Short for software as a service, SaaS has become the de facto software model for businesses in recent years. According to Gartner, SaaS is expected to be a $76 billion industry by 2020. Why else did four leading companies—Microsoft, IBM, CA Technologies, and SAP switch over to SaaS product development in 2017? Add to that, here are two more facts substantiating the growth of SaaS businesses—SaaS revenue is predicted to grow from $58.6B in 2017 to $99.7B in 2020 (Source: Gartner), and 80% final users prefer using SaaS applications (Source: FinancesOnline).
As an industry, SaaS is only set to expand further in the future. While the foreseeable growth is positively exciting in this sector, with over 5,000 SaaS businesses in the world today, competition is fierce. This makes it incredibly difficult for businesses to stand out in a crowded market.
According to a survey conducted by Totango, 86% of SaaS businesses treat “New Customer Acquisition” as their highest growth priority, and 56% treat “Existing Customer Renewals” and 54% treat upselling as high priorities. For SaaS businesses to thrive in surging competition, they must conquer two major challenges—customer acquisition and customer retention.
Customer acquisition is the driver of SaaS businesses. Driving leads to the bottom of the sales funnel and converting them into customers is not a bed of roses. It’s a complex mission for sales teams to prospect, follow-up, nurture, and sell. Add to this, sales reps also have to deal with upselling and retention.
In a market full of growing SaaS products, your business could be neck and neck with competitors. But, how do you compete and win more customers? Customer experience is the real differentiator. The upside here? Providing excellent customer experience in the SaaS business is easy with CRM software. Well, only with a good one.
CRM comes in all shapes and sizes. But the right CRM should facilitate your sales process from the first touch point to the final sale.
The ultimate goal for any business is to increase revenue. And this begins with improving sales and customer relationships. If you’re looking for a CRM, for starters, here are three aspects it must possess.
For large SaaS enterprises, acquiring customers is not a pressing concern, but retention is. On the other hand, for smaller businesses, customer acquisition is everything. But, how can you increase the number of customers?
Every business follows a customer acquisition strategy to attract and convert visitors into customers. What many new SaaS businesses don’t realize is, to boost acquisition you must know your ideal customer. Defining personalized journeys and targeting campaigns help convert more leads into customers. And, how can a CRM help?
Ecommerce businesses have long been using live chat as a channel to engage with buyers and drive sales. Live chat is no longer an ecommerce business necessity. Today, everyone visits a company’s website before making a purchase decision. And, live chat software is imperative if you want to improve the customer experience. 79% of businesses claim that offering live chat has had a positive effect on sales, revenue, and customer loyalty (Source: Kayako). A CRM that integrates with an effective chat tool allows sales reps to engage with visitors directly from the software. On top of that, integrating the two allows you to store information about the potential sales prospect in the CRM, giving context into future conversations.
Website traffic is of paramount importance to SaaS businesses. Tracking visitors and analyzing web visitor behavior is necessary for sales teams to know and act. CRM software tracks website visitor’s activity and facilitates understanding who your ideal customer is. You can put this information to use and personalize your campaigns to drive conversions. Now don’t look for another tool for campaigns. CRMs come with email marketing features. From templates to automated sales campaigns, you can set up your CRM to target and convert potential customers.
Anybody who lands on your website is a potential lead. Your company website is your biggest lead generation machine. Lead capture forms or web forms are essential to add to your website pages. Especially for SaaS businesses—74 of the top 100 fastest growing SaaS companies use a lead form (Source: Fieldboom). Setting up a form is only half the battle; you have to effectively capture the information in the right place and act on the hot leads. CRM systems offer an end-to-end solution—from creating your web form to scoring and assigning leads to agents—in one platform. Automating this process prevents sales leads from falling through the cracks.
Did you know that it’s 5 to 10 times cheaper to upsell an existing customer than acquire a new one? (Source: Chargebee) According to Marketing Metrics, the probability of selling to an existing customer is 70%, whereas a prospect is only 5-20%. By all means, upselling appears to be the way forward, but it’s not an easy approach for sales teams in SaaS businesses if they don’t have the right tools.
