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  • All About Accounting Software for SaaS

    How many of us really like dealing with the nitty-gritty of running the accounting and bookkeeping operations of our companies? Unless you’ve got a passion for numbers (or you’re the founder of an accounting startup), you probably look at accounting as the least engaging, most time-consuming part of your day-to-day as an entrepreneur.

    Accounting Software for SaaS
    Accounting Software for SaaS

    So how do you keep track of your daily business accounting while also gearing up your business for future growth? You pick the best accounting software for SaaS companies. Implementation of the proper systems, processes and technology stack as early as possible is the solution. With the right accounting software for SaaS businesses, you can achieve a seamless flow of data between all financial processes in your business which would ultimately enter your cloud accounting system, ideally automatically.

    Also read:

    Spreadsheets vs. SaaS accounting software

    When you start making your first purchases for your startup, it’s easy to record them in an Excel or a Google Docs spreadsheet. Excel spreadsheets may seem perfect for the first weeks, or even months, as you’re getting your business off the ground, but continuing to manage your books that way — and not using real SaaS accounting software for your startup — is simply the wrong thing to do. This is true especially when you seek investments or venture capital to grow your business; when you show potential backers your financials in a handful of spreadsheets, chances of errors are higher and it looks unprofessional.

    Spreadsheets vs. SaaS accounting software
    Spreadsheets vs. SaaS accounting software

    There are certainly people who could maintain their financials for their SaaS startup in this manner. In these cases, they’d have to create very detailed spreadsheets with all the accounts and reporting elements of standard accounting. Spreadsheets like this would look a lot like accounting software, and the amount of time they’d take to set up and verify would be better spent on growing their business. The disadvantages of using Excel for accounting for your SaaS startup is about a lot more than just the way figures look in a spreadsheet. There is so much that can be wrong in a spreadsheet that investors can’t take that sort of financial data seriously.

    What SaaS accounting software offers?

    SaaS accounting software offers so much more than Excel that it’s really a no-brainer. Here are some of the best features that most accounting software provides:

    • Contact and project management: Set up your contacts, create projects, and manage your clients, all without having to copy and paste rows and columns.
    • Time tracking: If you bill your clients by the hour, most accounting software includes the capability to do this automatically. Create time sheets, then add them up when it’s time to issue invoices.
    • Invoicing: This is one of the most practical features of accounting software. You can easily invoice your clients, according to what you’ve sold them, how much time you’ve spent on their projects, and more. You can also create estimates, which you can then convert to invoices with a few clicks.
    • Price database: Depending on what your business sells — services, hardware, etc. — you can have a price database and update it as needed. You’ll always be charging your clients the correct prices. And you won’t need multiple calculations for sales tax; the software will handle that too.
    • Expenses: Accounting software handles expenses very well. Each team member has a role in the accounting software, and you can see, at any time, how much has been spent, and reimburse people accordingly.
    • Apply purchases and expenses to the appropriate accounts: Some of your expenses are for payroll, others for office equipment, and others for capital assets. Try separating those correctly in an Excel spreadsheet, especially when you need to calculate depreciation. Accounting software does this for you, and helps ensure best practices are followed in recording expenses.
    • Payroll and benefits: Handle payroll, payroll takes, reporting, and all the related expenses without breaking a sweat.
    • Bank feeds and reconciliation: With accounting software, you can have your bank transactions update automatically, and apply their expenditures to the correct accounts with a few clicks. Accounting software handles multiple bank accounts easily, and some software handles multiple currencies, so you don’t even have to look up exchange rates.
    • Cash flow projections: You can do this with Excel, with complicated formulae, but accounting software lets you see the big picture at any time.
    • Sharing: You may have a number of principals in your startup who need access to your accounts. With an Excel spreadsheet, you won’t all have access at the same time. Plus, you’ll never know if anyone has made a mistake. With accounting software, your accountant or CFO can check your books easily, and you can even give potential investors limited access to view your accounts.
    • Pretty printouts: Whenever you are seeking investments, you’ll need to show how healthy your business is. Accounting software prints out easy to read, standardized reports: your trial balance, profit & loss account, balance sheet, and more. You’ll look a lot more serious with accounts that investors can understand at a glance.
    • Audit trail: No one wants to get audited, but if you ever do face the scrutiny of the IRS, accounting software makes the process a lot simpler.
    • Support: When that person who set up the Excel spreadsheet leaves your startup for a different gig, who will be able to help out when something goes wrong? Accounting software includes support so when you don’t understand something, an answer is just a phone call away.

    Relevant read:

    Why are good accounting systems important for SaaS?

    The difficulty with SaaS businesses is that they are typically high transaction volume businesses, especially on the revenue side of things. It’s not uncommon to have thousands of transactions per month happening due to the recurring revenue model. When you have old, archaic accounting software (or even worse, spreadsheets), managing this high transaction load, it means that it’s very manual to reconcile and categorize your financial data on an on-going basis. You would need to enter every single one of these transactions 1 by 1 into your accounting system or spreadsheet in order to handle the accounting properly.

    Some SaaS businesses that we encounter even have 1 full time employee at the company just to handle data entry. Using this approach usually ends up with the company wasting time, wasting resources and not getting the data they need when they need it. With the right accounting software for SaaS businesses, much of this manual data entry and categorization process can be greatly alleviated.

    Focus on These Features

    Ok, you have decided that it is time to find a new accounting solution. Here are a few accounting-specific modules that you should ask about when assessing new software.

    Features
    Features

    Revenue Recognition

    Recurring revenue is the heart of your business. The revenue recognition process must be bullet-proof. Ask the vendor if they have specifically addressed ASC 606 or IFRS 15. Reporting is also key. Can you produce a report that shows recognized revenue by month by customer by product? Reports are also needed to prove out your deferred balances by customer. Your auditor will ask for this!

    Payment Integration

    If you invoice customers and receive a check or ACH in return, payment integration may not be relevant to you. But if your customers pay only by credit card, you’ll want a solid integration to Stripe or PayPal, for example, into your software. It must be able to track the meta data related to these transactions so that revenue recognition can be performed.

    Must read:

    Sales Tax

    This seems to be changing every year, and sales tax treatment on SaaS varies wildly from state to state. An out-of-the box integration that connects your accounting software to sales tax compliance software is necessary.

    Fixed Assets

    Software companies are typically not capital intensive in fixed assets (servers, expensive laptops, phone systems, etc.), but you do need a module for this. And it is a bonus if it also tracks the multiple “tax books” for GAAP, federal, and state purposes.

    Travel and Expense

    Does the software offer its own module to track and submit employee expense reports? And a mobile app? If it’s clunky, you may want to consider an outside T&E software vendor that integrates into your accounting system.

    CRM Integration

    Where does your quote and order begin? Integrating that information into your accounting system removes manual work, reduces errors, and most importantly, allows you to invoice faster so that can you accelerate cash flow. And cash is paramount in running any business.

    Conclusion

    If you’re going to eliminate the administrative nightmare of your accounting and start getting timely, accurate data, it all revolves in having the right accounting software for SaaS businesses in place, though choosing the right apps is just 50% of the equation to achieving stress-free accounting. The proper system architecture needs to be assembled, processes need to be defined so that everyone knows how data will flow between all apps and the right team has to be in place to maintain the integrity of the data on an on-going basis.

  • How to Price Your SaaS Product?

    For many new products, price is a decision made shortly before launch. But pricing a software-as-a-service (SaaS) product presents unique challenges for product and marketing teams. Unlike traditional software, customers licensing SaaS products pay for your product on a recurring basis. This gives you more options for pricing models. The problem is, you have no idea how to price your SaaS Product. You are probably asking yourself:

    • “Should I be charging less than my competitor, or more?”
    • “Should I gate off specific features, or charge by a metric like number of users — or maybe both?”
      And the list of questions goes on

    Pricing for SaaS Product
    Pricing for SaaS Product

    This article aims to help you find answers to all your pricing questions. “You must know your customers to know your pricing”. Gathering customer data helps you understand the general makeup of your customers and quantify the value people derive from your product, so you can drive your pricing strategy accordingly. Surveys are a very effective and relatively fast way to obtain information, but you need to be smart and intentional about the questions you ask.

    Standard survey templates include demographic data points such as age, gender, location, etc., but behavioral insights are more useful for pricing purposes. One of the most important things to consider when it comes to pricing strategy is what your different customers actually care about when they use your product. By realizing who wants what, you can understand which features all customers should have, and which features can be gated by tiers.

