Software as a Service (SaaS) is one of the fastest-growing businesses in the world today. By the end of this year, the total global revenue of SaaS companies is expected to touch $106 billion. While t his is great news for future prospects, it also means that there will be stiff competition for success in the narrow space. To stand out from the crowd, SaaS companies will have to constantly think about ways to differentiate themselves.
This is where Inbound Marketing comes in. SaaS and inbound is a match made in heaven; let me tell you how.
SaaS companies follow the principle of providing valuable services to their customers via periodic subscriptions, the latest business model that is seeing so much success (think Netflix, Spotify, and Amazon Prime for movies, music and shopping respectively).
This model demands that the seller initiate and nurture a long-lasting relationship with the customer. The company’s relationship with the customer is not a one-time event but a continuous process that is mutually beneficial.
Inbound marketing functions on a similar principle of treating customers with respect and customizing services to their exact needs. As opposed to traditional marketing tactics such as print ads, hoardings, and commercials, inbound marketers attract leads by providing them with information guaranteed to be useful to them.
SaaS companies specifically succeed with inbound marketing for the following reasons:
- Establishing thought-leadership: One of the pillars of inbound marketing is providing clients with quality content that is helpful to their business. By providing original and constructive information to its customers, inbound marketing can help a SaaS company attract and convert customers and also demonstrate its superiority and expertise in the field.
- Higher conversion rate: Inbound marketing campaigns can be very effective in drawing visitors to a website and entice them to sign up for a service, thus converting them to qualified leads. For SaaS companies, having a customer sign up for a service could make all the difference to the bottom line.
- Lower customer acquisition cost (CAC) + higher lifetime value (LTV): In a traditional model, while initial costs of customer acquisition are high, they’re also compensated by the first business deal or sale made right after. However, in SaaS companies, due to the subscription model, the revenue comes in slowly over a period of time; hence, upfront CAC needs to be kept low. Inbound marketing has shown to reduce CAC by up to 40%.
Additionally, inbound marketing provides tools for keeping track of the buyer’s journey and for keeping their attention engaged with quality content throughout the subscription period and beyond, increasing the lifetime value of the customer.
It is no wonder that more and more entrepreneurs, business owners, and marketers are realizing that inbound marketing is here to stay. As a strategy, it has shown repeatedly, its value in creating brand awareness, generating leads and converting them to customers and finally to brand ambassadors.
If you own or run a SaaS company, you would do well to consider the huge benefits that come with inbound marketing strategies.
To know more about the advantages of inbound marketing in SaaS Industry, contact us at www.digitant.com