Live Launches: PM wants to expand sales of product to new markets
Product Manager:
“We want to see more efforts being made to sell this product outside of the US. We are seeing success in the US and want to see this replicated, specifically in EMEA”.
We spent significant time defining our true ideal client – those clients that we have the most probability of winning with our product - in this instance specifically US based companies based on the underlying product dataset. Based on this we prepared why we win with these clients, our value props, our objection handling, competitive positioning, the channels we will reach them through, etc etc. We launch and drive significant pipeline, going on to close multiple deals and blitzing our annual target in just 8 months…
Incredible, so what now?
Product Manager: how do we sell this product to other regions/client types?
In my experience this approach of expansion to markets that are outside of your true ideal client profile comes with many challenges:
1) Win rates are going to decrease – this is obvious but often overlooked. The minute we move away from our most ideal clients, the objections new client types have increase and subsequently the ROI they associate with the product diminishes
2) Average deal size likely to decrease – we have already defined those ideal clients that we believe will receive the most value from our product, so anything outside of this will most likely diminish the value and therefore deal size
3) Absorb sales reps time – taking both the above into account, you are then asking reps to focus time on products with lower win rate and deal size, diverting their time away from products with strong product market fit. It also isn’t just the sales reps time that will be absorbed…
4) Underestimate GTM lift associated - in many instances expansion to new markets changes the core value props, client objections, competitors etc. In these instances, the effort required across teams (sales, marketing, CX) to prepare and launch with the required impact is significant. This investment must be considered against the diminishing returns discussed above.
As a Product Manager, there is no real downside to throwing more at the wall. The more reps trying to sell your product the better, even if win rates and deal sizes diminish. But for heads of sales, it is integral that you discuss and debate with heads of product, ensuring you are protecting your sales team’s time to truly focus on those products in which they have the largest right to win with their client base. Failure to do so will impact overall sales performance. I have experienced many sales reps performances drop significantly due to being distracted by products that, if we are honest, just aren’t optimized for their markets.
Expansion can come, but I always recommend investments in maximizing success in our ideal client profile first, before looking outside of this group. As you do then look to expand, you must be critical in understanding the requirements of the product to truly land with the new markets/client types being targeted. Failure to do so will distract GTM teams in supporting a product that is sub-optimal for that specific client type, with the potential to negatively impact overall revenue performance.