    Also read: New year Party Ideas for Office | Amazing Party Ideas
    Must read: How to Track Customer Acquisition in SaaS?

    Pricing Models for SaaS Products

    Different pricing strategies
    SaaS pricing models
    1. FLAT RATE PRICING: Flat rate pricing is probably the simplest way to sell a SaaS solution: you offer a single product, a single set of features, and a single price. This method is still used by eCommerce SaaS CartHook. A single monthly price of $300 (or $2,400 billed annually) grants access to all features of the company’s product.
    2. SAAS USAGE BASED PRICING: Also known as the Pay As You Go model, this type of pricing strategy directly relates the cost of a SaaS product to its usage: if you use more of the service, your bill goes up; use less, and your spend decreases. Usage based pricing works particularly well for recurring billing platforms like Chargify.
    3. SAAS TIERED PRICING MODEL: Tiered pricing allows companies to offer multiple “packages”, with different combinations of features offered at different price points. SaaS content marketing company HubSpot employ tiered pricing to great effect: each tier is designed around the needs (and budget) of a different type of potential customer, ranging from Basic to Pro to Enterprise.
    4. PER USER PRICING: A single user pays a fixed monthly price; add another user, and that price doubles; add a third user and, you guessed it, the monthly cost triples. Example of such pricing is road mapping SaaS ProductPlan. The only variable in their business plan is the number of users added to the account, and the per-use price is the same, whether you’re a single user or a team of 100.
    5. FREEMIUM BUSINESS MODEL: Thanks to high-profile success stories like Slack, Evernote and Dropbox, many SaaS companies use freemium pricing: offering a free-to-use product, supplemented by additional paid packages. Live chat SaaS, Drift use freemium pricing to great effect. Their “Free” package allows small companies to talk to their first 100 contacts for free: when demand for the service increases beyond that point (most likely correlating with company and revenue growth), it becomes necessary to upgrade to their paid packages.

    Also read: List of Pune Startups | Entrepreneurs & Startups in Pune
    Relevant read: Challenges Faced by SaaS startups

    SaaS PRICING STRATEGIES

    Your pricing model is at the heart of your SaaS business: it’s the foundation that allows you to build out repeatable sales processes and generate recurring revenue. But, within the framework of your pricing model, there are all-manner of different goals you’ll need to hit on the way to your over-arching objective of “growth“.
    That’s where SaaS pricing strategies come into play. Each of these strategies is suited to a different objective: whether that’s rapidly expanding into a new market, or attracting particularly high-value customers.

    Here are a few additional areas to consider when pricing SaaS products:

    • Your sales model influences your pricing.
    • Create upsell opportunities within your pricing model.
    • Use caution when offering annual pre-purchase discounts.
    • Build discounting options in enterprise licensing.
    • Consider free trials.
    • Service is key.
    • The demand curve is not linear.

    Also, a lot of companies offer a “free tier” which has limited features. The idea is that people will start using the product, get value out of the free tier but see a lot more value if they were to start paying and eventually upgrade. In theory this sounds great and for some companies it is. The problem with the free tier is that you may start running into problems such as the high cost of providing support to the free customers, the free tier bringing in the wrong type of customer, and requiring you to spend resources to try and convert the cheapest customers to actually pay you. Early-stage startups feel this pain the greatest since they can only afford spending resources on critical operations. Look at your buyer personas and product — sometimes the freemium model works well and sometimes it does not.

    Also read: 8 Ways to Toggle SaaS Customer Retention
    Must read: How to validate your SaaS idea before building an MVP?

    SaaS Pricing Strategy: The 10x Rule

    Applying the 10X rule to SaaS product pricing is simple. Just make sure that the value your solution delivers is at least 10x what you charge for it. If you can save a company $100,000 per month, you should probably initially think about charging them $10,000 per month. If you can save a company $10,000 per month, you should probably be charging them $1,000 per month.

    10x strategy
    10x Strategy

    Now, let’s see some companies with their pricing models.

    1. Upscope Co-browsing doubled revenue by doing per seat pricing only after making lots of mistakes.
    2. Drift made a free plan so they only charge those really using it.
    3. Hubstaff found their free plan ended up costing them money
    4. TribeHR took a data driven approach to pricing their product
    5. Aircall figured out pricing by calling their customers and talking
    6. Creately made a ‘Pay whatever you want plan’

    Conclusion

    Pricing your product is an ongoing process. You will never be done with your pricing strategy. As you get more data and feedback from your customers you will change your personas to be more accurate and change your pricing strategy to better target those people.

    Comment your views on the article and also let me know what is your pricing strategy in the comment section below.

  • What is Customer Engagement?

    Customer engagement is the key to sustaining growth for SaaS companies. SaaS businesses must aim to educate and entertain their users to boost satisfaction and retention. You want customers to feel compelled to login to your platform in the morning, during lunchtime, and even before bedtime. You want the stickiness factor. Not only does this help boost user satisfaction, but it can also help your company improve customer retention.

    More and more SaaS companies are recognizing the amazing value that product-led growth provides. As a result, user engagement tools have become increasingly important. The goal of a SaaS CEO should be to increase the profit they make from each customer (LTV), and lower the costs in sales and marketing that it takes to acquire each customer (CAC). Measuring Customer Engagement is a key tool that will help you achieve that goal, as it will allow you to increase your trial conversion rates, which directly reduces CAC. And it will help you lower your churn rates, which directly increases LTV.

    What is Customer Engagement?

    Customer engagement is all about interactions between your customer and your brand. As a result, the interactions that you qualify as an engagement will be just as unique as your business. When you let your customers choose how they’d like to engage with you, you’ll be more likely to uncover the type of interactions that they find valuable. By making it easier for customers to engage in ways they find valuable, you’ll strengthen their emotional investment in your brand.

    What is customer engagement?
    What is customer engagement?

    Some customers will have a deeper level of engagement than others. For example, a new shopper might engage by following your brand on social media and placing an order, but this level of engagement is very different than someone who’s placed 10 orders in the last year and also referred their friends. Finding ways to add value to your customer experience can help you drive more valuable engagements more often. When customers feel like they have just as much to gain from engaging with your brand as you do, you’ll foster a sense of reciprocity that keeps them emotionally connected to your brand.

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    Why is Customer Engagement Important?

    The digital marketplace offers customers a greater range of options than they’ve previously experienced. Now, the majority of value is gathered over time through a continuing cycle of commitment and re-commitment. To maintain a customer’s interest, enterprises need to be responsive to change, alert to a customer’s day-to-day needs, and in frequent contact. Customer engagement helps to continually demonstrate your commitment to the customer and allows you to deliver value in every phase of the customer journey.
    The importance of great customer engagement can’t be emphasized enough, as it builds and fosters:

    • Trust
    • Commitment to excellent service
    • Better communication
    • Healthy customer relationships
    • Valuable customer knowledge
    • Customer loyalty

    Customer engagement is the proof you provide to your customers that you value their success and are always working to deliver more. Remember, friendships endure while acquaintances come and go. With the right engagement strategy, you can foster long-term, mutually beneficial relationships with all your customers.

    How to measure Customer Engagement?

    You can’t improve customer engagement if you don’t know how to measure it. There are a number of different ways you can calculate engagement, which is why we’re giving you a head start by highlighting the most important metrics to start with. Measuring customer engagement requires that you do the following:

    • Identify the key events that you would like to track.
    • Track the number of customers who complete a purchase without making an account
    • Assign engagement scores to each action in a way that can be changed as your company evolves
    • Keep an eye on how often your customers make a purchase
    • Find the average amount a customer spends when they make a purchase
    • Create a database to store this information, ideally in a form that allows for fast querying, and easy cube-style, cross tabulated analyses.
    • Connect this database with other data sources that contain additional customer attributes that are relevant for understanding segmentation
    • Compute an engagement score for each user that can be used by sales and support.
    • Customer Engagement Score = (w1*n1) + (w2 * n2) + 
 + (w# + n#) where w is the weight given to a random event and n is the number of times the event occurred.

    Relevant read:

    Some Promising Customer Engagement Strategies

    Send Triggered Messaging

    Communication plays an integral role in customer relationships. You’re already emailing customers welcome messages, product updates, and the occasional thank you note. Real-time triggered emails get good results because they respond to subscriber actions and are relevant to them, so they benefit from current high engagement. Whereas routine marketing emails can be more like interruptions and are sometimes rejected as irrelevant.

