With exponential growth in the SaaS industry and estimated profit revenue of $360 billion by 2024, many are searching for the best process to implement in their business. However, that won’t stop there as a boost of $200 billion more in the next five years is already predicted.
What do you need to know about SaaS?
Saas companies are known to be more flexible and adaptable to the changing market. As a result, they are proliferating, which is predicted to continue in the next five years. These self-service marketing funnels are what everyone needs to maximize their revenue.
What are the benefits of SaaS?
With an increase in sales and marketing efforts, there is a need for more resources to be available at any given time. This is where these self-service funnels come into play, as they will help you capture leads without spending too much or having little control over your data.
These lead capturing tools have been proven to provide better user engagement than those implemented on traditional software models, and it’s why they continue to grow by 70% every year with no signs of slowing down anytime soon. Everything from social media tracking, email campaigns, website analytics, etc., everything necessary can now be done within one platform, which helps cut costs and save valuable time.
With the success rate that they provide, you must also know the most effective sales and marketing techniques to avoid going down the wrong path. First, let’s learn the common mistakes that most businesses make and fail their business faster.
4 Common Mistakes SaaS Startups Are Doing
With the efficacy of SaaS, there are still a lot of mistakes that startups are making. It’s not too late to correct them and start increasing revenue, however.
Struggles with cash-flow
Financial struggles are common in the early stages of SaaS startups. Therefore, it’s essential to have a plan in place for handling your cash flow so that it doesn’t take an unexpected hit down the road. If not handled accordingly, poor cash flow can put you in a position where it’s harder to re-invest and make your product more competitive.
The churn rate is the number of customers that leave in a certain amount of time. For example, if you have 100 users and only 80 are still using your product after one year, the churn rate is 20%.
There can be many causes for customer attrition, like pricing issues or an unsatisfactory experience with the app’s performance. While it may not seem essential to track this metric when you’re just starting as a business, having information about who stays and who leaves will help you understand what might need improvement so that you can grow revenue long-term.
Ineffective market research
As a startup, you need to do thorough research for your target market. Otherwise, you’ll fail. First, you need to know what your audience wants, and the best way to do that is through surveys or focus groups. Ask them about what they want in an application, and then build it for them!
If you don’t research properly before you create your product, you won’t be successful more than likely. So make sure market research is a priority if this will be one of your priorities as well! The bad news is that even with proper market research done, poorly developed products can still succeed by being first-movers into an underserved niche. However, without any customer interest at all, there’s no reason to continue working on product development – so get out there and start surveying people today.
Flawed business structure
Another reason that a startup may fail is that its business structure itself isn’t properly thought out. For example, suppose you aren’t taking the time to get your company’s legal and financials in order. In that case, it will be easy for someone else to come along and take over your market share – especially if you’re not doing something unique or different from everyone else. Unfortunately, so many small businesses have failed because of poor planning with their company formation.
No management vision is complete without a revenue stream. You need to demonstrate that the work you are doing is valuable and will lead to greater results down the road.
With SaaS, this becomes easier than ever before since there’s no installation or customization necessary on your part for someone else to benefit from it. But, of course, creating sales strategies can come with its pitfalls if not carefully executed – which means you should make sure that you’re following these 20 tips to maximize your potential return on investment!
Effective SaaS Sales Tips To Try in 2021
One of the most challenging parts of SaaS is to keep up with all the latest trends. New products come out every day, and it’s hard to keep track of what each one does or how you can use it for your benefit.
While some companies are willing to take a leap of faith to try something new, others prefer sticking with tried-and-true methods – which means they’ll stick closely within their comfort zone until someone comes along and makes them see reason as far as trying new things goes.
Build Your Team
While most business entrepreneurs think that the right technology is the key to a successful SaaS campaign, the truth is that it’s only one of many things you need to think about.
To maximize your revenue and ensure a better return on investment, ensure that you’re building your team with individuals who have expertise in various areas – not just sales. You should also consider hiring an outside consultant to act as a mentor for your SaaS efforts since they will help identify problems before they happen.
Client-centric process is the key to SaaS success.
For a business to be successful, they need to ensure the customer is always at the forefront of their mind. Whether it’s through creating engaging content or providing excellent service, keeping your clients happy will ensure that you’re going in the right direction as far as revenue goes.
Product should fit your target market.
One of the biggest mistakes SaaS companies make is creating a product without first identifying their target market and understanding what they need.
If you want your sales strategy to be optimized, you need to consider who will benefit from using your product or service before trying to sell them on anything. By focusing on creating something that fits with this niche market, not only are you going to get more conversions – but those customers are also likely going to stay longer as well!
Implement Lean Model
One of the best ways to start generating revenue from SaaS is by implementing the lean methodology.
Before you go ahead and invest in new technology or try out any new sales strategies, you must make sure that your model can be sustained. This means ensuring that you’re hitting all-time highs with each product/service – even if this means doing so at a smaller scale than anticipated.
Begin with the MVP approach
One of the biggest mistakes that SaaS companies make when it comes to their sales strategy is adding too much clutter and not focusing on what’s most important.
