SaaS LTD Giveaways: Is It Really a Good Idea?
March 2021 marks the 22nd anniversary of Salesforce. Back then, Marc Benioff, Parker Harris, Frank Dominguez, and Dave Moellenhoff simply wanted to build a solution that would add value to the users.
Today, Salesforce is worth north of $230 billion and is poised to keep growing due to the mess the pandemic created. Meanwhile, the SaaS industry as a whole is worth $145.5 billion in 2021. And by 2026, it’s projected that number will balloon to $307 billion.
Unsurprisingly, there are a lot of SaaS startups out there clamoring to get a piece of that massive market. And with all that competition, these founders are increasingly finding it difficult to acquire clients.
So much so that a lot of them are willing to provide SaaS LTD giveaways just to get their solution in the hands of users. Which begs the question: are Saas LTD giveaways a good thing?
Well, let’s find out.
What exactly are the pros and cons of this user engagement approach? And are there strategies to enhance the former and mitigate the latter?
SaaS Giveaways: Why Are People Doing It?
As mentioned earlier, SaaS startups are finding it more and more difficult to get clients due to oversaturation. To remedy this, a lot of founders have turned to SaaS lifetime deals (LTDs).
Put shortly, a SaaS lifetime deal is a one-time payment that gives you a perpetual license for that particular solution. In other words, you don’t need to pay a monthly subscription to access that SaaS product. You pay once and you can use it forever.
These businesses sound a bit desperate, yes? Well, if you think that’s desperate, there are startups out there who are launching SaaS LTD giveaways.
You’ve read that right. They are giving away lifetime access to their SaaS product. For free.
Well, there are several reasons.
Pros of SaaS LTD Giveaways
As you may have guessed, these startups aren’t giving their solution away out of the goodness of their heart. It’s a calculated marketing tactic that has proven to be incredibly beneficial for everyone involved.
Provided the proper strategies are charted and implemented, of course.
So what are these SaaS LTD giveaways benefits?
- Receive feedback
- Users will stress test your product
- Generate hype
- Lifetime deal users can be converted to paying clients
Receive valuable feedback
SaaS founders are willing to give these perpetual licenses freely as they want people to use their solution. In turn, these users will provide valuable feedback to the company to identify bugs and improve existing features.
This will lead SaaS founders, which is you, to build a product that users need.
One of the golden rules in SaaS is to create a solution that can offer repeated value to its existing customers.
By doing so, you’re creating a product that helps your client smoothen their operation. And ultimately, increase their MRR (monthly recurring revenue) and ARR (annual recurring revenue).
It doesn’t matter if it’s accounting software, CRM software, a communication platform, or an all-in-one outbound solution. As long as the SaaS product is delivering value, customers are more than willing to pay for it.
And why not? If it’s streamlining their work process, it means your SaaS product is increasing their efficiency. And an efficient system is a profitable system.
Building your solution like this is called Product Led Growth, a strategy that made several SaaS companies reach billions in revenue.
Of course, before that could happen, user feedback is needed to navigate the road ahead. Without it, your SaaS company’s growth will suffer. Or worse, stagnate and die.
Users will stress test your SaaS product
Another reason why founders are using SaaS giveaways is for users to stress test the product. Even if you’ve built your solution as best as you can, there will always be bugs and irregularities hidden somewhere.
But when a lot of people are using it, these glitches will manifest themselves more. And when they do, you’ll be able to conduct the necessary repairs.
That’s not to say you’re going to onboard hundreds of users for free simply to find these glitches. This brings us to our next point…
We’ve all seen this type of marketing tactic before, a particularly common avenue companies take when rolling out a new product. So it’s unsurprising SaaS startups are using it as well.
They want to generate hype around their solution and create curiosity in their target market. And to do so, they’re more than willing to engage in SaaS LTD giveaways.
This is where Facebook groups come into play.
Ken Moo actually has a community like that on Facebook called Ken Moo’s SaaS Lifetime Deals (LTDs) Group. This group, which has 7.7k members as of this writing, is filled with passionate SaaS users looking to find the next best solution to help their business grow.
And if they can get a perpetual license for such a solution for free, all the better. Of course, there’s no guarantee they’d snatch one just because they’ve joined the group.
There are events and social media contests involved – more on that later. But the point is that getting a SaaS lifetime access for free all boils down to chance. But hey, there’s no risk on their part so why not participate, right?
As for the SaaS product that’s being promoted, once a free perpetual license is on the table, people will start turning their heads. Better still, they’d actually consider the value you offer.
From there, you could nurture those leads and convince them to participate in your upcoming launch.
Free lifetime deal users can be converted to paying clients
True, you got a segment of your user-base who got their perpetual license for free. But that doesn’t mean you can’t convert them into paying clients.
Every SaaS user out there knows that a perpetual license isn’t necessarily, well, perpetual. What am I talking about?
A SaaS product will undergo several transformations throughout its lifespan. After all, your customer base will request a lot of features from you to improve the solution.
These features will be available to your SaaS LTD giveaway winners, of course. But you can also structure it in a way that it’s limited.
