A Market Strategy is a core element of a company’s revenue architecture and differentiated strategy. Revenue leaders need to define how to approach the Market Strategy based on attractiveness, competitive positioning and fit.
This post dissects Market Strategy and its components, and explores why it is essential to any business.
Market Strategy Defined
Market Strategy requires a continual assessment of existing and potential market opportunity. The analysis takes into consideration factors such as market size, geography, profitability potential, competitive positioning, segment growth potential, and complementary markets.
A Market Strategy defines the market white space opportunity and how you will position your firm and offerings to the market and various segments. Segmentation further breaks down the market to define market opportunities with similar elements to enable you to clearly define segment revenue goals, metrics and establish the “funnel DNA’, including elements of the go-to-market model, in order to drive segment revenue performance.
Given limited resources, you will need to prioritize certain segments over others. Your Market Strategy guides your decision-making, as you develop an understanding of which market segments have the greatest potential for growth profitability based on size, competition, fit and other relevant factors.
Continuously adapt your Market Strategy to changing market conditions and enter and exit markets based on their revenue performance potential.
Elements of a Market Strategy
An effective Market Strategy will include the following:
Market Analysis and Segmentation
Define the addressable market including market size, share and market outlook and determine the overall market opportunity. Identify the most attractive market segments, considering factors such as geography, industry, customer personas, size and fit. You can map segment market opportunities on a matrix of business attractiveness to current capabilities to help focus on the segments with the greatest potential.
Value to Market
For priority segments, evaluate your company’s capabilities and value relative to the particular market segment. Compare your company’s current capabilities to the market with research and analysis of market needs and have an objective and complete view of your company’s resources, capabilities and limitations facing the market.
Understand how your commercial use cases have evolved and to what degree they are relevant to your target customer. Understand customer needs and align product offerings, listing possible interactions that your company has with customers in the segment to better understand product value profitability.
Competitive Advantage and Positioning
Establish a clear understanding of your competitive strengths and weaknesses to determine how you differentiate and provide competitive value in the market. Establish persuasive messaging and positioning that articulates your advantages with your target market segment. Your competitive advantage is your main selling point.
A strong Market Strategy requires a comprehensive and defined product portfolio. This involves re-aligning your product and service portfolio to the market opportunity including making the needed changes in your product/ service offerings, eliminating poor performing products and services and reinvesting in emerging growth opportunities. Your Market Strategy informs the evolution of your product portfolio.
Why is it important?
Developing and maintaining a Market Strategy is a foundational element of your revenue architecture. Without an understanding of your market competitive opportunity, the segments to target and the value you provides to the market, you will not be able to effectively engage your customers and realize the market potential.
According to Circle Research, 92% of B2B marketers segment their target market.
Clearly, segmentation is a key aspect in developing B2B marketing strategies. An effective Market Strategy utilizes segmentation to identify attractive segments of your market which then, with consideration for your company’s competitive advantage and resources, shapes your decision-making and revenue strategy.
Market Strategy is one of the 12 dimensions of a world-class revenue architecture. Download the free 12 Dimensions Infographic to help visualize the critical success factors for revenue growth.