Why Your Go-To-Market Strategy Matters

Most companies were created through product innovation. They are based on an idea: a new way of doing something. But as the market matures, it becomes harder to sustain innovation.

Most markets fall into one of two models. The first model is a thriving market. Customers have a widely recognized need. There are likely two or three leaders who provide a relatively stable set of options for customers to choose from. Product innovation takes place at the margins. It is rarely a turning point. Think about detergents. While there are many brands, relatively few companies compete in space. Where they fight, they compete on price (driven by operational scale), habit (my family has always used the tide), or level differentiation (smells better or whiter brighter).

The second model is a new market, where product innovation is a catalyst that reshapes everything. Think Tesla, Airbnb, or Uber. The new idea redefined the expectations of the customer and, therefore, of the market. In some cases, such as the iPod, customers may not even realize they have the underlying need until innovation occurs. The impact on the market is huge. Legacy leaders (if not innovators) are left behind or have to focus on catching up.