SaaS Marketing

Recently you might have come across a lot of job notification that focus on SaaS and SaaS marketing, and the notifications specifically mentions that the applicant must have a mentioned set of skills to work for the organisation. 

So, today we will look into "What is SaaS", "What is SaaS Marketing", "How SaaS Marketing is different from others", and "How to design a Strategy"

What is SaaS?

SaaS - Software as a Service is a software licensing model in which access to the software is provided on a subscription basis, with the software being located on external server/cloud rather than on servers located in-house. In this model, an independent software vendor (ISV) may contract a third party cloud provider to host application.

SaaS is one of the three main categories of Cloud Computing, alongside Infrastructure as service (IaaS), and Platform as service (PaaS).

SaaS offers a variety of advantages over traditional software licensing models. It is easy to implement, easy to update and debug, customisable, and can be less expensive. 

Looking at this you might feel SaaS is perfect, but with the advantages also comes disadvantages.  SaaS removes burden for organisations to install and run applications on their systems or data centres, it eliminates the expenses of hardware acquisition, provisioning and maintenance, as well as software licensing, installation and support, but, the disadvantage here is, as business is relying on outside vendor to provide software services, there is a potential risk of security breach and other challenges. 

Examples of Applications 

    - Email Services

    - Auditing Functions

    - Automating sign-up for products and services

    - Managing documents, including file sharing and document collaborations 

    - Shared company calendars which can be used to schedule events

    - Customer Relationship Management 

Examples of popular SaaS Products

    - Salesforce

    - Google workspace apps

    - Microsoft 365

    - HubSpot

    - Trello

    - Netflix

    - Zoom

    - Zendesk

    - DocuSign

    - Slack

    - Adobe creative cloud

    - Mailchimp

I hope you understood what SaaS - Software as Service is. Now let us look into SaaS marketing - the most seen job notification in recent times.

What is SaaS Marketing?

SaaS Marketing is a type of marketing that focuses on promoting and acquiring leads for subscription-based products. Compared to business with physical products or one-time purchase, SaaS business need to continuously prove to their current customer and prospective clients that their services are worst their time and money.

How SaaS Marketing is different from other products or services marketing?

We all know Marketing is hard, but do you know how hard it is to market something that is not visible or has no physical presence, or market something that is constantly changing or progressing.

I guess by the question itself you have understood how different SaaS marketing is.

Marketing has its own set of rules when it comes to SaaS. In this domain, potential clients research (online) and then buy services, which means driving people into free trails and demos are crucial and first step to connect with a prospect.

Reason: Give away a free product or service is one of the most standard and widely accepted SaaS marketing strategies. Free trail is a strategy for SaaS customer acquisition and onboarding.

The biggest challenge in SaaS Marketing is not just sale, because sale is just the start. Onboarding, Churn Rate (the annual percentage rate at which customers stop subscribing to a service), growth hacking, and wealth calculations around the ROI create a challenging landscape.

Reason:

    - Lifecycle is remarkably short in SaaS world, one year is like an eternity

    - The cost now to develop and market software has decreased. This has led to new entrants into the market. (Competition).

SaaS marketing success rests on laying strategic foundations. You might think and certainly be tempted to think SEO and Social Media Marketing is enough to marketing your SaaS, but know that marketing tactics depend on a number of factors including the state of awareness of clients, who you are targeting, vertical specifications, the price point to name few and so on. Keep in mind, your greatest asset is your information.......It's amazing how foundational this is, yet how often overlooked.

SaaS Marketing Strategy:

According to few there are many types of marketing strategies for SaaS, and the principle of success remain the same as any product or service, but, I feel, building a strategy must be as unique as the SaaS solutions. 

The strategy must focus on "How your SaaS is solving their business problems", "Educating them around that point", and "Creating empathy", than the jargon and financial aspects.

Reason:

The Value propositions have changed. The clients focus has shifted. They are aware of the technology. So, your marketing's key messages have to move substantially beyond finance and technology concerns like others. This is not something that can be addressed with simple tweaks to your competitors approach, you need to strategically re-think the way your business markets its solutions. Either developing a strategy from scratch or redeveloping legacy plans will help you win over the competition, define target market and establish positioning, and USP. 

I know, this process looks like an humongous task, but a good starting point is to plan all the marketing activity that you want to undertake on a time scale basis (monthly or quarterly basis). This ensures your marketing is well through and avoids the pitfalls of being reactionary or ad hoc. It prevents activity from being perceived as tactical without direction. 

The quickest way to ensure your strategy is effective is to map frequent (monthly) activity to an overall strategy, and this rests on understanding the costs of securing a new customer.

There are three key metric you must calculate to create a successful demand generation model for SaaS,

    - CAC - Cost of Customer Acquisition

    - LTV - Lifetime value of a Customer

    - ROI - Return on Investment

While there is no specific rule, the general recommendation would for LTV:CAC is 3:1. This is the ratio of customer acquisition cost to customer lifetime value. This metric shows the relationship between the cost of acquiring a customer versus the value attributable to that customer. The smaller this number is, the better. Because customers don't have to commit, SaaS marketing have to focus as much(or more) on retaining existing customers as they do on acquiring new customers. 

Apart from the above mentioned you must,

• Focus on constantly optimising the website conversion rate because, the website is the heart of any marketing strategy and the window to your organisation. 
• Focus on showcasing your expertise because, once your website layout is optimised, your next challenge is to perfect the powers of persuasion around your solution's capabilities. The unique feature that differentiates you.
• Focus on the benefits and less on Jargon. To you, your software is built on great technology but for a client who is not from an IT background it is a big turn-off when you try to explain its greatness. For him how your solution is making his organisation grate is important. So, you must focus on customer benefits and answer "What's in it for customer", "What are the benefits of your system to their business", "What plus points does it offer to clients", "Why does it save people money or make them money", to name few. 
• Nurture your prospects because, SaaS products can take time to sell. Some of your prospects may come to the website many times before they contact your company or signup. It's highly likely that they are also regular visitors to competitors sites, so you need to keep evaluating and updating your website.

I hope you have understood What is SaaS and What is SaaS Marketing. You will understand more clearly once get into the field. But the main thing you need to focus in SaaS marketing is "Information". Information about clients needs and competitors strategies that will give an edge over the others.