When your consulting company is ready to launch a new service offering, it's critical to develop a go-to-market plan. A comprehensive go-to-market plan clearly describes the goals of the new service and outlines the steps needed to achieve those goals. Just as important, a go-to-market plan helps your leadership team identify key risks to address in order to make the plan become reality. By proactively addressing these risks, your organization will give its fledgling service line the best opportunity to flourish.
Elements of a go-to-market plan
A well-designed go-to-market plan describes the following key issues:
- Value of service offering to existing and potential clients
- Strategy, timeline, and scope of the service rollout
- Revenue potential for the service line over a period of three years
- Initial costs and resources (for example, marketing costs, head count, and capital expenditures) associated with rolling out the service line
- Ongoing costs of maintaining the service
- Risks associated with achieving the targets within the budget, along with mitigating strategies for managing those risks
Developing a strong go-to-market plan requires thoughtful analysis and teamwork from leaders across your company. Depending on the complexity and size of the service offering you are planning, the process of developing a go-to-market plan can take anywhere from a few days to two weeks.
Five steps to a better plan
To develop a thorough go-to-market plan, you'll need to take these five steps:
- Define the market opportunity for the service.
- Build a budget model to establish clear goals over a three-year period. Metrics should focus on revenue, profit margin, market share, and head count.
- Define the general strategy for how the service offering will be delivered.
- Outline the specific tactics required during the first year to execute the strategy.
- Identify the economic, competitive, and internal risks associated with executing the strategy, and develop mitigating strategies and tactics.
A go-to-market plan case study
To put this process into action, let's use the example of a system integrator located in the southeast market that deploys financial applications to small and medium-sized manufacturers. After reviewing the market environment, client feedback, competition, and its own strengths and weaknesses, the firm found that it was ideally suited to provide strategic services related to demand forecasting.
The firm performed a detailed cost, benefit, and risk evaluation of the new service line. The next step was to package the evaluation results to provide a clear plan for how the firm would successfully release the new offering. The following table shows the specific steps taken to generate the go-to-market plan.
|Define the market opportunity
- Review current and prospective client feedback regarding the market opportunity.
- Review feedback from employees.
- Review trend data from trade publications, analysts, and industry groups.
- Develop a clear hypothesis regarding the opportunity.
- Conduct client/employee workshops, executive forums, and external focus groups to test the hypothesis.
- Define the primary customers who will be served by the new offering, and determine what would compel them to buy the service from your organization.
|Build budget models (for one-year and three-year periods)
- Develop a revenue model based on expectations for market penetration, average deal size, and the impact of new marketing efforts.
- Estimate margins over one-year and three-year periods, based on startup and ongoing costs.
- Based on how the market is defined, set clear goals for market share penetration.
- Particularly for year one, estimate the head count required to sell the new services and then execute upon demand. If the head count isn't readily available, be sure to include recruiting and retainment costs in the budget.
|Define the strategy
Focus on these issues:
- How will the service be delivered?
- Why do clients need this service?
- Why will clients buy the service from you?
- How will activities such as hiring, marketing, and training affect the ability to deliver during the startup phase of the new service?
- How will the strategy evolve after the startup phase (typically defined as the first 90 days)?
|Outline the tactics for the first year of operations
- Define how the organizational structure needs to be changed to accommodate the new service.
- Identify the new skill sets that need to be developed to sell and implement the service.
- Outline the marketing activities needed to generate awareness in and to create leads from the targeted market/client base.
- Determine the tools and systems required to support operations.
|Identify and mitigate risk
- Outline the biggest risks that may affect your ability to reach the goals of the new service line.
- Develop strategies to address how risks can be mitigated.
After completing these five steps, the system integrator has developed a detailed go-to-market plan that prepares it to launch a new demand-forecasting service. The go-to-market plan clearly defines the market opportunity, establishes the financial goals, and identifies a strategy for achieving the stated objectives.
Most importantly, the firm was able to identify key risks that might prevent the offering from being successful. Before launching its new service, the firm developed strategies for overcoming some of these potential obstacles.
The thorough preparation required by the go-to-market plan placed the firm's new service offering on sound ground, providing a secure platform for the future growth and success of the service launch.
About the author Larry Melillo is a manager of CFO Advisory Services at KPMG, a leading provider of audit, tax, and advisory services. CFO Advisory Services professionals help organizations implement strategies and process changes that drive a more value-added finance function.