The software as a service (SaaS) business model is on an exponential growth trajectory. It's getting more popular than ever. According to a report by Finances Online, this sector could be worth more than S650 billion by the end of 2023.
This growth exponential growth implies more businesses are entering the industry. And with more competitors coming in, businesses with frail SaaS marketing strategy bound to fail.
SaaS businesses need a marketing strategy that helps them stand out in the crowd. And more importantly, it helps them promote virtual and intangible products.
So if you are a marketer who wants to switch to this booming SaaS industry, or a SaaS business owner wanting to understand the complex world of SaaS marketing, this guide is for you.
This guide will give you a basic understanding of SaaS marketing, how it's different, and some strategies to get started!
Let's dive right in!
Understanding SaaS Marketing
SaaS marketing helps you promote and sell software as a service (SaaS) products to potential customers. SaaS products are software applications that are hosted on the cloud and accessed through the internet rather than being installed locally on a user's computer.
From a distance, it might appear that SaaS marketing is the same as marketing any other product — promote it, market it, and then wait to get a lot of sales.
But it's more complicated.
It's mainly because of how different SaaS products are. For instance, it's not a product that you can show off in your hand. Therefore, the strategies used to market it needs to be different too. And this is where SaaS marketing comes in.
SaaS marketing focuses on creating awareness around a product by leveraging the digital space and content marketing. And it's pretty justified. After all, the internet is the best place to find users for Internet-based products.
SaaS marketing strategies help make your SaaS product more relevant for your target customers by considering their needs and preferences. It's the art of building interest in your target audience to know more about the product, try it, and eventually subscribe to keep using it.
That said, let's see how marketing a SaaS product is different.
How Is SaaS Marketing Different From Traditional Marketing?
SaaS marketing is a unique and complex process that requires a different approach compared to traditional marketing. This is mainly because a SaaS product is intangible and is accessed through the internet rather than being a physical product that can be touched and experienced firsthand.
Additionally, SaaS products are usually subscription-based and require the customer to pay a recurring fee to continue using the product, which adds another layer of complexity to the marketing process.
In this section, we will explore how SaaS marketing is different from traditional marketing and why it requires a unique approach.
Selling Service as Much as the Software
In SaaS marketing, the focus is not just on selling the product but also on providing excellent customer service to retain customers and prevent churn.
For example, a customer relationship management (CRM) SaaS product needs to not only have a user-friendly interface and powerful features but also provide timely and helpful support to its customers to ensure their satisfaction.
In contrast, traditional products are usually sold as a one-time purchase, and the customer service aspect is relatively less critical.
Different Target Audience
SaaS products usually target businesses rather than individual consumers, which means that the target audience is different, and the marketing strategies need to be tailored accordingly.
For example, a project management SaaS product may target small and medium-sized businesses, while a CRM SaaS product may target enterprise-level organizations. And usually, it's the business's stakeholders who decide what SaaS product to use, not the end users.
Marketing to businesses requires a different approach compared to marketing to individual consumers, as businesses are more likely to be interested in solutions that can improve their efficiency and productivity rather than just cool features.
Short Sales Cycle
The sales cycle for SaaS products is typically shorter compared to traditional products. This is because the customer can quickly sign up for a free trial and test the product before making a purchasing decision.
For example, the stakeholders can let their team try out a CRM SaaS product for 14 days and see if it meets their needs before committing to a subscription.
This short sales cycle means that SaaS marketers need to be agile and quick in their marketing efforts to convert leads into customers before they lose interest or find an alternative solution.
Tiered Pricing Structure
SaaS products often have a tiered pricing structure, where the customer can choose a plan based on their needs and budget.
For example, a CRM SaaS product may offer a basic plan for small businesses, a premium plan for medium-sized businesses, and an enterprise plan for large organizations.
This tiered pricing structure allows SaaS marketers to cater to a wide range of customers and provide them with the right value for their money.
Unlike traditional products, where customers typically make a one-time purchase and are done, SaaS products require the customer to pay a recurring fee to continue using the product.
This means that SaaS marketers need to focus on building long-term relationships with customers and providing them with continuous value to retain their loyalty.
One great way to build valuable long-term relationships with customers is by providing regular updates and new features. It'll keep them engaged and motivated to continue using the product.
Understanding these differences is crucial for any SaaS marketer looking to succeed in this highly competitive industry.
Challenges That Come With SaaS Marketing
SaaS marketing is a challenging field that requires a unique approach and a deep understanding of the market and the customers.
Despite of many opportunities that come with it, SaaS marketing also has its fair share of challenges that need to be overcome for a company to be successful.
