How to Create a SaaS Go-To-Market Strategy (2024)

Closeup on a notebook with text SAAS GO TO MARKET STRATEGY

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Your Software-as-a-Service (SaaS) product launch’s success depends on an effective go-to-market (GTM) strategy. 

Good GTM strategies are key to building and launching better products to the right customers at the right time and standing out from the competition already existing in the market. This helps reduce the chances of startup failure at the get-go.

According to a Harvard Business School study, although 30,000 new products are launched each year, 95% of them fail, and 92% of startups fold in their first three years of operation. 

This is attributed to introducing products or other solutions where there is no real need for them. Startups find that there is no real market for the solutions they’ve come up with.

You can prevent this from happening to your business with a solid SaaS go-to-market strategy.

Whether you’re launching a new product into an existing market or expanding to new customers in emerging markets, your GTM strategy helps you validate your product or service idea early on before you invest more resources in it.

By validating your product idea ahead of time in the game, you save precious time, money, and other resources moving forward. You ensure that you’re moving in the right direction before you invest more of your resources into it.

What is a GTM strategy in SaaS?

On business charts there is a pencil and an arrow sticker with the inscription - Go to market strategy in SaaS

Your SaaS go-to-market (GTM) strategy is the roadmap for how you’ll take your product to market. It lays the foundation for a successful product launch and business going forward.

It’s a comprehensive guide on how to send your product or service to the market—hence the term “go to market.”

It is a detailed, step-by-step plan for how you’re going to use your company’s resources to deliver your unique value proposition (USP) to your customers, giving you a competitive advantage in your target market. 

A good go-to-market strategy in software helps you launch your product or service to the right audience with the right messaging at the right time.

An effective GTM strategy includes a clear identification of your target market, your positioning and selling strategy (product-led growth, sales-led growth, or hybrid?), pricing model, marketing distribution channels, and more.

You need to clearly answer the 5Ws and 1H:

  • Who is your target audience?
  • Where are they?
  • What product or service are you offering them?
  • Why are you offering it to them (brand positioning)?
  • When will you get it to them?
  • How will you get it to them (marketing and sales plan)?

SaaS GTM vs. Marketing Plan: What’s the Difference?

Although a SaaS go-to-market strategy, as described, sounds like a marketing plan, the key differences are in the plans’ time coverage and product focus.

A SaaS go-to-market strategy is a one-time plan to help you break into your target market as you launch your product or service. 

A marketing plan is an ongoing and evolving plan, extending beyond the initial product launch. It involves continuous marketing efforts to acquire more customers and grow your market share.

A SaaS go-to-market strategy also focuses only on a single product or service to launch. 

A marketing plan focuses on the brand’s main value proposition and how this is translated into the marketing of its products and services.

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SaaS Go-To-Market Strategy: 3 Key Benefits

There are many benefits to coming up with a SaaS go-to-market strategy, but the three most important are that they help you:

1. Map out all significant touchpoints

With a SaaS go-to-market strategy, you get to not only identify but also clarify:

  • Who your potential customers are 
  • What their pain points are
  • How your offering can address these pain points
  • Who your existing competitors are  
  • How are they not addressing your customers’ pain points well enough?

So, you can craft the effective marketing strategies that you will employ to gain a competitive advantage over them.

In the process of identifying your potential customers’ pain points, you will also need to identify their customer touchpoints

What are customer touchpoints?

Customer touchpoints are the important interactions that happen between your brand and them along their customer’s journey. 

Typically, customer touchpoints before a purchase involve social media, online ads, digital marketing content, peer referrals, and company events.

Customer touchpoints during a purchase involve conversations with company representatives, product catalogs, your ecommerce website, product reviews, and the point of sale.

Touchpoints after a purchase typically involve thank-you letters or emails, product feedback surveys, upselling and cross-selling emails, billing actions, and subscription renewals.

Customer touchpoints in customer service involve customer support channels, customer success programs, customer onboarding, customer loyalty programs, and self-service resources.

When you list and then group these touchpoints chronologically, you will gain a complete picture of an average customer experience with your business.

When you see this big picture, it will help you develop the strategies that will best speak to your target customers and move them along their customer journey with you.

2. Addresses product-market fit early on

A good SaaS go-to-market strategy ensures that your product fits the target users’ needs, so the issue of product-market fit is solved early on.

