Attaining stable growth for SaaS companies means continuously acquiring new customers and retaining them for as long as possible.
Although this might sound easy, finding new opportunities for customer acquisition in the crowded SaaS industry can be extremely challenging.
This is where optimizing the SaaS conversion funnel can aid you in quickly developing your SaaS business. The conversion funnel, though, is often misunderstood and confused with the sales funnel at times.
This is why it is important to break it down into stages. This helps in finding out what data to watch and what to optimize from your existing sales processes for better conversions.
The SaaS conversion funnel consists of the following stages:
- Awareness: This is the stage where customers are just getting acquainted with your brand.
- Engagement: This part of the funnel is where you attract leads to your acquisition funnel, and educate them and be a resource.
- Exploration: This is the final stage in the process of acquisition before leads convert into a customer.
- Retention: This is the post-conversion stage when leads have already become customers, and the goal is to retain them so that they continue to be paying customers.
Importance of a SaaS Conversion Funnel
On their way to a purchase, customers will hit a number of different touchpoints as part of their customer journey. How you serve content, ads, and other brand communications to your target audience will have an effect on how those prospects will convert.
Often, you will find that no matter how big or effective your company is, there is at least one location that is an obstruction point in your consumer acquisition funnel.
Obstructions represent qualms that your target customer base may have about buying your SaaS. Addressing these objections and resolving them at the appropriate touchpoint in the funnel is extremely necessary for engineering conversions.
Optimizing your SaaS funnel will help you identify these obstructions so that you can reach out to more buyers, convert more prospects, and sell better.
1. Identify Target User Persona
The target persons or buyer persona helps you comprehend the needs of your clients and identify who they are and how they can be reached out to more efficiently. Creating your buyer persona doesn’t have to be a difficult task for an upcoming digital marketing or email marketing campaigns.
A few pointers about who your ideal customer should be is all you really need to narrow down your options to identify them. For SaaS companies that want to drive their business forward in powerful ways, it’s best to start by asking yourselves the following four basic questions.
- What problem are they trying to solve?
- What features of a product are most important to them?
- What objections are they most likely to raise?
- What is their buying process?
Once you have answers to all of these questions, you will have a buyer persona ready to target and be attractively positioned to dominate the market.
2. Integrate Chatbot to Filter Leads
The conversion of a lead from marketing to sales to purchase is often a matter of persistence or luck; however, even that requires a prospective buyer willing to buy your service or at least considering it. As such, qualifying leads are the best bet for a high conversion rate for SaaS sales teams. Tending to qualified leads often means that less time is spent on unqualified leads.
Fortunately, with the burgeoning swell of AI solutions, there exist a lot of options today to help sales teams weed out bad leads from the good ones. A chatbot is one such solution and is smart enough to respond to leads and filter them according to their value and potential.
These bots can also service customer queries simultaneously about your service or product and assign a lead score to prospects based on your existing lead scoring system. These bots then filter leads based on their lead score and hand over eligible leads to sales reps once the lead has shown that they are willing to move further down the funnel.
Not only does this ensure that less-qualified leads are kept in the funnel for later nurturing but it also wastes the lesser time of sales reps that otherwise would have gone behind a futile attempt to convince an unwilling prospect.
3. Shorten the Sales Cycle
While it is an old adage, time really sums up to be equal to money. And the easiest way to optimize the sales funnel is to close the deals you have faster. The shorter your sales cycle is, the lower it costs one to close a deal, the quicker it helps you learn, respond, and improve, and consequently, the more successful you become.
In order to shorten the sales cycle, there are really only three steps you need to follow.
Focus on Time Traps
Hold meetings with your SaaS sales team to identify the gaps where they lose time. Are there any particular issues that they believe eat into their sales time?
Free up some of their questions by brainstorming to figure out a few ideas that may help. Like if the demo presentations can be shortened or not, if the use of sales proposal and presentation templates makes sense or not, if there’s a need to store customer information centrally or not, among others.
Use the Power of Now
While talking to a prospect, don’t wait to make decisions and put them off for later. Is there another move that your prospect needs to take and do they need a little nudging to do that? If so, don’t wait to help them.
If you think they will have any questions or concerns, answer them then and there. Take action instantly. So do not delay it for later when they could be easily distracted.
Promote a Culture of Learning
Finally, utilize the data at your disposal to promote a culture of continuous development and edification about the state of the mind of the customer.
Try to gain and accumulate more data on the types of customers who purchase your services more to see how you can better position your sales process to cater to their needs.
4. Leverage Exit Intent Popups
Did you know that according to Conversion Sciences, 10-15% of lost visitors can be ‘saved’ by using exit-intent popups?
Exit-intent popups help you ascertain when users may be about to exit your site. These pop-ups add a script to your website that monitors the mouse movements of your guests based on the exit-intent framework. On desktops, this script throws a popup every time users move their cursor to the exit button. On mobile devices, the exit-intent script throws up the popup when visitors press the back button or scroll up to interact with the address bar.
There are several ways that an exit-intent popup can increase your conversion rate. However, here are some of the most common circumstances in which to use leverage exit-intent popups:
- To promote a promotional offer.
- As a lead magnet.
- To redirect guests.
- To gain feedback on your brand, company, or website.
5. Invest in a Customer Advocacy Program
Often, The creation of a well-designed loyalty program for frequent users is the most effective technique for customer retention. This is especially important considering that 80% of a SaaS company’s revenue comes from just 20% of its existing customers.
SaaS businesses are generally nervous about renewals. As such, the deployment of a customer loyalty program to fuel growth has become completely essential for companies today. Creating a loyalty program can help you gain the attention of your regular customers. Plus, boost online conversions, ultimately pushing the customer lifetime value (CLV) higher.
To know an excellent example of a rewards program, one needs to look no further than Dropbox. Well known for the success of their referral program, Dropbox’s referral rewards were extra storage space. This is something that was key to the usage and enjoyment of their product.
This referral program is still such a hit that 35% of daily sign-ups on Dropbox are via the referral program.
SaaS optimization is as difficult or easy as you want it to be.
There are a number of evolving variables involved. And since decentralized optimization teams are the norm in SaaS companies, holistic optimization is difficult to achieve at times.
This is where you can use the steps outlined in the article above. This ensures optimization is a breeze and that you are ahead of your competition at all times.
Dhruv Mehta is a Digital Marketing Professional who works at Acquire and provides solutions in the digital era. In his free time, he loves to write on tech and marketing. He is a frequent contributor to Tweak Your Biz. Connect with him on Twitter or LinkedIn.