A funnel is not an indicator of madness anymore. You know, since medieval times, the funnel has been associated with madness. It is time to change that and rebrand the funnel as a SaaS funnel.
You are here to understand the SaaS marketing funnel. OK, then, we are successful in this regard. Anyways, let’s learn about the SaaS marketing funnel.
What is a SaaS Marketing Funnel?
A Saas Marketing Funnel can be defined as a selling process that encapsulates multiple stages and starts with awareness, and extends to the period after the initial purchase. So, we can say that the SaaS funnel contains every stage of the customer experience – from learning your brand to after purchasing your product for the first time.
How is a Marketing Funnel Different for SaaS?
In order to tell the difference between a SaaS funnel and a traditional funnel, we first have to talk about the traditional funnel. Generally, a “normal” funnel has the stages following;
- Awareness. This is the phase where the potential customer looks for information and asks questions. This is the stage where they meet you and your product.
- Engagement. In this stage, the potential customer starts to consider you as a reliable source. They come and consume your content.
- Exploration. After you gain the trust of the potential customer, you start to show how valuable your product is and compare your product to other brands with the help of case studies, user testimonials, etc.
- Conversion. This is the stage where your potential customer becomes your customer.
This is the general concept of a traditional conversion funnel. Although the marketing funnel for SaaS is similar to a traditional funnel, there is a key difference between them. This difference is the retention stage.
Unlike any retail business, you don’t just simply desire your customers to make one-time purchases. Since you are a SaaS company, you should impress your customers with your value every month. This makes the retention phase quite significant for any SaaS company because retention is your main focus point. If you don’t pay attention to improving your monthly recurring revenue, the churn rates will increase.
In order to keep churn rates low, you have to keep updating your software in regular intervals and budget for customer retention and loyalty programs. Don’t forget, this is the most crucial step, after all.
Why You need to create a Marketing Funnel for your SaaS
A sales funnel is an amalgam of marketing and sales – i.e., you attract potential customers, and they convert into conversions. Without it, your company will have a hard time finding new customers and profiting. This especially holds true when there are studies showing that if you invest in your potential customers, you will have 50% more profit with 33% lower cost.
A sales funnel, in this regard, assists you in grasping what works for your customers and what does not. You can clearly view at which stage your potential customers drop out, they start to trust you, and when is the right time to send follow-up emails. Understanding the sales funnel is essential to pinpoint customers’ needs and assure them why your product is the best for them.
3 Examples of Great Marketing Funnels in SaaS
“But, who does so?” is a question that comes to mind out of necessity. The best thing to do, then, is to see some companies which show examples of excellent marketing funnels.
Netflix is one of the giants of its industry. The funnel they created plays a part in this too. When you initially get in touch with Netflix through its homepage, you can see that the design is very simple. You immediately get the idea of what you are dealing with.
Also, Netflix gains your trust at the end of the homepage. The frequently asked questions section answers your possible questions about getting Netflix for the first time. Also, you are able to call Netflix for additional questions.
What Netflix is doing here is building a bond between the potential customer and the brand based on the trust factor. With all the information it provides to the customer, Netflix says to customers that it is a brand they can rely on. Not a lot of internet-based brands have their phone number explicitly shown.
Basecamp is a tool that helps your company to organize all the work-related projects, communications, etc., in one place. Once you get to know Basecamp, you can see that it feels very personal – and this is one of their strong points.
They utilize the power of blogs, credentials, and the free trial. What we can call a blog is essentially the information points it provides. These bits of information can be found anywhere on their site. They are utilizing these “articles” to build a connection between them and customers. Also, throughout the pages, you can see the social proof of Basecamp being reliable.
And, what is better than a free trial if you aspire to create a personal bond between you and your customers? Basecamp utilizes free trials to give “a piece of their brand” to customers. This way, they can experience Basecamp personally and make a decision.
Mailchimp is the final example we can look at. It is an email marketing tool that offers its potential customers a freemium plan, which is a good thing to do in a SaaS marketing funnel. Mailchimp focuses on the identity of its potential customers. Any potential customer will feel like they have befriended Mailchimp as their way to the top.
