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How SaaS Marketing is Different from Traditional Marketing

How SaaS Marketing is Different from Traditional Marketing

Syd Harris
October 26, 2021

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The Software as a Service (SaaS) industry is innovative and competitive. Which makes the process of promoting software unique, even if the marketing methodologies and tools are similar to ones used for traditional marketing. A big difference between traditional and SaaS marketing is the customer base. SaaS tools are generally targeted to other businesses and the market is intensely competitive. Businesses in our modern digital world use dozens of software tools every day. Which makes getting in front of the right audience and capturing their attention even more challenging (hello, inbound marketing 👋).  

The Growth Hack Funnel Model

In order to address the intensity of the SaaS marketing and sales lifecycle, many SaaS companies take a growth-hacking approach. B2B SaaS companies often use a more specialized funnel called the AAARRR funnel, also known as the pirate funnel. AAARRR stands for Awareness, Acquisition, Activation, Retention, Revenue, Referral. Let's dive into how this model helps SaaS companies see results.

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Awareness: This stage is all about creating interest and gaining visibility. Inbound marketing is the main focus at this stage, and is an important asset when it comes to gaining organic traffic to your website.

Acquisition: This is generally described as the company’s first interaction with a prospective user. This may look like a lead showing interest by asking for more information or providing contact details. Once the lead engages with the funnel, they can be nurtured to the next funnel stage with targeted communication.

Activation: For SaaS companies, this stage more often than not involves promoting a free trial period for the user. The idea is to give the user a “test drive” by giving them a glimpse of how to use the software service and how the functionality can work to meet their needs. This also gives a lead the opportunity to ask more questions about scalability, implementation, and customization. This stage often relies heavily on marketing automation and multi-channel communication.

Revenue: After the free trial has expired, the customer has to decide whether to keep using the software. The most important aspect to realize during this stage is that your marketing work does not stop here. Throughout the Activation and Revenue stages, you should be regularly engaging with your lead to answer any questions or concerns about how your software can solve their problems. Once a lead decides to keep using your software, they've entered the revenue stage. 

Retention: Retention is all about making sure your customer stays happy. The best way to achieve this is to provide excellent customer service and product support. For marketers, this means a continual level of interaction to ensure a positive user experience and improve on your communication. Customers in the bottom stages of the funnel are ideal opportunities to gather user data about your product, messaging, brand, interface, etc. 

Referral: A happy customer is on their way to becoming a loyal customer. These are the customers who may advocate for your product or service within their organization along with recommending your software product to others in their industry. The value in referrals lies in the fact that existing customers will provide new prospects with unbiased evaluation and credible information, shortening the sales cycle.

This process of evaluating your lead's pathway to conversion is called the Buyer’s Journey. Understanding the journey your customers travel to become satisfied customers and regular product-users is vital to your messaging, focus, and tactics used in the early funnel stages. 

What is the Buyer's Journey?

The Buyer’s Journey focuses on the entire lifecycle of the lead — which does not end when the lead becomes a customer. Due to the nature of the SaaS industry, companies are constantly competing for their spot in the marketplace. SaaS companies thrive when you're able to retain your customers for extended periods of time and compound growth by adding customers without losing existing users.

Because the SaaS buyer is empowered by the wealth of information available on the internet and does a great deal of research before even reaching out to a real person, it is a must for SaaS companies to not only share information that helps them make their decisions (*ahem* pricing included) — there must also be education and problem solving involved.

buyer-journey

Timing is Everything

SaaS marketing needs to react to the needs of the industry. Timing is everything as you provide prospective buyers and current users with what they need when they need it. The technology industry changes regularly, with innovation, updates, and expanding technologies affecting the way you talk to leads and the service needs of your SaaS product.  

To take this even a step further, in order to truly stay ahead of the game, SaaS companies will often start marketing and selling products and services that do not fully exist yet. This model requires constant improvement and innovation to your services to prevent churn. For SaaS companies, existing customers are the best leads. In-house innovations mean that you may have new products or features to offer to existing customers — the ones you already know are interested in your products. This increased importance of customer retention makes it so that the synchronization between customer support and marketing has become extremely important. Depending on how we look at it, marketing is not just there to support the product. It is part of the product.

A great example of this is HubSpot’s Blog. HubSpot produces a large amount of high-quality content to function as a knowledge base to support their customers, but also as a way to attract new customers. HubSpot's blog posts range from very specific solutions for their extensive software platform to general “how to” topics related to their industry. By constantly creating useful content, HubSpot has been able to create a brand, service, and product that provides an excellent source of information for their customers, as well as attracting new customers, all outside of their actual SaaS platform. 

Customers Already Know What They Want

Because the Referral stage is such an impactful part of the SaaS sales cycle, customer support becomes a very big part of ensuring your product is a success. Similar to your blog functioning as a resource and informational tool, customer support can and ideally should function in the same way.

Because of the constant competition in the SaaS industry, a great user experience is equally important as functionality. A great user experience often equates to a shallow learning curve, making it more likely for people to make a start with your product or make a switch from another software service to yours. And good user experience isn't limited specifically to your actual software. It includes documentation, onboarding, your knowledge base, and any other resources you can offer your user to improve their usability with your product.

This intricate relationship between sales, marketing, product, and customer support creates another unique aspect of SaaS marketing. Great customer support includes maintaining an extensive and comprehensive knowledge base. By paying attention to the questions that are being asked throughout your funnel and the problems or updates that users are identifying, you can constantly improve your software according to the needs and desires of your customers.

SaaS Marketing in Practice

In conclusion, SaaS marketing is different from traditional marketing because the lines between sales, marketing, product, and support are blurry. The scope of your product is complex. The SaaS industry is continually innovating to create products and services according to the needs of customers. Customers already know what they want, the question is: how well are you meeting their needs?

Looking for SaaS marketing in action? Check out our Growth Driven Design (GDD) program. For SaaS companies who have existing content, conversion pathways, and powerful products — how you're sharing that information on your website can have a big impact on whether leads and customers can find the information they're looking for. With GDD, we test, optimize, and iterate website functionality, infrastructure, and content to see what's working best and what can be updated to work better. 

Growth Driven Design Websites