Assumptions about SaaS marketing strategies

SaaS marketing strategy differs a bit from other, more traditional marketing strategies, as SaaS strategy typically is highly scalable as long as additional customers yield a positive ROI.

SaaS marketing strategies should be able to expand as long as this increases net revenue. This calls for highly optimized marketing campaigns, building on a foundation that strengthens the brand, demonstrates thought leadership, and enables 3rd-party endorsement.

For the SaaS marketing strategies in this article, I assume the following:

• SaaS marketing strategies should generate revenue with positive ROI in the short term (especially when marketing SaaS start-ups);
• Campaigns are flexible and scalable if it is proven that they generate net revenue
• Marketing activities should contribute to strengthening and protecting the brand
• Both offline and online marketing are integrated with sales, product management, and after-sales.

• What do investors or other stakeholders expect as marketing results?
• Are brand recognition and perception where they want to be?
• Is there a short-time need for positive cash flow?
  Are our promises and deliverables aligned?
• Etc.

Insights from the SWOT analysis will help to set marketing priorities, baselines, and align the messaging with the right audiences.

Calculate Customer Lifetime Value (CLV)

Knowing how much revenue is created by a typical customer is one of the most important aspects of SaaS marketing strategies. This allows you to calculate a baseline and the ROI for every marketing strategy, tactic, and campaign. As long as a campaign yields a positive ROI, it generates net revenue. This enables the company to increase net revenue and market share over time.

Map your buyer’s journey and loyalty loop

In 1898, E. St. Elmo Lewis developed a model which mapped a theoretical customer journey from attention to purchase, often referred to as the “customer journey” or “buyer’s journey“. This model, and others like it, are great tools to analyze and optimize the road towards a purchase.

However, for SaaS, the bulk of the revenue and profit comes from sustained subscriptions. For example, increasing the length of a SaaS subscription by 10% will have more impact on net profit than a 10% improvement in CPA.

Ensure that your organization has mapped out all the steps of the buyer’s journey and the loyalty loop, so you can optimize your messaging accordingly and market your software as efficiently as possible. This will increase the effectiveness of all marketing campaigns and help build and load your brand.

Persuasion architecture and micro-moments

Persuasion architecture is the art of addressing all the questions, fears, and needs that a potential customer has during the buying process when it is most effective to lead to the desired outcome. This is usually done by chunking the customer’s train of thought up in micro-moments. Every time the customer has a need for a new piece of information, this will be presented at the right time and in the right format.

Organize marketing channels by function & KPI

Step 1: Introducing the REAN model

Step 2: The REAN model & media channels

Now that all the steps in the buyer’s journey and loyalty loop clear, it is time to map out the marketing channels used during these phases in the REAN-process.

This helps your organization to:

• Track which marketing channels are being used
• Visualize the role of these channels in the buying process and the client lifecycle
• See if you are missing any opportunities by identifying missing marketing channels

Step 3: Add SMART KPIs

In the next phase, we will add SMART Key Performance Indicators (KPIs) to marketing activities.

A KPI is used to measure the results of the marketing activities. A SMART KPI means that it is Specific, Measurable, Actionable, Relevant and Time-bound. Such KPIs provide consistent and clear data and form the foundation of performance marketing.

STEP 4: THE MARKETING MATRIX

Now we have all the information in one place, it is time to tie it all together. This can be done using a marketing matrix. This matrix combines the:

• REAN phases;
• Organization’s marketing goals
• Storytelling during each REAN phase
• Marketing channels used to do this
• KPIs that are used to measure results

1. Divide a whiteboard into 4 columns – one for each phase in the REAN-process;
2. Each attendant takes a stack of sticky notes and a marker, so they can write down any channel they’re using and stick them in the applicable phase(s) in the REAN-process on the whiteboard. Take a picture for reference;
3. Discuss the findings: are all marketing channels included? Are all REAN-phases covered by a reliable mix of channels?
4. Now, ask participants to add additional channels that are currently lacking. Discuss these to identify potential opportunities;
5. Finally, discuss and add SMART KPIs to each marketing channel, to ensure that all marketing activities are measured and geared towards the right deliverable.

STEP 5: ADD VALUE ATTRIBUTION

Finally, allocate the value of each conversion to each KPI conversion. Conversions with a relatively low correlation to generating revenue get a low value (e.g. a download of a white paper), while the ones that correspond with a very strong buying signal get a high value (e.g. a sales call that lasts over 5 minutes).

By this point, all the work that went into mapping all marketing channels and tactics might seem a bit excessive, but trust me, it’s paramount to efficiently manage and improving marketing ROI over time. We’ll get into more details later when we look at managing, tracking, and optimizing results over time.

At the end of this article, I’ll provide a list of tools you can use to automate value attribution from various on- and off-line marketing channels, including phone calls.

