Marketing Goals & Challenges in SAAS
Today, the technology and SaaS industry has grown from a $5.5 billion industry in 2008, to the $116.4 billion industry that it is today in 2018. But according to recent data from McKinsey, if a software company grows only 20 percent, it faces a 92 percent chance that it will not even exist within 3 years.
Originally, the technology and SaaS industries evolved as purely product development and innovation but in today’s hyper-competitive landscape, having a best-of-breed product or solution doesn’t necessarily guarantee the user or customer growth for a company to survive over the long run. Having a app, software, or product with tremendous value and a great experience is still an extremely important part of the equation but marketing is required to achieve the growth needed for sustainability..
"if a software company grows only 20 percent, it faces a 92 percent chance that it will not even exist within 3 years"
That’s why technology companies have become increasingly focused on marketing strategy and investment. Marketing (when done properly and systematically) guarantees a steady stream of industry visibility, sales leads, and revenue growth. Technology companies both big and small have recognized this fact, and now marketing has become a cornerstone of business strategy for SaaS and tech companies.
For example, in their first five years, SaaS companies have invested around 80 percent of their revenue on average in sales and marketing efforts. This number may seem significant, but in the world of investor-driven growth requirements it is necessary to meet objectives.
But it’s not just the initial growth phase that tech companies use a ton of marketing muscle to overcome. After SaaS and tech companies get past the start-up phase, those that rely mostly on internet sales devote 65 percent of the median customer acquisition cost (CAC) budget to marketing efforts and tactics.
What specific challenges each organization is seeking to address, or goals that they’re looking to achieve depends upon their product, industry, and target market. But here are some the common, core issues that tech and SaaS companies are spending marketing budgets to address in 2018:
To grow at a predictable rate, technology companies need a consistent, sustainable way to generate sales leads that might eventually turn into customers.
Many SaaS products are complex, expensive, and require lengthy sales cycles. Thought leadership marketing is key to helping prospects overcome barriers as early as possible.
How prospects (and even current customers) interact with digital marketing efforts can yield insights that can be used in multiple areas of the business. Companies are recognizing the value of marketing data more than ever.
Especially in the technology industry, sales is the proverbial customer of marketing. SaaS organizations are investing in marketing tactics and technologies that will facilitate better collaboration between the two.
Simply Google the word “Circle,” and the first result brings you to a fintech company instead of the actual shape. It’s just one example of how SaaS companies are pushing to get even higher search rankings than ever.
The internet is a crowded place for technology buyers, and technology companies are becoming acutely aware that they need to dedicate marketing budgets that will help them reach the target audience in the right places.
According to recent figures, there are currently over 5,000 various marketing software and technologies on the market. Choosing which platforms are worth the investment has become more challenging than ever for tech marketers.
Adjusting to B2C
Even B2B SaaS buyers are consumers themselves, and they’re increasingly influenced by those B2C marketing experiences. Marketers are now thinking about how they can connect with their audiences in similar ways.
As tech leaders continually place marketing, sales, and services under the umbrella of Customer Experience (CX), any investment that can link marketing strategically with other CX areas is of potentially of great value.