What Is a SaaS Sales Funnel?
The SaaS market is very crowded right now. Several SaaS companies are vying for a piece of the pie for every niche. Because of this intense competition, you need to think about creating a SaaS sales funnel to improve your customer acquisition.
But what is a SaaS sales funnel? How can it help your SaaS business? This article will answer those questions.
What is a SaaS Sales Funnel?
A sales funnel is a term generally used to describe a customer journey from the moment of first contact until conversion. It’s called a funnel because it’s supposed to have a funnel shape when it’s visualized.
As you go down the sales funnel, you will notice that it becomes narrower because the people involved in the customer journey becomes fewer in the later stages. At the top of the funnel is where you’ll find your target audience entering your sales funnel so it’s the biggest section. It’s the stage where customer acquisition happens. At the bottom are those who converted into actual paying customers and where customer retention strategies are executed.
Why are Sales Funnels Important?
A sales funnel guides you and gives you insight into what your potential and existing customers expect at every step of their journey towards purchasing. The information from the funnel will help you make the right marketing choices. For example, if you can tell from your sales funnel that a qualified lead responds better to Facebook ads, you can shift to that instead of other advertising efforts. This data will tell you if your content marketing efforts are better than your email marketing campaigns, for example.
Aside from helping you to pick the right saas marketing strategy, here are other reasons why a saas sales funnel is essential:
Having the right sales funnel will tell you clearly how to connect and relate with your customers. For example, you can use the funnel to determine what language would connect you best with your new customer. After figuring out the best language that works for you, you can then change the language you’re using depending on your SaaS marketing funnel metrics.
An optimized SaaS sales funnel generates more sales for your SaaS product. This one goes without saying actually because it’s the ultimate goal of any business. But as you understand more about your potential customers through your SaaS sales funnel, you can connect to them better to drive up conversions and reduce churn.
Having a sales funnel gives you an edge over your competitors. A lack of direction is one of the challenges that new SaaS businesses struggle to overcome. This is because there are so many things to do, and they sometimes get lost. However, with a sales funnel, you can have a clear path. No SaaS business model is perfect in the beginning, but there is always room for improvement. As you learn more about your customers, you can refine your SaaS business model to serve their needs and expectations in a better way.
These are just some of how a SaaS sales funnel can help your SaaS business.
What Are the SaaS Sales Funnel Stages?
We’ve talked about the sales funnel having different levels or stages. We’ve mentioned that the top of the sales funnel has the most people involved. What are the various sales funnel stages? What should you know about these stages comprising a sales cycle?
1st Stage: Awareness
This is the stage when people become aware of your SaaS product, brand, or company. Before this stage, they have no idea about you. They might see you from an ad, a social media post, or someone they know might have recommended you. There are different reasons that can trigger awareness of your SaaS product.
The awareness stage is very crucial because it creates a first impression. You need to impress the prospect and convince them that you might just have what they are looking for.
Some SaaS companies do not place too much emphasis on the awareness stage. They prefer to work on the later stages when the customers are further down the sales funnel. That’s because a sales qualified lead has shown some interest in the product.
But it’s a mistake to ignore the awareness stage. Remember, it’s a sales funnel. The people who buy your SaaS product will have to start at the top. Once again, your customer acquisition strategies will be most useful in this stage. If you have a marketing team within your SaaS company, you’ll want to implement inbound marketing strategies to gain new customers, for example. But for this to be effective, you got to know your buyer persona.
2nd Stage: Interest
After your prospect becomes aware of your brand or service, they will evaluate it. Now, depending on their level of interest, they will move towards the next stage or decide to exit the funnel.
The foremost thing on their mind is the problem they are trying to solve with your software. They will also conduct competitor research and check more about other available alternatives at this stage.
It’s important to note that the middle stage of the saas funnel is where many of the customers fall off the customer journey. So you also need to be relentless in your marketing efforts to further convince a new customer to make a sale with you in the future.
3rd Stage: Decision
As the lead learns more about your SaaS product and company, they will have an easier time to decide whether to purchase or subscribe to using your SaaS product. In this stage, it’s critical that you have the necessary content and information for your customers to learn more about the prices and packages you offer, for example. At this stage, calls from your sales rep and info on landing pages can also help a lot. They might contact you as they’re trying to make a decision.
At this stage, you’ll want to convince them that buying your SaaS product or getting your service is the best thing to do. They need a little more assurance and push, and the best source of it is you.
If people are falling off from this stage, then there are certainly improvements that should be made so people will decide to use your SaaS product. Look at tools such as Google Analytics to know what stages of your conversion funnel needs optimization through key metrics such as visits to your website, number of people who called you, submitted a form, etc.
4th Stage: Action
This is the stage that you should aim for. All the preparation you made in the earlier stages of your sales funnel should lead a potential customer to action – whether it’s to schedule with you for a consultation, or have them sign up for a free trial of your SaaS product, or best of all, make them purchase or subscribe to your SaaS. If the prospect does not make a purchase, that’s okay. You can still include those who did not purchase in other campaigns, which can still convert them later on.
These are the four stages of a sales funnel. Knowing what these four stages are all about will ensure that you can use your SaaS sales funnel to your advantage.
Taking Advantage of SaaS Sales Funnel
A sales funnel is a marketing strategy that guides your customer from initial contact to eventual purchase. It’s the backbone of any successful SaaS business, and it can be used for lead generation or conversion rate optimization (CRO) purposes.
One of the easiest ways to entice customers to spend more money on your product is by introducing special offers. Whether it’s a limited-time discount, a coupon code, or a lifetime deal, it’s your chance to get more money out of the people who have already shown interest in your product. The key to making this work for you is having a good sales funnel.
The sales funnel is one of the most important aspects of your business. It’s what helps you move leads into customers and close more deIt’s something that many startups miss out on because they just don’t know it exists. It’s also something that a lot of startups either don’t know how to do or aren’t sure what the best practices are. An optimized SaaS funnel will increase your recurring revenue, increase your existing customer base, gain higher sales metrics, better sales process, and lower customer acquisition cost.
Find success in your own unique niche by reading more of our articles in our SaaS marketing blog here.
