Updated on by Kate Gordon
One of the biggest challenges, when approaching sales and marketing for your SaaS company for the first time, is that you may well be expected to do everything with nothing. But, as this survey found, companies that spent more on sales and marketing (as a percentage of revenue) generally grew at a faster rate than those that spent less, so you can see how vital it is as an investment.
Once you have defined your sales and marketing objectives, as clearly and in as much detail as possible, you can start to think about strategy. If budgets are limited, you need to think creatively, strategically and efficiently. Here are our six steps for building a strong sales and marketing strategy for the first time.
1. Getting your presence out there
First things first, how to get your presence out there when you don’t have huge budgets at your disposal? Fortunately for those in the SaaS space, there are a number of great directories which list SaaS companies, and these should be your first port of call.
G2, Capterra, TrustRadius and AlternativeTo are four great software comparison sites where you can list your company, and receive reviews from real users. An added benefit to this is that, the longer you’re on the site and the more positive reviews you receive. You could also receive specific awards or be added to comparative grid rewards. Check out our “Best Support” and “Easiest To Do Business With” awards from G2 earlier this year.
Ensuring your company and brand is seen in the correct vertical markets is a great way to make sure you are seen by your prospective customers.
2. Testing the water
Secondly, you need to test the water. Where should you market? Think about who your customer base is and how best to reach them.
Once you have narrowed down where your audience will be looking for software like yours it’s the time to test.
To do this properly you should have a small budget to put into a campaign. Without historic data to work off of, identifying success can be difficult. Resisting the urge to constantly tweak a campaign will be tough, but knowing what doesn’t work is often beneficial; giving you the opportunity to hone your messaging with each new campaign.
3. Choose your channels
You don’t need to use every single channel available to you. Just choose the ones that are the most relevant to your products and at this stage, will give you the most ‘bang for buck’. Low Google AdWord spend is great for positioning, while Capterra provides a vertical industry focus. Make sure your social media channels are active and monitored, as they are a great way to communicate with customers and prospects. Likewise, start to build an email database so that you can send sales and marketing emails to your database.
Use all of these channels as testbeds. What are you spending on each and what ROI are they giving you?
4. Time for PR
At some point, it might be time to consider moving beyond owned and paid for social channels to the earned channel of PR.
PR will complement your other marketing activities and is a way to secure media coverage that isn’t paid-for advertising. As a bare minimum, you will need either news or thought leadership topics to approach the media with.
Read more about PR for SaaS in our recent article.
5. Scaling up
When looking to secure funding or you’ve been allocated a bigger sales and marketing budget, then you’re going to need to look at scaling up. Hubspot says that, in order to establish a revenue or lead-commitment based on your funnel metrics and revenue-growth goals, you should work backward from the gross revenue amount that marketing is responsible for generating (generally around 40%).
Sales and marketing shouldn’t always be focused on new customers either. According to KeyBanc Capital Markets, the median cost to acquire $1 of annual recurring revenue (ARR) for a new customer is $1.32. However, when using upselling to existing customers, the cost drops significantly to $0.71.
6. Review and test
Throughout your sales and marketing campaigns, track the number of visitors, trials and closed deals, and the conversion rates. These conversion rates represent the ability to forecast future revenue and retention accurately. What’s more, it will impact staffing levels and future sales and marketing spend.
Review and test these metrics over time to ensure that you are continuing to improve them. It is important to measure the overall ROI from your lead generation activities. If things are working well, then putting more focus and resource on marketing and sales can not only ramp up leads and revenue, but it also helps you stay one step ahead of your competitors. However, you should always check that scaling up in budget mirrors what you expect in terms of your KPIs.