With numerous new SaaS startups emerging every year, competition is growing. Learn how to grow your SaaS business faster & stay ahead of the crowd.
How to Grow a SaaS Company
Lately, SaaS has strongly rooted itself as an integral part of the digital ecosystem. There are thousands of them available on the web today and the industry has a projected growth rate of 13.1% annually. The potential within SaaS is clear and entrepreneurs seem to be jumping on board to get their fair share of the massive (and growing) pie.
But that means competition is high because of the number of available services today. You have to stand out from the rest. Just because you have an amazing tool or product doesn't mean that you’re automatically destined for success and massive market returns. Simply put: great product development might not be enough nowadays - you must work on your business model.
And by “market returns” we mean individuals who are actually willing to pay for the services that you are offering (at the price you’re asking).
In this article, we're going to cover the details on how you can grow your SaaS business faster while reaping maximum returns.
But first, let’s get everyone up to speed on what SaaS is before we move to the nitty-gritty.
What Is SaaS?
By way of reminder, SaaS stands for Software as a Service and is a way of delivering applications over the internet through web platforms. SaaS applications have several names and are sometimes known as web-based software, hosted software, or on-demand software.
The SaaS industry utilizes cloud computing and allows software vendors to host and maintain the servers, databases, and code that make up the application. This frees customers from the hassle of having to buy, install, maintain, or update any hardware or software. All you need is a stable internet connection and a web browser to access the application.
So now that everyone knows what SaaS is, let’s move on to the details.
Ways to Grow Your SaaS Business Fast
In today’s digitally driven world, SaaS companies have the potential for exponential-level growth. The goal of every business is to catapult to success, and SaaS companies are no exception. Regardless of the type of software you’re offering, you’ll want to accelerate your company’s SaaS growth.
To fast-track the growth of your business (and achieve a certain level of success), you’ll need to incorporate some strategies which we are going to highlight in the following sections.
Many SaaS companies are startups, which means that there’s often a limited amount of resources available for covering expenses and running day-to-day business. Typically, this usually comes with the pressure to gain more customers and get more money to run the business. Faster. Earlier.
The easiest and most efficient way to expand your business reach is through a SaaS marketing strategy. Successful marketing will open doors for your business that you didn’t know even existed.
Having a unique SaaS product isn't a guarantee that clients will come streaming to you. You need to make yourself known and stand out from the rest of the competition. Identify a niche in the current market and exploit it fully. As Apple did with the iPhone, offer a solution to the shortcomings of your competitors and ensure you deliver it… magically.
So rather than coming up with a new product for something that clients don't realize they even need, focus on solving existing problems. Ensure that the niche you choose is all-encompassing and will allow you to reach into multiple industries.
The secret to growing your business is by establishing and maintaining a strong and long-term customer base. This is even better than focusing on obtaining new customers. It’s often easier said than done. If you offer an amazing product that your customers love, then they will likely continue paying as long as you continue offering them value for money.
Of course, not everyone needs your product and that’s okay. Instead, what you need to do is focus on a specific target audience that’s genuinely interested in the product or service you’re offering.
You may have heard of this customer referred to as the “Ideal Customer Profile” (or ICP).
There are (potentially) millions of clients out there. All you need to do is reach them and convince them that your product is what they need. That it’ll solve their problem… their FELT problem.
Getting clients is the easy part, keeping them is where it gets harder. And with the typical SaaS pricing model of recurring monthly payments, customer success is getting them to pay month after month.
The easiest way is to listen to your clients and make customer support your biggest priority. When clients feel that you genuinely care about their needs (FELT problems) and address their pain points promptly, they will (likely) stay.
Invest in your customer retention management (crm) through exceptional customer service and they will pay you back in loyalty. You’ll find that retention is way cheaper compared to customer acquisition costs.
It doesn’t matter how amazing your product is, it means nothing if nobody knows about it. You have to invest heavily in getting people to know about your brand. Social media platforms like Linkedin have also made it easier for online-based companies to gain traction.
If your product is as good as advertised, it will quickly gain more clients because more people will be talking about it. This leads to increased profits and return on investment (ROI). When done properly, brand advocacy can even attract new investments which will skyrocket your business to new levels.
