4 Go-To SaaS Sales Strategy To Boost Business Revenue in 2022
Published on February 17th, 2022
Published on February 17th, 2022
SaaS products are rapidly developing & becoming a go-to solution for many companies. According to studies, SaaS sales are to reach $396 billion in 2021 [Source], and the industry will grow 21.7% to reach $482 billion in 2022 [Source]. Statistics are always intriguing. Isn’t it?
But to leverage SaaS sales, you need to adhere to a specific SaaS sales strategy as the sales process of the SaaS products is unique.
Wondering why? It is primarily because SaaS products are intangible products that require precise selling techniques, KPIs & sales methods. Are you seeking ways to develop excellent B2B SaaS sales & power growth of your sales cycle? You have to ponder upon the sales strategies.
If you are in a managerial role in a SaaS company or associated with developing SaaS products or a SaaS sales rep looking for SaaS sales strategies, we have prepared a guide for you comprising all the SaaS sales basics. Right from the different sales models to sales cycles & metrics, we have encased all. Let’s dive deep into the blog.
SaaS or software as a service is a cloud-hosted, secured product operated from one unified interface. We can define SaaS sales as the process of selling cloud-based software to SMBs, agencies, or enterprises.
The SaaS product features are incorporated with analytics tools, publishing & scheduling features, CRM, team collaboration workspaces, and many more, supported by the provider’s product engineers & customer success team. Selling SaaS products refers to trading subscription access of the products designed to minimize the users’ pain points.
Just like other B2B products, SaaS products are also designed to save time & human resources. Notable that SaaS solutions often support both B2B & B2C business models.
Are you wondering why the SaaS sales process is different from other types of B2B sales? The difference in SaaS sales strategies revolves mainly around the complexity of the SaaS model.
Usually, many SaaS products deal with a complicated business process that includes managing & recurring revenue through subscriptions, payments, and compliance & retaining customers for a one-off transaction.
In SaaS sales strategy, aiding the target audience with proper education is a significant step to make your client completely understand the product capabilities; otherwise, if they don’t feel confident about the product, they’ll be hesitant to invest in it. Hence, the salesperson must unearth the customers’ pain points & elaborate how they can leverage the product to solve their issues.
A sales rep should have ample knowledge of the product to make the client understand how exactly the product works. For customer acquisition & retention, you have to be proactive in providing substantial education as an integral part of the sales process.
The initial step of a SaaS sales strategy is to choose a suitable pricing model. Typically, SaaS solutions operate with a monthly or annual subscription-based pricing model. So, you must strategize the number of sales representatives you require & equip them with advanced tools to work best with your target market. However, choosing a suitable pricing model entirely depends on your product.
Let’s check out different SaaS sales models to strategize your SaaS sales:
The most common sales-led model in B2B SaaS sales is the transactional sales model. The model is incorporated with selling software to SMEs & the process generally takes over the phone. Since at this level software costs more, you are required to provide more personalized services to the customers. It would be best if you had an independent sales team, and the sales reps should have a certain amount of autonomy, such as offering discounts or leading customers toward the tiered pricing models. The salesperson here has to utilize the maximum efficacy to get the highest quality leads.
It is a product-led model which is a suitable fit for lower-price & high-volume SaaS products. If you have SaaS products that can be used without any company business process, the customer self-service model is a good fit for you.
You can take the best example of this product-led model as the Spotify subscription or OTT platform subscription process. To draw your prospects’ attention, infuse the model with free trials or a freemium model such as ASANA or MailChimp or Zendesk integrations, etc. Since the target audience signs up by themselves in this model, you need not integrate a full-service sales team in the self-service model.
The enterprise sales model is another sales-led model that primarily deals with software with high price & low volume. If your SaaS solutions offering are incorporated with social listening, bulk scheduling, or data analytics tools, the enterprise sales model is the SaaS sales strategy you should ponder upon.
Usually, these SaaS products are highly specialized & in this model, your sales representative is required to spend a substantial period with the prospects. During the sales cycle, the representative processes product demos & answers a wide range of technical questions; besides, the sales team meets the key stakeholders.
If you wish to opt for an enterprise sales model, your representatives need to acquire extensive technical knowledge of the product. The sales team should work closely with the engineers and product marketers to gather all the necessary product updates & information to secure high-value deals.
Enterprise sales target market encompasses large organizations with sufficient budgets & they usually can afford the high price range. The primary challenge associated with this sales model is that the sales cycle is quite long, leading to significant opportunity costs if the sale ends up leads-lost or lead nurturing fails.
