THE CONSUMER SECTOR:
10 GTM Fundamentals Of Launching Products To Market
What do Segway, Coca Cola C2, Lululemon Astro Pants, and Allbirds leggings have in common?
Failed GTM (go to market) strategies that resulted in product launch disasters.
Not only do product launch failures create financial losses but also a stain to a company’s credibility that can take years, if not decades, to regain the trust of their hard earned customer base.
I have had the good fortune of successfully developing, marketing, selling and distributing over $1B of volume in nearly every consumer product in the industry from sheets to shoes, to underwear to accessories to suits. While every category has its nuances from sizing to fit to sourcing raw materials and designing packaging (if applicable), the fundamentals of a GTM strategy do not change.
As I always share with new potential clients, the product category is irrelevant to me; what matters is you have product-market-fit and I can help make it grow. I appreciate well designed consumer products whether it’s a chair, bottle of shampoo or pair of sneakers.
My proven process for GTM strategy is both macro and micro
Here is a condensed list of inputs that I analyze before launching products to market (extended list below):
- Addressable market
- Competitive analysis
- Calendar of events
- Distribution channels
For new product categories or line extensions, let’s take a deeper dive into each point. Before introducing a new consumer product to the market I first analyze the industry in which you are competing. This may seem obvious but you would be surprised how many companies approach a market blindly. Understanding the total addressable market (TAM) is the first step that many entrepreneurs or even experienced product managers get wrong. The goal is to understand if the TAM for your particular product category, or sector, is a large enough sector to enter and to understand the macro economic trends (i.e. is it growing or declining and why).
Once you’re comfortable with this topline figure and understand how the market is shifting, we need to further determine how your product category can earn market share within your Serviceable Obtainable Market (SOM) and analyze the baseline. For example, if you are creating a new line of premium golf shirts you can’t use the entire apparel industry for your SOM. A best-practice is to segment this one particular category of activewear polo shirts and further sub-segment into the price point you are targeting to determine how much business this line of golf shirts can reasonably generate.
Once this is defined and you are satisfied with the market reach, I move into the competitive analysis phase. When analyzing the competition it’s wise to consider both direct and indirect competitors. I do this by creating a “competitive matrix” to visually see where other brands compete as far as aesthetics and price point. There can be multiple inputs based on your specific product category; for example, if you were launching a new football helmet you would also include differentiator inputs such as safety scores or helmet weight into your competitive matrix. This process allows you to zoom-in to determine your product’s value proposition, or uncover white space that you can develop into (that’s where disruption occurs), which ultimately will drive your marketing messaging (e.g. features & benefits). If you discover your football helmet ranks #4 in safety scores and ranks #1 in weight (i.e. too heavy and mediocre protection), well, you don’t have a very good value proposition. It’s time to go back to the drawing board and develop a better product in order to have a successful launch.
Calendar of events
Timing is everything in life and business. I cannot overstate how important it is to consider your industry’s calendar with key dates such as trade shows or seasonality of selling time. Again, this may seem obvious but most small to medium sized companies just “wing it” without a structured process in place causing a GTM strategy to fall flat. A best practice is to start from the end point and work backwards to create a timeline of deliverables.
For example, if the most ideal launch date is July, you must have your products shipped to market by May and therefore, marketing assets must be complete by June and so on. If your deliverables are off track causing the product launch to shift into August, there could be significant revenue loss and risk giving a first mover advantage to a competitor.
Having a diversified multichannel distribution strategy is imperative in today’s hyper competitive market and demanding customer base. Your own DTC (direct to consumer) channel should make up the majority of your business providing a superior customer user experience. However, your wholesale channel is equally as important as far as customer reach and profitability. Expanding distribution channels is something I’ve excelled at my entire career. It’s important to understand that each retail partner needs something different from a brand. You must do your research to understand the merchandising voids at each retailer so you can tailor your product presentations to them.
For example, when we launched Calvin Klein men’s underwear at Saks Fifth Avenue, my team developed & presented cotton modal and cotton stretch fabrics to their buyers. Saks didn’t want 100% cotton because that’s what every other retailer had and their S5A private label filled the cotton void on their product matrix. Therefore, Calvin Klein was able to fill the cotton stretch void in their assortment providing a point of differentiation in their stores resulting in a win-win partnership for both Saks Fifth Avenue and PVH Corp (parent company of Calvin Klein).
Lastly, you cannot overlook the off price channel and must have a strategy in place to liquidate every brand’s dirty secret – aged inventory. This is a delicate balance and the off price partnerships are just as important as full price relationships.
Other considerations that must be analyzed and executed for a successful product launch
The above inputs are only a few of the considerations needed for a successful product launch. Many other factors must be analyzed, oftentimes simultaneously, such as:
5. Consumer insights
6. Product development
7. Product testing
8. User Experience (UX)
9. Pricing strategy
10. Supply chain growth roadmap
The customer determines how good you are with the final vote through their purchasing power
Does that mean that every product I was involved with launching, succeeded?
I’ve had a few failures myself and have learned from these mistakes so your company and brand can avoid these pitfalls. I’ll give you a couple examples.
While at Hugo Boss we launched a basic bowtie + printed pocket square gift box. In retrospect, the packaging was not well designed. The problem was customers could not tell which fabric showcased through the plastic window of the box was either the bowtie or the pocket square. Customers thought they were buying a polka dotted bowtie and plain black pocket square when, in fact, it was the other way around. This confusion led to consumers (e.g. Christmas gift givers) rejecting our product and therefore, we had terrible sell-throughs with this product launch during the important holiday season. Thankfully, it wasn’t a huge order and we were able to liquidate it relatively easily, albeit, at a loss.
Another failed example was a men’s canvas slip on sneaker with “patches” while I was working at Steve Madden. The fashion office executive of a large national retailer had heavy influence over the footwear buyer at the time, and they insisted that they have an exclusive key item sneaker with patches because it was a hot trend in jackets and backpacks at the time.
NEWS FLASH: Trends don’t always translate from one category to another.
Against my better judgment, we acquiesced and accepted a large order for over ~400 stores (10,000 pairs of shoes), when in reality this particular fashion sneaker should have only been sold in a few flagship fashion stores. This pressure mounted because I worked for a publicly traded company, which was under duress to forecast future growth to appease investors (e.g. Wall Street). Thus, the short term gains were not worth the long term risk as publicly traded companies often prioritize quarterly results over long term growth, forcing bad decisions. But I digress, this could be another post altogether.
Back to the canvas-patched-sneaker … It BOMBED!
The problem was the retail executive in the fashion office had zero shared accountability for this decision. It was a painful and slow process of liquidating the product of this overdistributed sneaker, temporarily stunting the growth of the men’s division. The lesson learned is don’t feel pressured to take an order if you know in your gut the product is not going to sell. Yes, in the short term you’ll look like a hero because your future bookings show a huge increase but what really matters is how the product sells at retail.
How can I help your brand with a successful GTM strategy & product launch?
My experience with successful and unsuccessful product launches are your company’s benefit. I can help you strategically plan, determine where the white space opportunities are, and hold cross-functional teams accountable for a successful GTM product launch.
Most importantly, I have a flexible service model so if you only need the strategy piece covered (e.g. GTM Playbook) or everything including execution (e.g. Fractional Chief Growth Officer), I can fill the gaps in your business.