SaaS Marketing Strategy: Ultimate Guide

The software as a service (SaaS) business model has become increasingly popular in recent years for B2C and B2B organizations. SaaS products are a hybrid of product and service, where software applications are hosted by a provider and made available to customers online. The unique nature of SaaS products can make them challenging to market, often requiring a specific type of marketing campaign. 

For mature SaaS companies and startups alike, developing a marketing strategy designed to maximize your marketing budget is vital. That’s why we’ve compiled this essential guide to SaaS marketing, covering the trends and best practices you need to know to be successful.

SaaS Marketing vs Digital Marketing 

Just as a sports car is a specialized type of automobile, SaaS marketing is a specialized form of digital marketing. While both involve lead generation, driving organic traffic via inbound marketing, and leveraging automation to increase efficiency, the subscription-based pricing model of SaaS offerings emphasizes customer retention as much as acquisition, leading to strategies focused on engaging and supporting existing customers.

As a result, SaaS marketing and general digital marketing differ in their target audience, marketing elements, products, marketing channels, and customer journey. SaaS marketing strategies tend to be narrowly targeted according to the benefit offered by the product or service, and follow similar contours whether you’re working with an in-house marketing team or a SaaS marketing agency. SaaS content marketing tactics often drive viewers to free trials and product demos designed to insert the product or service into the customer’s existing processes, especially for B2B SaaS companies targeting enterprise-level customers.

In contrast, digital marketing targets a broader audience with varied products and pricing models, utilizing diverse marketing channels to attract and retain customers.

Key Aspects of a SaaS Marketing Strategy 

While no two products or marketing strategies are the same, there are several key elements that tend to define SaaS marketing campaigns. To help you get started creating your SaaS marketing strategy, here are a few key considerations you’ll want to keep in mind: 

Importance of Target Audience 

Many physical products, from clothing to decor to household appliances, can be marketed to a broad audience. However, the target audience for a given SaaS product is typically much more narrow and specific: the average consumer will likely have little interest in marketing automation software, a payment processing application, or a Slack-like corporate messaging service.

This makes pinpointing a well-defined buyer persona a vital first step for maximizing the impact of your marketing budget, but building a comprehensive understanding of your ideal customer means going beyond demographics. You must also understand their unique needs, pain points, backgrounds, and goals. Use this insight to create marketing content that truly resonates with your audience by thinking about the specific benefits they might seek from your product or service and what factors might motivate them to take action.

Selecting Target Marketing Channels

Once you’ve identified your ideal customers, the next step in formulating a SaaS marketing campaign strategy is figuring out which type of marketing channels – the mediums or platforms used to communicate with a target audience – you’ll use to reach them. 

While SaaS companies can employ a wide range of effective marketing channels, such as social media, email, search engines, websites, and traditional media, most companies don’t have the budget to leverage all of these options. Even if budget isn’t an issue (and when is that ever the case?), marketing teams only have so much bandwidth to create content, and spreading your creatives too thin risks producing mediocre content that won’t stand out in today’s saturated channels. 

These time and financial constraints make understanding and selecting the right marketing channels for your message just as important as clearly defining your target audience. This is especially true at startups, where human and capital resources are often tight or may be unexpectedly diverted.

Here are some of the primary types of marketing channels SaaS companies looking to implement a marketing strategy should consider: 

• Email Marketing remains an effective marketing channel: 87% of brands consider email marketing essential for business success.
• SMS marketing functions offers many of the same benefits as email marketing, including high open rates and the opportunity for messaging tuned to different buyer personas. 
• Paid search involves paying to display pay-per-click (PPC) ads on search engine results pages (SERPs). Advertisers bid on keywords, and their ads appear when users search for those terms, generating targeted traffic for their website.
• Search Engine Optimization (SEO) strategy revolves around keyword optimization, content creation, and improving your site structure to make it more attractive to search engines. Doing so improves its SERP ranking for searches related to your products, making it visible to more searchers.
• Content marketing is the process of creating and publishing high-value, helpful content to engage potential customers and boost SEO. 
• Social media marketing entails building a social media following for your brand and creating a community around it. It can also include paying for PPC ads on social media platforms like LinkedIn and Facebook. 
• Podcasts have skyrocketed in popularity recently, offering a great way for SaaS companies to reach a wider audience and establish their brand’s authority in the industry. 
• Referral marketing involves encouraging existing customers to recommend your products to others via discounts, free products, raffle entries, and other incentives.
• Influencer marketing is not quite as common in the SaaS space. However, working with established industry influencers and thought leaders to promote your products to their audience can generate instant credibility for your brand.

Again, for all but the largest and most well-funded SaaS companies, fully leveraging all of these different marketing channels at once likely won’t be possible. Instead, you should use your target audience as a guide to focus your marketing efforts and budget on the channels where you’re most likely to reach them.

