SaaS, which stands for software as a service, is cloud-based software that provides specific benefits to its users without downloading any application to their computers or phones. These services can range from office management platforms to automated video creation due to their extensive scope. As a rule of thumb, SaaS companies provide subscription-based services, making it easier to track and predict revenues.
Because of their convenience, the demand for SaaS products is constantly growing, resulting in higher competition. Consequently, companies providing SaaS services need to be at the top of their game to thrive.
This is where marketing comes into play. It allows businesses to directly reach the audience interested in their products and forge meaningful connections with them. However, this may be a bit more challenging than it sounds. If you have a SaaS business or work with one, understanding how to market it can be challenging and time-consuming. Therefore, it’s essential to understand how SaaS marketing works and what strategies you can use to help your brand grow.
To help you with this, we’ve assembled a comprehensive guide to a successful SaaS marketing strategy and what it takes to build one.
What is a SaaS Funnel?
In short, the SaaS funnel is the journey a customer takes from the moment your product grabs their attention to the moment they decide to purchase it. On this path, it is necessary to consider all the customer's needs, questions, and motives for making the final decision. Therefore, applying the sales funnel concept means identifying how a customer decides to make a purchase and then using this information to build communication with them.
The SaaS sales funnel is more complex than the marketing of eCommerce platforms: it has more steps, and most of the everyday actions take place not on the website but in the CRM system.
How to Market Your SaaS Business Effectively?
Marketing your SaaS business is by no means an easy feat. It requires time, effort, resources, and careful planning. To help you navigate the world of SaaS marketing, we have gathered a list of SaaS growth techniques and channels to compete, survive, and thrive in the software industry.
Top SaaS Marketing Techniques
To begin marketing your SaaS product, you need to step back and understand the outcomes you want to achieve. After that, research and understand some of the highest-performing SaaS marketing techniques and how you can use them to achieve your goals.
Below are some of the popular ones for you to consider.
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Implement a content marketing strategy
Many SaaS marketers use content marketing to build brand awareness, drive visitors to a website, and increase software subscriptions. In addition, it is essential to educate potential customers about your SaaS product so that they know exactly what benefits they’ll get. Research shows that people are 131% more likely to buy from brands that have educated them through their content.
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Focus on email marketing
Email often seems to be an obsolete form of marketing, but it’s far from being the truth! In fact, today, it is an integral strategy that is a highly effective tool for sales. Whether you want to focus on customer retention or achieve exceptional ROI, email marketing can help you grow your SaaS business. However, once you decide to implement emails into your marketing strategy, you need to consider your brand needs. Depending on that, the email marketing tools you choose to use may differ, so make sure to be aware of your goals.
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Don’t forget about Search Engine Optimization (SEO)
When it comes to increasing organic traffic to your website, SEO plays a fundamental role. Typically, you need to focus on two categories: On-Page and Off-Page SEO. An effective combination of these two strategies has helped companies attract millions of visitors organically for many years already. You can do the same by conducting thorough keyword research and optimizing your website accordingly. Over time, you will also need to focus on important key points such as website protection, bot integration, user experience, etc.
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Offer free trials to gain subscriptions
Offering potential customers free trials are one of the fastest ways to get more software subscriptions. However, after a free trial, your customers may want to shift to purchasing a paid plan. That means keeping an eye on payment methods. Thus, there is a high chance of a potential customer switching from a free trial to a paid one. If you plan to make several business transactions and receive payment, consider online payment software for more organized operations. Free trials are a great tool to promote your product as they not only help users understand your product better and show them why they need to sign up for the paid version.
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Connect with your users
Once a user signs up for a free trial of your software, try to connect with them. This will help build trust towards your brand and allow the user to ask questions about the product. Use customer support tools like phone support or live chat to make that connection possible. Don't wait until the last day of the free trial to contact your customers. At this point, the user is less likely to answer your call! Communicating in the audio chat is another way that works better than just chatting.
