• Ankit Dudhwewala

    3 Key Factors to Increase Revenue for Your SaaS Product

    3-key-factors-to-increase-revenue-for-your-saas-product

    There are two types of SaaS products.

    1. New innovative product
    2. The commodity products (which is a copy of an innovative product)

    The innovative products get sign ups and are able to scale because they have built a very useful and handy USP. They get word of mouth from early users which are enough for them to grow to a considerable size.

    However, most SaaS products today fall into the commodity category with no innovative features. For such products, three factors are really important to grow.

    saas-product

    Pricing

    One you have marketed your product well, and have people landing on your website, the first important thing is to get them to Sign up. Here the most important criteria is Pricing. As you are a commodity product, the price point, lower than the market leader will help in getting paying customers. Such a pricing strategy helps you get the price conscious customers to sign up. Remember, pricing is a factor of features. Pricing would be irrelevant without features, and your software needs to provide the features that your competitor is giving at a lower price.

    Let’s take the example of Freshdesk. When Freshdesk launched, pricing was their major differentiator from their competitor Zendesk.

    Usability, UI, UX

    Pricing can get you signups. However, your users need to start using your software to give you their credit card ultimately. If you are not a market leader and want even to become the second best, you will have to focus on the design and usability of the product.

    Often the first mover tends to avoid design, as they are competing on their innovative feature and design is where the late movers can compete on. Easy to use design coupled with self-onboarding features will help in getting the customer engaged.

    The trials most SaaS products have is for 15/30 days. It is practically impossible to implement the product in the complete organisation in 15 days’ time and try all features of the product. Hence, the usability & design of the product is the most important deciding factor.

    As you already have ensured a convincing pricing, there is a very high probability that the user will convert to a paying customer.

    Pipedrive is one company which entered the CRM space rather late and still could make it big. This is because Pipedrive focused on the usability of the product. They have taken care of very small things — every time my team cancels a meeting or an appointment, Pipedrive gives an automated pop up which will ask for the next appointment. It reduces the chances of losing a lead in the pile because of not setting up the next activity. I run SoftwareSuggest, and have many friends who run CRM software companies. All of these CRMs are free for us to use, but we still prefer to pay Pipedrive because of its usability.

    Customer Service

    Converting a user to paid customer is not enough in SaaS. You will need to maximize the lifetime value (LTV) of the customer so that you start making profits. Once the user has converted to a customer, you need to start focusing on ensuring impeccable service quality. Organisations generally don’t prefer to move from one SaaS product to another. It’s a pain. Once they have signed up for a product, they like to stick with it. However, not focusing on customer experience once they have made the first payment will lead to churn. They might even leave before you have recovered your cost of customer acquisition. Hence, you will need to constantly monitor their usage of the product and ensure that the time on the app is increasing. Setting up a customer success team can be a good method. Good service will help in increasing the lifetime value of the customer.

    Originally published on LateralPost

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