Defining a Content Marketing Strategy 

Content marketing, or inbound marketing, is a marketing strategy focused on consistently creating and distributing valuable, relevant content to attract and engage your target audience. The goal is to drive profitable customer actions by developing brand awareness and providing information that addresses customers’ needs and interests, building trust and loyalty with the audience.

Working with your marketing team to develop a successful content sales funnel can help improve your website’s SEO, generating more qualified leads through organic, targeted search traffic. A well-planned content sales funnel is also essential for nurturing potential new SaaS customers through the sales cycle and retaining existing customers through continued engagement.

A content marketing strategy leads customers through three segments of the sales funnel, using content geared specifically toward each phase: 

• Top-funnel content, or awareness-stage content, is designed to build brand awareness with potential customers by educating and/or entertaining them through blog posts, infographics, short-form videos, and social media posts.
• Mid-funnel content, or consideration stage content, is about nurturing leads and moving them closer to making a decision. It should address specific pain points and position your SaaS product as a potential solution. White papers, webinars, case studies, and comparison guides fall into this content type. 
• Bottom-funnel content, or decision stage content, focuses on closing the deal and convincing leads that your SaaS product is the best solution for their needs. It tends to be more “salesy” than other content stages and can include content types such as case studies, product spotlights, and customer testimonials. 

Some content types, like podcasts and case studies, can live in multiple parts of the funnel, depending on what’s in the content itself. For example, our Content Restructure Growth Case Study shows how a well-executed content marketing strategy helped one company grow its organic website traffic by 248%.

Understanding SaaS Metrics & Terminology

When formulating your SaaS marketing strategy, understanding the impact of various metrics and terms is essential. In this section, we’ll explore a few of the more significant ones. The better you grasp these concepts, the more you’ll realize their value in shaping successful SaaS marketing campaigns. 

• Customer Acquisition Cost (CAC): This metric tells you how much it costs, on average, for your company to acquire a single new customer. Calculate it by dividing your total sales and marketing costs over a given period by the number of new customers acquired during that period. 
• Customer Lifetime Value (CLV): CLV measures how much value the average customer provides over their lifetime. There are a few different ways to calculate it, but one popular formula is (Average Revenue Per User X Gross Margin)/Churn Rate. 
• Customer Churn Rate: Customer churn rate tells you the percentage of customers who cancel their subscriptions or leave your company during a given period. Calculate it by dividing the number of customers lost during the period by the number of customers at the stard, then multiplying by 100 to convert to a percentage.  
• Net Promoter Score (NPS): Your NPS tells you how likely customers are to refer your company to others. Companies typically collect this by asking customers to rank their likelihood to recommend your company on a scale of 1-10, with scores of 9-10 considered “promoters” and 0-6 “detractors.” You can calculate NPS using this formula: % of Promoters – % of Detractors. According to Survicate’s 2021 NPS benchmarks report, the average NPS score for SaaS companies was 32.
• Monthly Recurring Revenue (MRR): MRR is your company’s predictable monthly revenue, usually from recurring subscriptions. Calculate it by multiplying your total number of customers by your average monthly revenue per user. 
• Customer Onboarding: Customer onboarding is the process of helping new customers learn how to use the product. Customer onboarding can take many different forms, but it commonly includes welcome emails, tutorials, training sessions, and customer support services. No matter how you educate new customers, it is vital for any company selling complex SaaS products to get this step right.

Establishing Goals & KPIs

A marketing strategy without concrete goals is like a road trip without a destination: you’ll get somewhere, but it may not be where you want to go. Instead of developing your SaaS marketing plan and hoping for the best, setting meaningful, measurable goals for your campaigns is essential. 

Establishing KPIs for your campaigns is one of the best ways to keep your goals measurable and aligned with broader business objectives. These KPIs should tie directly to your SaaS marketing goals and can include metrics such as churn rate, click-through rate, conversion rate, and customer retention rate, among others.

Aligning your KPIs with the right metrics lets decision-makers take a data driven approach to fine-tuning and optimizing SaaS marketing campaigns. For example, a low click-through rate on a PPC ad could indicate that your copy needs to be improved, while a high customer churn rate could indicate that your onboarding and customer support materials need to be improved.

Qualifying New Customer Leads

Generating and qualifying leads is one of the most important outcomes of any SaaS marketing strategy. Although a sales funnel full of leads is never bad, qualified leads are more valuable because they’ve already demonstrated a higher likelihood to convert. 

A qualified lead meets the criteria you outlined when developing your ideal customer and has already shown a genuine interest in your product or service through downloading content, attending webinars, or filling out forms. Many SaaS companies choose to gather qualified leads by offering a lead magnet. For example, you might create a landing page offering a free demo of your product or a free eBook download to anyone who provides their contact information. 