    Let’s imagine that new users who don’t take a significant action on your platform within 2 days of signing up are more likely to churn. You can set up a triggered message to nudge these users to login to their accounts. Below is a triggered message from Buffer. Their system automatically emailed when social media post surpassed a specific audience reach.

    Triggered messaging
    Triggered messaging

    While routine marketing emails may seem interruptive because they may be irrelevant, triggered email messages tend to have a more positive impact on customers. Since the messages are triggered by specific actions that the customer did or did not take, these messages are more relevant and thus, more beneficial to the customer and more likely to promote engagement.

    Award points when a customer makes a purchase

    Showing your customers that you appreciate their investment in your brand can be as simple as awarding them points each time they place an order. Polaroid Originals adds value to every order their customers place, making each of them more likely to return to make another order in the future.

    Award points for a purchase
    Award points for a purchase

    By showing their customers they have just as much to gain from each purchase as they do, they’ve fostered feelings of reciprocity that will give them every reason to order from you again.

    Must read:

    Engage customers through the in-app chat feature.

    After working in SaaS marketing for years, it can be easy to forget how challenging it can be for a new user to navigate your company’s platform. Many customers may not be familiar with SaaS technology and may have a hard time successfully using the platform or getting the most out of its features. This frustration can often cause users to give up or move on to another SaaS product they may believe is easier to use. In addition to sending triggered messages with helpful tips, tutorials, and advice, you can also engage these users through in-app messaging to help provide ongoing assistance.

    In-app chat feature
    In-app chat feature

    Simply establishing the fact that you are available makes your customers feel better. It makes them not just view the product as some pixels on the screen, but as an extension of the people behind its creation: you. In-app messaging is effective because it allows you to speak with your customers one-on-one, helping them solve their greatest challenges. In addition to providing direct assistance to customers, you can also use the chat feature to find out which features new users are finding most difficult or asking specific questions about their experience. You can then use the information that you gather through these conversations to create interesting and relevant content that is helpful for users who are having similar issues.

    Encourage your best customers to share your brand with referrals

    RUNGUM Give 5 Get 5 Explainer Page
    RUNGUM Give 5 Get 5 Explainer Page

    Driving engagement also doesn’t have to be solely between your customers and your brand, it can also be between customers. Empowering your best customers to easily share your brand with their friends and family can not only help you acquire a new one, but also engage the customers you have. RunGum’s Give $5 get $5 simultaneously adds value to the friend that’s been referred to their brand and the customer that referred their friend. It’s this value that will make both customers more likely to re-engage again in the future.

    Also read:

    Develop educational tutorial videos.

    Continuing education is a vital part of SaaS customer engagement. In addition to free trainings and webinars, you can also create video tutorials as part of your SaaS marketing strategy. While you will still want to provide the typical educational assets such as blogs, e-books, and guides, you can also use video tutorials to engage your audience. Videos are stimulating and allow you to clearly and simply communicate your message to users faster than you can in text. Videos are also easier to consume on mobile devices, allowing users to quickly and conveniently access your training videos on demand.
    Basecamp, a project management company came up with a series of tutorial videos to educate prospects.

    Educational tutorial and videos
    Educational tutorial and videos

    If you want to produce video tutorials that are engaging, you need to think about what your customers most want to learn about your software. Consider what your customers greatest challenges typically are when they start to use the platform. Also, think about which features your customers will find most useful and create content around these topics. In addition to the topics that you choose for your video tutorials, it’s also important to consider how you plan to structure the content. To keep users interested, use storytelling methods that will help draw them in and make your content interesting and helpful.

    Conclusion

    Customers are the lifeblood of your business. To retain your users, experiment with different engagement strategies to improve retention. In the end, it’s important to remember that engagement = retention. If people aren’t using your platform, it could be because they are not engaged.

    It’s essential that SaaS marketers try out different user engagement strategies to find the most effective tactics for improving customer retention. You can use the SaaS marketing strategies above as a starting point for experimentation. Choose one or two of the strategies above and watch as your engagement rates steadily improve over time. Also, please let us know if this article helps you in any way.

  • Disadvantages of SaaS Discounting

    Discounts are one of the most powerful tools in a sales team’s arsenal. But way too many companies are using them wrong. To get people into their product, many SaaS companies turn to discounts to increase acquisition. They think that they can raise prices later, once these customers see the value in the product. But by discounting, you have already hurt that value.

    SaaS Discounting
    SaaS Discounting

    Pricing is a dedicated and patient process. After spending so much time perfecting your pricing, you shouldn’t use discounting as a “quick fix” to bring in more customers by underselling the value of your product. Excessive discounting causes a ton of damage to growing SaaS businesses. The most obvious impact is losing potential revenue. While that does hurt, there are much more destructive consequences that come later. So, let’s jump right in.

    Discounts Increase Your Churn

    Discounts increase your churn
    Discounts increase your churn

    One simple rule is key to sales: customers buy when the perceived value exceeds the price. The gap between price and value is the benefit a buyer receives. This is what makes discounting so effective at winning deals. You can get away with low value by offering an even lower price. That allows you to preserve this value gap. In this way, discounting hurts your business and increases customer churn.

    Discounted Customers Are Less Willing to Pay

    In SaaS, customers are constantly presented with so many promotions and discounts that if you offer a discount “for two days only,” they know there will be more coming down the pipeline. When just looking at the goal, it seems that the aggressive strategy may be the better choice. However, limiting our view to only this small window of time means we miss the significant repercussions of such an aggressive discount strategy further down the line.  

    Discounted customers are less willing to pay
    Discounted customers are less willing to pay

    We see that by using aggressive discounts, customers had:

    • Lower willingness to pay. Their price threshold is already set so low so when the price is brought back up, they have a higher price sensitivity and are less likely to renew.
    • High churn rate. Following the rise in price, rather than renewing, customers are more likely to churn out and look for a cheaper alternative.
    • Lower lifetime value (LTV). With so many customers that don’t renew, you’re losing out on that investment you’ve made to acquire them without even experiencing any revenue.

    Also read:

    Discounted Customers Don’t Appreciate Your Value

    That simple price and value model doesn’t reflect how people actually behave. That’s because there is a difference between actual value and perceived value. While actual value provided doesn’t change when you lower price, the perceived value does.
    Why is that? Through experience, people have learned to associate high prices with high quality. A nice dinner is more expensive than a burger from a fast food restaurant. A Ferrari is much more expensive than a Ford. Price is a proxy for quality.

    And this is why the perceived value is so important. When you lower the price of your software, perceived value will also decrease. A low price may help you land the deal today. But a low perceived value reduces the likelihood a customer be successful. At low price points, customers may not invest time & resources in your solution. It is easy to forget about a solution you paid little for. Without customer investment of time and resources, they won’t see results. And if they don’t see results, they will leave at the soonest available opportunity.

    Discounting Undervalue Your Product

    Companies often offer discounts thinking that it will help with cash flow by increasing acquisition of customers. However, in the long term, it ends up hurting you instead as you have to spend longer recovering CAC which is even higher with the increase in customers. Even if the discount brings in more business initially, you may never end up recovering CAC for these discount customers and ending up losing even more money in the end.

    Discounting undervalue your product
    Discounting undervalue your product

    While discounting directly affects your actual revenue, it also kills your momentum as a company by training both your customers and your team to devalue your product. By offering the same product at a discount, your potential customers may not think your product is worth your original price. Your sales teams just want to close. They may be using discounts as the path of least resistance to close a sale, diminishing the culture of profit you want to centre your company on.

    Relevant read:

    Customer Discounts Confuse Your Business Strategy

    Another dangerous consequence of discounted customers with high churn is confusing your company strategy. Companies optimize growth by identifying an ideal customer profile. Once understood, they then focus marketing & sales on these target customers. But if your churn is too high, you don’t know who your best customers are. In SaaS, a good customer isn’t one who is easy to sell. It is a customer who sticks around for a long time. Retention is much more important than the first sales conversion.

    So, excessive discounts used to land deals hide the most important insight: who will stick around. And if you don’t know whom to target, you will waste money on sales and marketing. This lack of focus also hurts your product team. They need to design features to make current customers stickier and attract new ones too. But if product managers don’t understand your users, they can’t improve the product to better meet user needs. So, the product gets bloated with unnecessary features that don’t tie to a clear use case. And guess what? Bloated products confuse and frustrate customers trying to use them. That reduces adoption and increases the likelihood of churn.