The study shows that 95% of new product launches fail, and top brands such as Google, Coca-Cola, and Colgate were part of this statistic. 

The Google Glass project received millions of dollars of investment but quickly disappeared from the scene. Google Glass is a wearable, voice- and motion-controlled Android device that resembles a pair of eyeglasses and displays information directly in the user’s field of vision. The product was launched in 2014 but pulled from the market in 2015.

New Coke, using high-fructose corn syrup instead of regular sugar, was launched in 1985. It was renamed Coke II in 1990 and discontinued in 2002.

The oral hygiene giant Colgate introduced Colgate Kitchen Entrees, a series of precooked meals, in 1982. It apparently didn’t delight people’s tastebuds and was eventually brushed aside, pun intended.

These large companies can obviously take on the costs of product launch failures, but startups can’t.

MIT professor Svafa Gronfeldt explains why only 5% of new products survive: “Many organizations don’t take their customers’ needs into account when launching their products. Without putting themselves in their (customers’) shoes, it’s often too late when they realize there’s no market for their solutions.” 

Go-to-market strategies are useful not only for product launches but also for long sales cycles. They not only help you attain product-market fit but also set a solid foundation for future product operations.

3. Determine customer acquisition cost and the most suitable strategy ahead of time.

Developing a good SaaS go-to-market strategy helps you determine the customer acquisition cost, which can then be the basis for choosing the most suitable strategy for your product.

Instead of following the marketing tactics that your competing SaaS companies predominantly use, such as huge discounts, which may not be appropriate for your product, you can make better-informed strategic decisions that won’t cost you more money than necessary.

What are the 5 Go-To-Market strategies?

Hand writing Go To Market Strategies with marker concept background

You can consider this the condensed version of a SaaS GTM playbook. The five pillars of a successful SaaS go-to-market strategy are:

1. Product analysis

Most startups have products in an evolutionary, constantly evolving state. This means that new ideas, responses to the market, and key accounts can put the product’s value proposition in a continuing state of flux.

So, a critical first step is to understand the current state of your product. 

What is the market potential for it now, compared with what the product team plans for it in their roadmap?

Plan for the time and capital expenses required to take the product to its intended state. This will likely limit your resources and marketing strategy, but this sober assessment is necessary to align your team’s expectations.

Carefully look at your target users. Create valid customer personas to guide your GTM strategy. 

Is your market well-defined? Have you clearly described the value you will provide the target user?

As your product evolves, the market definition and user value will shift. Ensure that your answers to these questions remain valid. This is key to a successful GTM strategy.

2. Product messaging

Product messaging starts with your basic product position statement. It ensures that you are communicating your product’s core objectives clearly.

A typical product positioning format looks something like this:

(Product name) is a (product class) for (target market) that (product purpose). Unlike the (main competitor), (product name) has (unique features).

Before you can even craft your simple-looking product positioning statement, you will need to carefully evaluate your competition. You will also need to see how your buyers and users are different. 

From this assessment, you will be able to develop good customer personas that will help you see how your buyers and users perceive your product and how they make decisions.

You will also need to consider your product’s value. Put yourself in your target client’s place.

What is the business case your buyer will make to capture a budget commitment from their company for your product? What is your product objectively worth to them? How do you define and defend the worth of your product?

3. Sales proposition

Man with huge magnet attracts people

You need to consider how your messaging is delivered at different stages of the sales cycle, especially if your business engages in direct sales.

Early-stage messaging emphasizes the business case. Case studies and white papers can be helpful sales collateral in this early stage of the sales cycle.

At mid-stage, messaging focuses on how your product compares to the competition. A classic example is using the competitive product matrix. It’s a way of checking out your competition by identifying your competitors and laying out their products, sales, and marketing strategies in a visual format.

By doing this, you will learn where you are currently positioned in the market, how to differentiate yourself from your competition, and how to improve your processes so you can get ahead of them in the market.

Late-stage messaging turns the focus away from the product to the business relationship. A good example is the use of testimonials on the value of your after-sales support.

When you evaluate your current sales proposition, take some time to audit your existing or targeted strategic client accounts. 

Does your value proposition align with their needs? How are the account expectations being managed currently? What quarterly milestones did the team set for these accounts, and how are they tracking their progress against those milestones?

