Building a SaaS product is just a single first step on the road to success. The UX within your product is vitally important, but so is the path to purchase that you create for potential customers.
The way you price, market, and sell your software is the real key to a successful SaaS company, and it’s also a common stumbling block for CEOs and founders. Understanding the concept of a low-touch SaaS model and, more importantly, how to execute it successfully can have a huge and immediate impact on your growth.
What are low-touch and high-touch SaaS models?
A low-touch SaaS model means selling your product to prospects with minimal person-to-person interaction. Common features of a low-touch SaaS model include offering free trials of the product as the primary sales method (usually promoted through digital marketing and email marketing) with the in-product experience optimized to encourage the prospect to purchase, often directly within the product.
High-touch SaaS model follows a more traditional approach to selling and marketing.
In contrast, a high-touch SaaS model follows a more traditional approach to selling and marketing. Salespeople receive leads from marketing or engage in cold calling to book demos and follow-up meetings in order to close a sale.
Many companies employ a combination of the two models. They might start with a low-touch approach and graduate to a high-touch model for larger accounts in order to land and expand a contract.
Low-touch SaaS vs. high-touch SaaS
Many low-touch SaaS products are commonly sold at different pricing tiers, e.g. basic, premium, and enterprise-level pricing. Users can see from a list of product benefits which plan is most suitable for their needs and purchase accordingly.
High-touch SaaS models, on the other hand, often leave a lot of discretion in the hands of the salesperson to tailor packages for different customers. This makes it more effective for targeting enterprise-level clients who could potentially be looking for licenses for hundreds of users.
Low-touch SaaS models often use metrics such as conversion rates from free trial to purchasing to measure their success. But, as a CEO, it can be difficult to know how your conversion rates measure up to the competition.
If your low-touch software does not require a credit card to sign up for a free trial, you should be looking for a 1 to 2+% conversion rate from trial to purchase. Software that does require a credit card to sign up for a trial typically sees a much higher conversion rate from 40 to 60%.
High-touch models, however, are more likely to look at benchmarks such as MQL to opportunity and close rates.
Low-touch SaaS software employs in-product features to provide a seamless experience from free trial signup to product usage and purchase. Tooltips, pop-ups, a well-developed knowledge center, and seamless UX throughout the path to purchase are key.
On the flip side, high-touch SaaS uses much more involvement from sales executives and a client success team to onboard new customers and support them in exploring and using the product.
The free trial is the cornerstone of low-touch SaaS models. Whether it requires a credit card to sign up or not, the product does all the talking. Marketing may support the free trial with drip email campaigns to encourage product usage and stickiness.
Conversely, most high-touch models use customized demos and multiple touchpoint calls to show off the product, assess product-prospect fit, and close the sale.
High churn rates in any SaaS model can often be traced back to a poor onboarding experience. Onboarding and activation are critical, even in a low-touch model, to deliver value as quickly as possible. This immediately validates the purchase for your new customer, reduces churn, and increases the likelihood of upgrading or expanding the account in the future.
Onboarding and activation are critical, even in a low-touch model, to deliver value as quickly as possible.
For low-touch models, automated email marketing and in-product messaging and guidance are critical components of customer success. If you’re doing low-touch right, this should be all the connection your prospects and customers need.
High-touch models typically use in-person interactions with the customer success team to onboard and activate the account. This can include onboarding calls, product training, and dedicated support personnel for each account.
Examples of low-touch SaaS vs. high-touch SaaS models
Low-touch SaaS model example
A great example of a low-touch SaaS model is Jamdoughnut, our long-time client. UK’s No 1 cashback app collects and analyses user transactions via OpenBanking APIs, and works out where users can save money by buying and spending rewards within the application.
Since successful onboarding and activation are essential for low-touch SaaS products, we designed and built the whole platform using customer success tactics that act as multiplicators, such as:
- Minimizing the time to value to achieve a quick win.
- Leveraging the built-in referral system to boost customer acquisition and lower its costs.
- Using notifications and email marketing to increase retention and reduce churn.
Building the product around the above resulted in exponential growth in active user count and increased per-user spending on the platform.
High-touch SaaS model example
An example of a high-touch SaaS model is Reachbird, an influencer marketing platform we have been building with the founders for many years.
The entire onboarding process, including the website, and all CTAs, is geared toward encouraging visitors to schedule time with a live person to learn more about their pricing, product benefits & features, and packages. During this demo, Reachbird can show how their SaaS platform will generate ROI and answer any questions that might come up.
Knowing their customers and engineering product onboarding to fit how they buy help Reachbird become the leading influencer marketing platform in Europe and part of Adesso Group.
Building a low-touch SaaS product
Making a success of low-touch SaaS requires careful and precise execution of an exceptional free trial, purchasing, and onboarding experience for your prospects and customers. At VeryCreatives, we provide all the guidance and expertise to help you make decisions while we execute the work.
Check out some of the revenue-generating apps and software we’ve built for our satisfied customers here. And if you’d like to learn more about SaaS business models, take a look at this article on SaaS pricing models.