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Offer a free demo
When you're selling SaaS, it's not always enough to just offer a free trial. If the software is advanced, enable a free demo. Show them the ropes. This will not only help them use your software, but it will also give them more confidence and increase their chances of purchasing the product after the trial period ends.
Moreover, before offering a demo, make sure that you have a chatbot solution readily available for users thinking of making a purchase.
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Build a solid social media presence
Over 200 million businesses use Facebook to connect with customers, and 57 million companies are on LinkedIn. So, if your SaaS company isn't listed on social media platforms, you are missing out on many opportunities. Nonetheless, the choice of social media channel depends on where the target audience lives.
Let’s say your target audience is active on Instagram or maybe even TikTok. You can conduct influencer marketing research and find influencers from your niche that will be happy to be sponsored by you or spread the word about your service. Likewise, you can also set up platform-specific ads and promoted posts to spread brand awareness. Hang on because we take a deeper dive into social media marketing further in this article.
Best SaaS Marketing Channels
As you work on your SaaS marketing strategy, a key aspect is the marketing channels you use. Depending on your goals, some channels may work better than others. Therefore you must know what exactly it is that you want to achieve. For example, if your target audience is not on Instagram, maybe dedicating resources to that platform is not the best decision.
Below, we take a look at some of the widely-used channels for SaaS marketing.
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SEO and content marketing
The first channel is SEO and content marketing. We combine these two as they are very often linked. SEO is the process of optimizing your website based on keywords people search for when they look for your product. Properly optimizing your website will allow you to appear in search results of Google and other search engines when people look for keywords you are targeting.
What concerns content marketing, it’s the process of creating high-quality keyword-optimized content such as landing pages and blog articles that attract the attention of search engine crawlers.
SEO is a long-term promotional strategy that requires an investment of time and effort, but the results will benefit your brand for a long time. For that reason, you need to develop a comprehensive SEO strategy based on your goals and business needs. Before you start developing your strategy, check the Google ranking of your website to see where your website stands.
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PPC advertising
The second channel is PPC or pay-per-click ads. As the name suggests, when running PPC ads, you pay only when someone clicks on the ad and is redirected to your intended website. One of the most popular forms of PPC is search engine advertising, such as Google, YouTube, and Bing ads. PPC is a great way to spread information among target audiences about your product and increase the number of sales and conversions.
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Email and retention marketing
The third channel is email and retention marketing. It, in its turn, has three subcategories.
The first subcategory is internal retention marketing. This includes emails, push notifications, chatbots, and on-site chats for those users who left contact information. As mentioned previously, email marketing should not be underestimated. It is an excellent tool for marketers as it helps with customer retention and builds a bridge between customers and brands through catchy email subject lines and interesting content. All you have to do is choose the right email marketing tool that fits your budget.
The second subchannel is the external and cold sales, also known as Cold Email Sales.
The third and last subchannel of email and retention marketing you should know about is cross-promo with partners.
All these communications of internal retention marketing are aimed towards the following goals:
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Converting leads into buyers;
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Reducing churn and extending the subscription period;
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Increase in average earnings per client, ARPU (average income from one active user for the period);
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Stimulation by referral program and recommendation to other potential clients.
When it comes to email marketing, you need to ensure email deliverability, SPF records, great messages, etc. These will complete your campaign and make it more efficient in the long run.
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Social media and PR
The fourth channel is social media marketing and PR. Here we are talking about organic reach on platforms like Facebook, YouTube, and different media outlets. Of course, your success will depend on the quality of content you create and its distribution. Usually, this step involves creating content on social media and working with journalists, opinion leaders, and partners to showcase the benefits of your company and product.
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Affiliate and referrals
The seventh channel is affiliates and referrals, which involves working with partners and encouraging users to invite colleagues and friends. It also requires cooperation with influencers or users and offering them commissions in exchange for attracting customers. Here’s an example of how it works: the person who wants to participate in your affiliate program gets a unique link to your schedule. Then, every time someone purchases the link, the referrer receives a small percentage from the sales.
Social Media Marketing Mini Guide
Social media plays a unique role in any marketing strategy, targeting business (B2B) or direct customers (B2C).
