SaaS companies need customers in order to survive. As competition ramps up in the industry, the need for a more strategic approach to attract those customers has been heightened. Those who understand this and take action early can get ahead of the competition and create lasting success for themselves while satisfying their customers in the process.
SaaS customer acquisition in 2022
Despite the stressors at play in years prior, the SaaS market has continued to grow. Given the incredible adoption rate of SaaS technology among companies of all sizes, it isn’t difficult to see why. Some 80% of businesses were found to be intentionally shifting all of their systems to SaaS alternatives by the year 2025. Couple this information with the fact that as many as 99% of businesses have currently adopted a SaaS solution, and it should become apparent that the industry’s growth rate is as strong as ever. However, industry-wide growth alone won’t guarantee your company can land sales or acquire new customers.
Marked growth in the industry has proven to be both a strong indicator of interest among customers and organizations in need of cloud solutions as well as a glistening invitation for new founders to get involved. The rapid influx of founders has led to a glut of options across most niches in the SaaS industry. Across market segments, competition has grown fierce and SaaS startups have found it increasingly difficult to distinguish themselves from all of the noise. As many as nine other alternatives existed for each individual startup in the space all the way back in 2017. Competition has only gotten steeper since then. Companies looking to differentiate themselves among a sea of competitors attempting to do the same have run into a series of common challenges. Solving these challenges unlocks the potential for profitability, but it’s no small task to take on.
Primary challenges
Costs
Your company’s choice of pricing strategy can make or break its performance at market. Naturally, setting prices too high can potentially scare great customers away and trying to get a foot in the door with especially low prices can quickly undermine your profitability. Adopting a reasonable pricing strategy involves taking the time to research what your competitors are doing and what your customer base might actually expect from you. Once you have a good idea of your audience’s expectations and your competitors’ approaches, you can choose any number of pricing models.
There are three well-known pricing strategies worth considering for SaaS purposes. These are competitor-based pricing, promotional-based pricing, and value-based pricing:
- Competitor-based pricing leverages your competitors’ prices to decide your own—a useful approach to take when you have yet to collect much information about your audience.
- Promotional pricing lowers your solution’s initial price to encourage leads to give it a try. This works well in some cases, but dragging out the promotional period is likely to leave your customers doubting the actual value of your digital service.
- Value-based pricing can be super-effective or a total flop of a technique, depending on your ability to convey value to your audience. This approach relies on your ability to gauge customer opinion at speed and adapt your offer to match.
Competition
Competition is a powerful thing, pushing companies to innovate and deliver more to their customers to carve out their fair share of the market. However, competition has a dark side as well. Amid mounting competition, many companies are finding themselves desperately struggling to prove their worth to customers who can choose a valid alternative at any time.
Competitive analysis can be beneficial for fledgling SaaS companies looking to identify the value propositions that their top competitors are using to win over customers. Researching and analyzing the actions of your competitors can also clue you in to any similarities your organization may have to other service providers, allowing you to alter your course as needed for increased differentiation.
Security and privacy
SaaS alternatives to on-premises tools and techniques make for a particularly attractive value proposition. However, the removal of on-premises solutions also opens companies up to a whole new slew of vulnerabilities in the form of less oversight and dramatically reduced control over data.
The way data is managed matters more than ever before, owing to significant regulatory challenges in major markets such as the EU, where the GDPR (General Data Protection Regulation) rules now apply. Organizations in health and medicine niches may also have to contend with HIPAA (Health Insurance Portability and Accountability Act) laws governing the way in which individuals’ medical records are stored, transferred, and accessed.
Data privacy and general security are essentially mandatory for companies in certain niches, and customers looking to adopt new SaaS solutions are decidedly more likely to ask questions about these details before they make a final decision regarding paying for your offer.
As you can see, the challenges laid out above are enough to warrant a measured approach from business leaders as pertains to not only general growth but the acquisition of new customers as well. That’s where having a legitimate SaaS customer acquisition strategy in place comes in handy.
