As cloud computing and entrepreneur-oriented businesses grow, creating a software as a service (SaaS) startup is a potentially profitable business opportunity. Organizations, both small and large, can benefit from a well-designed SaaS and know the value of the return on investment.
However, having a great product isn’t enough to garner success. As a startup, it’s necessary to have a growth strategy. Let’s explore why you need a growth strategy for your SaaS startup, and some critical elements for success.
The Importance of Having a Growth Strategy
The last thing you want to do as a startup is to stumble in the right direction. Having a growth strategy outlines key performance objectives and metrics to make outcome-based decisions for your business. A growth strategy provides the framework and guidance for building a successful business over time.
Following a growth strategy creates a series of small wins that grow exponentially. This proven course of success will prove invaluable when approaching investors, hitting revenue targets, and considering your company selling options in the future.
While there are many ways to encourage growth within your SaaS startup, some strategies work better than others. When creating your growth plan, you won’t want to miss these four fundamental elements.
SEO as Top Priority
SEO is the bread and butter of digital marketing, and content reigns supreme. As an SaaS startup, investing heavily in SEO will set you up for continued success in the years to come. As SEO tends to be a longer-term strategy, planting the seeds now is integral.
Choosing the Right Keywords
Keyword research is something that can be started before your business launches, using other SaaS tools to accomplish the task. Collect a master file of relevant keywords using resources like Ahrefs and Answer the Public.
When choosing keywords, it’s important to have a blend of longtail and shorttail options. Additionally, you’ll want to build your content with voice search and Position Zero at the front of your mind. It’s estimated that half of all internet searches will be voice searches by the end of 2020.
The notable difference with voice search is that queries are often phrased in the form of a complete sentence or question, rather than incomplete, keyword-centric inquiries. Fortunately, Position Zero is also built around queries in the form of a question, creating strategy cohesion.
Outreach and Backlinks
Guest posting and backlinks that highlight your content still play a pivotal role in SEO. The more links to your content that are featured on high-quality websites with relevant subject matter, the higher you will rank on an SERP.
The downside of outreach is that it’s time-consuming. As a part of your strategy, consider reaching out to a reputable blogging outreach service to assist with your content creation and backlinking strategy. This approach is one of the best ways to start boosting your SEO quickly.
Leverage Influencer Marketing
Influencer marketing is a largely overlooked opportunity for SaaS Startups. Many companies make the mistake of thinking influencer marketing is targeted more toward product-based businesses. However, when properly executed, influencer marketing for SaaS can be lucrative.
The secret to successful influencer marketing for SaaS startups is to find the influencers that accurately represent the target market. Whether your ideal client is a large business or entrepreneurs, finding well-respected influencers within that scope is paramount.
When you find influencers who fit your demographic, create a personalized outreach email (not a generic, mass automation) highlighting how your SaaS could benefit their business efforts. Offer them an extended free trial to see for themselves.
To start on a smaller scale, consider working with micro-influencers first. Micro-influencers are often labeled as those who have between 1,000-10,000 followers, though the number is arbitrary and can reach up to 500,000 followers. It’s estimated that micro-influencers have up to seven times more engagement than large-scale influencers due to their tight-knit community.
Whether a micro-influencer will work for you is contingent on your SaaS offering, target market, and overall goals.
Freemiums and free trials are still a valid approach to creating a growth strategy. They get prospects into the sales funnel and build trust over time. For many SaaS startups, having a freemium is more effective than a free trial, as consumers are becoming more aware of convoluted cancellation policies, subconscious subscriptions, and loopholes to use a premium service for free.
Buffer: The Freemium Model to Emulate
Buffer is a prime example of a successful freemium model that segues into tiered pricing. Within the free version of Buffer, users get the same streamlined, user-friendly UX that those with paid subscriptions experience. In their free version, Buffer allows for three social media posting accounts, one user, and up to ten pre-scheduled posts, which is ideal for a small enterprise or taste of what they can offer.
From there, the tiered pricing kicks in. The $15 per month price tag is still manageable for small businesses, offering eight social media accounts and 100 pre-scheduled posts. The options become more enterprise-centric from there.
