What is the best way to find new TAM? As revenue leaders search for their next round of growth, there is an inherent risk associated with moving into a new vertical.
One of the biggest challenges is time.
Once we launch a new campaign to test a new adjacent market, we often faced with an 18-month timeframe before we see closed won opportunities. Further compounding this problem, it takes another 12 months to learn if these newly acquired segments eventually create a churn problem.
We have some interesting insights we’ve learned after having this discussion with many revenue leaders:
- Start by creating a deeper understanding of your existing customer base. Do you have pockets of strength within specific customer segments? What are the LTVs of these high-value segments? What is your current market share in each segment? Is TAM enough to hit growth targets for the next two to two years by focusing on your core
- Before moving into a new segment, seriously consider geographic expansion. For example, is EMEA a viable market? How about APAC?
- Segmentation expansion: Have you already been selling into these segments? If so, how do your logo retention, LTV, NPS, and product adoption rates compare with other customer segments within your business? If so, the information you need may be in your CRM or contract management system.