    Conclusion

    Businesses are evolving every day, and so are the tricks that can help you acquire customers. Discounts are one of the oldest, most effective selling tools; that being said, a discount isn’t just an easy-win tactic, but something you need to employ strategically based on the needs of today’s decision-makers. Bad discounting can do serious damage to your customer retention efforts.

    It attracts low-value customers who don’t appreciate your service and are likely to churn. It creates a ton of work for your Customer Success team trying to rescue accounts that won’t stay. And it confuses the ideal customer profile your teams need for focus. If you know about any other disadvantages/advantages of discounting, please let us know in the comments section.

    Also read: SaaS Discounting Strategy that Works

  • SaaS Discounting Strategy that Works

    Software as a Service (SaaS) is the present and the future of the tech industry. According to Transparency Market Research (TMP), the SaaS market will reach $164.29 billion by 2022. The IDC says that SaaS delivery is growing five times faster than the traditional software market, with cloud software accounting for $1 of every $4.59 spent on software.

    Discounting SaaS products can greatly impact your revenue and consumer perception. Survey reveals that discounts have a substantial influence on customer acquisition, brand loyalty and brand perception among consumers. But here’s the thing: Discounts work differently from the seller’s perspective. And if businesses aren’t careful with discounts—if they don’t strategize correctly—the whole thing can backfire in a big way.

    Long-Term Effects of Discounting

    Quality and price coexist. In the consumer’s mind, the higher the quality, the more the product costs. So, when buyers notice your discounted product, they are confused. And their first rational is: something is wrong. Frequent discounting serves to lower the value of the brand because of an almost subconscious reaction by the consumer who believes that quality also has been lowered.

    Consequently, your pricing strategy will train customers to buy only when you offer discounts. That’s not helpful for your bottom line. Your team won’t be attracting ideal customers who want your products. Instead, price-sensitive buyers who don’t appreciate your product’s value could become the norm. Data also revealed that SaaS discounting lowers LTV by over 30%.

    Also read:

    Here are 7 key lessons that companies can use to implement pricing and discount strategies that work. So, without further ado, let’s get started.

    Tips to Implement Correct Discount Strategies

    Package Level Discounting

    Package level discounting is discounting without actually discounting. In fact, this method encourages customers to pay more than they intended to in the first place.
    For example, a customer signing up has the option of taking the $10 per month standard package plan, which will fulfill their needs. However, by signing up today, they can get the premium package with all of its extra features for $20 per month instead of the regular price of $30 per month. And they can have it at this price until they cancel or downgrade, after which they’d have to pay full price.

    Or maybe they could enjoy the reduced price for the premium plan for the first 12 months — giving them a lengthy period to reap (and hopefully become attached to) the benefits and extra features. It’s a clever way to use discounts and a great method for sales reps to deploy with new customers.

    Understand the Timing of Cash flows

    Companies at any stage should consider offering discounts to their customers—but not without knowing their own profit margins. Discounts can kill a company’s cash flow if they are offered in silos, without taking into account sales commissions and data from the finance team. But how do you determine the ideal discount percentage? It’s a tricky question but thankfully one you can do a little math to answer.

    In the graph below, there are three discount models:

    • 25% off monthly payments
    • 25% off upfront annual payment
    • First three months free

    Both the 25% off monthly and three months free options result in the company facing a cash challenge if the commission is paid within the first 3–6 months, with the 25% off monthly option putting the company at greatest risk. As you can see, the best approach for the business is to offer 25% off up front.

    Principle of Reciprocity

    If you give the customer a discount, the customer should you give you some other commitment in return. That commitment should be something other than closing the deal. One commitment to consider is increasing the length of the contract. This is a win for both parties. The customer gets an attractive price on your offering. Your company locks in a few years of revenue, eliminating any chance for near-term churn.

    Another commitment to consider is changing the payment terms. Pair a discount with paying the entire annual contract right now. Or tie discounts to quarterly payments. Once again, this enables you to lock in more revenue early. Even better, you get money in hand right away.

    Relevant read:

    To be really effective, discounts require scarcity

    Whether that scarcity is the amount of time the discount is available, the number of discount subscriptions available, etc. it needs to be there. If you don’t put some bookends on the offer, it looks like you’re just discounting your product for no reason (or, several reasons like your product sucks, you don’t value it, you’re desperate, you don’t know how to market your product, etc.).

    Scarcity also gets people to take action; no scarcity, no sense of urgency to take the offer.  It means you’ll have to actually figure out how to attract better customers, raise the value perception of your offering or, ideally both. If you really do have cash flow issues, then figure out how much you need and offer only that many annual subscriptions, then stop offering them.

    Don’t broadcast discounts to the world

    A lot of people are willing, and happy, to pay full price. A large banner across a website advertising discounts risks lost income from those people. The idea of a discount should be to make it easier to close a sale, but only as a last resort. Sales reps need to identify customers that require a discount to sign-up and offer them sparingly. Instant demos and online sales meetings are a great way to get to know prospects and understand their pain points and motivations in order to know when (and when not) to offer a discounted rate.

    Ultimately, products should be priced to reflect true value and command sales without any deviation in price. However, when the moment is right and when prospects need a little nudge in the right direction, discounts used at the right time can be used effectively.

    Percentages Are Hard for People to Understand

    Let’s say you’re out getting your favorite coffee. There’s a special promotion, and you have a choice: You can either get 33% more coffee for the same price, or take 33% off the price. What would you do? A team of researchers at the University of Minnesota’s Carlson School of Management asked the same question to their students. The vast majority of them viewed both options as equal, even though the discount by far is the better proposition.

    In other words, customers prefer getting something extra to getting something cheap. Retail businesses often see bonus deals valued more than discounts of the same value. For SaaS businesses, this is a great tactic to incorporate in sales proposals—offer the first or second month free instead of using percentages.

    Also read:

    Demographic-specific discounting

    Enterprise and student discounting are the most commonly used demographic-specific discounting methods in SaaS and can be used without damaging the perceived value of a product.
    Given the factors involved, such as volume and package requirements, enterprise discounts should be issued on a case-by-case basis without prices being plastered across a website. Non-disclosure agreements (NDAs) can also be put in place to ensure deals remain confidential.

    Conclusion

    Discounting your products is a major business decision. It can attract the wrong customer and even cheapen the perception of your brand. However, in certain circumstances, offering discounts to enterprise customers can produce greater long-term benefits. So, be strategic with your SaaS pricing and discounting strategy and let us know your views in the comment section below.

  • Best SaaS Affiliate Marketing Software

    It’s no secret that software as a service (SaaS) has become a common fixture in our daily lives, used for both professional and personal functions. Whether it be a task manager for the workplace, payment services for social outings or tracking health progress for individual goals; SaaS is now intertwined with our everyday routines. Getting your customers and website visitors to promote your product is a difficult task. One way to encourage them is to offer a commission on every product they sell. This is known as affiliate marketing.  

    Affiliate marketing is a profitable channel where you can acquire more customers easily and increase your revenue tremendously. To set up a hitch-free affiliate marketing for your SaaS product, you need a robust SaaS affiliate marketing software that can take care of your marketing needs. In this article, we reviewed 5 best SaaS affiliate marketing software that will help you drive more customers and revenue for your product.

    Relevant read:

    Tapfiliate

    Tapfiliate
    Tapfiliate

    The first SaaS affiliate marketing software on the list is Tapfiliate. It is an easy-to-use affiliate marketing software. There are no transaction fees and you can reward, track and give incentives to your affiliates as desire. It offers a 14-day free trial. Tapfiliate makes it incredibly easy to grow your social reach across the web with rich, engaging branded content.

    Features:

    • Offers personal referral links, coupons, banners, and other brand materials to your affiliate
    • Create engaging social media posts for your affiliates
    • Motivate affiliates by setting targets based on the number of sales they make.
    • Set up automated emails and Web hooks using Zapier app
    • Automate or approve commissions manually
    • 34 Super easy copy/paste integrations, including Zapier.

    Tapfiliate SaaS affiliate marketing software offers three pricing plans – Essential – $69/month, Pro – $149/month and enterprise – custom price.