After all, nobody wants to purchase a product from you if they don’t know what it can do for them first! To get around this issue, start with creating an MVP (which stands for the minimum viable product) – which will give your customers a taste of what being a client looks like before investing in something more substantial.
While most companies would instead jump into the deep end by investing in expensive sales strategies, it’s important to remember that bootstrapping is always going to be your best bet – especially when you’re just starting.
Not only are you able to build up a client base without having to worry about how much money they’ll bring back at once, but this method also allows you more flexibility as far as testing new things goes!
Focus on inbound marketing
One of the best things about SaaS companies is that they can create a steady flow of income without having to rely on anyone’s source.
While it’s true that many people are still going to come your way by searching for keywords, you can further increase this effect by focusing on inbound marketing – which includes creating content and seeding articles online as well as building backlinks.
Never compromise your customer service.
No matter what, your customers will always be the most important thing – which means that you need to make sure that they’re happy with every purchase.
Some people might argue that this is a waste of money since you’ll never see any results from such an investment. However, it’s pretty easy for someone who has been dissatisfied with their product due to poor customer service (or lack thereof) to switch over and become one of your clients instead! As long as this issue doesn’t happen in the first place, there won’t be anything holding them back.
Smarter Allocation and Budgeting
Even though it might not seem like there’s a huge difference between how much you’re spending on different aspects of your sales strategy, the truth is that some things are going to be more effective than others.
For example, if one thing brings in $100/month and another brings in only $30 – even though they both cost the same amount as far as money goes, you should focus on increasing those numbers rather than throwing everything into advertising. This way, you’ll get better results with less effort!
First And Faster To Market
No matter what you’re selling, it’s always better to get out there first and faster than your competitors.
By doing this, not only are you able to generate a fair bit of revenue before they even have the chance, but you also help solidify yourself as an authority figure in your field – which makes it easier for potential customers to come running.
Collaboration is the Answer
You might think that you need to work alone and in isolation if you want a chance at success, but the truth is collaboration can make your entire business better.
Working together will bring out the best of both worlds, especially regarding marketing! It may be intimidating at first since this kind of thinking isn’t industry standard, but once you get used to doing things differently, there won’t be anything stopping you from reaching new heights!
Focus on Customer Retention
Even though it’s essential to get new customers, you also need to make sure that they don’t go running off with the first thing they find – because this is something that will happen all too often if you’re not careful.
Instead of spending your time and resources on marketing, focus on customer retention! By doing so, there won’t be a chance for them to switch over or abandon ship while still making money from their existing services.
Encourage clients for annual contracts.
No matter what you’re selling, it’s probably a good idea to encourage clients for annual contracts. The reason is that by doing so, not only are they going to feel like their money is being well spent (and isn’t about to disappear), but there won’t be any chance of them forgetting and canceling on you halfway through the year – which can cut into your profits!
Monitor Measurable Metrics
There are many different things that you can do to boost your sales, but you must keep track of the measurable metrics so that you know what works and what doesn’t – this way, there won’t be any surprises when it comes time for performance reviews.
Lead Generation Investment
Lead generation is one of the most critical aspects of your business, and it’s also something that you need to invest in. It’s one of the best ways to warm up customers for the long haul and get them interested in your services, making it easier for you to follow through on their initial interest!
Boost Email Marketing
Email marketing is one of the most critical aspects of your business, and you need to make sure that it’s always at the forefront. Whether you’re reaching out for a follow-up or trying to convert leads into clients, this type of outreach will go much more smoothly if you’ve got an email list!
Whether you’re selling something online or offline, data security is going to be an essential factor. Not only will it help prevent your customers from getting hacked and putting themselves at risk for identity theft (which can really hurt your business), but it’ll also encourage them to do more shopping with you in the future!
Create Shorter Trials
One of the best ways to get people interested in your services is by offering a trial. The problem is that it’s far too easy for them to forget about this offer or never bother taking advantage, which means you’re wasting time and money – neither of which is ideal.
Instead, try creating shorter trials (no longer than two weeks) with an emphasis on convenience, so there won’t be any chance they’ll fall through the cracks.
Value-Based Demos For Products
If you’re selling a product, it’s essential to offer value-based demos that go beyond the features and benefits of your services. This is because people aren’t just interested in what they get with these things – but rather what more they can do by working together!
For this to work, be sure all demonstrations are personalized to each individual so there won’t be any issues at hand.
Embrace Digital Advertising
Digital advertising can help you increase your conversions by quite a bit, but it’s essential to make sure that you’re embracing this strategy rather than staying away. Also, make use of all the channels available (such as Google Adwords and Facebook), so there won’t be any issues missing out on potential customers!
As confident it may seem, in-depth research with a focus on relevant factors can take time. With the help of the perfect team, techniques to limit churn, product to your target market, improve customer retention, and so on, the success of your business becomes more likely.
To maximize your sales revenue, increase your customer lifetime value, and accomplish other goals on the way to becoming a top-performing company in today’s competitive market, these 20 tips are a great place to start – so give them a try!