Another strong point of Mailchimp is the way it sends emails. Every mail you send via Mailchimp ends with a phrase that tells you the sender uses Mailchimp – which in turn creates social proof of Mailchimp being used.
The pricing and blog are two other important factors we have to discuss. Mailchimp does not try to sell you its service; on the contrary, with the blog posts, it educates you on a topic, then signs you up for free to practice what you have learned so far.
These three examples are coming from the best companies in their respective brands. I hope it answers your question. So, the next question should be, “how can we be as successful as them?”. No worries, just keep reading.
Setting up Your SaaS Marketing Funnel in 5 Steps
Now, you are ready to set up your SaaS marketing funnel. Then, let’s see what you have to do.
1- Identify the Right Stages
Establishing a user base should be of utmost priority. Moreover, a high majority of your customers have to pay for your product, so that your business model based on recurring purchases work. In order to do so, you have to lay out a clear path to conversion for your potential customers. In other words, you will need a sales funnel.
Any purchase process has a good sales funnel at the core. Then, acquisitions and churns become the factors that you must master in order to have a steady growth. Although sales funnels change from company to company, you can implement certain stages to your funnel that will work for your product and company.
2- The Right CRM
Generally, keeping track of all those leads is a chore for your sales team – specifically when your marketing team still tries to direct new potential customers to your sales team.
In this regard, your sales team has to determine which potential customers have or have not contacted your sales team. With the help of this, your sales team can use time efficiently and provide continuity for the users – due to people not wanting to repeat themselves.
To decide what is the right CRM for you, you can check out our blog post, where we talk about the best CRM tools. If you don’t have an idea where to look, it will help you a lot.
3- Set Metrics and KPIs to Track
Metrics and KPIs are important indicators of how successful your business is. Apart from that, they also show you how your customers feel about your product. Determining the right KPIs and Metrics become a significant way of understanding your customers and your product.
In order to start utilizing metrics, you can check out the blog post in which we talk about metrics and KPIs. Although it is not all set and done, it can give you an idea of where to start. Then, you can add more metrics and KPIs according to your needs.
4- Set Goals in Your Funnel
After you start using some metrics, you will see that your business meets or exceeds the numbers you need to hit. Based on this, you can clearly see that your sales team has to make some sales, the number of demos, and the number of trials they have to initiate.
With all these numbers and requirements combined, you and your teams can explicitly comprehend that you collectively must create a funnel that has goals and is efficient. This way, your potential customers will not have a hard time getting to the conversion stage.
5- Collaboration of Sales and Marketing
As we stated above, a sales funnel is a common effort of sales and marketing teams. This means that these teams should not only focus on their metrics and KPIs without how they affect other departments and the business. They have to understand this is a work of harmony, and they have to be aligned with each other.
For example, if a sales team has to generate a number of conversions, the marketing team must understand that they have to accomplish specific tasks to help the sales team with their goal. Also, any sales team has to provide feedback on the quality of a lead to the marketing team – this way, they can collectively improve the sales funnel.
This is a work of communication and alignment. If you are able to achieve this, you will immediately see that your business starts to grow; otherwise, you will be stuck at the same stage regarding growth.
Finally, you know how to create a funnel for your SaaS business. It is time to test the tips we give you now. The journey to the top never stops, and you should act accordingly. Good luck!
Frequently Asked Questions
How do you make a SaaS funnel?
First, you have to understand that you should focus on retention. Then, you can make a SaaS funnel by implementing the right stages, getting the right CRM tool, determining the right metrics, setting goals, and aligning marketing and sales teams.
What is a SaaS marketing strategy?
A SaaS marketing strategy is about paying attention to the product and the content built around it being digital – due to the nature of SaaS.
What is SaaS Digital marketing?
In SaaS digital marketing, you have to create awareness of your product and gain trust. Then, you focus on retention – which indicates that your customers come back and purchase your product in regular intervals.