Recap: Go From Market to Scale Camp

Decision #10: What Distribution Channel Will You Build As a Pathway to Customers?

Author Helen Yu first urges the reader to realize the difference between go-to-market strategy and product-market fit. We will look at the difference between the two concepts next.

According to Yu, your go-to-marketing strategy is the "step-by-step roadmap to launching your product in a shorter period of time" (p. 83). On the other hand, a product-market fit refers to being in a market where your product satisfies the needs of that market that your customers want to buy. The latter is what we need to answer with Decision #10. 

SBH Labs uses the online marketplace where Amazon takes a small percentage with every sale. Something the book fails to take into account is the state the world (and economy) was in after the pandemic. The owners of SBH Labs didn't have much choice in selecting a distribution channel due to the COVID-19 pandemic.

However, David sustains an online marketplace is a right channel to create a strong product-market fit. SBH Labs' ideal customers are health conscious and consume as much knowledge as possible about what ingredients are put on and in their bodies. Having an online platform to reach customers allows SBH Labs to share knowledge and other relevant information with its customers regarding the health benefits of the ingredients of the SBH Labs products. Being an online retailer also allows customers access to the brand and support at all times. David hopes this increases customer trust and a sense of reliability in the brand.

Because Amazon does take a portion of the sales, SBH Labs' new plan is to get its current Amazon customers to order from the SBH Labs website to minimize other vendor fees.

Decision #11: What is Your Pricing Strategy?

Yu relates the important message that "you want your pricing to be tied to value." if an item is priced too high, customers will not find it is worth the money. If an item is priced too low, it may indicate inferior quality.

Another important tidbit is the next statistic: "On average, 50 to 70% of revenue growth comes from expansion revenue." This makes it all more important to form strong connections with your customers so you can upset and cross-sell your existing clientele.

Yu also mentions the dangers of giving away things for free. It shows that you don't have a strong value proposition or that you don't know the value of your own product.

SBH Labs has both extension and competitive pricing but for different markets. Extension pricing, or when a company has a standard price that encompasses all shipping, taxes, and other expenses, in one singular price, is used to sell directly to customers. However, there is a separate market for commercial sales. Because these customers are ordering large quantities that do not need to be packaged individually, there is room for discounts.

Decision #12: How Will You Help Your Customer's Customer Scale and Grow?

Yu's advice on these critical decisions is:

"Be intentional about the steps you take to keep the customers of your customers driving success. [...] Make them look good, act bravely, and deliver on your customers' brand promises."

SBH Labs is helping customers achieve a healthier and more couscous lifestyle, paying attention to what goes in and on your body.