The SaaS business model is one that has been gaining considerable momentum in recent years. The need for useful services and innovative marketing strategies has become the need of the hour. Knowing how to hack your SaaS business growth is key.
63% of businesses prefer SaaS because of more flexibility to changing marketing conditions and 58% due to business continuity.
80% of businesses use at least one SaaS application. Although these statistics look promising, you need to realize that a company needs to keep growing if it wants to survive.
So, how do you grow your SaaS company in a way that will not just help you stay afloat, but keep you way ahead of your competition?
In this article, we’ll talk about the main aspects you need to focus on to grow your SaaS business. We’ll also dive into some super useful growth hacks that will help you acquire an active audience, turn them into customers, and expand your business.
Are you excited? Let’s start!
Keys to Grow Your SaaS Company
There are three main contributing factors to SaaS business growth:
- The size of your target audience
- The average revenue per user (ARPU)
- Your churn rate.
To scale your SaaS business, you need first to understand these factors on a deeper level.
1. Target Audience
You need to build a substantial audience before you plan to make any business from them. Gone are the days when a couple of generic ads about your business would convince your audience.
So what do you need to do to grow your audience? For starters, identify your target customer. There’s no use having a huge audience when not one of them is very likely to invest in you.
Figure out your customer’s challenges and create a niche tool that can help them tremendously in one or more aspects of their business. Remember, you can never be all things to all people.
Determine who you are going to help and how.
2. Average Revenue Per User (ARPU)
The untold truth about growing your business and significantly increasing your revenue is this:
Understand your customer’s value.”
Realizing the worth of each customer will help you:
- Streamline your marketing efforts
- Set realistic revenue goals
- Determine what ways you can implement to increase your overall revenue
The simplest way of calculating how much a customer is worth to you? The average revenue per user.
ARPU tells you the average amount of revenue each user of your service generates for you. You calculate it by dividing the total amount of revenue generated during a specified period by the number of active users in that period.
3. Customer Churn Rate
Customer churn is when your existing customers stop doing business with you for whatever reason.
Although it may sound painful, the hard fact is that every company (no matter how big or small) has a customer churn rate. Once you’ve let that sink in, it’ll be a lot easier to handle.
The first step to addressing customer churn is by finding out what that means for your company. Are you going to measure it by the number of canceled subscriptions? Or by the number of closed/ inactive accounts?
Once you’ve found a way to calculate the churn rate for your business, you can move on to fixing the issue.
What are the Ways To Help Grow Your SaaS Company?
Now that you have understood the importance of identifying your target audience, realizing the value of each customer, and measuring your churn rate, let’s move on to the growth hack tips for your SaaS company.
Here is a list of things you can do to grow your target audience, increase your ARPU, and significantly lower your churn rate.
1. Content Marketing
Always create original, research-backed, and useful content. You could either teach your audience to solve a problem on their own or show them how your business could do it for them.
Use your content to build authority and trust within your niche audience.
The kind of content you create could be video tutorials, infographics, social media posts, or blog posts. You can also create long-form advertising style content like this comparison of mattresses.
Zoma Sleep goes into detail about the different types of mattresses suited for various purposes. At the end of the post, they recommend one of their beds with all its specifications and reasons why you should buy it.
The whole post is incredibly detailed and backed with tons of credible research, giving readers a reason to trust them with their problems.
2. Search Engine Optimization (SEO)
SEO is a crucial aspect of growing your business. Optimizing your website and content for search engines allows you to gain a whole lot of organic traffic.
SEO allows people who are actively searching for a SaaS product like yours to come to you on their own. In other words, SEO will enable you to attract high-quality website visitors who may turn into paying customers.
Take care of your on-page SEO by:
- Researching keywords to rank for
- Linking to relevant posts within your website
- Improving site speed
- Optimizing user experience
Off-page SEO usually refers to link building, which we will talk about later in this article.
3. Website Optimization
Your website must be optimized to convey the message of your business immediately to readers.
It is helpful to create a short and catchy phrase that condenses all that your company stands for (your unique selling point).
Website Setup has a great checklist you can use before you launch your website. It encourages website owners to generate an SSL certificate and re-route all your traffic through HTTPS. Doing so will help you avoid the ‘Connection not secure’ warning users may receive when they enter your website.
Another great tip is to configure the permalink structure on your website before you start creating posts and web pages. According to Website Setup, this not only makes your URLs look better but also gives users a lot more information about the page they are on.