You will also need to consider your pricing. 

How clearly do you define the variation between your product’s price and its value to your target customer? How does your pricing line up with the competition? Does this factor significantly impact your buyer’s purchase decision process? 

For example, if you choose a premium pricing structure for your product, make sure that your sales proposition supports it.

4. Marketing strategy

If you’ve developed valid buyer and user personas, you can then craft targeted audiences and a plan to reach them with the right marketing and advertising campaigns.

Consider age, geography, income, position/title, affiliations, and online behavior as starting factors to create campaign audiences to test. 

What’s good about digital marketing is that you can test targeting audiences with unique messaging, images, and creatives that initiate the call to action (CTA) across a number of advertising channels.

When done right, you can achieve effective test results even on a limited budget. For example, you can test a full set of messages on Facebook audiences with budgets as low as only $20 a day, running around 15 ad sets for 7 days.

The best digital marketing strategy is agile, with sprints continually testing channels, ad creatives, and targeting. Start with small budgets as you tweak your ads and copies until you dial in an optimized conversion rate.

This also ensures that your analytics capture attribution, which lets you capture the lifetime value of a customer who can be credited to the campaign.

Score your outcomes accurately. This enables you to direct how and where to expand your digital marketing budget.

Later, when you move to less agile advertising channels, you will benefit from your tested ad messaging and key performance indicators (KPIs).

5. Sales strategy

Begin by evaluating your current sales pipeline. 

Does it reflect your current sales potential? Can pipeline reporting be relied upon to accurately predict future revenue?

Then, define your partner strategy. 

What products complement yours? What products will most probably be purchased before or after yours? What advantages can be gained from joint marketing with these other product providers?

A channel partner strategy considers how and when other products might add unique value when selling your products. This is classic business development, which is the art of getting others to sell on your behalf.

Two SaaS go-to-market strategies are often considered in sales strategizing: product-led or sales-led.

A product-led go-to-market strategy uses the product as the main channel for customer acquisition, conversion, retention, and expansion. 

Everything is self-service. 

A product-led go-to-market strategy depends on organic product growth, backed by an exploratory model and a seamless user experience in setting up and using the product. 

Often, the product has self-serve features, and the strategy uses freemium offers and trial-to-buy offers.

Typically, customers sign up for a free trial, upgrade to a premium plan, or cancel their subscription without communicating with sales instantly.

Brands spend more on marketing than on sales with a product-led GTM strategy. This allows for a broader net cast and lower customer acquisition costs (CAC). 

A good example is Ahrefs, with over $50 million in annual recurring revenue and more than 3,200 new leads every week, even with zero salespeople.

Product-led strategies are best for shorter sales cycles, catering to small and medium businesses (SMBs).

A lot of SaaS companies, such as Dropbox and Slack, use this product-led strategy. It is based on building a value-filled product experience for customers that encourages them to keep using the product.

On the other hand, a sales-led go-to-market strategy involves the prospect interacting with a company sales representative at every stage of their buying journey. 

It depends heavily on your sales team and channel partners. Your sales team will connect with clients, build relationships, explain product benefits to potential customers, and take them through the contractual process. 

Business-to-business (B2B) products that require long contract cycles and significant time to position and onboard often require a sales-led approach. 

This implies more investment in sales resources. You will need to invest in the recruitment hiring, and training of your sales team, as well as equipping them with the necessary sales collaterals.

Clients are typically enterprise-scale, requiring your investment in qualification meetings, demos, overcoming customer objections, negotiations, and other complex requirements.

Companies whose products require more high-level guidance with a longer sales cycle use the sales-led strategy.

The key point to remember is that it’s not an either-or choice when it comes to product-led or sales-led strategies. You must choose what’s best for your situation. 

You must identify where the change point is so you know when to shift from one to the other. 

You can also use these two go-to-market strategies in tandem if this approach applies to your business situation.

How Do You Create a SaaS Go-To-Market Strategy?

Man with arrow going up in hands studying diagrams

We now come to how, specifically, you create a SaaS go-to-market strategy. 

There is no standard GTM template, but a basic strategy would involve the following steps:

1. Identify the right audience.

This first step is crucial. It determines whether you can address the product-market fit challenge or not.

Identifying the right buyer and user personas or target audience will determine the rest of your SaaS go-to-market strategy.

