Optimizing your SaaS sales funnel is one of the best ways to improve software-as-a-service efficiency. This will allow you to accompany a potential client at all stages of becoming a partner and form your own user-oriented model. If you want to learn how to design a funnel for SaaS companies and make your business more profitable, take just a few minutes. “Around Web” will help you understand the nuances of building a sales funnel for SaaS.
What is a SaaS Marketing Funnel
- 1 What is a SaaS Marketing Funnel
- 2 SaaS Marketing Funnel Stages
- 3 SaaS Marketing Funnel Features for B2B
- 4 Building a Sales Funnel for SaaS
- 5 How to Optimize Your Marketing Funnel for SaaS Companies
Modern SaaS is simply impossible to imagine without the concept of a sales funnel. Let’s try to recognize its features, delving into the essence of the concept itself. What is a SaaS marketing funnel (Sales Funnel, Purchase Funnel)? For more than a century, this term has existed, which, regarding SaaS companies, has been adapted to digital conditions. In a broad sense, a SaaS sales funnel is a concept that includes the basic rules, principles, and ways for potential customers to go through a sequence of steps to turn them into real buyers of a SaaS product (subscribing). In a narrow sense for SaaS, this category is a practical tool for step-by-step subscriber mobilization, from generating leads to closing deals by achieving planned quantitative and qualitative indicators. Visually, we can represent it like this. At the top of the funnel (inverted pyramid) is the target audience we are interested in. Its numbers are limited only by our imagination or the market’s capacity. One in a thousand or nine hundred and ninety-nine will buy our SaaS? The marketer’s task is to accompany as many participants from the top to the narrowing bottom as possible and ensure the conversion.
There is no universal methodology for its formation, but there are effective templates that help move through the main stages. Specialists place accents for SaaS funnels of B2B and B2C markets, taking into account the specifics of such businesses. They are the basis of adaptation and key to increasing SaaS sales’ profitability. The same company may have several funnels for SaaS users and partners.
SaaS Marketing Funnel Stages
All SaaS funnels are multi-level and usually include three to five main steps. Below is a roadmap for SaaS funnels similar to the AIDA («Awareness – Interest – Decision – Action») model with content detailing.
This stage corresponds to the formation of the target audience’s interest in SaaS. The algorithm is such that the main task of a marketer is to provide reliable and complete information about your project and business direction. The introductory process allows you to use various promotion channels for lead generation: SEO, mailing lists, virtual conferences and presentations, blogs, contextual advertising, SMM, referral links, and more. Conventionally, each channel is a separate branch of the roadmap through which leads come. Therefore, its presentation will vary according to segmentation criteria and SaaS growth goals.
The top of the sales funnel is wide, which means that all the resources necessary for the company are concentrated here. Now you are actively drawing attention to your own SaaS project. However, do not rush to rejoice, as an experienced specialist understands that unlocking this potential requires significant efforts in the field of sales. Not every lead can go through the SaaS funnel journey and become a loyal customer. Many are already eliminated at intermediate iterations on the way to conversion.
How it works on the example of SaaS
We set target metrics and launch contextual advertising of the SaaS product for those who are not yet familiar with or need it. The task is to create a super-specific ad dedicated to the potential client’s problem (pain point), which would “hook” him and transfer him to the category of leads:
- “Are you looking for a new CRM system?”
- “Are you an HR manager searching for highly qualified specialists?”
- “Are you a young promising team looking for a referral program?”
- “5 main mistakes when working with cloud services.”
- “A guide to getting to the TOP or a war with a competitor?”
An adequately targeted and specific advertising message will help weed out an audience with a high bounce rate. The more accurate the advertising message is, the more people will be interested in your SaaS, and the higher the sales conversion will be!
The future user has already seen the informational message and is ready to learn more about SaaS. If at the same time he receives recommendations from his friends and partners, consider that the efforts were not in vain – the lead entered the system, and now you know precisely his origin and who is behind him. So, you can move on and start winning his interest. An effective tool for this is the automation of the engagement process – create automatic email newsletters, blogs, content, videos, and so on. Then, concentrate your efforts on interaction dedicated to a particular object. Only after receiving a signal in the form of feedback can one judge the degree of interest in SaaS. This direction will lead to the next stage of the funnel.
If the analytics show that the actions are no longer active and the risk of losing a lead is high, then we recommend not missing the chance and creating a second funnel that will be more effective and lead to a conversion. Reorient the target group with a different message as you know her attraction channel and motives. Create an alternate reality and update the roadmap branch!
How it works on the example of SaaS
Being under the influence of contextual advertising, the lead is registered in the SaaS project. Here, providing him free access to a trial version of “software-as-a-service” with limited functionality is quite logical. So, the more interesting, unique, relevant, and attractive this “probe” is, the more likely this lead will continue moving straight down the SaaS funnel to a purchase.
During the research phase, potential service users will analyze analogs and competitors to ensure that your offer is the best SaaS solution. The choice is in your favor if the lead magnet-activated on the SaaS site works. Remember that the customer value created by the product is more excellent; the more valuable and unique the SaaS itself is for the consumer. Now is your chance to convince incoming leads in the narrowing part of the funnel that the SaaS on offer is better than the competition. Give them a free pro level for the initial period of use, a discount in exchange for a quarterly subscription, shareware maintenance, and other “hidden treasures”. The client must feel the WOW effect and make sure that if the received free information is so valuable, then for the money, he will be able to get a unique service for him. Also important is the content quality within the SaaS strategy framework and the planned sales plan. Second-rate content will only drain traffic and reduce the effectiveness of the SaaS funnel.