Mapping out a SaaS customer acquisition strategy
Acquiring new customers is never an easy feat, but it definitely doesn’t need to be an impossible one either. SaaS customer acquisition follows the same steps most companies have followed for years—from garnering early attention and interest to bridging the gap between engaged leads and paying customers. Here are each of the steps you’ll need to accommodate in a bit more detail:
Building awareness
Awareness is the first step toward profitability and closing a sale. After all, customers can hardly be expected to purchase products and services they don’t yet know exist. A reasonable SaaS customer acquisition strategy should focus on marketing efforts for this first, crucial step. All types of tactics are fair game in marketing, including mainstays such as building out an email list (and communicating with subscribers via regular updates) to social media posts and paid ads on multiple platforms.
For steady results that are viable over the long term, search engine optimized content can be created, boosting your web presence for search terms that are relevant to what you offer your audience. Your primary goal should be to cast a wide net and capture the most relevant leads you can on a regular basis.
Nurturing engagement
Next up, after getting your prospects’ attention, you should concentrate on getting them to take action in interacting with your brand and the service you offer. Engaging your audience galvanizes them into valuable, active participants in their relationship with your company. This active stance is vital for generating results in the form of inquiries, requests for information or new features and, ultimately, sales.
Offering a wealth of content choices for interested leads to consume can go a long way toward boosting their engagement, as can actually listening to (and implementing) their suggestions and tailoring the onboarding experience to fit their needs.
Encouraging exploration
As leads become more engaged with your brand, you should seamlessly encourage them to explore the solutions you have on offer. This can be as simple as directing them to your pricing or sales pages, but it can also be the perfect moment to offer them a free trial to get started actually using your product. As leads become more familiar with your product or service, they soften up to the prospect of paying for all of its features. Ensuring they can derive the maximum benefit from your solution can help guarantee a better portion of them will ultimately convert.
Converting leads (and keeping them!)
Finally, upon guiding your prospects through each of the previous stages of your SaaS customer acquisition strategy, you can focus on landing the actual sale. However, even the sale itself shouldn’t be seen as the end of the line. Retention is equally important and worthy of your utmost attention. Loyal customers form the bedrock upon which all successful businesses are built. For SaaS companies, this is doubly true as subscription monetization models are often used instead of other pricing options.
Expert strategy examples
Here are a few good SaaS customer acquisition strategy examples to consider implementing:
Aim to be more customer-centric
Recenter your organization’s focus on solving users’ problems as effectively as possible. You’ll need to champion your customers’ concerns and push for complete customer success to seal the deal and earn their loyalty. Streamlining communication not only between your brand and your customers but also between team members and divisions within your organization is a great way to make this happen.
Leverage automation at key moments
Interaction at key points of the buyer journey is essential for winning over discerning leads. Automation opens the door for more personalized experiences and timely outreach. It also makes retaining key users quite a bit easier too.
Refine your conversion strategy
Help customers caught on the fence to embrace your service by guiding them to the solution they’re looking for. This is essential for creating an actual customer base as opposed to letting leads languish without proper direction just as they’re considering signing up.
Show some proof
Going where no one has gone before can be daunting, especially when the trip isn’t free. Prospective customers considering your offer are likely to respond well to a well-placed display of those who have gone before them—other brands and buyers who have chosen your solution and benefited from it. A whopping 31% of all customers are positively impacted by the sight of a great review. Positive reviews spur cautious customers to give new products and services a go so they don’t miss out on a good thing.
Adding a review section to your sales page can bring immensely positive results without coming across as pushy or disingenuous. Combining simple star ratings and testimonials with full-fledged case studies can net you new customers who may not have otherwise given your company a go.
Seek a dedicated partner
For best results in acquiring more customers and keeping them hooked on your services, it helps to have an expert on call to guide your efforts. At VeryCreatives, we help startups and digital product companies to align their actions with their growth objectives. Book a call today to learn more about how we can help your business succeed.