4. Link Building to Drive Referral Traffic
As we spoke about earlier in the tip about SEO, link building is also called off-page SEO. There’s a lot that goes into building high-quality links from high-authority websites.
Loganix describes high-authority links as “Manually built, contextual links from authority sites within your niche.”
They also recommend guest posting as an effective way of building your domain authority and driving high-quality referral traffic to your site.
5. Lead Magnets
Lead magnets are another effective way of growing your audience and building their trust by providing a valuable piece of content in exchange for visitor contact information.
There are many types of lead magnets you can offer your target audience depending on their position in the buyer’s journey.
Checklists, an email course, or an eBook can be a great way to further educate your audience on how your SaaS solution can help them with their challenges.
One of my favorite examples is from LFA Machines, who utilize an eBook as their lead magnet:
These are fantastic for driving more leads off of your existing traffic, rather than trying to constantly get more traffic but failing to convert them.
Retargeting helps you track your website visitors once they leave your site. It then allows you to display relevant ads as they browse through the internet.
Retargeting, also known as remarketing, helps you re-engage people who left your website.
Contextual ads placed in strategic locations on different web pages remind your website visitors that they were interested in your company or website. Then maybe when they have the time or have gained more interest in your product or service, they will click on the ad and re-visit your site.
A tip for effective retargeting is to offer some sort of a discount on the ad so that it entices users to come back and check out the deal.
7. Testimonials & Referral Marketing
71% of people would most likely purchase something based on social media referrals. Testimonials and social proof are a sure-fire way to gain trust within your target audience. It shows your potential customers that your service was able to solve the problem of another person in a similar situation as them.
These days companies come up with creative ways to display their social proof. You could choose to approach your customers and create video testimonials of them stating how your company helped them.
You could also display quotes from your previous customers on your website or social media. Case studies and whitepapers are great ways to show your audience how useful your product or service is to others in their niche.
Try to get your existing customers to refer your product to people they know. You could give them an incentive for doing so – it could be a gift, a coupon, or a discount.
8. Performance Marketing
While there are some people that suggest products without incentives, most influencers are looking to make a buck from their opinions on the best SaaS products. Once you have established the above mentioned strategies, creating an affiliate program is the channel that will take your SaaS growth to the next level.
Imagine you could have an army of sales reps that only get paid when they close a deal. Sounds like a good deal right? That’s the power of affiliate marketing.
Creating an affiliate program (the right way) is not an easy task though. For the program to succeed, you need to ensure:
- The right strategy is in place
- Your team has the proper affiliate management training
- You have an experienced affiliate manager who has worked in your niche market
Do not try to cut corners with this channel. An affiliate program is an investment of time and resources that will not provide instant results. You will need to build your network for a minimum of six month before seeing a real return on your investment.
Consider outsourcing the setup and affiliate management to an agency with experience in building successful programs.
9. Customer Experience
Focus on customer experience. Whether it’s pre- or post-sales, customers need to know that they are valued and appreciated by the company.
Invest in an excellent customer service team to help your customers with problems they may be facing. It will be well worth it in the long run.
You need to create a good rapport with your potential customers right from the beginning and maintain that relationship even after they have done business with you.
Creating a fantastic customer experience will help you get repeat customers and genuine referrals that will help your SaaS company grow more.
10. Product Trials (Free Trials)
Product trials are a perfect way for potential customers to test out the features of your product so that they can decide whether it works for them or not. You can make a free trial available on your website so that people can sign up for it.
Free trials will help you build an email list of people who may buy your product later. Free trials also allow influencers to test your products for reviews without investing money.
Ensure that your customers have a flawless experience using the free version of your product so that they will think of investing in the paid version.
11. Offer More Products
Once a customer has bought your product, you could cross-sell customers another product or service that integrates with the first one.
You could also up-sell them by offering them an upgrade to an existing product. Do this when you notice your customer using the upper limits of your plan.
Hack Your SaaS Growth
With the increasing demand for innovative SaaS products, you need to ensure that your SaaS company is continually growing and evolving to meet the needs of your potential customers.
Identifying your target audience, calculating the average revenue per user, and keeping a check on your churn rate will help grow your SaaS company consistently.
Use the power of word-of-mouth marketing. Create a strong content marketing strategy. Make sure that you optimize your website for SEO.
Build links from high authority websites in your niche. Use effective lead magnets to grow your audience further and gain their trust.
Find out why some of your website visitors are not returning and try out a different approach to win them back. Develop your unique brand voice and deliver unparalleled customer experience every time.
These are some of the growth hacks you can use to boost your SaaS company and increase your revenue.