For instance, let’s say you’re a keyword research tool with a Keyword Golden Ratio feature. While your SaaS giveaway winners have access to that specific feature, you could set it to limited usage.
If it isn’t beneficial to your potential customer, no harm done. They can use your product’s other features.
But if it is, then they’ll eventually convert to a subscription payment model to access more of that component.
How to Launch SaaS LTD Giveaways
Now that we know the pros of SaaS LTD giveaways, it’s time to launch our campaign. And one – if not – the best way to do that is using social media channels.
You can choose a Facebook contest, Instagram contest, or any other social media platform out there for this event. You can even hold a photo contest if it makes sense for your SaaS product.
In our experience, a Facebook contest has yielded the best results for our clients. Say what you want about Facebook, but when you use it properly, it’s one of the best social media channels out there.
Anyway, the contest will depend on what your main goal is. For our example, our target is to get your SaaS product in the hands of your target audience.
But you don’t want to hand over your LTD giveaway SaaS license to just about anyone. Remember, you want to receive feedback from your customers, right?
So the quality of that feedback will matter a lot. Let’s break down each step so we can properly map this out.
- Specify your objectives
- Create a winner persona
- Decide what social media contest to run
Specify your objectives
We briefly covered this earlier but it’s worth expanding on. When you’ve decided to launch a SaaS giveaway, you want to be specific with your objectives.
Yes, you want users to stress test this system. But you also want the tester to know what the heck they’re doing.
To measure this, try launching a Facebook contest encouraging people to outline how they’re planning to use your solution.
That way, you can get a pulse on the expertise of your contest entrants. Moreover, you’re already receiving valuable information on how people will use your SaaS product for their business.
That’s a great insight to have for your product feature roadmap.
Create a winner persona
Creating a winner persona ensures that you’re onboarding people who will use your product. And use it in a way that’s unique and innovative.
You see, it’s going to be inevitable that people who aren’t well-versed in using SaaS solutions will enter the contest. They do so only for the sake of winning something. That’s it.
We’ve even held Facebook contests where people don’t claim their prize despite winning. Those are few and far in between but it does happen.
So it’s always a good idea to create a winner persona. It allows you to gauge the passion of the contest entrants and if they are truly excited about using your SaaS product once they’ve won.
However, this isn’t saying you’re going to ignore people who aren’t experts in using SaaS products. Again, this will depend on your specific objectives.
You could still use them to improve your onboarding process. Also, it’ll sharpen your team’s ability to educate potential customers in the future who may be interested in using your product but needs a bit of coaching on your end.
Decide Your SaaS Giveaway Contest
Your SaaS giveaway events will depend entirely on what you’re trying to accomplish. For our clients, it’s usually to get feedback. But other times, it’s simply to get the word out and increase brand awareness.
Here is some SaaS giveaway contest you can use:
- Asking specific questions
- Sharing use cases
- Sharing reviews/ feedback
- Leaving a simple GIF
- Comment their favorite feature
Again, if you’re trying to gauge the excitement of your contest entrants, have them answer specific questions. But be warned.
If you make your Facebook contest or Instagram contest too complicated, most will ignore your event. So strike a balance between easy and comprehensive.
True, you want valuable feedback. But writing those feedbacks will take time out of your customer’s day.
Time that they may not have considering they’re operating in the SaaS industry. Is it truly worth the effort to answer questions on social media contests to win an unproven SaaS solution?
So make your online contests simple for your customers but complex enough to benefit your SaaS company.
SaaS LTD Giveaways: Creating FOMO
Despite all of the advantages mentioned above, you may still be skeptical. Are SaaS LTD giveaways a good thing for your business both in the short term and long term?
After all, you’re onboarding clients who you’ll need to support for an indefinite period. That’ll eat up your resources. Resources that you could’ve allocated to acquire clients who are paying a monthly subscription.
But that’s why you’re going to set your prize for a limited number of people only. It’s already been proven that if there is scarcity, it can create the fear of missing out (FOMO).
As a result, a lot of people could join your social media contests and you’ll receive a lot of useful answers. Of course, not all of them will be valuable feedback. But that’s exactly the point.
The more people answer your question, the more likely it is you’ll receive feedback that can help improve your SaaS product.
You can even use a feature tier to further take advantage of this.
10 people could win a basic feature package. Three people could win an advanced tier package. And only one will win unrestricted lifetime access to your solution.
SaaS LTD Giveaways: Starting the Avalanche
We’ve found that SaaS LTD giveaways are quite effective in generating hype for a SaaS small business. Having said that, you should always take the time to outline the specific objectives of your giveaways.
That way, you’re maximizing the benefit of the grand prize you’re handing out. Moreover, you’re already starting to build the pathway of your product-led growth strategy.
This, in turn, would lead to your T2D3 framework. And who knows, you might end up turning your business into a unicorn company.
But all of that will only happen if you properly execute the right strategy. And you don’t have to necessarily follow the steps outlined above, either.
Think of it as a guideline, something to refer to when you’re running out of ideas.
After all, every SaaS startup is different. And the unique nature of your solution may need unique tactics that’ll lead you to success.
For more tips and strategies to grow your SaaS business, visit our Ken Moo marketing blog here.