    Tapfiliate plan
    Tapfiliate plan

    LeadDyno

    LeadDyno
    LeadDyno

    LeadDyno is the second SaaS affiliate marketing software on the list. You can set up your affiliate marketing account in minutes. So, you can start recruiting your affiliates immediately. You can link to the affiliate sign up page right from your website and your social media channels. LeadDyno will even help to promote your affiliate sign up page in their network of influencers and affiliates so you can quickly get the initial traction you need to take off.

    Features:

    • Personalize your affiliate dashboard with the look and feel of your website
    • A quick “Plug and Play” with your e-commerce provider
    • Affiliates have their personal dashboards
    • Use LeadDyno to Track Online Marketing Success
    • 10 levels of commission payments and tracking
    • You can use LeadDyno for Google Adwords Conversion Tracking too
    • Automatically invite customers to join the affiliate program
    • Send out automated emails to affiliates as at when needed

    LeadDyno SaaS affiliate marketing software has three plans. Starter – $49/month (Up to 3000 unique visitors per month), Biz Builder – $59/month (Up to 4500 unique visitors per month) and the Accelerator – $79/month (Up to 7500 unique visitors per month).

    LeadDyno plans
    LeadDyno plan

    OSI Affiliate

    OSI Affiliate
    OSI Affiliate

    With OSI Affiliates, you can easily create an affiliate program and integrate it with your website. Once that is done, customers can refer your products to friends and family members. This will help you to get more website traffic, leads and paying customers.
    It is easy to setup and help tickets are responded in 24 hours. OSI Affiliates allows you to have a customer affiliate page at yourdomain. Biggest weakness here is the inability to be able to group affiliate into tiers and pay certain people a higher commission without creating a new campaign.

    Features:

    • Get customers to promote your product on social media channels
    • Give out promo codes and coupons to users
    • Your customers can easily promote on Facebook, Twitter, and Linkedin
    • Turn every customer into an affiliate with the auto-sign up
    • Reward your affiliates with commissions, coupons, discounts, and gift cards
    • Easily find your most loyal customers by sending out a one question email survey
    • Motivate your affiliates with contests

    OSI Affiliate SaaS affiliate marketing software has three plans – Basic – $470.00/year, Professional – $970.00 and Premium – $2470.00

    OSI Affiliate payment
    OSI Affiliate plan

    Also read:

    iDevdirect

    iDevdirect
    iDevdirect

    Idevdirect is an easy-to-use SaaS affiliate marketing software you can use for your business. With its feature-rich platform, Idevdirect helps you to create customized commission payouts. It offers an extensive list of marketing tools at your disposal. It helps you to grow your sales, increase website traffic and enhance your SEO.

    Features:

    • Offer affiliates marketing tools such as social media, videos, banners, and QR codes
    • Provides date range reporting with charts and graphs
    • Make it your own with editable content
    • Structure your payout system using different options such as coupon code commission, per product, commissioning and pay per click or pay per lead or action
    • Get desired color scheme and logo
    • Avoid frauds with its built-in security features like Advanced fraud protection tools, Proprietary password hashing and Adjustable tracking expiration
    • Integrate with almost everything

    Idevaffiliate SaaS affiliate marketing software has two pricing options. One for cloud and the other for self-hosted. The self-hosted plan starts at $199 (one-time fee), the cloud is $39/month, cloud social is $49 / month and cloud premium is $59/month.

    Idev Affiliate pricing
    Idev Affiliate pricing

    Zesty.io

    Zesty.io
    Zesty.io

    Zesty.io has gained a lot of traction lately for its affiliate marketing program and is enjoying subsequent growth as a result. It is one of the most robust SaaS programs out there that offers plenty of opportunity for its affiliates to promote and earn along the way.

    Features:

    • Zesty.io supports its affiliate partners by providing them with innovative technology
    • Unrelenting support
    • Incredible revenue opportunities
    • Exceptional training to do justice to their product.
    • The client is able to deliver enterprise-grade websites quickly and with relative ease
    • Zesty has its own in-app communication tool that helps the users to build better client relationships and gain quick insights on the company’s products and features.

    Zesty.io SaaS affiliate marketing software has three pricing options. The small project plan starts at $50/month, the business plan is $475/month, mid-size enterprise is $3500 / month and custom enterprise plan.

    Zesty.io pricing
    Zesty.io pricing

    Conclusion

    In this article, we reviewed 5 best SaaS affiliate marketing software that will help you drive more customers and revenue for your product. It’s your turn. Which of the SaaS affiliate marketing software mentioned above is your favorite? Share your thoughts in the comment section below.

  • How to Track Customer Acquisition in SaaS – SaaS Customer Acquisition Strategy

    We’d all love to drive Bentley’s and live in mansions overlooking the beach, but not if it means spending the money your family relies on to buy food. Similarly, every business wants to get as many customers as possible, but not if it means going broke in the process. In order to achieve that balance, a crucial metric for businesses (especially startups) to track is customer acquisition cost (CAC).

    Achieving sustainable growth for a SaaS company means constantly acquiring new customers and keeping them around for as long as possible. While this may sound simple, it can be incredibly challenging to find new opportunities for growth and customer acquisition in the crowded SaaS industry. If you’re too cautious about your CAC, you will likely be missing out on customers and future revenue. Yet, if you spend too freely, you won’t be profitable and will likely end up in the dead pool.

    This article will walk you through the saas customer acquisition strategy.

    Also read: Boonbox- Taking Online Shopping to Rural India

    What is Customer Acquisition Cost?

    Put simply, customer acquisition cost (CAC) is – you guessed it – the cost of acquiring a new customer. To compute the cost to acquire a customer, CAC, you would take your entire cost of sales and marketing over a given period, including salaries and other headcount related expenses, and divide it by the number of customers that you acquired in that period.

    It doesn’t take a genius to understand that business model failure comes when CAC (the cost to acquire customers) exceeds LTV (the ability to monetize those customers).
    A well-balanced business model requires that CAC is significantly less than LTV:

    Example of balanced business model
    Well Balanced Business Model

    Here are some typical industry standard cost of customer acquisition values, the amount of money each company spends on average on marketing and advertising to acquire just one new customer:

    Travel: Priceline.com – $7
    Telecom: Sprint PCS – $315
    Retail: Barnesandnoble.com – $10
    Financial: TD Waterhouse – $175

    Relevant read: 8 Ways to Toggle SaaS Customer Retention

    How CAC works?

    Let’s say you run a company called ABC, which sells movie inspired accessories.
    From June to December 2019, you spent $100,000 on sales (mainly sales team salaries) and marketing (Google ad spend, Facebook ads, content creation, marketing team salaries).
    In that same time frame, you made 10,000 sales.

    calculating CAC
    CAC Calculation

    Dividing $100,000 by 10,000 gets you 10. So, for this time period, ABC has a CAC of $100.

    Relevant read: Kapture CRM – A Single Platform to Manage the Sales and Service Teams

    Why Is CAC so Important?

    Understanding CAC is critical for businesses of all sizes. However, it’s particularly relevant to startups that are in the early stages of scaling up or trying to woo potential investors. Once you know your CAC, you can evaluate the cost of growing the business and the value each new customer brings.
    To acquire new customers, most SaaS companies devote a substantial amount of time and money before they see a full return on their investment. Examining just how many months of revenue from a customer are actually needed to recover these costs becomes essential as your business grows, as it may take much longer than you think for your company to recover CAC and actually begin to profit.

    Graph of revenue and cost

    Tracking Customer Acquisition allows for a better control of your spending and makes sure you’re being profitable on specific channels.

    Also read: Must-Read Startup Books For Students

    Why is SaaS Customer Acquisition So Difficult?

    The average length of the sales cycle for a SaaS company is nearly 3 months. That’s quite a long time to be chasing someone down and asking them to buy something from you. If you consider some of the factors that lead to this extended buying process though, you’ll see that it makes quite a bit of sense for customers to take their time:

    High Cost

    SaaS solutions aren’t usually very cheap. Even with less expensive tools, customers must factor in the recurring charges that go along with the SaaS subscription-based payment model. This can add up to be a significant amount of money for some customers.

    Privacy Concerns

    Because SaaS solutions are based in the cloud, new customers can sometimes be reticent about allowing an unknown tool process their (or their customers’) personal data on external servers without learning more first.

