5 Important Parts of a Successful SaaS Marketing

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5 Important Parts of a Successful SaaS Marketing

Marketing for subscription software is different from the type of marketing in other industries. While regular components like tracking success and inbound marketing are retained, a few adaptations are necessary to boost interest, conversions, and subscriptions.

Also, SaaS marketing is often tweaked to suit the software in question. For instance, as a B2C SaaS provider, Spotify cannot market its product the same way as HubSpot, a subscription platform. This is why most SaaS providers prefer to work with a marketing consultant to get the best out of their marketing efforts.

However, any SaaS marketing strategy must include these five components to achieve maximum results;

1. Using Free Trials to Entice Leads

The software as a service industry is more compatible with the inbound marketing model than any other industry, thanks to the adoption of free trials. Paying a one-time price is considered a lesser commitment to subscribing to software with a monthly subscription such as HubSpot enterprise or Netflix, irrespective of the charge. Therefore, customers are usually interested in getting a feel of the software before making a long-term commitment.

Free trials provide this excellent opportunity for a test. Customers can access the software and use it for their needs for a limited period. While at it, providers can collect important contact information of such customers as the condition for signing up. This information can help generate leads. Free trials optimized for conversion are a proven lead generation technique for SaaS marketers.

Alternatives to the free trial model include a freemium model, which allows the free use to last indefinitely but without a few features. There are also demonstrations where potential users can see how the solution works before subscribing. However, both options are variations of the primary idea – offering a limited version of the software to potential customers to generate SaaS leads.

2. Converting Leads to Subscribers

Leads are only useful when they convert to subscribers. This is only possible when you nurture the leads gently towards the ultimate aim – another important marketing concept that works excellently with a SaaS product.

The goal of lead nurturing is to gradually establish your credibility with your audience by sending regular and valuable messages to them. This prepares their mind until they are ready to become your customers. The first step in converting leads to subscribers is offering a free trial.

While the traditional lead nurturing doesn’t follow a timeline, the SaaS version does. The lead nurturing must only last as long as the duration of the free trial. The chances of conversion decline if there is no action by the user at the end of the free trial period.

There are different ways to integrate nurturing, including tutorials on software features, industry trends, and regular content that portrays you as an authority in your niche. Unlike traditional lead nurturing that focuses on email messages, the SaaS model includes introducing links to webinars and blog posts to increase the chances of conversion. Establishing a personal connection towards the end of the trial can also boost commitment chances.

3. Retaining Subscribers for The Best Value Possible

Now that you have subscribers, the next step is retention. A subscription software only thrives when customers are willing and ready to make regular payments for as long as possible. Here are some proven ways of improving retention rates;

  • Increasing price to increase the expected value
  • Effective customer interactions
  • Quality engagement from the point of subscription
  • Continuous nurturing after subscription
  • Providing valuable content to improve user experience
  • Rewarding long-time subscribers via loyalty programs
  • Encouraging long-time subscriptions through goals
  • Offering quick responses to subscribers’ complaints

It’s all about building a sterling relationship with your customers. Subscribers often expect more personal and regular contact with brand representatives from their long-term software providers than the one-time providers. Hence, they are as important as your potential customers, if not more, and working by this is the only way to maintain a high retention rate.

4. Cross and Upselling Opportunities

Another way to increase retention is by regularly providing subscribers with an improved and updated version of your software. Alternatively, you can add a new offer to your brand catalog. These processes are called upselling. Cross-selling, on the other hand, means selling a new software package to existing subscribers.

Both concepts are crucial to the success of your software marketing campaign. Studies have shown that targeting existing customers is easier than trying to sell to new customers. Upselling and cross-selling are relatively cheap to run, despite their enormous potentials to improve the profitability of your SaaS software over the lifetime of an individual subscriber.

5. Monitoring your SaaS Success Metrics

A successful SaaS marketing strategy requires adequate monitoring of your progress. You need to see if and how your efforts are working. Here are some excellent metrics you can use to track the success of your efforts;

Churn rate or cancellation rate, which is calculated monthly and annually. The difference between the churn rate for both periods can help you determine if your subscribers are leaving at an alarming rate.

Average Monthly Revenue is calculated per subscriber and shows how much each subscriber is worth in a month. You can use this to plan out your monthly budgets.

Cost Per Acquisition is the amount of money spent on getting a new customer to subscribe. It includes the marketing and sales effort cost and can be estimated as an average by dividing the entire cost over a specific period by the number of subscribers recorded. This metric is closely connected to the 4th metric.

Customer Lifetime Value is the average amount a customer is worth to you over the lifetime of their subscription. It is calculated by multiplying the average monthly revenue by the average duration your subscribers stay subscribed. It is the most efficient method of estimating the true worth of a subscriber, considering you can easily determine how to spend your marketing budget. For best results, your CLV should never be lower than your cost per acquisition. 

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