Many B2B SaaS & B2C SaaS businesses offer free trials at the initial stage of the sales cycle. It is indeed a good practice of SaaS sales strategies to attract new clients as the process aids the prospects to have an in-depth understanding of all the benefits of that particular SaaS product. However, you have to proceed with a strategic approach to leverage the free trial model.
If you’re a beginner in the SaaS industry, choose a trial period based on the complexity of your product. If you have a lower-cost product, a seven-day trial period is reasonable, but in the case of enterprise business software 30-days trial period is an excellent option to make your customers get accustomed to the product benefits.
While you create & conduct a demo, ensure that you are not overwhelming the customers with an extensive feature set. It is always a wise step to start the process by researching the prospect & accordingly tailor a demo focusing on the product benefits which can solve that particular problem the prospect is looking for. Relevance is a crucial factor while organizing demos for SaaS sales, as when the demo is relevant to them, it helps prospects relate more with the product usage.
The SaaS sales cycle is the entire buyer journey, the venture of the prospects to a closed-won deal. To create accurate revenue forecasts, you need to understand the SaaS sales cycle. There are five key factors based on which you can strategize your SaaS sales. Let’s drill down the point to get clarity:
Client Type: If you are associated with an SMB, the SaaS sale cycle is typically shorter as these sections of clients make purchases quickly. But the enterprise-level client follows a more structured approval process that involves many decision-makers. Hence the sales cycle takes time.
Complexity Of Product: Do your SaaS products have a considerable number of features? If yes, your prospects will require substantial knowledge & guidance before deciding to buy the product. Your cycle length may go higher as the negotiation period may be extended upon the product complexity.
Product Pricing: The higher your product price, the more prolonged the SaaS sales cycle is. When you have an expensive product, your prospects follow an approach requiring multiple decision-makers’ approval, which causes delays.
Trial Periods: Before buying a product, prospects look for a free trial period. But if you have a too long trial period, you have the risk of prospects getting complacent. Hence it is crucial to maintain a follow-up process to get engaged with your options.
New Market: When you break into a new market, it ends in a longer sales cycle. Your team should spend a considerable amount of time creating brand awareness & visibility. However, it is an essential task to attain success in the new market.
Inculcate growth marketing strategies with your SaaS sales strategies to draw client attention & use blogs, articles, infographics, manuals to explain your product to the targeted market.
There are primarily five stages of SaaS sales. We have unpacked all the stages. Let’s have a look:
Product Visibility: It is the early stage where you need to focus on the marketing efforts as it does all the tasks to make your product visible in the target market. Inculcate content marketing, social media marketing, advertisements to get onto your client’s radar.
Identifying Quality Leads: To save time, focus on identifying the most promising leads among your website traffic & trial subscribers. Leads scoring platforms can be your helping hands to gather data about your visitors. Besides, your sales representatives can contact new prospects after the signup process to clarify & assess their level of interest.
Awareness: In this stage, aim at getting qualified prospects. To master the process, engage your sales team to discuss customers’ pain points & how your SaaS product can solve their issues.
Handling Queries: After being aware of your product, your prospects may have questions & concerns regarding product fit or pricing. Ensure to listen carefully to their queries to understand them. If your prospects have concerns regarding the product fit or usage, dig deeper to understand the issues. If the queries are associated with price, ensure to clarify the product value in a way that outweighs the cost.
Close The Deal: It is an all-important stage where your prospect decides to become a customer. You can offer discounts to win over opportunities. Ensure you follow a transparent communication process to avoid chaos or misunderstandings that can negatively impact the SaaS sales cycle.
Ensure to examine KPIs to assess your efforts. It helps you understand if your approach is helping you gain more prospects & if there is any amendment required.
You can measure SaaS sales metrics such as Net Revenue Retention Rate (NRR), Monthly Recurring Revenue (MRR), Annual Recurring Revenue (ARR), Customer Acquisition Cost (CAC), Churn Rate, Net Promoter Score, Customer Lifetime Value (LTV), Win Rate, and Sales Qualified Leads, Lead Velocity Rate, Deal Velocity, etc.
Considering all these factors, look at the different stages to develop an effective SaaS sales strategy. Break down the process to the granular level to understand the scenarios & help your team to build a workflow around it. Also, to retain customers offer quality customer support, aid your sales rep team with comprehensive training. Besides, offer freebies to your customers & invite your clients to seminars, workshops to strengthen your relationship with them. Engage with your target audience & onboard them for a more extended period.
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