. Especially at the beginning, this segment is particularly important to focus on and absolutely nail before moving on to anything else.
Why It Matters
Identifying TAM, SAM, and SOM ensures you focus on a market you can effectively reach and convert, rather than chasing an overly broad audience that dilutes your efforts.
Step 2: Building Your Ideal Customer Profile (ICP)
Your Ideal Customer Profile (ICP) defines the type of company or individual that benefits the most from your product. Key attributes include:
- Firmographics: Company size, industry, and location.
- Technographics: Existing tools and software they use.
- Pain Points: The specific problems they face that you solve.
- Buying Behavior: How they evaluate, purchase, and implement software. Especially for more complex, higher value deals, keep in mind this may involve multiple personas with slightly different behavior and/or pain points.
Example
A B2B SaaS offering AI-driven sales analytics might target mid-market sales teams in tech companies struggling with sales accepted lead (SAL) to Closed Won conversion.
Why It Matters
A clear ICP helps tailor marketing messages, improve lead qualification frameworks, and increase conversion rates.
Step 3: Competitive Positioning & Differentiation
The SaaS market is crowded, and many mature categories like customer relationship management (CRM) have an enormous amount of competition. To help your solution stand out from the crowd, and especially to your target ICPs, you need clear competitive positioning.
It is important to note that this process will differ depending on whether your solution represents an entirely new category or is competing within an existing one. More often than not in the early stages it is better to enter an existing category rather than create a new one. Regardless, the core components of your positioning are:
- Unique Selling Proposition (USP): What makes your product better or different?
- Pricing & Value Comparison: How do you compare to alternatives in terms of features, cost, and outcomes?
- Messaging Framework: Consistent, compelling messaging that communicates your differentiation.
Example
Slack positioned itself as the “email killer” with a frictionless team communication experience, differentiating itself from traditional email-heavy workflows.
Why It Matters
Clear positioning helps customers understand why they should choose your solution over competitors, which helps to capture more ideal fit prospects and reduce friction in the buyer’s journey.
Step 4: Pricing & Monetization Strategy
Pricing strategy is a complex topic with a lot of nuance. Done well, it involves a lot of awareness of the competitive landscape combined with strategic thinking on longer time horizons. There is a lot of variance to be aware of, but some high-level common pricing strategies include:
- Freemium: A free plan with limited features, encouraging upgrades (e.g., Dropbox).
- Tiered Pricing: Multiple plans based on usage, features, or team size (e.g., HubSpot).
- Per-User or Per-Seat Pricing: Charging per user (e.g., Slack).
- Usage-Based Pricing: Charging based on consumption (e.g., AWS, Twilio).
Why It Matters
Choosing the right pricing model ensures your product remains accessible to target customers while maximizing revenue potential.
Step 5: Customer Acquisition Strategy
Your acquisition strategy, sometimes referred to as go-to-market motion, determines how you attract and convert prospects. These can be used standalone or simultaneously in compliment to one and other. Some examples of motions include:
- Inbound Marketing: Content marketing, SEO, webinars, and organic social media to drive traffic and educate potential customers.
- Outbound Sales: Cold emails, LinkedIn outreach, and targeted ads to proactively generate leads.
- Partnerships & Ecosystem: Integrations, affiliate programs, and strategic alliances to leverage existing customer bases.
Example
A SaaS CRM platform might use inbound content (blog posts on sales optimization) to attract leads while also employing outbound SDR teams to reach decision-makers at target companies.
Why It Matters
A balanced acquisition strategy ensures a steady flow of leads and customers without over-reliance on any one channel.
Step 6: Customer Success & Retention
Retention is crucial for growth since customer churn can significantly impact recurring revenue. Moreover, as a company looks at funding to scale many investors will be looking for signs the product is “sticky”, and retains most of its new customers. A strong customer success strategy includes:
- Onboarding & Activation: Smooth setup and training to ensure quick adoption.
- Customer Support: Self-service resources, chat support, and dedicated account managers.
- Product Adoption Strategies: Regular feature updates, personalized recommendations, and customer engagement.
Example
Zoom’s seamless onboarding experience and customer education helped it grow rapidly during the pandemic, ensuring users quickly adopted and integrated the product.
Why It Matters
High retention rates increase lifetime value (LTV), reducing the pressure to acquire new customers constantly.
Step 7: Sales Process & Revenue Model
Your sales approach will vary heavily depending on your target market and pricing strategy. Many B2B companies strive long-term to serve the enterprise market with an expensive and highly-skilled sales team operating on long sales cycles. This is often perceived as a sign of business maturity.
It is worth noting that there are some very large companies using “self-serve” models in which the vast majority of customers will never speak with a sales team. Hence, be careful of assuming enterprise sales is your ticket to an initial public offering (IPO).
Common models include:
- Self-Service: A “no-touch” process in which customers sign up and pay without sales involvement (e.g., Dropbox, Trello).
- Inside Sales: A sales team nurtures leads and closes deals remotely (e.g., HubSpot, Zendesk).
- Enterprise Sales: A “high-touch” process with long deal cycles (e.g., Salesforce, Workday).
Why It Matters
Matching your sales model to your pricing and customer profile ensures an efficient sales cycle and sustainable revenue growth.
Step 8: Metrics & Continuous Optimization
You can’t expect to make progress unless you are measuring key indicators as you progress. There are a lot of metrics, and many founders will already be familiar, but the most common set to monitor closely when making changes in go-to-market are:
- Customer Acquisition Cost (CAC): How much it costs to acquire a new customer.
- Lifetime Value (LTV): The total revenue expected from a customer over their lifetime.
- Churn Rate: The percentage of customers who cancel their subscription.
- GRR & NRR: Gross revenue retention and net revenue retention.
- ARR & MRR: Annual and Monthly Recurring Revenue, essential for measuring growth.
Why It Matters
Data-driven decision-making allows you to optimize spend, refine messaging, and improve customer retention.
Conclusion
A successful SaaS go-to-market strategy requires careful planning across multiple dimensions, from defining your market and ideal customers to refining your pricing and customer acquisition approach. By aligning these elements effectively, SaaS companies can create a scalable, repeatable, and profitable growth engine.
If you’re building or refining your SaaS GTM strategy, start by evaluating these core components and iterating based on data and feedback. With the right foundation, you’ll accelerate your path to product-market fit. And if you need any help, don’t be shy to reach out.