If you are a SaaS company who is committed to marketing, you:
- Try to do whatever possible to stay ahead of the curve with inbound and interruption marketing.
- Strive to be effective as possible with lead generation, lead nurturing, conversion, retention and growth hacking.
- Realize that marketing expectations from clients are greater than your ability to satisfy.
- Have just a handful of overworked employees that represent your marketing department.
You are often left with a disjointed approach that includes multiple vendors, inconsistent messaging, and hundreds of marketing initiatives that are only 30 to 40% complete.
Meanwhile, your team and your C-Level employees are tapping their feet wondering when your SaaS marketing engine will turn into the marketing machine that you were hoping for when you had your quarterly board meeting.
Why Is SaaS Marketing So Difficult?
Let’s break it down to size:
- Problem 1: The Financial Mismatch
- Problem 2: Silver Bullet Marketing
- Answer: Systems not Solutions
Problem 1: The Financial Mismatch
Before SaaS companies were “a thing”, technology companies used to create software where they charged their full asking price upfront.
That had its advantages and disadvantages.
The advantages are that when you actually made sales, you had more capital upfront to work with than you currently do with modern SaaS pricing models.
For example, if you look at a software product like Adobe Photoshop, the cost of this product before they went to a monthly recurring payment model was between $400-$600. That means Adobe had $600 per sale added to its top-line revenue.
The downside of this revenue model is that a $600 piece of software becomes a big financial barrier to potential customers.
Therefore, they decided to modify their approach to a monthly fee of $20.99 monthly payment.
The bean counters at Adobe realized that in the long run, they would sign more new clients and retain them longer if they have a lower barrier of entry.
Another illustration of this model is Planet Fitness. In Philadelphia, there is a Planet Fitness in every town. The gym experience is average at best. However, they have made the pricing a measly $10 a month.
The reality is that people rarely go to this gym regularly. But, Planet Fitness is smart enough to know that paying $10 a month is less of a pain in the butt than canceling a membership.
The same concept applies to SaaS companies like Adobe, who now charge $21 a month for Photoshop, knowing that nearly every company in the world has that kind of money to invest in their SaaS marketing budget.
But if you’re a startup SaaS company operating with seed capital or funding that comes from your own pockets or those of your parents, friends, or family, the financial issues that arise from the measly monthly payments can be quite significant.
SaaS Financing Before Reaching Critical Mass
With a low-cost recurring payment model, it might be exciting to get a new sale knowing that the lifetime value of a client might be $600-$1000 in the long run. But, if their monthly payment is $20, that doesn’t go very far. Your business needs cash flow to survive, operate, and thrive.
To make matters worse, if there’s any customer service involved in that initial sale, it might be two or three months before you recoup your time investment. And let’s be clear: time is money.
As a subject matter expert in SaaS marketing, we understand the cash flow challenges that our clients face.
We understand that reaching a critical mass in dependable monthly revenue in new client income as soon as possible is essential for the sustainability of your company in the long term.
If we know that the financial dynamics of running a low-cost recurring payment model can be a challenge, we need to figure out how to reach our clients’ expectations so that you retain their payment, and they help promote your business as loyal fans (something we call brand ambassadors).
Satisfying Client Expectations
Getting to critical mass is the concept where your company has enough regular paying clients to sustain your expenses, payroll, and growth goals. However, that can be a tall order for a start-up company even if it has significant funding, so it is essential not to waste time/money.
Traditionally, companies adhere to what we call a reactive marketing strategy. Reactive marketing is a series of sprints and slow periods throughout the year. For example, you might sprint to be ready for a trade show and then do nothing with your marketing for several months. Or, you sprint to be ready for seasonal events that are followed by periods of inactivity.
Enter the solution: proactive marketing.
Proactive marketing is built on the concept that your team is pumping out thought leadership content on a consistent basis. That way, management knows what content is going out in the next 30 days, 60 days, 6 months or even a year. It is designed to be consistent to show steady progress while at the same time being nimble enough to fit in items that come up throughout the year.
Picture proactive marketing as somebody who faithfully works out at the gym for six days a week according to their personalized workout plan. Then, picture reactive marketing as someone who goes to the gym once a week.
Who do you think will make more progress towards their fitness goals?
In the SaaS world, proactive marketers consistently work on the marketing system as if they are building a machine. Once the machine is built and running systematically and predictably, the results are often substantial.
For nearly 20 years, Farotech has been helping SaaS companies move from a reactive marketing approach to a proactive SaaS marketing approach.
To accomplish this, we teach our partners to stop looking for SaaS marketing solutions and to start looking to develop a SaaS marketing system that is predictable, dependable, and transparent.
Problem 2: The Silver Bullet Marketing Approach
Before I start explaining the silver bullet marketing approach, you need to know that it never works.
