Route to Market

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Once we know the market size (TAM), who the company plans on targeting (SAM) and what the company’s target is for market share (SOM), it’s important to understand how the founders plan on capturing that market. What is their route to market / market entry strategy / customer acquisition strategy? How are they going to get customers?

Essentially this is a summarised version of a marketing plan. Founders will come up with hundreds of creative ways to capture the market. Here are a couple of examples from other companies…

AppVirality is a referral marketing software designed to help mobile apps and SaaS products automate their marketing. Not only have they listed their marketing strategy and channels, but also the partnerships they’ll need to be successful.

Castle raised $270k with their pitch deck and their marketing strategy was a key slide. It may have impressed investors, but it might not have gone down so well with customers. Castle closed its doors (pulled up the drawbridge?) in 2018. It’s a nice-looking slide though.

Good investors will expect founders to know:

  • Where do these customers already hang out?
  • Who do we know (individuals or networks) who can get us access to more customers? Who do they listen to? Who are their influencers?
  • Is there anything viral about what the company is doing?
  • What strategies have worked well for similar companies?
  • What strategies have failed for similar companies?
  • Is there anything about the product that makes it ‘sticky’?
  • Are there any switching costs for customers? If so, how will they make it worth it to switch?
  • How much will this cost?