When potential customers complete high-engagement activities like these, it’s a strong indicator that they not only understand and align with your product or service’s value proposition, but are likely motivated to become paying customers. 

However, companies should also assess whether leads are qualified based on factors like budget, authority, need, and timeline. This additional layer of evaluation helps sales teams focus their efforts on prospects with the very highest potential for conversion, resulting in shorter sales cycles and more closed deals.

While doing this manually is possible, a Customer Relationship Management (CRM) like HubSpot system helps qualify leads by centralizing and analyzing customer data. It tracks interactions and engagement levels, such as email opens, content downloads, and website visits, to identify high-interest leads. CRMs also score leads based on criteria like demographics, behavior, and firmographics, aligning them with your ideal customer profile. Automation features in CRMs can segment leads, prioritize follow-ups, and provide insights into lead readiness, enabling sales teams to focus on prospects with the highest conversion potential.

Providing Added Value to Customers

Remember: SaaS customers can typically leave your company with just a few clicks if they feel they’re not getting their money’s worth from your service, so once leads become your current customers, it’s critical to find ways that you can continue adding value to their experience to maintain their satisfaction and loyalty. 

Offering a high-quality product and continually working improve it is a nice start, and something you should communicate to both new and existing customers in your marketing materials. Other key strategies include:

• Gather Feedback: Regularly solicit and listen to user experience feedback through surveys, interviews, or direct interactions to better understand customer needs and improve your offerings by staying aligned with evolving expectations.
• High-Quality Content: Tutorials, industry insights, advanced usage tips, and webinars not only educate customers on maximizing the use of your product, but position your company as a thought leader in the industry.
• Excellent Customer Service: Ensure your support team is responsive, knowledgeable, and helpful. Offering multiple channels for support, such as live chat, email, and phone, can enhance your customers’ experience by providing timely assistance and solutions to any issues.
• Exclusive Offers and Updates: Reward loyal customers with early access to new features, special discounts, or loyalty programs. These incentives can enhance customer satisfaction, encourage continued product use, or reward users who recommend your product to others.
• Community Building: Create forums or online communities where customers can share experiences, ask questions, and provide insights. This fosters a sense of belonging and allows customers to learn from each other, increasing their engagement with your brand.
• Personalized Recommendations: Use customer data to provide personalized product recommendations or tips tailored to their specific usage patterns and needs. Doing so shows customers that you understand their unique requirements and are committed to helping them succeed.

Implementing these strategies can strengthen customer relationships, enhance their overall experience with your product, and ensure long-term satisfaction and loyalty.

SaaS Marketing Best Practices 

There are always tips and best practices you can follow to enhance the impact of your SaaS marketing strategy. Here are some essential approaches to consider: 

• Incorporate SEO Practices to Reach New Audiences: Search engine optimization involves optimizing your website and content to rank higher in search engine results. An in-depth SEO strategy helps potential customers who don’t know your company or product but are searching for related terms find you, which is essential if you want to get more organic traffic on your site. 
• Allow Potential Customers to Experience Your Product: Purchasing a subscription based SaaS product is often a major time and financial commitment, so traditional marketing strategies can fall short when it comes to getting conversions. Offering free trials, freemium versions, or product demos lets potential customers experience your product before committing to a purchase. This can reduce barriers to entry and increase conversion rates. For instance, many B2B SaaS marketing strategies involve a 30-day free trial, allowing users to explore the full range of features. 
• Source Questions From Within Your Community: Of all the marketing tools and resources yosposal, feedback from existing customers is one of the most valuable. By collecting feedback from your community of customers, you can pinpoint their needs, pain points, and preferences and then use that information to guide your messaging. As an added benefit, engaging with your community and answering their questions can generate great content ideas and demonstrate your expertise.

Take Your SaaS Marketing Strategy Up a Notch

Having a thoughtful SaaS marketing strategy is just as important as having the right product. Understanding your target audience, selecting the right marketing channels, and crafting a robust content marketing strategy that speaks to their needs and pain points are all pivotal steps in developing an effective SaaS marketing strategy that expands your company’s reach and turns the leads you capture into paying customers. 

Decoding key SaaS metrics, setting clear goals and KPIs, and effectively qualifying leads can also significantly enhance your marketing efforts. To maintain customer satisfaction and loyalty, you must also provide continuous value to your customers through high-quality content, excellent customer service, and personalized experiences.

At Five Tool, we specialize in helping SaaS companies achieve their marketing goals through tailored strategies and comprehensive support. Whether you’re looking to refine your existing approach or build a new strategy from the ground up, our expertise as an industry-leading SaaS marketing agency ensures you’re in capable hands.

Ready to elevate your SaaS marketing strategy? Contact us today, and let us help you reach new heights in your marketing journey.