It’s estimated that 92 percent of SaaS companies will close within 3 years.
This happens despite growth and funding. The software as a service industry is a cut-throat business to be in and needs companies to be creative, intuitive, and fast.
During a SaaS business’ early days, a SaaS startup grows around 4.4 percent every month. Once the company starts earning a sizable revenue, it can expect to only grow about 2 percent monthly.
To avoid this closure and increase growth rapidly, SaaS companies have looked at growth hacking as a way to get ahead of competitors as fast as possible.
In this article, we’ll take a look at 10 proven growth hacking techniques SaaS companies use.
Growth hacking (or growth marketing) itself is an umbrella-term. It encompasses techniques used by companies that generally involve getting as many users as possible in a short amount of time.
Growth hacking is generally used by smaller start-ups that have smaller budgets. They want to grow their user base as fast as possible, with the lowest amount of money spent.
Software as a service companies rely on their customer’s subscriptions, whether they be monthly, quarterly or yearly, to pay the bills.
Unlike companies that sell traditional software, which is becoming more scarce by the day, SaaS companies can be launched with much less capital when starting, as long as they can quickly build a large user base.
Traditional software needs a higher growth percentage, since they need to keep selling new software to new users.
SaaS companies need to grow too, but once they have a large user base, their goal will be to keep users on the monthly bill cycle.
It’s easy to create a piece of software, even better if it fulfills a need no other software can.
The issue is, if no one knows about it, then it’s all gone to waste.
It’s a known fact now that online reviews are one of the easiest ways to get new customers. Online directories like Facebook and Google Business Profiles are excellent places to post your business and get some reviews.
To get people reviewing your software, you could offer a free monthly trial, as long as they sign up with an email and leave a review after.
This will entice people to try your software and get your business reviews early on.
Considering that the main purpose of growth hacking is getting as many subscribers as fast as possible, the use of conversion rate optimization tools make sense.
One of the biggest downfalls of a SaaS company is leaky sales funnels. Worse if you get visitors to your website, but the bounce rate is extremely high.
CRO tools will help you optimize your website to help convert new and regular visitors.
It’s even more important for SaaS companies that offer free trials. These PQLs (product qualified leads) especially need to be converted to paying subscribers.
With the growth of freemium software services, converting these users to paying customers has become a number one priority for plenty of SaaS companies.
Companies may see a conversion rate of 2-5 percent when it comes to freemium users paying for the premium version, but the average is only 1 percent.
Chatbots can be used to any business’ advantage.
When it comes to growth hacking, the idea is to have a chatbot pop-up that’s able to answer any of the frequently asked questions a user might have.
Not only does the conversational tone provided by a chatbot make users feel listened to, and a customized experience is important, but they are also cost-efficient.
This is proven by general consensus. 62 percent of users would rather talk to a customer service bot than have to wait for a human to answer. Also, another study from Hiver shows that 37 percent of respondents describe a customer service experience as good when their issues are resolved on time.
Data does show that chatbots do increase the conversion rate of your website, but it varies greatly depending on the industry. It can be anywhere between 10-100 percent.
For any company, transparency is a crucial aspect. Every consumer is keen to know about the product and services they are using hence there must be a very thin line between clients and the company. All terms and conditions, company policies, pricing, and facilities provided should be clearly outlined to customers so that there is a good understanding of services between the provider and the client.
The main aim of SaaS companies is to turn their visitors into paying users and in order to approach this, the product should be user-friendly.
Here are some interactive ways that can be attained to make the consumers happy:
Give free trial sessions
Turning a new consumer into a regular client requires great effort. Free things often attract users and so do these free trials. Free trials give the idea of the software to consumers. It helps them in deciding whether to continue with it or not. However, these free trial sessions should be less than 15 days for better productivity of the software.
One of the most popular collaboration tools for enterprises, Slack, has one of the highest SaaS company growth rates on record.
Leverage referral marketing:
Utilize referral marketing to achieve a stratospheric rise similar to those of Dropbox, Uber, Airbnb, and Paypal. These were the ones who turned them from simple startups into billion-dollar businesses.
Startups using SaaS could not afford to spend more on paid advertising. Referral marketing stands out as one of the efficient forms of quick and inexpensive SaaS marketing strategies for efficient leads.
A new referral customer has a lifetime value that is 16 percent higher than non-referrals.
