Go to Market Partnerships – Helping Each Other Sell

Oct 31 2018

NGD Systems

Diagram of go to market partnerships (GTM) showing off the structure of GTM chains.

Unlike technology partnerships, go-to-market (or GTM) partnerships are all about how to market and sell products to the end consumers of those products. The structure of GTM chains generally depends on four factors:

  1. Product Cost: In general, the more expensive a product is, the more likely it is to be sold directly by the producing company. This is because there is generally enough margin in expensive products to pay for the cost of direct sales teams. A good example of this is enterprise storage arrays – since most are in the hundreds of thousands of dollars price range, a 2%-3% commission can still provide a salesperson with a significant amount of money. On the other end of the spectrum are “commodity” electronics, which are often sold through multi-tier distribution channels.
  2. Product Complexity: This attribute is similar to product cost – the more complex the product is to sell and deploy, the more likely that it needs strong technical sales and installation personnel, which drives the need for direct sales and services teams.
  3. “Completeness” of the Solution: This attribute really measures whether other products are required to compliment the product being sold, or whether the product is a “solution in itself”. For instance, in-memory databases (IMDBs) typically need significant hardware to be integrated with the IMDB software, which is usually done either by server OEMs or large system integrators (SIs).
  4. “Customer Ownership”: In most cases, customers try to reduce the number of parties that they buy products from – it simplifies their supply chain and keeps them working with “people that they trust”. This often means that for certain classes of customers (especially medium size businesses), a vendor may only be able to get to them through a reseller network.

At NGD Systems, our products are computational storage devices in the form of solid-state drives (SSDs). They form part of a larger solution that can include analytics software and servers. As such, our GTM chain includes server OEMs and SIs for general IT markets. It also includes telecom equipment manufacturers (TEMs) who supply equipment to telecom carriers, and content delivery network (CDN) operators who typically integrate their own systems. If you would like to work with NGD Systems, please contact us me at eli.tiomkin@ngdsystems.com.

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