Why? The tricky part is that you are offering a specific digital service that addresses a particular need in SaaS marketing. But, most importantly, you need to reach out to the people for whom you created your service.
Empowering the proper social media channels, tools, and approaches can increase the digital presence of your SaaS product, reach the right audience, and raise your brand awareness.
Social media is also a great source of valuable information about your audience and how they interact and perceive your business.
Why does social media work for SaaS marketing?
The reason social media works well for SaaS companies is that your customers are already there. For example, millennials (people between the ages of 23 and 38) are considered the most influential consumers globally. They are very active on social media, and you take their interests into account to discover new products or improve your product.
Be close to your audience
Before starting to build a social media presence, you need to choose which platforms are suitable for your SaaS product:
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Find out where your audience is located;
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Research and plan which channels you have the most potential customers through;
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Of course, you only want to invest time and resources in those that promise a higher return on investment.
To choose the right social network for your business, you need to have a thorough understanding of your target market, as well as the product you offer.
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Facebook
Facebook is the most popular social media channel, which is excellent for B2B and B2C customers. While it's true that Facebook has an average of 1.82 billion people who use the social network every day, it has excellent tools for targeting audiences and creating effective ad campaigns. What's more, your very presence there will increase your brand awareness as customers looking for your brand will find some validation of your business. Facebook is also a great spot for getting customer feedback and finding out any gaps or inefficiencies.
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LinkedIn
If your SaaS product is primarily for other businesses, then you need to go to LinkedIn. A social networking site for professionals is a great place to connect with people from different industries and showcase your product or service.
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YouTube
YouTube can be convenient for your SaaS business. You can create various sections such as tutorials or training courses or any other valuable video that you can share with your clients. If you've launched a new version of your software or developed new features, your customers will find it easier to watch videos than read blog posts about it. And if you don’t have the necessary technologies for making videos, start a podcast and upload it to YouTube.
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Instagram
You might think Instagram is not the best place to promote your SaaS product, but you could be wrong. Instagram is now one of the most essential and fastest-growing social channels, making it a great place to present your product more engagingly. Known primarily as a visual platform, Instagram offers a plethora of ways to promote your brand there, from short video reels to influencer corporations. This popularity of the platform has given rise to many Instagram influencers in different niches, so one of the strategies you can use is influencer marketing.
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Twitter
Twitter is where you can engage with your audience and build brand awareness of your SaaS product. In addition, you can share news about your company or publish articles from your blog.
Another good practice is to follow other industry leaders or other brands and reply to their tweets or helpful retweet information. Actively on Twitter, you can grow your followers and work to build an online community around your brand.
Saas Marketing Metrics And KPIs
Data is the lifeforce of any business strategy, from marketing to finance. Any additional data can empower you to make better decisions and help your business grow faster.
To develop a profitable growth strategy and identify points of success, the team needs to understand what SaaS metrics and KPIs are, know their types, track them regularly, and learn how to get insights from analytics.
What's the difference between metrics and KPIs?
A metric is about numbers that you can count, for example, users number, transactions, followers, etc. KPI is about percentage and means a critical performance indicator that has a particular norm. So, for example, by comparing your actual indicator performance with the market average, you can summarize how your business performs.
Here are some of the critical metrics you need to consider to understand when developing your marketing plan. They combine SaaS financial metrics, sales, customer success, and marketing metrics, providing insightful information for you to act on.
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MRR (Monthly Regular Income);
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Annual recurring income (ARR);
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Churn rates;
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Gross Profit, Cost, EBITDA SM, Rule 40.
With this list of SaaS metrics, you can quickly gain insight into overall performance and where things will go.
Understanding lead generation and customer acquisition
Lead generation is about attracting potential customers using various methods of collecting their contacts and additional information. It is essential to understand that the lead is precisely the potential client who could interact with the company, not already doing it.
Since lead generation is considered a process of attracting potential customers, a person can become a lead only if they saw an advertisement for a product and became interested in it or otherwise showed interest in a company offering goods and services. Therefore, the more people are interested in a particular company's products, the more opportunities the company has to get the maximum number of customers.