Focus on low-hanging fruit

For a high-performance SaaS go-to-market strategy, it is usually important to focus on an audience that has already shown interest. These are the potential customers that are looking for the service or have already shown interest and are ready to buy. These people are already Googling your service or have visited your app or website. They are already at the bottom of the conversion pyramid and ready to purchase.

We’ll focus on this group in the lead generation core – the heart of your SaaS marketing strategy.

CREATE A SAAS LEAD-GENERATION CORE

The lead generation core is a set of highly focused SaaS marketing activities that generate a steady stream of high-quality leads. A dependable backbone that continuously generates quality conversions allows you more leeway with other campaigns and gives you room to test new strategies and other media.

For a strong SaaS lead generation core, consider the following channels:

a) TRIAL ENVIRONMENT

This is probably the most important part of your marketing mix. Giving potential clients a way to try out your service is paramount to getting them to sign up. This can ideally be done with a trial environment or (if unavailable) a free trial period, a sandbox environment with dummy data, a video or even a slideshow. The better they can try out your service without having to pull out their credit cards, the higher the sales rate from all your media channels will be.

b) HIGHLY RELEVANT SEARCH ADVERTISING (SEM/SEA)

Google Ads and Microsoft Ads campaigns focusing on highly relevant searches (e.a. people looking for your services) are usually a great way to generate quick results, with a fairly high ROI. The high amount of control also allows you to AB-test extensively and use these learnings in other campaigns. Start with an extensive keyword analysis, set up granular campaigns and use a large set of negative keywords before go-live for a quick start and to beat the competition.

c) SEO AND CONTENT STRATEGY

Great content gives you the opportunity to demonstrate thought leadership, demonstrate product value, and coax potential clients down the buying funnel. High-quality content also forms the backbone of SEO, which is the medium that typically generates the 2nd highest ROI (after advertorials).

d) SOCIAL AND PUSH MEDIA

Leverage organic social media, as well as push media (such as push notifications) to make the most of your content. Create once, post to many, and use this as a way to increase your free coverage and build SEO authority as well.

e) (NEGATIVE) RETARGETING

Retargeting (or remarketing) is a great way to improve brand recognition and brand favourability among engaged visitors who haven’t signed up yet. Use this to make people come back and increase results from all media. Also include negative remarketing, which is a great way to cut advertising cost by excluding existing clients from your target audiences.

CONTENT MARKETING AND THOUGHT LEADERSHIP

Content marketing is an important SaaS marketing strategy. It helps to strengthen your brand by demonstrating thought leadership, but also in many other ways:

• Articles addressing common problems that are solved by your SaaS generate direct response;
• Problem-solving blog posts generate traffic AND help with service adoption and client retention;
• Expert interviews help to build credibility, topic authority and decrease perceived risk;
• Industry news demonstrates that your services are up-to-date and show you’re knowledgeable;
• Service comparisons help you to stand out from the competition and focus on niche audiences.

Content will not just be visible on your website or in your app, but it will also bring in new potential clients, as new content can easily be used to expand your visibility:

• SEO will make your content appear on Google and Bing;
• Push notifications are an easy way to earn followers, providing an instant reader base for new content;
• Newsletters are a flexible way to engage with subscribers, test new content, and launch new services;
• Press & PR is a great way to get the word out and obtain SEO authority;
• Advertorials generally provide the highest ROI and can be used to promote cornerstone content.

PHASE II: CHANNEL EXPANSION

With a powerful SaaS lead generation core in place, it’s time to expand the marketing mix with other channels. Here are some good starting points for other high-yield SaaS marketing strategies:

PROGRAMMATIC / DISPLAY ADVERTISING

Show (and test) ads on highly relevant 3rd-party pages. Make sure that you chunk up the campaign in different topics and send traffic to a landing page that is optimized for that topic in particular. Blacklist irrelevant placements and isolate high performing placements to increase ROAS over time.

ADVERTORIALS

Both off- and online advertorials typically yield a very high ROI. Use advertorials to generate direct response and increase brand visibility and authority. helps to load brand. On the downside, advertorials typically have limited reach & scalability.

AFFILIATE MARKETING

Affiliate marketing – where you pay a 3rd party based on results –  has a low risk. ROI is usually not that high, but the risk is low and time investment is minimal. Just make sure you focus on the right KPI and keep an eye out for irregular behaviour (e.g. many sales from 1 IP-address, affiliates leeching on your brand, etc.).

PROTECT YOUR BRAND

Before your brand recognition and demand grows, you need to make sure that your brand is well-protected. Make sure that you:

• Trademark your brand name, logo, and slogans;
• Claim any domain names related to your brand;
• Block brand assets to be used by affiliates (e.g. deny the use of your brand name);
• Claim local offices in Google My Business and Bing Places;
• Set up an AdWords and Bing SEA campaign for searches on your brand name.