In the silver-bullet approach, your company often strives to excel at marketing in one or maybe 2 channels. This approach is commonly not intentional and is often born out of issues related to bandwidth.
If you find yourself saying things like, “If only we were on the first page of Google for critical keywords, then all of our lead generation problems would be solved,” or saying the same thing about social media, paid advertising or video-based SaaS marketing, then you are falling into the trap that is the silver bullet approach.
There are a lot of problems with this approach. The biggest one is that you don’t own the platforms that you’re marketing through–meaning that it is quite possible that you’re one algorithm change away from understanding the concept of “building your SaaS marketing house on sand.”
And these algorithm changes happen so often that the marketing industry literally tracks these changes into something similar to a weather report. This report is called MozCast
To avoid falling into the silver bullet trap, you need to create a digital marketing system.
A digital marketing system is an alternative to a standard marketing approach, so let’s unpack it.
With this approach, all of the critical parts of marketing are handled under one roof by utilizing a strategic partner who is a subject matter expert in SaaS marketing.
When done properly, an agency with a team-based approach will know how to cut the critical time-saving corners to keep your SaaS marketing budget productive.
When a SaaS marketing plan is done right you will:
- Understand who your buyer personas are and how to effectively reach them to get the right message, to the right client at the right time.
- Identify what user personas will have retention challenges and have pre-planned strategic approaches to combat cancellations.
- Understand your platform’s usability and understand where conversion originates.
- Have brand consistency between your website and your platform.
- Apply heat mapping, scroll mapping, and click mapping to understand where user’s eye movements, and mouse movements are going on your website/platform.
- Identify your SEO traffic potential and compare it to your competitors or industries/products with similar offerings.
- Identify the critical buying keywords to use in conjunction with SEO.
- Use effective content marketing strategies to understand your buyers’ journey as they transfer from awareness to consideration to decision.
- Install marketing automation platforms, such as Hubspot, to understand where your potential clients are in the buyer’s journey, how to lead-score them, and how to monitor their engagement.
- Consistently segment your audience to systematically drip market to potential candidates with pre-written emails that have to do with:
- Features and benefits
- Cost of procrastination
- Case studies
- Frequently asked questions
- Next offers
- Develop a social media approach that maximizes your organic messaging to work seamlessly with your engagement strategy.
- Integrate paid social media ads to put a pixel on your potential clients’ devices, so you understand the exact demographics. Then, you methodically reach out to similar audiences.
- Implement retargeting campaigns so that users who have come to your website get targeted ads based upon the parts/products on your website that they have visited most.
- Connect your system with an analytics tool that allows your organization to make data-driven decisions about your marketing.
- Implement a paid ad strategy that uses the right platforms to reach the right target audience.
- Understand the delicate balance of maximizing your impressions, click-through rate, and conversions at the lowest cost possible.
- Repeatedly analyze and measure each part of this process through A/B testing and multi-variant testing to understand what’s working and what’s not.
- Understand how to marry customer service with technology using sophisticated ticketing systems so that you can build a system around the concept of QWASI (Questions With Answers and Simple Information).
- Develop a knowledge base so that your existing and future clients understand how to get information quickly and effectively.
- Have a system to growth hack your platform so that your existing clients become your raving fans and best salespeople.
- Have made user experience paramount.
That sounds like a tall order, but it doesn’t have to be. When working with a team-based agency, your company’s marketing director becomes a quarterback using the battle-tested system mentioned above.
Where do you start?
You need support. You need a team-based agency.
The number one issue that separates a below-average marketing agency from a great SaaS marketing company is understanding clients’ needs inside and out. That starts with a Gap Assessment.
If you’re looking for a SaaS marketing company and they give you an estimate without a Gap Assessment, they are just guessing. It takes our team months to deep dive into our clients’ needs, goals, visions, and challenges.
Why is a Gap Assessment so long? Because we don’t believe that a marketing agency can make an accurate quote/proposal on how to transform your marketing until they have taken significant time to analyze your goals, vision, set up, and existing marketing.
Would you go to a heart surgeon if he insists you need surgery after a simple check up? Most likely not. This is no different.
A Gap Assessment is a proven process that we implement with our clients to develop a 3-5 year roadmap to 5x or 10x their sales and opportunities.
Interested in seeing what a Gap Assessment looks like? Click here to get one now.
Conclusion: Marketing Done Right
Ask yourself hard questions to see if your SaaS marketing approach is moving in the right direction.
Do you have a clearly defined 3-5 year goal with all of the KPI’s outlined to get there?
Consider whether you are falling victim to the silver bullet approach by putting all of your hopes and dreams into one channel.
Be certain that you understand the difference between SaaS marketing solutions and a SaaS marketing system.
If you’re interested in dramatically increasing your sales and business opportunities, consider getting a Gap Assessment for your company.