B2B SaaS Growth: 18 powerful tips to grow your SaaS business
B2B SaaS Growth: 18 powerful tips to grow your SaaS business
18 tips on how to grow your SaaS business - 1-sentence value proposition, north star metric, ideal customer profile, churn alerts, sticky product and customer surveys.
The previous 2 blog posts are about sales and marketing tips to grow your SaaS business.
Today I will share with you 18 generic tips to grow your SaaS product.
👉 But before diving deeper, let’s make sure you download your FREE copy of the SaaS Growth Strategy Worksheet.
1. Be intentional about your growth strategy - product-led vs. sales-led vs. hybrid
Being product-led vs. following a sales-led growth strategy is a totally different game. That’s why being intentional help you grow your business. You can take better decisions on your product roadmap, on your hiring plan (what kind of profiles you need) as well as on your sales and marketing initiatives.
The decision, If you should follow a product-led or sales-led (or maybe a hybrid model) is mainly based on your positioning in the market and the segment you are hunting.
🐭 🐰 🦌 🐘 🐳 - Are you hunting mice, rabbits, deer, elephants, or whales?
Learn more about 5 ways to build a 100M€ ARR business (and how to hunt those sweet animals).
4 criteria that help you take the decision (product-led growth vs. sales-led growth vs. hybrid model)
how your customers actually want to buy your product (not what you personally prefer)
the complexity of your product // how easy can you deliver the value
the complexity and length of the buying process
the price point of your product
The more complex the product, the longer the sales cycle, and the more expensive your product, the better a sales-led strategy for you (and vice-versa).
2. Value-based pricing beats cost-based or competitor-based pricing
Choosing the wrong pricing strategy is one of the most common startup mistakes.
Oftentimes there is a misalignment between pricing and the value of the product (pricing is not based on the value metric). Not charging based on the value of your product also leads to undercharging (increasing prices can positively affect your conversions).
When choosing your pricing model (flat-rate vs. usage-based vs. tiered pricing), make sure your pricing is aligned with the different target personas (different needs) and scales with the value metric (e.g. number of bookings, revenue, requests, minutes, features, seats...).
Get more insights on how to price your SaaS product.
3. Keep your language simple - Can you explain your business to your grandparents?
If not, you will struggle with your marketing and barely find clients.
Having a powerful 1-sentence value proposition is super helpful.
Below, are great 1-sentence value proposition drafts you can use to explain your business in simple language and be on point👇.
We enable/empower/help [ICP] to [Main Result] by [Solution]
We, [company XYZ], create software/platform for [ICP] that enables/empowers/helps them to [Main Result] by [How]
My/our product/service helps [the target group] who want [jobs to be done] by [minimizing a pain] and [maximizing a gain] unlike [your competitors]
Having a powerful 1-sentence value proposition is key for all your sales and marketing communication (Sales emails, Onboarding Email sequences, Cold Calls, etc.).
Comment your 1-sentence value proposition on the Linkedin post. I will review each of them for free.
4. Understand your customer journey
Be conscious about the steps of your customers and where they are in your funnel. Write down the journey (or better draw the customer journey, e.g. using a miro board) and decide on what should happen at each step in the journey (e.g. drip email, outbound call, webinar, etc.) and who owns it (e.g. marketing).
5. Use a North star metric & OKRs to focus on what matters
Having a clearly defined north star metric gives you direction and helps you to focus on things that drive impact. OKRs as a framework are great to align the whole team on making sure that everyone knows how they positively impact the north star metric.
6. Find your niche - be clear on your ideal customer profile
You need to know first who your ideal customer profile is, what pains they have, to know how you can help them to release their pain (your value proposition). Only after that, you should think about the best growth channels.
Get specific about the following for a powerful ICP:
Firmographics (company size, revenue, number of employees, industry, location, etc.)
Pain points
Buyer persona
Job title, department, age, gender
Jobs to be done
Challenges
Goals & metrics
Daily activities
Responsibilities
Understand customer behavior
What software tools are they using?
What partnerships do they have?
Who else is also selling a complimentary service/product to them?
What content/website/newsletter do they read?
Who are they following? What events are they taking part in?
Who do they want to become? Who are their role models?
Create your own powerful ICP with the free Growth Strategy Worksheet.
7. Do manual things to get your first 50 customers - do scalable things later
If you are just starting out with your business, don’t spend time automating things or testing highly scalable things. Focus on manual things like personalized emails, cold calls, LinkedIn messages, comments on relevant social media posts, or posting on communities where your ideal customer profile hangs out.
If sales demos or cold calls don’t convert, paid ads will not work too.
From business idea to first 100 paying customers in a nutshell to learn more about it.
8. Pareto 80/20 rule - be conscious about it
The Pareto rule says that 20% of the input is responsible for 80% of the output. Being aware of that lets you focus on the right things. Find out what your 20% most valuable activities are and try to scale them (especially in early-stage with limited resources, the focus is king).
What is the one growth channel we need to master? What are the core features that really drive value to the customers? And what are rather nice to have things you can or should do later?
9. Master one growth channel after another (not all at the same time)
Today there are so many different growth channels on how you could reach your target audience.
