How to Have a Healthier and Productive SaaS Product on the Web?
Build the Sticky SaaS Product: The sticky SaaS product is the product that becomes part of someone’s daily routine. Something they can’t do as good or enjoyable the work without that product. It’s something they need and love. It comes from 2 main reasons. Either the kind of solution that’s awesome or it’s a kind solution that provides a superior customer experience.
Increase the Stickiness by Reducing Time To Value (TTV):
It is the measure to think about the customer perspective. TTV is the velocity of the customer seeing the value of the product or how long it takes them to get those ah-ha moments that make them see the benefits. From the customer perspective, you need to discover what those ah-ha moments are. When you do so, the product marketing has its mission.
Product Launch Strategy: As technology grows, the SaaS companies are churning out the new products to keep with the demand. Having a seamless product launch strategy, increases your chances of success. The perfect launch strategy includes the critical steps your company takes, defining your audience and delivering a better customer experience etc., So, the brand understood the importance of using key performance indicator (KPI) and measurements to test the success of a product launch and see where your product launch is faltering. By understanding these measurements, you will be better able to make changes quickly and maximize your launch potential.
Product Marketing: When marketing the SaaS product, the first step is to think about the customer development. It involves reaching out to customers, listening individual concerns and paying attention to popular concerns that they are talking about the product. From there, you can up-sell and cross-sell your product. Visualize conversion optimization as experience focused approach that gathers all types of feedback to constantly adapt and improve to interact with brand properties by encouraging the precise actions your visitors, customers, and users take. Conversion Rate Optimization is essential for any website.
As a SaaS business founder, you may face many risks of building the business when starting your own company. Keep in mind that the following will help you to build recognizable SaaS business,
- Cloud Environment in the Delivery Model:
It is important to look at your platform to sell other companies you need to integrate with. These are classified as cloud based SaaS product and the location based SaaS product. Even the SaaS is a fully featured cloud infrastructure, it can manage the location-based by location based CMS, online maps, geocoding, routing etc., It will substantially enhance the UX to maximize conversion.
- Pricing of SaaS Product:
Setting up the right price for the SaaS product is hard. If you set a low price, you’ll lose the credibility in the market, or if you set a high price, it will scare away the customer. The pricing sweetspot looks at several factors like production, business costs, competitor pricing, revenue goals etc., So, the Pricing optimization fine tunes the possible conversion rate. It is important to understand the customer and the value of the service as perceived by the target market.
The SaaS pricing can be easy by looking at your competitive prices. Even it is not completely based on your competition, the numbers can serve as a starting point for your product pricing. Generally, the startups try to sell and provide more value for the cheaper price. This way they can cut out the incumbent solution and win the businesses.
- Build the Product for Customer Success: When you are considering what your Saas product will be, align your offering with an area you are interested in and try to find some excitement towards your customer base. If you want to compete, you need to keep a close eye on your competition. There are other companies that offer similar services in your niche. So, you need to stay up-to-date on their offering and success of the product. As you build the product, think about the customer needs and want that will help you to create and establish every facet of your business.
SaaS Metrics for Customer Success:
If you are an owner of software product, you need to assess the impact of SaaS will have in the key areas. Decide on how you would like to view your company’s progress and profitability. You may choose monthly or annually and be consistent throughout the process. These three are the building blocks of strong business model and proves to be powerful SaaS metrics,
- Life Time Value (LTV): It is the first step for building the SaaS business. It also represents how much you will earn from the customer until they churn. A basic formula for LTV is,
LTV = Average Monthly revenue per account (ARPA) * (Average subscription Length)
2. Customer Acquisition Cost (CAC): It is the cost to acquire one additional customer and this will impact to selling the product to the customer. The cost of the product doesn’t include the fixed costs of servers, cloud storage. It has been included the marketing, sales, support teams, ad spend etc. It can be defined as,
CAC = Total sales and marketing expenses / No. Of customers acquired
The ratio of LTV/CAC will reveal the long term feasibility of your business.
The successful SaaS business model has a ratio of LTV/CAC above three in the long term.
3. Cohort Analysis: It is a group of users who signed up in a month. If you see the cohort spending over the time, some users in the group will churn, reducing their spend to $0, and others will buy new subscriptions, increasing their spending beyond the original subscription.
If the cohort’s total spend goes up over the time due to cross selling, it means you have achieved the negative churn and your business model is going to be highly successful.
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