The Software-as-a-Service (SaaS) business model has revolutionized how software companies generate revenue. By using recurring revenue, companies can build steady, predictable revenue streams. This makes it easier to reinvest in development, operations, and ultimately churn a profit.
Every SaaS company is constantly looking for ways to increase revenue. Leveraging hard lessons, testing and insights that we have learned at PayKickstart, I thought I would share with you the top 5 growth hacks for other B2B SaaS companies looking to boost revenue.
There are a lot of obvious things you can do to increase revenue, such as “reducing your churn”, or “increasing sign-ups.” But how do you actually accomplish these things, among others?
It’s easy to talk about high-minded goals, but to actually see progress, we need to dig a bit deeper…
Growth Hack #1: Increase Sign-ups By Offering a Clear Value Proposition
When someone visits your website, you have just seven seconds to make a good impression. That’s why you need to quickly deliver your value proposition.
What pains does your SaaS address or better yet, solve? And what makes you different from other solutions? Who is your SaaS for and more important, not for?
While building the PayKickstart shopping cart, we focused both on how we could help our clients and also how we can distinguish ourselves in what is, quite frankly, a crowded field. For us, that meant offering affordable flat rate subscription fees and powerful conversion tools, among other things.
Once you deliver your value proposition, you should back it up with evidence and social proof. This could include demos, stats, tutorials, case studies and testimonials. It should also include positive reviews from your current customers. In fact, customers are 63 percent more likely to purchase from a website that has user reviews.
Growth Hack #2: Make Your SaaS as Sticky As Possible
A lot of companies focus on acquiring new customers. However, if you focus too much on new customers, you may end up neglecting your current customers. And if your churn rates are high, this could be a major threat to your MRR.
So how do you reduce churn rates and keep your current customers happy?
The first thing you need to do is make your product as “sticky” as possible. This means encouraging your customers to interact with your product frequently.
CloudApp, a tool for screenshots and screensharing, does a great job of providing value, while subconsciously getting users to interact and use the app.
For example, if you haven’t completed the initial setup, they sent out a reminder to make sure you complete the onboarding steps.
When someone views a link hosted by Cloud, they send you a notification that someone viewed the link and to go to the link.
Another way to keep your SaaS “sticky” is to create a simple, intuitive wizard – specifically for brand new users. Getting them as quickly to “first value” as possible.
Another way to increase engagement is to offer ample training on how to use your SaaS. If a customer can’t figure out how to effectively put your SaaS to work, they’ll be more likely to abandon it. Likewise, your SaaS may offer useful features that customers don’t even know about.
Create a quick-start guide or set of video tutorials on how to maximize your SaaS and drive home the value.
Growth Hack #3: Close the Deal with a Free Trial
Customers still on the fence? Shopping cart abandonment rates remain stubbornly high, averaging nearly 70 percent across industries. Even if a customer is in the middle of your checkout process, there is no guarantee they will complete the process.
So offer a free trial. This way, the customer can eliminate risks and get to know your product. Customers can test features, familiarize themselves with the interface, and otherwise see how everything works. So long as you’re offering a great SaaS, your product should sell itself.
Of course, you will also make your product stickier by offering lots of tutorials and tips. The more customers learn about your product and the better they become at using it, the more likely they will be to sign up for a paid membership.
Growth Hack #4: Make Sure the Checkout Process is Stupid Simple
A great rule of thumb is to have a purpose with each field you add to your checkout or free trial sign-up. If you don’t need certain information upfront, it may be better to ask for that information later on. Also keep in mind that every companies sign-up will vary slightly, as certain details are more information than others – depending on your onboarding experience and sales process.
We’ve tested a number of different sign-up flows and have stuck with this sequence – let me break down why…
The first screen is only their email address. This way if they decide to leave after this initial step, we can at least follow-up with them with a cart abandonment email later, to get them complete the sign-up process.
The next step we ask for basic account details. We ask for their name, so we can customize the email sequence, in-app onboarding sequence and any sales outreach. As you can see below, when they set their password, we give them a visual guidance to follow, showing which security requirements there are.
The next step is to capture their company details. Given that we primary work B2B, it makes sense to add this step. If you cater more towards B2C it may make sense to remove this step. While we nudge them to include their Company Name and Phone number marking them required fields, we still allow them to skip the step. The reason we are asking for that information, as well as the type of business and number of employees will better allow us to qualify the customer – routing them to the appropriate sales person and customizing their emails with relevant case studies and testimonials.
Right after sign-up, we take them directly into our onboarding sequence.
As you noticed, in this sequence we opted NOT to collect payment details at sign-up. This is an open debate amongst SaaS startups, but we felt that by removing the barrier of payment, we can allow our onboarding experience to do the job of selling the product and reaching first value for the customer. If the customer can reach first value (which for us is getting their first product up for sale), when we nudge them about their trial expiring and a payment method is required, they are happy to add one.
Another important thing to consider is the number of payment options you provide. If you limit your customers to just one payment type, say credit cards, other customers who prefer different payment methods (i.e. Paypal) will be more likely to abandon your product. Simply by enabling PayPal, you could boost revenues by 20 percent!
Growth Hack #5: Sell to Your Current Customers
Many companies focus on acquiring new customers. But here’s the thing – selling to your current customers is actually 4 times cheaper than acquiring new customers. Think about it – your current customers have already expressed interest in your offerings. So why not sell them additional services?
Take Spyfu, for example. The company offers an excellent keyword research tool. This tool can be used to hunt down your competitor’s high performing keywords, allowing you -the competition- to target them. Once you know what’s driving your competition’s success, it’s easier to close the gap.
Spyfu knew that its customers were interested in competitor research. So they decided to offer a new SaaS: Nacho Analytics. This SaaS allows digital marketers to examine a competitor’s web traffic, providing even more competitor insights. Now, Spyfu can sell Nacho Analytics to their current customers.
What to Do Next
The strategies and methods you choose to increase revenues are vital. Your goal shouldn’t be to “just” use industry best practices but to actually exceed them. Implement these strategies correctly and you will see an increase in your bottom line.