For a new SaaS company to take off, it needs to find, attract, and convince new people to try their product. And it needs to accomplish these tasks very quickly.
According to a McKinsey report, SaaS companies must achieve annual growth rates greater than 20% if they want to survive. This growth spurt is not an easy task considering the competition and how SaaS marketing differs from other industries.
In SaaS, you usually promote a product without anything tangible to show for it. As a physical product, you can’t actually hold it in your hands. As a result, selling the product requires outstanding marketing skills to convince customers that your product works and is the solution to their problems.
Users decide whether to try out a SaaS product just as quickly. They often conduct a quick online search, compare similar solutions, and then make their selection. It can take no more than a couple of hours.
Your marketing must target every stage of the buyer’s journey and offer relevant information that can convince someone to test your product.
However, it is difficult for consumers to commit more than a passing glance to commit to the product. Many new users log in to an app once, never coming back. Most customers have a short attention span and they don’t realize the full potential of the app before moving on.
Your promotional efforts must help customers realize the true value of your product. You also rely on different sales models. Buying a self-service SaaS product, one which customers sign up for, can hardly take any time at all.
In a sales approach, a customer goes through most of the process on their own. However, in the last stage, they usually engage a sales team that helps guide and recommend the best plan. This process can take longer and might require more resources.
Finally, the enterprise cycle could easily take months, if not longer, before a contract is signed.
Typically, SaaS companies have the following objectives for their marketing strategies:
Objective 1: Attract the right audience.
To kick-start its growth, a SaaS company must connect with potential users and promote any way possible to get them to their site. Your target audience should be ones that already experience a specific problem that your product aims to solve.
So, the first objective is to understand what solution you can offer to your users. Then, develop a strategy to motivate customers to learn more about the product.
Objective 2: Build a relationship with leads.
Marketers routinely develop potential leads. Using a combination of content, emails and other channels, a new SaaS company should position themselves so they can convince leads to test their product.
Objective 3: Remove roadblocks to sign up.
In SaaS, marketers optimize conversions around various website goals, including trial signups and on boarding in an effort to convert these free users into paying customers.
Objective 4: Engaging users.
For most SaaS apps, users sign up for a free trial or demo version of the product first. It’s a marketer’s job to ensure they convert into paying customers.
Typically, marketers accomplish this by optimizing the free or trial plan to help a person get to the activation point, where they then realize the true value of the product by using it.
Objective 5: Increase customer lifetime value.
Since most SaaS companies charge customers on a subscription model, it’s important that users remain active for a long time as customers. SaaS marketing strategies are aimed at increasing customer lifetime value by moving customers to higher priced plans.