Who will benefit most from your product? What pain points of theirs will your product solve? Who will you target first when you launch it? How will you reach them?

In thinking about your target audience, especially when you’re in B2B, you need to consider that you will probably have a different persona for the buyer, the decision-maker, and the actual user of your product. You might also need to consider the influencers and gatekeepers around them.

Start by creating a 3-column Value Matrix table with the following labels for each column: Pain Points, Product Value, Main Message. On the left side of the table, label the beginning of each row with your identified target personas: User, Buyer, Decision-maker, Influencer, Gatekeeper.

Then, put yourself in each of the persona’s shoes and list down what you feel would be their answers to Pain Points. Once you’ve exhausted this column, you can then list down the Product Value and Main Message ideas you have to address each of their pain points.

Here’s a sample Value Matrix table to illustrate how this looks:

Source: Sales Hero

2. Create the value proposition and key messaging.

If you’ve accomplished your Value Matrix thoroughly and in detail, you will then have an idea of what your core value proposition and key messaging would be.

Your core value proposition highlights key target persona problems and positions your product as the best solution for them.

It’s helpful to use the recommended format to further clarify your product value proposition and key messaging:

(Product name) is a (product class) for (target market) that (product purpose). Unlike (main competitor), (product name) has (unique features).

3. Decide on a sales strategy.

Will you employ a product-led, a sales-led, or a hybrid go-to-market strategy? It depends on what is appropriate for your product, your market, and your industry.

In a product-led strategy, your product is the focus of all marketing and sales efforts. It’s best to use this if your product is simple to use, has a potential for virality, and has self-serve features.

A sales-led strategy largely depends on a well-informed and proactive sales force. It works best for enterprise companies whose products are complex, have a long sales cycle, and require high-level guidance from their sales teams. 

4. Choose your pricing strategy.

Your pricing strategy depends on your decision on how you will sell your product to the target market, given what you know now about their personas and pain points.

Generally, SaaS companies use any or a combination of the following sale and pricing models:

Freemium

This works best for B2B products that may need a longer period to understand and get value from. 

Entice new users with a free plan that has limited features to give them time to explore the product, experience its value, and increase the chances of their upgrading to a paid plan.

Flat rate

This is the simplest approach to selling SaaS. It’s focused and easy to communicate with prospective customers. 

This works best if you offer a simple product with limited features or a consumer-focused subscription product.

It involves offering your product and all its features at a fixed rate each month. Everyone gets everything at one price. Customers can choose to pay monthly or annually.

Pay-as-you-go

Infrastructure software companies often use this pricing model. It involves charging the users based on how much they use your product. The more they use it, the higher they pay for it. 

It’s also known as usage-based or consumption-based pricing. Since it has lower upfront costs for users, it can attract more users even as you learn more about them when they use your product. 

Revenue can grow fast, but it can also be unpredictable and difficult to forecast since you don’t know how much each customer will pay per month or per year.

Pricing per feature

What features and how many of them users need and use determine the users’ subscriptions. Users consider it fair pricing, as they pay only for what they’ll use. 

Typically, this involves creating different packages and listing all the features in each package. This pricing model offers clear package differences and helps in upselling.

Tiered

This pricing strategy lets you target different types of customers with a plan for everyone. It involves using different packages with various features and prices to attract customers.

It’s easy to upsell with tiered pricing, and it maximizes revenues. However, it needs deep audience research and risks overwhelming potential customers with too many options.

Tiered pricing is best if your business sells licenses, seats, or similar products.

User-based

This pricing model involves charging your customers based on how many users will be using the product. They can choose a plan most suited to their company size and change it if their size increases or decreases.

User-based pricing has lower barriers to entry and can easily attract new clients as the price is not the main deciding factor. It is also transparent and customizable. However, your growth depends largely on customers, and revenue is unpredictable.

This pricing model is best if you have volatile demand patterns.

5. Choose a marketing distribution strategy.

How do you plan to reach your target audience? How will you create brand awareness, attract potential buyers, and drive demand? Which marketing channels would be most effective for reaching and converting them?

Your answers to these questions and more should be mapped out in detail in your marketing distribution strategy.