How it works on the example of SaaS
Having tried the free version and realizing that life has become more accessible, the user will think about full access. However, do not expect that he is so stupid that he will not look for alternatives. Instead, convince him by providing reviews, partner testimonials, and already solved cases. Now that the client is satisfied with the service, its responsiveness, and full support, you can proceed to a commercial proposal or move on to a call to action.
The final destination in the AIDA model is active SaaS acquisition. The climax is the subscription or registration – this is actually what the SaaS sales funnel was created for, based on the type of business and the goals set. Also important is the comfort of the purchase process with the help of modern, convenient payment platforms for online payment. They allow you to scale your SaaS business worldwide, convert payments into currencies and minimize payment risks. Narrowing the SaaS marketing funnel will provide the final number of sales, but don’t think their journey is over. The task of a SaaS marketer is to motivate regular use of the service through subscription renewal and brand loyalty. You will be more likely to make a repeat sale to an already acquired customer than to waste your efforts generating a new marketing funnel.
How it works on the example of SaaS
The number of users willing to make a payment and renew a subscription is an integral part of the conversion toolkit. Use the customer payment forecasting service, which allows you to plan the future budget for promoting a SaaS product and adjust its growth strategy. You can track performance for SaaS using subscription change, delinquency, churn dynamics, customer lifetime value, and customer retention.
SaaS Marketing Funnel Features for B2B
As noted earlier, there is no one-size-fits-all SaaS sales funnel for all business forms. There are only general rules and templates for its construction, adaptable depending on the specifics of the SaaS company and the scale of activities, sales schemes, promotion channels, etc. A striking example of this is the construction of B2B SaaS marketing funnels, a distinctive feature of which is the use of the WIN-WIN partnership principle. All participants in the communication process during the journey through the funnel stages should receive mutual benefit from such interaction (a partner’s success is the success of SaaS and its creators). At the same time, such funnels look more like a pipe than a pyramid, which is explained by a clear understanding of the target audience and targeting. The goal is to keep the number of leads at the bottom of the funnel close to 100% of their original number. In addition, the distinctive characteristics of the B2B SaaS funnel also include:
- long sales cycle
- the need to build a long-term model of interaction,
- operating at the top of the funnel with dry facts and figures describing the benefits,
- the high cost of SaaS,
- using B2B channels,
- awareness of the need to be involved in a SaaS project,
- creation of parallel funnels for working with business partners,
- using a lead magnet with professional benefit for B2B.
Building a Sales Funnel for SaaS
We will analyze the basic principles of construction and analysis using the example of a sales funnel for the B2B sphere.
The company “XXX” is engaged in road freight transportation. However, due to the drop in the number of orders in the reporting period, “XXX” needs a reliable service for finding cargo for transport around the country.
Stage #1. Awareness
The company manager searches for suitable platforms on the Internet and, thanks to adequately configured SaaS Ads, gets to the SaaS site, where she finds the product she needs. Potentially, this is a cold lead that entered the system.
Stage #2. Involvement
In its SEO SaaS tabs, the manager compares service packages to select a specific option in a convenient interface. All this is served under an attractive “price sauce”, different from competitors but requiring individual miscalculations. For example, the representative of “XXX” fills out the application form and goes into the category of hot leads.
Stage #3. Research
The SaaS sales manager comes into play and provides all the necessary information, conducts a presentation of the software tool, and offers a free subscription to the service for a trial period of 14 days. The carrier’s management is interested in the commercial offer and evaluates the ratio of budget costs for using SaaS and the expected benefits while simultaneously studying the product’s competitors. The lead magnet has worked, and the SaaS company calls on XXX to take action.
Stage #4. Conversion
The SaaS company and XXX are negotiating and signing an agreement for using software-as-a-service within the selected tariff package and the specified scope of services with the possibility of future partnership participation. The SaaS support service accompanies you in a 24/7 format since the business processes of road freight transportation have their temporal specifics. Motivation “XXX” occurs with the help of high-quality service, regular SaaS updates, bonuses for renewing a subscription, participation in an affiliate program, etc.
How to Optimize Your Marketing Funnel for SaaS Companies
SaaS funnels can be optimized in several main ways, and which one to choose depends entirely on the current market situation and your desire to increase the number of leads at the last stage of the SaaS sales funnel. Below are the TOP 10 recommendations from the digital agency “Around Web” for such optimization:
- when forming a specific sales funnel, clearly outline the set of SaaS options available to the client,
- pay attention to the study of the behavioral aspects of consumers of SaaS services,
- warm-up customers by working on leads – do not let them go to competitors,
- use your funnel for each acquisition channel,
- clearly define the boundaries of each stage of the funnel promotion,
- remember that leads can move in the funnel not only in a straight line but also in the opposite direction,
- do not limit the number of stages in the funnel with a template – optimally, there should be enough of them to build a full-fledged chain before the sale is made,
- work with content to find the right approach to the target audience,
- develop a complete funnel optimization strategy with the designation of planned metrics,
- Make it easy for yourself to promote SaaS and build a SaaS funnel with a CRM system.
And finally, the MOTIVATIONAL BONUS from “Around Web”: remember that there is no perfect sales funnel for SaaS! Look for its bottlenecks and expand the walls!
Author Tetiana Dedilova, PhD (Economics) (KhNAHU)
Checked by marketer Victoria