Rule #1 for upsell— don’t bombard customers with phone calls and emails to get them to upgrade to increase revenue. In order to successfully upsell, sales teams need insight into the behavioral data of customers. For example, for a SaaS business that provides email marketing services on different plans, knowing the level of usage by customer helps you segment ones who are likely to upgrade.
An efficient CRM system gives you insights into user behavior either through a third-party app like Segment or using API. It tracks individual user engagement and logs the activity in a chronological timeline view. Using filters, you can segment users who performed a particular action on your app and send them a personalized email to opt for a more feature-rich plan. Segmenting users by behavior allows sales reps to run a targeted upsell approach, instead of shooting in the dark.
Customers are your bread and butter. Losing them to poor customer experience and to competitors is not only lost revenue but can also hurt your business’s growth. Angry customers rant making it harder for you to acquire new customers. Fewer sales results in less revenue and higher acquisition costs. Neither is good news for your Saas business.
How do you reduce churn and increase retention? In other words, how do you keep customers?
To begin with, you need a great SaaS product to satisfy your customer’s needs. After all, that’s the primary reason to do business with you—solve their challenges. Having a great product is a good starting point to attract new customers. But if your product is crappy, customers will churn. While it’s important to keep your product on par with expectations and benefits, customer churn is more often due to poor customer experience. Here’s proof—67% of customers state bad customer experience as their primary reason for churning (Source: Kolsky), while 78% of prospects don’t even become customers due to poor service (Source: American Express). Well, it’s obvious where we’re going—improve customer service.
There are several ways CRM can aid you to increase customer satisfaction. In today’s world, SaaS businesses are required to be on their toes. Customers want ease and speed. Faster response time and better-informed agents are the top two factors influencing their experience with your company. Find a CRM that seamlessly integrates with your customer support tool. How does this help?
Retention starts before acquisition. Aside from aligning sales and support to improve customer experience, your CRM is a powerful tool by itself to enrich the customer experience. CRM keeps track of all your touchpoints revealing valuable insights into your customers, thereby giving you the tools to help retain customers. Proactively engage with customers by knowing their interaction with your product and position your communication to deliver memorable personalized experiences.
Freshsales is a SaaS CRM software that fits the needs of a SaaS business like a glove. It helps you manage your sales and customer relationships, and provides insights to focus on the things that drive your business and grow your bottom line.
Integrate with Freshchat, so sales reps instantly chat with website visitors directly from Freshsales. Increase your conversions with a live chat tool seamlessly integrated with Freshsales CRM.g
Manage your leads from start to close in one place with a 360o CRM. With Freshsales, information from multiple touchpoints is linked to the relevant records. Also manage your recurring billing and invoices by integrating with QuickBooks.
Understand how customers use your SaaS product using in-app tracking. It’s beneficial in identifying most-used features for upselling and cross-sell campaigns. Insight into user behavior also indicates a likelihood to churn allowing sales reps to influence the customer proactively.
Segmenting customers into cohorts based on their activity, engagement with your product, or by campaigns in Freshsales helps you target your sales and marketing efforts. Use lists to perform bulk actions on records like email, update, or add them to a sales campaign.
Freshsales adds the ability for sales reps to raise tickets within the CRM by integrating with Freshdesk and allows support agents to be informed of customer’s historical data. Create personalized and meaningful conversations with customers.
CRM is a great tool, no doubt. But a fully-equipped CRM turns your SaaS business into a sales powerhouse. Freshsales comes with built-in features and numerous native and third-party integrations to save time on manual work, decrease response time, improve your products, and run your business.
Freshsales is a leading CRM built for sales teams in SaaS businesses geared to improve customer experiences, sell more, and maximize productivity. Your search for a CRM ends here. Sign up for a 21-day free trial and see how you can grow your SaaS business organically.