The top marketing channels for SaaS companies are search engine optimization (SEO), social media, content marketing, referral marketing programs, SaaS review sites, video marketing, targeted pay-per-click (PPC) campaigns, email marketing, free trials, and live demos.

6. Determine a customer experience strategy and customer funnel.

Especially if you decide on a product-led strategy, you’ll also need to craft a customer experience strategy.

This strategy maps out their customer journey with you, identifying the touchpoints with your brand and how you will delight customers at every step of the way. 

When your customers experience smooth and pleasant interactions with your products, they are more likely to convert to paying customers.

This is also helpful for a sales-led strategy.

7. Decide on the right metrics to track.

Sales-led growth metrics focus on customer efficiency, while product-led growth metrics focus on product usage and feedback.

Essential sales-led going-to-market strategy metrics are: 

  • Monthly Recurring Revenue (MRR): the predictable monthly revenue
  • Customer Acquisition Cost (CAC): total expenses incurred in acquiring a new customer
  • Customer Lifetime Value (CLV): total revenue a customer is expected to generate during their entire relationship with your business
  • Sales Conversion Rate: percentage of prospects converted into paying customers
  • Average Deal Size: average revenue amount per customer transaction
  • Sales Velocity: the rate at which deals are closed, integrating deal size
  • Churn Rate: the rate at which customers end their relationship with your business

Foundational product-led growth metrics are:

  • Activation Rate: percentage of active product adopters
  • User Engagement: user interaction depth and frequency with your product
  • Retention Rate: continuity of product usage or subscriptions over time
  • Conversion Rate: percentage of users converting to paid versions
  • Net Promoter Score (NPR): a score indicating the likelihood of users recommending the product
  • Time to Value: time taken for users to feel the product’s benefits

Even at this early stage of planning your go-to-market strategy, you should already focus on setting the proper metrics because they will determine how successful or unsuccessful your GTM implementation will be.

The CLV: CAC ratio is recommended to make sure you don’t start running losses by spending more on acquisitions before you gain.

Successful SaaS Go-To-Market Strategy: 3 Examples

Business growth vector concept with businessman and vertical arrow going up

Here, we show you successful GTM strategy examples covering both business-to-consumer (B2C) and B2B SaaS go-to-market strategies. 

They include Asana, Dropbox, and Slack.

Asana: Core Brand Messaging

Founded in 2008 by Facebook’s co-founder and president of engineering Justin Rosenstein and his Facebook colleague Dustin Moskovitz, Asana is a SaaS web and mobile “work management platform designed to help teams organize, track, and manage their work.” 

The founders left Facebook to build Asana after they saw how an internal work productivity tool, Task, that they built at Facebook was broadly adopted and how powerfully it impacted their internal work systems.

Asana’s go-to-market success is largely attributed to its clarity about what it seeks to do and how this is reflected in its core brand messaging and performance. It showed that its product is easy to use and easy to scale.

Asana aims to enable teams to work together and reach their goals at scale. It correctly identified a prevalent market pain point among individuals and organizations: people spend too much time on work about coordinating their work instead of actual productive work. 

So, Asana offers a work management platform that provides a seamless structure to unstructured work. Its Work Graph combines tasks, projects, portfolios, goals, and the relationships among these. 

Asana follows a hybrid go-to-market strategy, combining a product-led self-service strategy through its basic free service with a sales-led direct sales strategy to convert those free accounts into company-wide accounts.

Asana’s strategy follows a subscription-revenue model. It starts with a free basic plan that fills its marketing funnel with leads. The direct sales teams then process these leads, turning them into enterprise accounts.

Dropbox: Going Viral

Dropbox, a file host-sharing service that grew to $1 billion in revenue in only 10 years, is considered the poster child of a product-led growth (PLG) go-to-market strategy.

Traditionally, most SaaS companies use a top-down approach to SaaS growth by employing a sales-led go-to-market strategy. They would build a product and employ a sales team to directly sell the product to companies.

PLG is a bottom-up approach where you enable people to discover and adopt your product on their own. There are three key markers to indicate that a product or service is ripe for a PLG strategy: simplicity, virality, and a self-serve channel.

Dropbox possesses these three markers. 

It’s simple enough that a user can not only understand it and how it works but also be able to make a purchase decision independently of a salesperson. 

It has virality potential because it requires sharing to get the full value of the product. Since Dropbox is designed to facilitate collaboration with other individuals and groups, it can automatically create additional users by frequently exposing new people to the product.