A Strong Partner Network
Partnering both inside and outside the company is a sure way to achieve business success. Internally, everyone within the organization should be on the same wavelength. No matter what the metrics say, without working as a united force, your company can't succeed.
For SaaS companies, the developer team and management team need to be in sync at all times. After the developer team comes up with a ground-breaking product, it's up to the management to see the success of this product. Outside the company, partnering with like-minded corporations can also prove fruitful.
The market is flooded with tens of thousands of SaaS companies, meaning that the pool of customers is always steadily shallowing. Sometimes combining forces through partnerships can give you an edge that you would never have gotten while doing it alone.
Ways to Acquire Customers for Your SaaS Business
Customers are the driving force for any business. Without them, it's impossible to gain any profits. This means that acquiring and maintaining customers is critical for your survival. So, what are some tactics for acquiring customers for your SaaS business?
Prioritize Direct Sales
As much as a great product will sell itself, pushing it through direct sales will help you boost your numbers exponentially. Direct sales not only help you sell the product but also gives you and your sales team better insights from the clients to help refine your product offering. Clients who come in as a result of direct sales are more likely to remain for the long haul.
Invest in SEO/SEM
Because SaaS businesses are internet-based, you’ll need to take advantage of traffic on search engines to maximize your potential client reach. Google is the most popular search engine and is undeniably the greatest resource for internet-based companies.
Search Engine Marketing (SEM) through Google Ads can help you attract more customers and increase overall revenue. If you have heard the phrase “you need to spend money to make money” then SEM is the perfect vehicle to achieve this success.
Search Engine Optimization (SEO) is also another efficient strategy for accelerating lead generation if done correctly. An important aspect of SEO is content marketing, where you’ll create reliable and curated content for your potential customers through blogs. Ensure that your content is SEO friendly so that you rank higher on Google.
Work on Your PR
Press relations (or “public relations”) are one of the most effective ways for businesses to reach audiences and reel in potential clients. If correctly executed, press relations can prove to be the most cost-effective and highest converting channel. Axia states that press placements have 3 times the credibility and up to 6 times the reach of a normal advertisement.
This strategy is often not easy to achieve in the short term and will need consistent effort over time which will eventually pay off. With a strong media presence, your brand credibility skyrockets. Additionally, the links from press placements often boost your SEO ranking.
Don’t Forget Referral Programs
Successful SaaS companies will tell you that referrals are your best friend. Referral programs are effective because you’re not spending money on potential customers but on those who convert into paying customers. This means that the strategy is cost-effective and helps you grow your client base by rewarding existing users who invite new users and rewarding the new user too.
You can opt for referral program software to create a referral program. They are often quite affordable and they take care of all mechanisms of the program.
Things to Avoid When Creating a Growth Strategy
As exciting as growing your SaaS quickly may seem, you have to be careful not to make the rookie mistakes common among many SaaS startups.
The most common mistake that small businesses make is having the overnight success notion. In our years of experience, we can confirm that consistency beats luck. Unicorns aren’t as common as you might hope. You have to put in the necessary hard work for your business to succeed instead of hoping for one quick win.
Another mistake common with new SaaS entrepreneurs is taking the metrics too seriously. Yes, it sounds weird because data is the core of almost all businesses today and the metrics derived from them help steer the company decisions.
However, these numbers can often give a false sense of what is going on. You might feel discouraged or (conversely) get a false sense of security from the metrics.
Some key metrics to keep note of are the number of paying customers, active users, and churn rates. Even if the metrics show that you haven't made any new clients for weeks or months, focus on your existing customers and make sure they stay subscribed to ensure business continuity.
As lucrative as SaaS seems, it’s not a walk in the park. Then again, no one said it would be easy. As more businesses adopt SaaS, it’s projected that by 2028 the industry will grow to a staggering $716.52 billion. With the right strategies, you can set yourself up for maximum success and rapidly scale your business.
Ensure that you are constantly in the know by learning and talking to industry experts. At SaaS Academy, our coaching program for B2B SaaS founders has proven fruitful over the years – with many founders doubling their growth each year.
Join us today and let us help you grow your SaaS company to its full potential. Book your complimentary Growth Session with our team today.