    Complexity

    Most SaaS tools are built with deep sets of features and complicated use cases to solve complex problems for which customers may not even know the extent of their needs.

    Too Many Options

    The SaaS industry has exploded in the past 10 years, meaning customers have usually have several different choices when choosing a SaaS solution.

    All of these factors act as barriers to customer acquisition. This is why SaaS customers require an extra level of care and education (or nurturing) to incrementally move them towards a purchase decision

    Relevant read: Tally Dekho – A simple Tool for Accounting

    How to Track Leads through the Stages of SaaS Customer Acquisition?

    There are 4 unique stages that leads go through before making a purchase and becoming SaaS customer:

    Awareness

    Prospects first become aware of your business. This is usually the stage in which leads find you through a blog post or other content. Often, they’re not looking for a solution at this stage, and they may not even be aware that they have the problem your product solves.

    Engagement

    Potential customers start regularly consuming your content, subscribe to your newsletter, and maybe even download an eBook or other resource from you. They are more aware of the problem you solve and begin questioning whether they need a solution.

    • Exploration: After learning that they have a problem and need a solution, prospects will do research on their options. This usually means visiting your pricing page, reaching out to sales, requesting a quote, or signing up for a free trial or free account to test out the product.
    • Conversion/Retention: Once prospects have fully explored all of the options you offer, they sign up for the plan that’s right for them and become a paying customer. Now it’s all about making sure they succeed with your tool and continue to be an active user.

    Also read: The 10 Best Tools for Graphic Designers

    Things to Consider

    While tracking Customer Acquisition may sound simple at first, here are just some of the things you’ll need to consider:
    1. Ability to clean the data whenever necessary
    2. Ability to cater for your own business needs (targeting Accounts VS Users)
    3. Ability to integrate with other software (e.g. CRM, Payment Processors)
    4. Ability to manage all the Ad Platforms you use
    5. Ability to monitor all costs (CAC calculation)
    6. Ability to choose and switch between Attribution Models

    Relevant read: List of Top Startups in Bangalore

    Strategies for Reducing Customer Acquisition Cost

    If your CAC is higher than you’d like (or can afford), something’s got to change. Here are a few strategies you can use to reduce CAC and improve your bottom line.

    1. Conversion Rate Optimization

    Optimizing your website can increase your revenue and lower your CAC by making it easier for visitors to convert. This is particularly important for e-commerce sites that might be losing out on sales even if their traffic is high.
    Check that your site loads quickly, displays properly on mobile devices, and that your checkout process is simple and bug-free. You should also perform A/B testing on your landing page copy to find out what works best for your target market.

    2. Using influencer marketing, even for B2B

    The phenomenon of influencer marketing doesn’t start and end with Instagram models, especially not in the SaaS space.
    An “influencer” is simply someone who can lend their credibility, and in doing so boost an organization’s reputation. In the B2C world, celebrities will often sell just about anything.
    The audience for B2B influencers is different. Influencers have a reputation, so they won’t be promoting junk. They will seek to partner with superior products that align with their brand and are disrupting their space.

    3. Reward Referrals

    If you can get consistent referrals from existing customers, your average CAC will drop significantly. Say, for instance, a customer who cost you $15 to acquire refers two new customers. This brings your CAC down from $15 to $5 because you landed three new customers for the cost of one.
    Implement an attractive referral program that gets more customers to spread the word about your business – not just because they enjoy your product or service, but also because you’re offering a referral bonus to sweeten the deal. This could be something as simple as a discount code for their next purchase or a temporary upgrade to your premium service for referring new users.

    4. Building product-led growth into the marketing strategy (the flywheel)

    Startup unicorns have built insanely good products that catch on faster than any marketer can sell them. What does a product-led growth campaign look like out in the wild? Take Expensify, for example. As part of their marketing efforts, they directly targeted people who submit expense reports. Their slogan was “Expense reports that don’t suck.” Instead of looking mainly at buyers, they tried to hone in on a more specific user pain point.
    The Slack platform allows users to invite others into their workspace. Dropbox has a functionality where you can add a new user to unlock more space. The Ice Bucket Challenge raised $100 million in 30 days. All of these are examples of product-led growth.

    Look at the level of touch required to complete a sale. Some products are easily understood, while others may require a careful walk-through by a sales person. Sometimes, the customer will want a trial with their own data. Consider every possible way to minimize this. For example:

    • Create demo videos that answer every likely sales question.
    • List the common sales objections that come up in the sales cycle, and provide answers to these on the web site.
    • Try using customer references to avoid the need for a trial.
    • If your customers are going to compare you to the competition as part of their process, consider doing this for them, with a section of your site that has a comparison matrix with appropriate check marks.

    Also read: Life Story of Sundar Pichai: The Hurdles and the Success

    The Key to SaaS Customer Acquisition

    Tackling the SaaS customer acquisition cycle is not for the faint of heart. It requires a lot of work, and most importantly, a deep understanding of your customer and their needs to create a SaaS acquisition strategy that works.

    Jason Lemkin
    JASON LEMKIN, FOUNDER, SAASTR

    “A rough rule of thumb is successful SaaS companies are spending about 20%-30% of the fully calculated CLTV on customer acquisition.”
    JASON LEMKIN, FOUNDER, SAASTR

    So, if a SaaS customer LTV is $1,000, then their customer acquisition costs should be in the range of $200 to $300 to stay competitive. Or put another way, ⅓ to ⅕ LTV.

    When you’re applying these principles in your own acquisition efforts, be sure to always put your customer’s needs first. By focusing on their benefits and what they’re looking for in a solution, leads will be much more receptive to your messages. Keep this in mind and find ways to guide them through the acquisition process with helpful interventions that come at the right time and add value to their experience. This will lead to much more success in the long run.

    Also read: BookMyShow – The Indian Startup That Did Not Have A Smooth Sail

    Comment your views and if you know any other tip to track customer acquisition, please let me know in the comment section.

  • Top Knowledge Base Softwares

    Back in the old days and before the Internet, manufacturers used to ship products with a giant manual. It’s like a book with hundreds of pages that includes instructions about how to use the product. Of course, no one bothers to read them anyway. Today, we have knowledge base systems. Unlike those old bulky manuals, a knowledge base website is much more innovative. It provides users a place to find answers to questions and guides related to a product, all by themselves.
    A knowledge base is a self-serve online library of information about a product, service, department, or topic.

    Effective Knowledge Base

    It’s important to know what kind of features to include in your knowledge base to make it more effective.

    1. Search Function – Users need to be able to search for articles and guides on your knowledge base to find solutions to their problems. As a result, a properly functioning search system provides is a must-have.
    2. A User Feedback System – A great way to improve your knowledge base is to get feedback from users. A simple thumbs-up system is more than enough to learn if an article in your knowledge base was helpful to users or not.
    3. Front–end website – The front end of your knowledge base is much like a normal website, except with a focus on categories, navigation and documentation formatting. Here are the main front-end features:
      i.   Main page focused on top-level categories and search
      ii.  Clear navigation menu with multi-layer categories visible
      iii.  Article call-outs, code snippets, warnings, and article metadata
    4. Simple Backend Dashboard – Being able to easily create hundreds of articles, guides, tutorials, questions, and much more using a simple and easy-to-use back-end system will go a long way to serve your customers better.
    5. Analytics & Reports – With analytics, you can learn which knowledge base posts perform better and which creates more bounces. This will allow you to keep improving your knowledge base and create more helpful guides.
    6. Easily Manageable Categories – With lots of knowledge articles in one database, you could easily get lost while updating and adding new content. A simple archive and categorization system help keep the entire knowledge base organized. As well as make it easier to browse.

    Also read:

    To help you save time and money we rounded up a list of 5 best knowledge base system software. Whether you have a SaaS startup or a single product website, this list has knowledge base solutions for all.

    Top Knowledge Base Softwares

    Freshdesk

    Freshdesk is a cloud-based knowledge base helpdesk software which helps small sized businesses build relationships with their customers easily. Freshdesk also helps enterprise businesses to collaborate better across the globe, and enables more efficient businesses processes for better customer experiences. If you are looking for an intuitive, easy-to-use knowledge base software, Freshdesk may be the right choice for you.

    Freshdesk
    Freshdesk

    Rich text editors will have wider variety of formatting options allowing you to structure your content and answers better, better support for embedding images to show rather than tell, and will be easier to create and use than a software with just plain text editor. Freshdesk is one of the few Knowledge Base software providers which gives a rich text editor for free.