It has self-serve features, which became a channel for prospects to discover and use their product without needing help from a company representative to support them.

Dropbox’s PLG approach was straightforward. It started with a good product-market fit. It solved an existing market problem with a product that has a very user-friendly user interface (UI). 

Instead of having to use burdensome file transfer protocols (FTPs) or local file servers to store and share files for collaborations, users could use the Dropbox drag-and-drop feature, which allowed instant access from any computer on the web.

Its go-to-market strategy used a one-two approach. 

In the beginning, it focused almost entirely on growing its user base rather than on monetization. Then, it introduced features designed to take advantage of the viral factor: shared folders, a referral program, and shared links.

Basically, Dropbox focuses on solving a problem for users and then making it easy for these users to share their solutions with others.

Slack: Self-Service and Word-of-Mouth

When Slack was launched in 2013, the team communication app space that we know now did not yet exist. Teams communicated via email or switched between different apps to talk over chat, email, call, and video call. 

There was no app yet for efficient, effortless communication that helped people communicate effectively with less time and effort.

The team started working on polishing Slack in 2012 and used it internally by March 2013. They also asked their friends in other companies in the Silicon Valley area to test out their products and give them feedback. 

Slack’s early distribution happened through this informal network of early testers.

They used the feedback to improve Slack. Early on, they learned that their product worked differently depending on team sizes. So, they progressively increased the team size capacity and observed how the product worked as they added new features. 

They kept on iterating until they had the best features that worked well for different team sizes.

Once the product worked well enough for large teams, they rolled out their preview release for beta testing. Immediately, 8,000 people signed up in one day. In two weeks, they had 15,000 active users.

The increased number of users meant more feedback and iteration for Slack. This is how Slack’s “word-of-mouth” engine started running among Silicon Valley users.

As they kept iterating the initial product, Slack evolved into a workspace with different users talking one-to-one and on different channels. 

As it evolved, Slack’s team narrowed down Slack’s core features to three: Search, Synchronization, and Sharing (file).

They officially launched Slack in February 2014, replicating the original word-of-mouth strategy at scale via Twitter. They chose Twitter because most professionals chose to hang out on Twitter and directly contribute to discussions on the app. It also had a potential virality factor.

Slack’s team created the Twitter Wall of Love, which quickly exploded, receiving up to 10,000 tweets in a month.

From a zero valuation at its official launch, Slack reached a billion-dollar valuation in just eight months. In 2021, it made $902 million in revenue. Its customer base now includes 80% of Fortune 500 companies, including IBM, Oracle, Razorpay, Time, and Uber.

Slack’s product-led go-to-market “word-of-mouth” strategy fundamentally involves the following tactics:

  1. Get every relevant user to try the product.
  2. Take all feedback seriously and learn from it.
  3. Use the feedback to keep iterating on product improvement until all the loopholes are fixed.
  4. Make sure users bring in more users.
  5. Make your product so indispensable that users have no other choice but to buy the paid version.

This is how Slack built its $27 billion company with almost no “marketing.”

GTM Strategy Execution

Business niche market and specializing in a smaller opportunity as an individual dart going a different way as a metaphor for strategic planning as a 3D illustration

It helps to have a great product, but as you’ve seen in the Harvard study conducted, it is not enough. Ultimately, your success depends on your ability to effectively execute your SaaS go-to-market strategy.

Building a solid GTM plan gives you the framework you need. If you have the right people working with you, collaborating, challenging your assumptions, and providing encouragement, and your GTM strategies integrate the five pillars, you can avoid many costly mistakes. 

Your solid SaaS go-to-market strategy helps set your team’s expectations realistically and takes out the need for guesswork and unfounded assumptions. It will keep your resources focused and help you execute your strategy with the greatest potential for success. *

Jeanette Patindol
Content Writer
Former company
About Author
Jeanette early-retired in mid-2020 from her 23-year academic career as an Economics, Interdisciplinary Studies, and Communications professor to dedicate the rest of her life following her bliss doing what she loves to do most: writing. She has been writing for publications and various clients on multiple platforms since she was 14 years old. Now, she intends to help individuals and businesses across the globe achieve their goals by creating exceptional content that resonates well with their audiences.
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