Potential clients can be divided into three groups: cold leads, warm leads, and hot leads. They differ depending on how much the lead has formed a need for a particular product.
Lead generation workflow
How does lead generation work? Lead generation flow consists only of two aspects.
First is the source from which the stream of potential customers will come. It is important not to confuse this so-called traffic with the lead itself.
The second is the transformation of the existing traffic into a converter. Most often, companies will use their official websites or create separate landing pages for this purpose.
Customer engagement is the process of building long-term relationships between the brand and the customer. For example, almost any offer or business publication is crucial for attracting and engaging customers. And the fiercer the competition in a particular business area, the more innovative marketing plays a role in customer engagement.
How to Create and Manage a SaaS Marketing Budget?
For your SaaS marketing campaign to reach its goals, effective budgeting is the key. How much to spend on your marketing determines the successful image of your brand online.
How much should you spare for your SaaS marketing budget?
Digital marketing has no set limits as to how small or large your business should be. Therefore, before you determine the amount you would be setting aside for your marketing strategies, the following guidelines would help you make the correct decision.
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Marketing budget benchmarks
The company should first determine its nature of service, whether it would be catering to the final consumers or businesses. If the business needs marketing to other companies, the budget allocation should be 2% to 5% of the revenue. This allocated amount should double to 5%-10% if the business markets to consumers.
The above-mentioned average benchmark should be used and tailored around the goals and resources of the business so that an effective budgeting plan can be made. For example, if you have SEO, Social Media, and PPC in your marketing strategy, you need to determine which channel requires the most investment.
Your marketing budget plan should include the following key factors:
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Content creation
In the digital sphere, content is king. As a result, most marketers spend a large portion of their budget on content creation. The section of creative content includes images, photography, videos, rental locations as props, graphic designing, copywriting, editing, translating, etc.
The cost of content depends on how customized your content is. For example, free stock of photographs can be obtained from various free sites. However, for a personalized approach, you will need to hire a photographer.
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Software and tools
Tools and platforms are a part of most marketing campaigns. For social media campaigns, you’ll need to use social media scheduling tools to make sure your content goes live at the right time. You’ll also need design and editing tools, competitive analysis tools, SEO tools, etc. Make sure to calculate all of this and include them in your marketing budget.
Moreover, when it comes to business operations regarding money, payments, and transfers, you should be as professional as possible. There are different options when it comes to making invoices online, creating payment sheets, and other activities.
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Payment options
When preparing your marketing budget, you also need to consider the payment options. As part of your marketing efforts, you will probably be working with many different brands and individuals, so ensuring a proper payment process is essential. However, this can be tedious, primarily if you work with overseas companies or freelancers: money transfers can take days, and taxes and payment fees can too.
Another critical aspect to take into account when considering your payment options is data security. Unfortunately, with the rise of payment methods, there was also a significant rise in data breaches and money leaks. However, this is one of the reasons many businesses have begun to accept cryptocurrency payments: because of safe and fast transactions. For example, consider Coinbase, a high-profile cryptocurrency exchange platform available in over 100 countries for secure transfers. Besides, if you have other wallets, you can connect them to your crypto portfolio tracker to track your crypto assets from one place.
Verdict
SaaS marketing is comprised of different methods, tools, and techniques, so it’s essential to navigate through it diligently. Keep in mind that the monthly increase in the number of visitors on your landing page means nothing if none of them end up becoming a lead and a client. And if you've doubled your customer acquisition efforts, but your churn rate has tripled, then you're in trouble.
Effective SaaS marketing is highly specialized, so understanding what you are dealing with is much more critical. And don’t forget successful SaaS marketing depends on a solid understanding of your internal economy.
If you’re interested in entering the SaaS industry, but remain unsure of where to start, you can establish your own website builder business with Ucraft via our White Label program. You’ll be able to design multiple websites for your clients using our builder, but the branding will remain 100% yours. Learn More.
