There is no denying that the SaaS industry is gaining momentum worldwide, as an increasing number of people use SaaS solutions. According to a research report by Grand View, the global Software-as-a-Service market cap was 165.9 billion USD in 2021. It is expected to reach 716.52 billion USD by 2028.
But, have you ever found it difficult to use traditional marketing methods for your B2B SaaS products? Have you been thinking of building differentiated solutions to market your SaaS products?
If yes, then you have come to the right place.
The growing popularity of SaaS implies more competition in the market. As a SaaS business owner or marketer, you must promote your product to spread the word attract new customers and retain them. This is where SaaS marketing comes into the picture.
So, for marketing your SaaS product, you need to follow unique strategies. Acquiring customers for SaaS products is significantly different from retail or B2C customer acquisition.
Therefore to stay on top of the leaderboard of SaaS customer acquisition, you must pursue precise steps to build an effective SaaS marketing funnel. This article will give complete insights into what a SaaS marketing funnel is, and how it is different from other marketing techniques.
We will take a look at the stages of developing a holistic SaaS marketing funnel.
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What is a SaaS marketing funnel? How is it different from other marketing tactics?
A SaaS (Software-as-a-Service) marketing funnel is a sequence of stages and strategies businesses design that a potential customer can go through to become aware of a SaaS product, evaluate its value, and decide to purchase it.
The typical stages in a SaaS marketing funnel are awareness, engagement, interest, conversion, and retention.
A SaaS marketing funnel differs from a traditional marketing funnel in that the conversion stage is not at the bottom of the funnel. The bottom of the SaaS funnel is the retention stage, while the first consumer purchase or download happens in the middle of the funnel.
Instead of getting customers to their first conversion, the SaaS marketing funnel looks at what happens after a conversion. Whether subscribers renew a product? Do they recommend the product to others? What is the lifetime value of a customer?
As a Saas marketer, you will monitor and improve the product you’re building for your users by keeping track of these SaaS marketing funnel KPIs and building a strong funnel. The trick is to keep customers devoted to your goods.
Through the SaaS marketing funnel, businesses design a path to guide potential customers toward the buying process. While building this marketing funnel, the company provides relevant information – addressing customers’ concerns or objections & ultimately, closing the deal.
Five stages of creating an effective SaaS marketing funnel
Although each stage in the SaaS marketing funnel is essential to drive conversions and build brand awareness around your product, understanding your customer journey is the key to building a successful and effective marketing funnel.
Therefore, you must research and tailor your funnel and marketing strategy to align with your customer journey and provide a great user experience.
Let us look at the five stages of the SaaS marketing funnel and the metrics to track to measure their success:
1. Awareness
Potential buyers learn about your product during the awareness stage of your SaaS marketing funnel. They might need to be made aware of their issues or how your business can provide them with solutions.
This stage is usually the first customer touchpoint phase. Here the SaaS marketing team engages through social media posts & search engine results or ads. This phase of the funnel uses various metrics to track the customer. These are website visitors, social media engagement (likes, comments, shares, etc.), bounce rate, search engine ranking, etc.
2. Engagement
Users enter the engagement stage when they return to use your product again and sign up for extra content like an email list or a newsletter. This indicates that they are interested in your content. Staging a call to action (CTA) in the engagement stage is a great way to push your customers to contact your business. Track website metrics like views, clicks, time on the page and number of email signups or newsletter subscriptions.
3. Interest
By the time your SaaS marketing funnel reaches the interest stage, you’ve already developed a relationship with potential customers. They now see you as a reliable source of information, and their interest in your product has increased. Offer a free trial of your product or a “freemium” version here so the users can test it and feel more comfortable paying for a full version.
This stage proves to your customers that your product can solve their problems. By giving them a free trial, you can validate your product’s quality.
Keep a track of the number of users who have downloaded the free version of your product and how many of them are activating the trial by sending messages. This will tell you how many customers are testing out your product’s features during the trial.
These users are more likely to purchase than those who downloaded the trial but didn’t activate it. Consider offering a free demo or customer presentation if your business doesn’t allow for a free trial.
In this stage, you must measure success metrics like the number of free trial downloads, free trial activation rate, and demo requests.
4. Conversion
Conversion is a critical phase of the SaaS marketing funnel where all the efforts begin yielding revenue. Conversion happens when customers start making their first purchase.
In SaaS-based businesses, conversion happens when customers sign up or subscribe to a paid version of your product.
At this stage, ask yourself questions like how many users who entered your marketing funnel reached the conversion stage? Did your churn rate increase or decrease? These questions help you understand if you need to tweak your SaaS funnel to get more conversions. Other metrics to track are conversion rate and customer acquisition cost.
Soliciting customer feedback is a great idea to learn more about your customer journey and how they reached the conversion stage.
5. Customer retention
Retention is the most susceptive stage because of the SaaS product. Other marketing funnels reach the bottom once they have the conversion or purchase. But SaaS business models have to rely on recurring revenue.
This SaaS marketing funnel focuses on bringing existing customers to continue using the SaaS product and making customer loyalty. In this stage, focus on up-selling and cross-selling. One of the best ways to acquire more potential customers is through referrals or positive word-of-mouth marketing. For existing customer retention, the marketing team can leverage discounts, coupons, etc., to show customer loyalty.
Conclusion
The ideal strategy to create a SaaS marketing funnel is to gather as much information as possible about the user experience and solicit customer feedback. Understanding the consumer journey, utilizing marketing funnel tools, and monitoring KPIs will help you do this.
Remember that user-led product development is one of the best methods to promote business growth and foster brand loyalty. Customer loyalty and advocacy will come if you commit to addressing user pain points and developing a successful solution.