While Buffer recently changed to a free-trial first option, they make it clear from the start that it’s easy to downgrade to a free account. As a result, Buffer gains awareness and lead captures to gain a foothold for targeted marketing and growth.
Additional Benefits of Freemiums
One of the additional benefits of the freemium growth strategy is that it promotes awareness via word of mouth marketing. Incidentally, word of mouth marketing is another powerful growth strategy.
Source: Screenshot Buffer.com
Capitalize on Word of Mouth and Referral Marketing
Social media is effectively a medium for sharing thoughts and opinions about services and products. It has taken word of mouth marketing and evolved it into world of mouth marketing.
Startups in any industry would be remiss to underestimate the power of word of mouth marketing. As a part of your overall growth strategy, focus on these three components of client recommendations and referrals.
Creating a worthwhile referral program will help skyrocket your growth and customer engagement. It’s estimated that a customer converted through a referral has a 16% higher lifetime value (LTV) than those acquired through other means. Furthermore, referral programs yield higher conversions and retention, as well as lower churn rates.
Dropbox utilized their referral program as a part of their onboarding process and had unbelievable results. This simple SaaS grew 3900% in under 18 months without a significant advertising budget by offering something easy to forward and valuable to users: more storage space.
In the cloud computing world, storage space is invaluable. Not all referral programs have to be monetary: consider how you can leverage your SaaS to create a valuable referral reward.
A talk trigger is something that sets you apart from your competition and gets people talking about you. Talk triggers can either be something relevant to your business or something completely off the wall.
For The Cheesecake Factory restaurant chain, the approach of “no publicity is bad publicity” was enacted with the implementation of their 6,000-word menu. People may not get through the menu, but they tell everyone about it. For entrepreneur and author, Zack Miller, his talk trigger is wearing jeans and a black t-shirt to formal networking events. As such, he stands out memorably.
Choose something that will make potential customers react, remember, and differentiate you from the competition.
Reviews and Testimonials
If you aren’t making it easy for trial users and customers to write reviews and testimonials, you’re missing one of the most basic, organic word of mouth marketing opportunities.
Put a strategy in place to follow up with users to get feedback. Negative feedback will give you direction on how to improve in the future. Positive feedback can be posted, repurposed, and shared.
Before making an investment, customers want to know that other people have had success with your offering. Highlight your reviews and testimonials to build trust and generate growth.
Key Considerations for Implementing a Growth Strategy
Creating an effective growth strategy isn’t as simple as choosing a direction and running with it. For a growth strategy that works, you should:
- Evaluate the opportunity – consider what it will take to make your strategy work. Do you have the resources in place? What’s the timeline
- Know your strengths and weaknesses – identify what your startup excels at, and what areas you fall short. Evaluate the competition and identify how they are excelling in areas where you face challenges.
- Set a goal – create a reasonable goal that you hope to accomplish through your growth strategy. This could be revenue-driven or awareness-driven.
- Eat the whale – how do you eat a whale? One bite at a time. Break your overall goal into monthly, weekly, and daily objectives. The goal is your end point; the objectives are the actions you take to get there.
- Set KPIs – create metrics for success and determine how you’ll measure your progress.
- Do one thing well – rather than focusing on multiple areas, choose one strategy to implement at a time. By honing in your focus, you’ll be able to fully explore that opportunity without spreading your resources too thin.
- Put the right people in the right role – having the right human resources in place is essential for creating and implementing a successful growth strategy. Outsource and hire top talent to make it work.
By following these simple steps, you’ll create a growth strategy that yields results.
A robust growth strategy is essential for SaaS startups’ success and longevity. Implement one or more of these core strategy ideas and create a well-structured execution plan to make it happen. By doing so, you’ll increase your revenue and become a profitable and sustainable business.
Ashley Lipman is an award-winning writer who discovered her passion for providing knowledge to readers worldwide on topics closest to her heart – all things digital. Since her first high school award in Creative Writing, she continues to deliver awesome content through various niches touching the digital sphere.
Tim Ferguson is a writer and editor of Right Mix Marketing blog. He enjoys writing about SEO, content marketing, online reputation management, social media, AI and Big Data. When he is not writing and editing for Right Mix Marketing, he spends time on learning more about content marketing and getting better at it. You can follow him on Twitter at @rightmixmktg