VALUE ATTRIBUTION MODEL

SaaS typically has a long acquisition time, with multiple touch points where potential clients engage with ads, content, the testing environment and the sign-up form. This applies even more with B2B SaaS when multiple stakeholders are involved in the decision-making process.

Different marketing activities have different roles in the marketing mix. Some help to draw in new visitors, others build your brand or push potential clients through the conversion funnel.

To measure the impact of each marketing activity, you need a comprehensive value attribution model. This is where those KPIs and KPI values we discussed earlier come in. Focusing on just one KPI (e.g. CPA for sign-ups) will cause you to focus on media in the bottom part of the conversion channel, and might lead to starving those channels that are actually driving.

A data-driven value attribution model takes all those customer touch points and conversion values and attributes them to individual users and marketing channels. Your analytics software (such as Google Analytics) aggregates the data and shows you how each channel contributes to sales.

Ultimately, your value attribution model allows you to calculate and compare the ROI of marketing activities, such as campaigns, media channels, value propositions or creatives.

This ROI benchmark allows you to compare campaign and channel ROI against the benchmark and allocate your marketing resources to the activities that yield the highest return, while cutting budget from channels that are underperforming. This will greatly improve the results of your marketing mix over time. More about benchmarking in the next section of this article.

FEED YOUR ALGORITHMS

Many marketing channels depend on data for continuous optimization. If you use AdWords, Facebook, programmatic advertising, LinkedIn, Bing Ads, chances are that you let your campaigns optimize themselves by tracking clicks that lead to conversions.

Choosing the right KPIs is crucial to the success of a campaign. The KPI needs to be closely related to the business goal you would like to achieve. The better your KPI, the more efficient your campaign will be. Choosing a deep engagement KPI will get you more of those crucial conversions and help you obtain your business goals.

Here’s a practical case study, based on work I did for a client:

Imagine you run a Google Ads campaign that generates telephone calls to the Sales Department. The campaign tracks “inbound call” as a conversion and uses these data points to optimize the algorithm. Results are decent, and everybody’s happy. But think about it: is there a better KPI that you can use?

You come up with the hypothesis that longer sales calls are more valuable than short sales calls. You analyze the call data and learn that a successful sales call takes at least 6 minutes. You change the target KPI from “inbound call” to a “360s+ call”, and give it a higher ROAS conversion value that reflects the higher success rate of longer calls.

Here’s what happened when I did the same for a large financial company:

• The cost per call increased (boo!)
• The amount of SUCCESSFUL calls increased even more (woohoo!)
• As a result, the net cost per successful sales call decreased
• The company received 13% more sales from the same budget

But that’s not the only thing that happened. We saw an uplift in calls during office hours, higher closing rates from the call centre, more engagement on the website and an increase in brand demand. All from changing the definition of one KPI.

How can YOU improve you KPIs and feed the beast that is the algorithm?

BENCHMARK YOUR CAMPAIGNS FOR ROAS

if you have configured your tracking tools correctly, you will see the results generated by each activity, as well as the total conversion value. This enables you to calculate and compare the ROAS (Return On Advertising Spending) for each marketing activity.

Once you know how effective each marketing activity is, you can determine whether you want to boost it, leave it for the moment, or stop it altogether. Basing your SaaS marketing strategy on data and real results will allow you to minimize the risk, improve the effectiveness of your marketing mix, and test new SaaS marketing strategies.

An example of benchmarking campaign results (compared by CPA). Direct Mail has the highest CPA, and Position Targeting the lowest. Note that the CPA shows a range from the lowest to the highest CPA, depending on the margin for error. In this case, there is not yet enough data from Display campaigns to determine if they meat the target CPA.

TEST RELIGIOUSLY

Another way to greatly improve the results of your SaaS marketing strategy is to continuously test your messaging. According to the testing professionals at Behave.org, managers or business owners FAIL to pick the winning version in 40% of the cases. Truth is, there are so many options in messaging and design that nobody knows what will be most effective. Continuous testing will improve results across all media channels and improve results over many years.

PROVIDE OPTIONS BASED ON BEHAVIOUR

Keep an eye on client behaviour. Are users coming back to use your service? Do they finish their work? Are they running into errors? What content are they using? Provide an appropriate response to avoid disappointment and to get people re-engaged if needed.

Sources of Inspiration

• Occam’s Razor
• Kissmetrics
• Behave.org
• The Cult of Analytics, Steve Jackson
• Web Analytics 2.0, Avinash Kaushik
• Secrets of Online Persuasion, JP & D. Micek
• Don’t Make Me Think (revisited), Steve Krug
• Marketing Research (Applied Orientation), Naresh Malhotra

Free Consultation

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