    Freshdesk allow you to maintain different versions of a solution article and host the same article in multiple languages so customers can access the one they want. Also, Freshdesk give you virtually unlimited space to host your tutorials in, charging you for the number of users and portals you have.

    Zendesk

    Zendesk Guide offers a knowledge base that is simple to customize and use – as either an internal knowledge base, an IT knowledge base, an agent-only knowledge base or a customer facing FAQ resource. And because it’s always available, customers and agents can serve themselves with the right information at the right time.

    Zendesk
    Zendesk

    Build out a web-based knowledge base without worrying too much about the details. Drafts save if you’re in the middle of a work in progress, and rich formatting ensures that articles are easy to read. If you’re building an internal knowledge base, content can quickly be restricted to certain groups. Zendesk makes knowledge management software that’s simple to use and accessible for everyone. And the freedom to translate your articles into over 40 different languages provides a localized experience that’s right for everyone.

    Relevant read:

    Document360

    Document360 helps your team create, collaborate, and publish a self-service knowledge base for your software with ease. It is simple and clean. The focus is on your content, making sure that readability is great. You can access it anywhere. It has a responsive knowledge base tool across all devices – desktop, tablet and mobile. It also provides security as you can create custom roles, define their scope of access and usage in a granular level.

    Document360
    Document360

    Your customers want to use your self-service Knowledge base than reaching out to your support team. Document360 helps you reduce support tickets by providing solution on the go.

    Zoho Connect

    Zoho Connect is a team collaboration software that brings people and the resources they need to one place, making it easier to get work done. From keeping your workplace communication organized, to managing the resources your team needs, to staying in sync with your other apps, Zoho Connect makes your team’s work easier.

    Zoho connect
    Zoho connect

    People-on your team and outside it, like your partners, vendors, and clients- make your business successful. Keep them in the loop by creating an external network, and get your team working together with them with the help of Zoho Connect. Also, with integrations with other applications like Asana, GitHub, Google Drive, and more, you’ll get all the notifications from them, right within your Zoho Connect group.

    Zoho Connect also provides you features to know how members are interacting within a network, get the numbers on most active groups and members, posts and comments made, and blog posts with activity graphs.

    WordPress

    WordPress is a free and open-source content management software (CMS) you can use to build all kinds of websites, including complex knowledge bases. What makes WordPress a great choice for knowledge base platforms is its extensibility. With the help of WordPress plugins, you can add new features, functions, and integrate third-party apps with your knowledge base in just a few clicks.

    Wordpress
    WordPress

    Compared to other knowledge base software, WordPress is much cheaper to setup and use. It is extensible, means you can easily add and extend features using WordPress plugins. Including third-party integrations like Zapier and HubSpot. You can easily manage articles, media, and categories using the beginner-friendly WordPress admin dashboard. When using WordPress you’re in full control of your knowledge base. You don’t have to abide by the rules of a corporate company.

    Must read:

    Conclusion

    Now, that you know what is knowledge base software and also some of the best knowledge base software solutions, it is time for you to choose the right one that matches your needs. Hope this article will help you in knowing more about the top knowledge management software and indeed assist you in choosing the right one. Which tool are you using? Please let us know in the comments section below.

  • How to Convert Blog Traffic to Leads?

    Are you struggling to increase free trial signups? You’re not alone. Of course, if you have a SaaS product, you’ll eventually want to increase your conversion rates to get paying customers, but the process of getting a sustainable user base starts by getting more people to take free trials and check out demos. If you don’t, your business won’t last very long, because you won’t make the revenue you need to keep it going.
    Blogs are a popular, effective, and affordable way to bring people to your digital domain. That’s the good news. But the bad news is that traffic generation is only half the battle. Page views, likes, tweets, and comments are nice, but none of them are the ultimate goal. You need to convert that traffic into leads.

    Obviously, growing an audience isn’t enough. Content marketing is about delivering value while paving the way for the sale. It’s very rare that a first-time visitor of your blog will immediately buy your product. Thus, instead of hoping that visitors will somehow rediscover your blog later, you want to take actionable steps towards building a communication channel – so you don’t lose them.
    Here are several ways you can capture leads to build a relationship with your audience and ultimately convert them into new customers.

    The Reader to Revenue Strategy

    Here’s a super simple framework for understanding how you’re converting readers into customers. You convert readers to customers in just 2 ways:

    1. Through direct links to sales pages
    2. By capturing reader emails and emailing them.

    That’s it. Once you put your conversion strategy into that simple framework, you can move on to measuring how both funnels are doing and then increasing the conversion rate.

    Also read:

    Methods to convert your blog traffic to leads

    Offer an Irresistible Incentive

    One of the main challenges with converting blog traffic is driving visitors to your main website. When you think of it, that’s not why they came to the blog for in the first place. And chances are they aren’t that much interested in your product or service. But you can motivate them to be by presenting an irresistible incentive.

    An incentive is something that can motivate a person to take action. It works for a simple reason – it helps making the decision easier. In online marketing an incentive is typically an appealing element such as discount, bonus, special offer or promise constructed to stimulate a desired action. Whatever incentive you choose though, for it to work you need to communicate it to visitors. And there are 4 main ways to do that:

    • Display a Static Ad
    • Use A Scrolling Ad
    • Display a Notification Bar
    • Play on Visitors’ Curiosity with a Navigation Link

    Improve your pitch

    You’ve heard of an elevator pitch, right? It’s how you concisely pitch a prospect in less time than it takes to ride an elevator cab to the destination floor.

    Elevator pitch
    Elevator pitch

    Elevator pitches work in digital marketing, too. In fact, they’re often more effective than long, drawn-out pitches. You just need to know what works for your audience.

    Let’s say, for instance, that you’re selling shoes. Most people know what shoes are, so you don’t need to explain how they work or what they’re for. You just need to bottom-line why they’re the best shoes for your audience. If you search for Nike running shoes on Amazon and click on one of the models, you get very scant product copy:

    Nike running shoes
    Nike running shoes

    That’s eight bullet points. Why? Because it’s all the prospective customer needs to know. How can you tell what pitch will work best with your audience? Test different pitches. Try long- and short-form pitches. Adjust the wording. Switch up your headlines and calls to action (CTAs).

    Newsletter signup

    You’ve put in the work to get people to your website; make sure you capture as much of it as possible. Walk them through the next step of becoming your customers. A newsletter signup is a great way to do this. There are a few methods you can use to motivate them to sign up for your newsletter. One way is a pop-up that opens on the screen when users have scrolled down to a specific piece of the content. Some great tools to set this up are JustUno or Popup Domination, either of which will open up a pop-up to attract visitors to subscribe to your newsletter, just like the one below:

    Newsletters
    Newsletters

    Another technique is to have an email newsletter sign-up option on the right-hand side of the blog. This is always visible while being a bit less “obnoxious” to visitors who are reading the blog post. Some great tools for this are Get Drip or Hubspot, which allow you to create side opt-in forms, like the one below:

    Subscribe popup
    Subscribe popup

    The cool thing about this pop-up is that it makes it easy for visitors to become subscribers because it gives them multiple options, depending on their preferred contact method.

    Relevant read:

    Collect Immediate Feedback

    The best way to find out what’s working to increase free trial signups is to ask your visitors. Collecting feedback will help you tweak your marketing strategy and messaging to increased effectiveness. Options for collecting visitor feedback include using a customer survey and interacting with visitors via live chat, as in this example from Missinglettr.

    Feedback system
    Feedback system

    Popping up a survey just before people leave can help you find out why some people are ignoring your free trial. Then you’ll be able to adjust your marketing to get their interest next time around. Or you could email free trial signups immediately after they’ve signed up to ask what they’re hoping to get from the free trial. Again, that’s valuable information for future marketing.

    Call to Action

    Your blog posts need a call-to-action. Every one of them. You need to get your visitors to do something: sign up, download, click, read something else, subscribe, install, contact you, and so on. Giving prospects a clear action to take is the key to converting passive blog traffic into real, active, and engaged customers. This is arguably the most important persuasive skill you need as a marketer.

    A high-quality blog post without a compelling CTA is a lead lost. They’re already on your site. They’re already interested and engaged with you and your brand. So, give them more. A strong CTA is action oriented, benefit-to-them driven, visual, persuasive, and ideally creates a sense of urgency.