Gifts and rewards
For regular and loyal customers, the company can start programs to give some decent offers and perks. This not only builds deeper relationships with old customers but also attracts new users. 10-15 percent of discount can also be given to those users who are following the brand's social media sites.
Secondly, try to provide sole offers to deserving users. Be unique, try to come out with a unique offer that lies under the company’s parameters. Various discounts and schemes can be used to grow the product furthermore.
45 percent of businesses suggest gifting improves relationships with customers.
Influencer marketing is growing larger every year, and there has never been a better time to start using it.
In 2019, 55.4 percent of businesses and marketing agencies were using influencers. By the end of 2022, that number is expected to be 72.5 percent.
Influencers tend to already have a large established following, who trust their opinions. 44 percent of Generation Z customers base their purchases off of influencers’ opinions and suggestions.
SaaS companies tend to attract customers by combining service with enjoyment.
Easter egg marketing is a way of hiding any extra features or jokes inside the software for users to find. Google loves doing this during holidays when they update their Google logo.
Gamification is the process of visualizing so-called gaming elements like competing with others, game rules, scoring marketing techniques, and engaging products, and services.
Salesmachine is an excellent example of a fun and well-designed piece of software.
Salemachine can identify your top PQLs, offer health scores of customers, offer important SaaS metrics as well as automate customer interactions.
What makes it special is the beautiful design. It’s colorful, easy to understand, and offers live analysis at any point in time.
Taking care of public reviews is one of the best growth hacking techniques. To build and shape the company, analyzing all the customer reviews and insights is mandatory.
It not only helps in improving the overall product but also to understand what the customers want from your brand.
A SaaS company should provide a separate FAQ section where it can upload all the possible answers customers can have. Different platforms like Quora can also be used by companies to resolve all questions of customers.
84 percent of people trust online reviews. Having good reviews will quickly generate more organic traffic toward your company and software.
Additionally, these popular Q&A platforms, like Quora, can also help in creating awareness about the brand among people. Service providers should always be keen on answering the doubts of their customers, implementing possible suggestions, and respecting their feedback.
Feedback can be taken in different forms either by generating surveys or by online forms. Doing so bridges the gap between consumer wishes and supplier actions. Furthermore, it ensures the loyalty of the supplier towards the client.
SaaS companies are highly affected by their identity commonly referred to as brand names. Therefore it is very important to have a positive look on platforms like Facebook and LinkedIn.
Different blog posts and email marketing campaigns are used to boost the content on social media.
Gathering a large number of followers on popular sites is very important. This not only helps in public awareness but also connects you with the whole world and makes you aware of the trends of society.
This makes social media one of the best ways to promote SaaS companies. However, it may sound old-fashioned but getting SaaS products featured in a press release is also an important growth factor.
SaaS companies should get their reviews and content published on different platforms as well. Continuous press releases, articles, and reviews on something like Play Store or the Apple store can be done to draw the attention of the users.
Across all industries, proper content marketing strategies have been demonstrated to be a highly effective tactic for businesses. Additionally, it is an exceedingly economical growth hack.
You'll get more traffic as you create more content. Because you are bringing in new users to your website for free, this is the ideal circumstance for any growth hacker!
The best thing, though? More leads are generated by high-quality content—exactly three times more than by paid advertising.
The Buffer App is a great example of this growth hack. In a short amount of time, they produced high-quality material to increase their internet visibility.
A look at Buffer’s blog will quickly offer you high-quality, information articles pertaining to social media, business, and marketing. The high-quality images and illustrations shouldn’t be ignored either.
When you get to the root of the main SaaS issues, you'll see that a lot of users don't see the benefit of the software and are frequently reluctant to give up their current methods. The need for software that uses a platform-based approach and has a variety of plugins and integrations arises as a result.
The "network effect" is a phenomenon whereby as the value of a product increases for the user, its user base expands and more information, data, and content is generated. This phenomenon can be brought about by a partnership across technologies. For 70 percent of the value that tech companies generate, network effects are to blame.
SaaS integrations boost overall operational effectiveness, quality, and provide businesses a competitive edge. With an integration shop like Slack, Salesforce, WordPress, etc., you may develop plugins or make connections with well-known platform-based products easier.
There’s no doubt that SaaS companies that want to grow need to use growth hacking techniques. But often people consider these techniques as defined rules, which is not true. Growth hacking techniques will vary depending on the business type and budget. Either way, growth hacking should be a top priority for SaaS companies with low budgets.
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