In this section, we will explore some of the common challenges faced by SaaS marketers and discuss possible solutions to address them.
1. Defining the target market
Defining the target market is a crucial step in SaaS marketing as it helps you tailor your marketing efforts to meet the needs and wants of your ideal customer.
A common mistake is trying to appeal to everyone, which can lead to a scattered and ineffective marketing strategy. Instead, you should focus on a specific customer segment that is most likely to benefit from your SaaS product.
To define your target market, start by identifying the requirements of your ideal customer. For example, if your SaaS product is a project management tool, your target market may include small businesses and startups that need a more efficient way to manage their projects.
Once you have a good understanding of what they are looking for, you can create buyer personas to help you better understand their demographics, behaviors, and motivations.
Demographic data can also be helpful in defining your target market. This can include information such as age, gender, income, and location. By analyzing this data, you can gain insight into which customer segments are most likely to be interested in your SaaS product.
2. Establishing Credibility
Establishing credibility with potential customers is essential in SaaS marketing, as many people may be hesitant to try a new type of software.
In order to build credibility, you need to clearly communicate the features and benefits of your SaaS product and demonstrate how it can solve specific problems and meet the needs of your target market.
One way to establish credibility is to create professional and easy-to-understand marketing materials, such as a website and brochures.
You should also consider using customer testimonials and case studies to showcase the successes of real customers using your product. This helps potential customers see the value of your product and how it can benefit them.
Another way to establish credibility is by demonstrating your expertise in your field. This can be done through content marketing, such as writing blog posts or creating videos that provide valuable information and insights to your target market.
By positioning yourself as an authority in your field, you can establish trust and credibility with potential customers.
3. Generating Leads
Generating leads is a crucial part of SaaS marketing, as it helps you find potential customers who are interested in your product. And it's not quite easy, especially if you don't know the right ways to generate leads.
There is no one strategy that fits all businesses. The most effective lead generation approach will depend on your target market and business goals.
However, some common methods for generating leads are through lead generation websites, social media marketing, email marketing, etc.
For example, in email marketing, you can collect email addresses from potential customers and send them targeted emails with valuable information and offers. It'll help you attract leads who are actually interested in your SaaS product.
Moreover, by creating a strong presence on social media platforms such as Twitter, LinkedIn, and Facebook, you can reach potential customers, engage with them in real time, and convert them into leads.
4. Differentiating the Product
With so many SaaS products on the market, it can take time and be challenging to differentiate your product from the competition. In order to stand out, you need to focus on the unique features and benefits that set your product apart.
One way to differentiate your product is by highlighting its unique features and benefits. For example, if your SaaS product is a project management tool, you should focus on features such as real-time collaboration, integrations with other tools, or a user-friendly interface.
Highlighting these features will help your potential customers see how your product is different from others on the market.
In addition to highlighting the features and benefits of your product, it's also important to make sure that your marketing materials are clear and easy to understand. This includes your website, brochures, and any other materials you use to promote your product.
By providing potential customers with straightforward information about your product, you can help them quickly understand how it can meet their needs.
You can also use customer testimonials and case studies to differentiate your product. By showcasing real-life examples of how your product has helped other customers, you can provide potential customers with valuable insights into how it can benefit them as well.
5. Building a Pricing Strategy
Creating a pricing strategy is an important aspect of SaaS marketing, as it can help you attract the right customers and maximize revenue. However, it can be challenging to determine the best pricing strategy, especially if you are a small business or startup with limited resources.
There are several factors to consider when creating a pricing strategy for your SaaS product. These include the features and benefits of your product, the size of your target market, and the level of customer support you offer. You should also consider the pricing of similar products on the market and how your pricing compares to them.
One common pricing strategy for SaaS products is the freemium model, which involves offering a basic version of your product for free, with the option to upgrade to a premium version for a fee. This can be an effective way to attract potential customers and generate leads, as it allows them to try out your product before committing to a purchase.
Another pricing strategy is the subscription model, which involves charging a recurring fee for access to your product. This can be an effective way to generate steady revenue and build a loyal customer base.
Ultimately, the best pricing strategy for your SaaS product will depend on your business goals and target market. You can also experiment with different pricing strategies and track the results to determine what works best for your business.
SaaS Marketing Strategies to Grow Faster
Now that we know how different SaaS marketing is and the challenges that come with it let's look at some SaaS marketing strategies that can help businesses grow faster.
Content marketing is a powerful tool for SaaS companies, as it helps to establish credibility and build trust with potential customers. And it won't be an exaggeration if we say content is the backbone for SaaS marketing strategies to thrive.
By creating valuable content such as blog posts, articles, and videos that provide insights and information about your SaaS product, you can attract and engage potential customers.