    Example of CTA - Dropbox
    Example of CTA – Dropbox

    I recommend including a clear call to action in every blog article you publish. Too many blog articles, even on the best blogs, don’t result in any action after a visitor reads them. Including social share buttons at the bottom of a blog article will help visitors easily share your article, further expanding the reach of the article. Having a contact us button with an action-oriented color, like orange, can make it easier for people to get in touch with you if they have comments or questions about what they just read.

    Lead magnets

    Lead magnet is anything that your potential customers will find valuable. You’re going to offer it for free in return for their email and consequently a chance to develop a relationship with them. A classic lead magnet example is an eBook.

    Lead magnets
    Lead magnet

    There are however many other content types you could use to collect visitors’ emails:

    • Free tools – Hubspot’s Marketing Grader is a good example. The tool allows you to grade the marketing effectiveness of your site, in exchange for an email of course.
    • Templates / Checklists – Whitespark offers a Review Handout Generator allowing users to print instructions on how to leave a Google review for their business.
    • Discounts – Many Ecommerce and B2C websites offer discounts for the first purchase if you sign up for their mailing list.
    • Email Courses – Create an educational resource your visitors need and offer it for a sign up. For example, Enchanting Marketing offers a free, 16-part writing course.

    Must read:

    Show off case studies, testimonials, and social proof

    Collect reviews from your customers, ask clients to create testimonial videos, and mention any high-profile clients you have (with their permission, of course). If a well-known person in your industry has tried your product and loved it, mention that fact on your homepage, landing pages, and elsewhere on your website.

    Social proof, case studies, and testimonials are all excellent ways to convince your website visitors to convert. You want them to know they aren’t betting on something new and untested. You want to infuse them with confidence.

    Conclusion

    Generating blog traffic is only half the game. It’s knowing how to convert blog traffic that differentiates winning marketers from the rest of the crowd. Apply the actionable strategies we’ve discussed, and you’ll start seeing how your blog can be an effective tool to win you the sales you seek.

  • Ideas to Boost Customer Retention

    Customer churn is the SaaS kryptonite. It is what scares SaaS founders the most, and they are always innovating ways to beat it. Customer Retention is one of the most crucial and cost-effective SaaS retention strategies.

    Customer Retention = (Number of Customers at End of Time Period – Number of Customers Acquired During Time Period) X 100 / No. of Customers at Start of Time Period)
    For example: Imagine you start the year with 10 customers, gain 5 new customers in the first quarter, and have 1 customer churn.
    Customer Retention = ((14-5)/10)) x 100 = 90%

    If you’re not doing customer retention right, it can result in a loss as you acquire more customers. The SaaS model gets you profitability over time, and if your users churn before completing enough payment cycles to break even on the acquisition costs, all your growth strategies will be ineffective. Customer retention, in this sense, means getting your customer to stay and engage with your product long enough till it becomes a habit/ part of their daily lives. As they become long-term users, it will give you more opportunities to upsell, increasing their LTV (lifetime value).

    Also read:

    Now, we will discuss some ideas with which we can boost customer retention:

    Personalized marketing with email

    The first area to search for low-hanging fruit is in the emails you write. Most email programs come with the ability to record personal data alongside email addresses, so you can quickly personalize based on the needs of your subscribers. To use this simple strategy, send an introductory email with a compelling subject line asking subscribers to self-select their interest. Are they using your software for a small business, for personal use, or something in-between?

    Personalized email marketing
    Personalized email marketing

    A subscriber’s interests aren’t the only way you can segment. Turn also to the life cycle of your SaaS product. For example, recent signups might be more interested in learning about your biggest features, while power users will find details, advanced tips, and hidden shortcuts more valuable. Thankfully, this information is easy to gather from within your app analytics. Understand where users are in the customer journey and appeal to those stages.

    Time discounts and offers to free trial progress

    The most powerful feature that distinguishes SaaS companies from other products and services is the ability to provide a free trial. This is the perfect time to optimize your emails and take advantage of the buying mechanisms at play—urgency, a sense of trust, and the excitement of starting with your product. This is also a good time to offer a discount or other promotions related to the soon-to-expire trial offer. A great example is Zapier’s email reminder, which you can see below, lifted straight from the inbox:

    Zapier's email reminder
    Zapier’s email reminder

    The email is customized to each user, reminding him or her how many tasks have been automated and providing a custom recommendation for which upgrade to choose based on usage. In short, it’s the perfect email to convert a free trial user to a happy paying customer.

    Relevant read:

    Reward your most profitable (VIP) customers

    Information gathered in the CRM software can tell you which of your accounts are your most profitable. These are the customers you really don’t want to let go of, your key accounts. For this purpose, let’s call them the VIPs. Knowing who brings you most revenue allows you to allocate your time and resources efficiently, as well as increase your chances of cross- or up-selling.

    Example: Let’s say you have a number of incentives to give away. Use them to reward your VIPs to further increase their loyalty. The Pareto principle (also known as the 80/20 rule) states that, for many events, roughly 80% of the effects come from 20% of the causes

    Pareto principle
    Pareto principle

    It’s easy: just create a list of your VIP customers in your CRM software. Now, you can start to follow up and let them know about the rewards and incentives in order to make them feel special, so they continue to be your most profitable customers, which, if you consider the 80/20 rule, this investment is bound to pay off!

    Customer Referrals

    If you’re not already tracking customer referrals, you need to start. Your best customers are also your best salespeople. When they are happy, they will provide testimonials, leave reviews, and most importantly, refer their friends, family, and co-workers to your brand. Having a lot of customer referrals indicates that customer satisfaction is very high. Affiliate or refer-a-friend incentive programs are very powerful tools that marketers have been using forever.

    Not only do they reward customers for providing you with new business, but they provide you with several valuable insights. In addition to detailed tracking of your customer referrals, affiliate programs provide you with insight into why people recommend your brand. Referral programs might not be ideal for all types of businesses, but all businesses should be tracking customer referrals to determine if it ever could present a word-of-mouth marketing opportunity.

    Use automation to re-engage customers

    Automation is allowing some of your routines to be handled automatically by a software. The most popular is “marketing automation.” Monitoring and keeping your customers abreast manually are time consuming. Because there are so many processes to be repeated daily, in order to keep your brand fresh in the customer’s mind.

    Marketing automation
    Marketing automation

    The idea here is to use automation to re-engage your customers. Sure, you’ll see a boost in conversion rate as you engage customers manually, however, you can communicate stronger and faster through automation. Through automation, you can manage your customer contacts, drip feed education emails, schedule promotional emails, text messages, and event notifications.

    Know more about:

    Improve customer support.

    Excellent customer support makes a difference to your business’s success. Using chatbots for minor inquiries can help reduce the time taken to meet such concerns. Information like tracking updates, delivery details, reservations, and more don’t need human intervention. Chatbots save time when users need information that can be extracted from a database.

    Customer support vs Chatbot
    Customer support vs Chatbot

    Your live customer support staff can focus on critical issues, giving attention to problems that matter. You’ll offer faster support, saving time and resources. A chatbot strategy can improve your customer support and influence a customer’s decision to stay with your business. This leads to greater loyalty and improved retention rates. Successful businesses are the ones that recognize that customers form the backbone of their business. Support your customers with retention strategies, and they’ll support you.

    Leverage customer feedback surveys

    Surveys are powerful tools for building customer engagement. Surveys may look boring, but people like it. According to Fluid Survey University, “The Average Response Rate for email surveys is 24.8%.” Hearing from customers directly to know how they feel about your products and services is a great way to cement the bond that already exist. In essence, it can help you develop engaging custom content for customer retention. When customers are given the chance to express themselves, they reveal their minds and feelings about your brand.

    In their complaints, be sensitive enough to catch the pain points. Get to know the areas they’re not satisfied about and why. Adjusting in those areas will turn things around. Remember that through feedback, you can re-engage a customer that’s about giving up on your brand. No matter how you look at it, automation can help your business in so many ways. Most striking is the fact that it can help you engage and retain your customers.

    Conclusion

    The goal of inbound marketing is to build a mutually beneficial relationship between brands and customers. This opens the door for special offers that extend far beyond a coupon. Keeping your customers happy is more than continuing to receive their money, it also helps you improve your company to make them even happier – and in turn, they’re happy to spend more money. By the way, which of these customer retention strategies have you implemented, and how did it work for you?