Identifying target markets and internal contacts
Are you a founder wondering how to start building out your sales strategy? Drowning in information on the web? The bad news is that there’s a lot of terrible advice out there. The good news is that you’ve found this blog post, a tried and true process that will help you identify your first target market. This blog post will take you through Step 1 of the Sales Method Strategy: how to clearly define your target market and the importance of doing so
WHAT IS A TARGET MARKET AND HOW TO DO FIND IT?
It’s important to note that your target market (“TM”) is not the same as your total addressable market (“TAM”). Your TM is a small subset of your TAM, a clearly defined and whittled down list of your TAM. Helping you to narrow down thousands of companies to a hundred or even tens of companies that will be a good fit for your product or service.
CREATING A TARGET LIST OF COMPANIES
Finding your target market is two fold. First, you need to define the external criteria that will help you to identify companies that will have the pain points that your product or service solves. The external criteria used to create a list of target companies is going to be a combination of characteristics such as size, location, revenue, industry, growth rates, funding cycle, ownership structure, age, tech stack, etc. Setting a detailed criteria allows you to filter through the massive amounts of potential customers and have laser focus on specific target accounts. If you’ve built an integration into another product, start with list of companies that already use this technology and then use other identifying characteristics to further condense your prospects.
One tip is to start your search by looking at who’s signed up for competing products. If your product or service is in a similar price range, target the same or similar companies. If your offering is cheaper, go for smaller companies. If more expensive or more complex, you’ll want to focus on larger companies.
Once you’ve clearly defined the criteria for which companies will potentially be a good fit, you then need to determine who within those organization has the pain point your product solves and the authority to make decisions to sign off on contracts. This person will be your internal contact.
CREATING A TARGET LIST OF CONTACTS
Your target buyer within the organization is going to be the person with pain or close to the pain (meaning no more than one level of management above the people with the pain point) and the ability to make budgetary decisions. Figuring out who this person is can be tricky and it can vary wildly between companies and departments. Think about the individuals your product will create the most value for and keep in mind that it’s possible it may touch several different teams and departments within the same company.
Use customer interviews to determine who the internal decision makers are. Ask about the decision making process used when purchasing complementary technologies. Customer interviews can be a goldmine of information if you ask the right questions.
Identify at least 3 internal contacts, ideally by title, per company (Remember: Pain + Money = Internal Contact). Once you have this information for all the target companies on your list (determined by your external criteria filter) then you’re ready to start contacting them through marketing and demand generation strategies (more posts on these topics to come!).
If you can get laser focused on specific targets using external and internal filters, you’ll learn more about your ideal customers, know exactly how to market your product, close deals faster and spend less money selling them. It’s important to set yourself up for success from the beginning so you don’t have to go back and do that same work twice.