An effective SaaS content marketing strategy should be focused on the needs and interests of the target market. This can include topics such as industry trends, common pain points or challenges faced by your target market, and how your SaaS product can help solve these problems.
With content marketing, you can convince users and stakeholders how your SaaS product is the right fit to improve their productivity and fulfill their other requirements.
Free SaaS Trials
SaaS companies have a distinct advantage when it comes to offering a free trial to customers. Depending on what the SaaS product does, it costs little to nothing to allow the target customers to try it.
It's one of the most effective ways to attract potential customers and generate leads. When SaaS companies allow users to try out your product for a limited time, the potential customers get a firsthand experience of how it works and how it can benefit them.
The free trial should be easy to sign up for and include clear instructions on how to use the product. You can also provide support and resources to help users get the most out of the trial.
It's also important to clearly communicate the terms of the trial, including how long it lasts and what features are included. This can help potential customers understand what they can expect from the trial and whether they are interested in upgrading to a paid version.
For a product that is to be sold on the internet, it's criminal not to have an SEO strategy. SEO can help you improve the visibility of your product in search results. And the more users see you, the more leads you can get for conversion.
By optimizing your website and marketing materials for relevant keywords and phrases, you can attract potential customers who are searching for products like yours. And because these customers are already looking for a product like yours, their chances of conversion are quite high.
In addition to using relevant keywords, it's also important to ensure that your website is mobile-friendly and has a user-friendly design to improve the user experience and increase the chances of attracting potential customers.
Start PPC Campaigns
Pay-per-click (PPC) advertising is a popular and effective strategy that almost every B2B SaaS company leverages. It allows you to reach potential customers through targeted ads and generate leads.
PPC advertising is cost-effective, with costs typically lower than traditional ads published elsewhere. It's because you're only paying for the clicks on your ad and not the impressions.
For a PPC campaign to be effective, it's important to start with a general benefit and make a specific promise to address a pain point for your target market. Your ads should clearly show how your SaaS product can benefit potential customers.
It's also essential to pay attention to the ad quality score, which measures the relevance and value of your ads.
Moreover, you must ensure that your SEO strategy partially supports your PPC campaign by targeting relevant keywords and phrases. For example, the keyword for which you're running a PPC campaign should also be in your SEO strategy, helping you rank higher.
To maximize the effectiveness of your PPC campaigns, you should regularly track the performance of your ads and make adjustments as needed. This can involve analyzing data such as click-through rates, conversion rates, and cost-per-click to determine which ads and keywords are most effective.
Launch an Affiliate Program
An affiliate program is a way to partner with other companies or individuals to promote your SaaS product in exchange for a commission. This can be a fruitful way for SaaS companies to reach a wider audience and generate leads, as affiliates can help promote your product to their own networks.
The affiliate program should offer attractive commissions and provide affiliates with the tools and resources they need to promote your product effectively. You should also establish clear terms and conditions for your affiliate program to ensure that it is successful.
Social Media Marketing
Social media is an important marketing strategy for SaaS businesses, as it allows you to reach and engage with a large portion of your target audience. With 3.48 billion internet users on social media, your target market is likely active on social platforms.
In addition to reaching potential customers, social media also offers a direct channel for communication and is a great way to build a loyal following through one-on-one interactions.
It's also a valuable source of data, allowing you to collect information about your target audience and fine-tune your SaaS strategy to improve the value proposition of your product and decrease the churn rate.
SaaS businesses can also collaborate with social media influencers to build a solid image for the brand without requiring a lot of resources. This collaboration can help build brand awareness and generate tons of leads.
Email Marketing For SaaS
With SaaS email marketing, you can promote your business and interact with customers and prospects through email to support business growth. With 4 billion people using email daily, it's a powerful channel for increasing sales, building brand awareness, and improving ROI.
Some benefits of using email marketing for SaaS include increased website traffic, high ROI, becoming an authority in your industry, and enabling a personalized marketing approach.
By creating top-notch email campaigns, you can direct interested visitors to your website and nurture them with valuable content. You can also use emails to offer incentives, such as webinars or free trials, to prospects who are ready to purchase.
Through consistent email outreach, you can promote and educate your audience about your service, stand out from the competition, and provide personalized content using features such as custom fields and segmentation.
In this guide, we covered what SaaS marketing is and what are some challenges that come with it. We also discussed some strategies that can help marketers/owners take a SaaS product to a wider and more relevant audience.
But this is not the end. In the next guide, we'll discuss how you can get started with SaaS marketing and much more.
Want to learn SaaS marketing to get better career opportunities? Check out GrowthSchool's SaaS Growth Program!