There are hundreds of thousands of aspiring entrepreneurs with really good business ideas. From those ideas, only a few grow into a company.
SaaS or short for Software-as-a-Service describes a software model where the cloud-based system is licensed and is centrally hosted.
As every startup founder is looking for ways to catapult its business to success, SaaS business owners are also looking for strategies that can help them grow and ensure they don’t vanish in the competitive market.
With that in mind, we are going to present a few growth strategies to try. Ready to grow your SAAS startup?
Let’s do this:
1. Identify Your SAAS StartupTarget Market
Knowing who your potential customers are, their needs, and what encourages them to purchase is crucial for defining your target audience.
As a marketer or business owners, you don’t have all the resources to market your brand to everyone. You need to segment your most important customers – people who are likely to purchase, people who make repeat purchases, and people who are likely to spend a higher amount – as your target group.
This is what will make your SaaS business grow faster without increasing your marketing budget.
You can spend your audience based on:
- Geographic: Region, country, climate.
- Demographic: Gender, age, education, family size, ethnicity, and other indicators.
- Psychographic: Lifestyle, values, motivations, habits, and etc.
For a SaaS startup, if the target group is everyone, conversions and sales will be missed.
The reason why you need to define your audience is that it can help you focus on your advantages and strengths, offer features that meet your target group’s needs, and personalize the communication.
This can help you grow exponentially in a short period of time.
2. Test Different Prices
Pricing is not constant. Instead, it should evolve and change as your business grows.
Only by split testing different pricing levels, you can figure out and understand people’s perception of your brand, as well as their readiness to pay for your products.
The optimal price is when you have:
- A small percentage of people who say that your products are too expensive
- A small percentage of people that don’t hesitate before paying
- A big group of people who say that your products are too expensive, however, they are ready to pay anyway because they think they are valuable and high-quality.
A higher price generates an impression of higher value. People are aware that something extremely cheap can’t be good, and building great products involves costs.
Apple products are great examples. They don’t try to lower their prices. Instead, they use a WTP or willingness to pay strategy to form their pricing.
Apple sets prices based on the maximum that the majority of their target group can pay, not the minimum or the average.
3. Grow Your Email List
Building a big email list is a smart strategy for growing your SAAS startup. Noah Kagan (AppSumo) did it, and it is proven to be a life-changing decision for the business.
Noah Kagan built AppSumo, a successful business, thanks to his thousands of email subscribers or to be more specific to his 700.000 email addresses.
Yes, that’s right. Kagan managed to build an email list of over 700.000 addresses. Are you wondering how did he get so many addresses? He was obsessive about it.
Here is what you can learn from Noah Kagan and his blog.
When he first set up his website, he had one goal in mind – get email signups. That has been his only focus from day one. He is continuously looking for ways to do so without spamming people.
The tactics are simple and come straight from his guide to getting your first 100 email subscribers. Some of Kagan’s techniques for getting email addresses are:
- Give something away
- Use the by-line
- Exit popup
- Bonuses on posts
- Welcome gate
He did all of these things and absolutely killed it.
4. Make Partners not Competitors
We assume you’ve already done a competitive analysis and you are familiar with your biggest rivals. You have thought about what your differentiating factors are and how you are going to stand out from the rest.
This is a potential business opportunity for you. How so?
Is there a company in your industry or niche that has the majority of the market share? Becoming a competitor could be the way to greatest resistance or worse – mutual destruction. However, if you can make a partner out of that company, you can hack the way to growth.
One example is Airbnb.
When they first started, they acknowledged the presence of Craigslist and their popularity at that time. Craigslist was dominant in the rentals and vacation-home market when Airbnb started growing the user base.
Instead of investing in advertising, Airbnb decided to ask users to add their listings to Craigslist. This wasn’t easy considering the fact that Craigslist didn’t have an API or Application Program Interface whose tools and protocols help build a new app.
Airbnb figured things out thanks to coding magic.
5. Only Listen to Your Paying Customers
People today may say a lot of things about your brand and the products you offer. They may say that they like your product, they think your product is the best, they will definitely purchase your product, and etc.
Listening to all of them is a mistake. Don’t base your brand on free users or visitors who only visit your website but don’t purchase anything. If you do that, you will be improving your strategy and product for the wrong group of people.
Yes, you need to provide the best support to all users; however, you need to develop features only for those who take your brand seriously and purchase your products. Your paying customers provide you with insights that matter.
Growth-hacking may offer great opportunities for business growth. However, that doesn’t mean that there isn’t any extra work included
A dedicated and continuous effort is required to pull off a successful growth strategy.
Even the slightest changes and improvements in your business growth can have a positive impact on your SaaS startup’s success.