CHAPTER 4
Go-To-Market Strategy
How this chapter is organized
Introduction
Examples of how sellers connect with their customers
Developing a successful go-to-market strategy
Types of selling channels
Selecting the right selling channels
Customer needs and preferences influence channel selection
The efficiency–effectiveness trade-off
Should a high-touch or a low-touch channel be used to execute the
sales strategy?
Managing “hybrid” channels
The role of the sales force in connecting with customers
Should the company use a direct or an indirect sales force?
When to use an indirect sales force
Advantages of selling directly
Six go-to-market strategy insights
Your go-to-market strategy can be a source of competitive advantage
We live in a multi-channel world
The role of the sales force is changing
A sales strategy change may be necessary if star performers are
holding the company hostage
Technology is changing the channel structure
Go-to-market strategy should be reassessed at least every two years
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INTRODUCTION
Chapter 3 presented a framework for determining a firm’s sales strategy,
including the right product and service offering and sales process for each
type of customer. Next, the firm must decide which sales and marketing
channels are best suited to deliver this sales strategy. This is the firm’s goto-market strategy, as illustrated in Figure 4.1.
Go-to-market broadly refers to how a firm serves its customers with a
combination of sales, financing, logistics, and service. In this book and
chapter we take a narrower view, focusing on how different parts of the
firm’s sales process such as prospecting, qualification, and closing are
performed. Successful firms make go-to-market choices that enable efficient yet effective connections with their customers and prospects. Many
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A. A. Zoltners et al., Sales Force Design For Strategic Advantage
© Andris A. Zoltners, Prabhakant Sinha and Sally E. Lorimer 2004
Sales Force Design for Strategic Advantage
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Sales and marketing channels
Value-added
partners
Agents/
Direct
TeleE-channels distributors/
sales force channels
retailers
Advertising &
promotion
FIGURE 4.1 Go-to-market activities in the sales force design framework
industries have evolved from viewing the sales channel as consisting of a
talking tape recorder (the salesperson) and a delivery truck, and now view
the sales channel as a way to add customer value to the firm’s products and
services.
Go-to-market strategies use resources from both inside and outside the
company. Inside resources include a company’s direct sales force, product
specialists, service specialists, telesales personnel, and e-channels. Outside
resources include collaborators, co-suppliers, partners, wholesalers,
distributors, independent agents, value-added resellers, and retail outlets.
Companies creatively combine the use of internal and external resources
to execute their sales strategy in order to reduce the cost of connecting with
customers and, at the same time, to enhance customer impact. Sales forces,
whether company-owned (direct) or independent (indirect), often play an
important role in this connection.
Examples of How Sellers Connect with their Customers
The following three examples illustrate different ways that companies go
to market.
Figure 4.2 shows how a networking equipment manufacturer goes to
market. This company sells a very technical, complex, and customized
product that has high value and high risk for the customer. Thus, a highly
specialized sales force is used to serve the customers. Salespeople specialize both by market and by task.
Figure 4.3 illustrates how an office products supplier goes to market.
Compared with the products of the networking equipment manufacturer,
this company’s products are simpler, low risk, and do not require
customization. Thus, it is not necessary for a highly specialized sales force
to be involved in every step of the selling process. The office products
supplier uses a direct mail catalog and telemarketing to generate and qualify leads. Both of these selling channels are much less expensive than a
direct sales force. Generalist salespeople participate in selling to qualified
leads and in closing sales. Product specialists are used only to sell the