It’s an exciting time to be a SaaS company. The market’s expanding at an incredible rate: in 2012, Gartner predicted it would reach $22 billion by 2022 – a generous prediction, at the time. Just two years later, however, Forrester put that figure at $133 billion – by 2020.
I’ve outlined a few of the most common problems SaaS companies encounter in this area below.
challenge 1: standing out in a crowded market
Up to now, vendors have concentrated their SaaS marketing efforts on convincing companies they are burdened with a problem only their solution can solve. Suddenly, though, there is more to compete with than just apathy. According to analyst reports, smart process apps now often overlap with SaaS. And, while SaaS companies have been taking advantage of the appetite for their solutions in the US market, traditional software providers have been taking advantage of the opportunity to entrench themselves in Europe and Asia.
The result is that SaaS vendors now have more to compete with than just apathy and ignorance and their marketing strategy needs to account for this. Companies who want a piece of the predicted surge in growth need to spread their net a bit wider and find marketing methods that are both provocative and capable of reaching a wide pool of prospective buyers.
challenge 2: securing customer loyalty
The vast majority of SaaS companies operate based on annual or monthly contracts, making customer retention as much of a priority as customer acquisition. And yet, much of their marketing remains focused on telling people who they are and why they are necessary – existing customers rarely get a look-in.
Meanwhile, negative churn is stripping their businesses of their potential. Investing in SaaS marketing services that are targeted at building customer loyalty and engagement means your new sales can start contributing to growth rather than just replacing clients that have been lost.
challenge 3: reaching high volume, lower value customers
For many SaaS companies, the value of the average client contract is a lot lower than it is in traditional hosted technology companies. While the B2B technology sales cycle used to be lengthy and consultative, many cloud technology companies today cannot afford to have salespeople pounding the pavement for leads. Instead, they need to bring in a high volume of lower value customers which means that the only viable sales model has to be inbound.
SaaS companies need to design sophisticated marketing and lead generation machines that provide the prospect with all the information they need to make a decision, and need a B2B PR agency that understands these unique requirements.
While naming and understanding the problem is an important step, it’s equally vital that you’re able to devise workable solutions that encourage growth – and allow you to take as large a chunk of the burgeoning SaaS market as possible. The above is a decent primer – but our SaaS marketing eBook goes into greater depth, and can help you formulate a winning strategy.