But mastering all of them needs a lot of resources and a lot of testing. So sometimes it makes sense to test different growth channels and once you find a channel that works (great conversion rates + healthy CACs), focus your energy and resources on really mastering this channel (and stop with the others).
Check out 16 Powerful B2B SaaS Growth Channels for your Startup.
10. Invest in your Onboarding and Activation
No one likes to be ‘lost’. But if they sign up and don’t know what to do with your tool, they feel lost. So make your onboarding smooth and easy to follow. Great tools are checklists, progress bars, help center academy, and email automation (based on user behavior).
Check out the bowling alley framework if you’re following a PLG growth.
11. Know your sales funnel and conversions
You need to measure your sales funnel and conversion rates.
“You can't improve what you don't measure.” (Peter Drucker)
Focus on the parts that need to improve.
Based on your sales motion (product-led vs. sales-led) I would recommend measuring at least the following:
PLG: Traffic —> (Lead) —> Signup —> active/PQL —> paying user —> referral
SLG: Traffic —> Leads —> MQL —> SQL —> paying customer —> active paying customer
Of course, you should measure input metrics like #calls #emails #blogs published as well.
12. Be close to your customers, listen carefully, and learn
Don’t expect you better know what your customers want - be close to them and listen carefully.
In order to always increase the value of your product, you need to become more valuable to them. That means that you are building the right product that helps them to increase revenue, reduce costs or improve productivity.
But how do you make sure that you are always close to them and learn from them?
Here are some ways to do so:
Even if you are not in support or sales, have regular calls with customers
Analyze customer feedback (e.g. support chat, churn reasons, online reviews, social media, etc.)
Survey your customers (e.g. NPS survey) but also churns and non-converting leads
Run webinars, offer live chat or support hotline
Regular NPS surveys are so great to know what your customers think.
13. Identify churn alerts and keep a close eye on them
☠️ Churn kills growth! So if you want 2-3x SaaS growth rates, you need to reduce your churn rate.
You can try to prevent churn using churn alerts.
Analyze the behavior (e.g. product usage) and characteristics (e.g. company size, industry, lead source, etc.) of your churned customers.
Do you find patterns? Can you identify red-flag activities?
Use those patterns to analyze existing customers and get early alerts.
Implement churn prevention activities (e.g. free training, activation emails, etc.) to reduce your churn rates.
14. Survey your churn customers
Once your paying customers cancel, ask them why. Send automatically triggered emails with a quick survey (and the option to book a call with you).
Offer them a dropdown with churn reasons and an open text field for further info about why they cancel. So make it super easy and fast to give you feedback.
Based on the churn reason, you can personalize your follow-up and maybe even win back some of the churns:
too expensive —> one-off discount
too complex —> Customer Success call / Free Training
missing feature —> share product roadmap
15. Survey non-converting leads
Similar to surveying churn customers, you should also learn why leads are not converting to paying customers. Especially if you offer free trials, learn what’s missing for them to become a paying customer.
Go through the list of churn reasons and non-converting reasons at least once a month. Come up with initiatives for those reasons.
16. Don’t stop selling - Remember your customers about their pains and your value proposition
Don’t stop selling once the customer is paying. Always restate the benefits for the customer using your product.
Here are some examples where you can restate your value proposition:
on the invoicing (email) - because invoice messages are a churn reason
Highlight what your customer achieved (value metric of your product e.g. x email sent, y € revenue made, z websites designed, etc) in the last billing period.
on the product dashboard
This one is more obvious. But use the dashboard of your product to highlight the main metrics that are important for your customers.
celebrate successes
Everyone likes to get positive messages. So why don’t send your customers frequent updates on how they are doing? Or maybe even give them a call (for larger accounts).
👉 Curious to learn: What works best for you to restate your value proposition? Let me know here.
17. Know the AHA moment of your product
Especially if you are product-led, be sure you know the aha moment of your product. Once you know the aha moment, you can work on your activation strategy to increase your conversions from sign-up to paying customers.
Check out 13 powerful tips on activating more leads (B2B SaaS Activation).
18. Sticky product and lock-ins - APIs, data analytics, and lots of user accounts
Creating a lock-in effect helps you to keep your customers and to increase the value of your product. Probably you have heard about the term sticky product.
For social media friends and followers are lock-in effects, for Spotify, it is creating your own music playlists in the app (which is something you don’t want to lose, so you are not switching to amazon music). For B2B SaaS integrations to other tools, lots of historical data and insights (which you would lose switching to a competitor) and lots of stakeholders (e.g. colleagues, customers, etc.) using it too.
Grow your business with a powerful strategy
Don’t forget to download your FREE copy of the SaaS Growth Strategy Worksheet.
❤️ If you enjoyed the article, please click the heart icon below, share it with other SaaS professionals who can benefit from it as well, and comment below with your questions and thoughts!
🚀 3 more things
If you need support in growing your B2B SaaS business, feel free to reach out to me via Linkedin.
Do you want more content? Check out some more helpful resources and subscribe to my FREE bi-weekly Newsletter on Substack.
Give back time: If you like the content, give it a like and leave a comment below. Simply share the newsletter with others and help me to reach my goal of 3000 subscribers.
Nice Post, SaaS Product Marketing Strategy www.kloudportal.com