9 Tips On How To Sell SaaS

For many start-up SaaS companies, knowing how to sell SaaS is key to both a strong start and longevity. Today’s article shares nine tactics for ramping up SaaS sales for start-ups.

RELATED: 5 SaaS Sales Principles To Boost Performance 

In this article:

  1. Conduct Short Hyper-Focused Product Demos
  2. Keep Trials to 14 Days Maximum
  3. Maximize Email Campaigns
  4. Get in Touch with Those Who Sign up ASAP
  5. Adopt a Relentless Follow-Up Strategy
  6. Compete with Value, Not with Price
  7. Don’t Sell at a Discount
  8. Offer Annual Prepaid Plans
  9. Never Settle for Bad SaaS Sales

How to Sell SaaS: 9 Ways to Boost Start-Up Sales

1. Conduct Short Hyper-Focused Product Demos

One of the biggest mistakes start-ups make when pitching their products is making long, unfocused product demos. Instead of piquing the interest of the prospect, they conduct what are seemingly training sessions that bore the decision-makers to death.

Product demos should give prospects a clear and concise idea of why they need to get the product or service. They can make selling SaaS, or any other product or service for that matter, easier.

They don’t need and want to know all of the features and functionalities of the product — at least not yet. What potential customers want to know during product demos is how the product will make them more profitable or efficient.

Here are three practical tips to optimize a product demo’s chances of successfully selling SaaS:

  • Conduct them on qualified leads only. Giving product demos to all prospects – leads or otherwise – will be an unproductive use of time and resources.
  • Focus on the product benefits instead of its features. Customers don’t buy products because of their features but because of the benefits they can get from products.
  • Learn the art of successful elevator pitches, which is making clear and compelling pitches in less than 15 minutes. Because people today have shorter attention spans, product pitches exceeding 15 minutes are unlikely to convince decision-makers.

2. Keep Trials to 14 Days Maximum

sales woman working by computer | Tips On How To Sell SaaS | sales process
Many SaaS start-ups think that long trial periods are a good sales strategy to win prospects over. Sadly, that’s not true. For most start-ups, trial periods longer than two weeks can hurt their chances of closing.

There are several reasons for adopting a sales strategy that limits trial periods to only two weeks, tops. These include:

  • Most prospects never use the free trials for the entire period, which makes a trial period exceeding two weeks excessive.
  • Extended trial periods will likely make prospects procrastinate on trying the product, and ultimately, forget about it. A shorter trial period gives them a greater sense of urgency to use the product.
  • Shorter trial periods can help maximize profits from sales to new customers. A shorter trial period means a shorter sales cycle and a lower customer acquisition cost.

3. Maximize Email Campaigns

Most prospects tend to forget emails they get from online marketers. The only exceptions to this are very well-crafted, lead generation email campaigns for marketing and selling SaaS.

To maximize the chances of making prospects respond favorably to an email campaign’s sales funnel, consider these practical tips:

  • Send truckloads of emails. Getting leads is a numbers game — sending more emails means more prospects and, ultimately, potential leads.
  • Personalize email addresses used to send marketing emails. Instead of addresses like Offers@YourBiz.com, use YourName@YourBiz.com or something like it.
  • Send call-to-action emails or emails that tell your prospects what they need to do next. Calls-to-action may include signing up for a free trial account, among others.

4. Get in Touch with Those Who Sign up ASAP

Another indicator that a start-up has no idea on how to sell SaaS is procrastinating on contacting their trial users. Often, they wait close to or until the end of the free trial period to contact them.

Why do start-up SaaS companies need to contact trial users within minutes after signing up? Here are some important SaaS marketing reasons for this strategy:

  • Higher potential response rates because chances are, trial users are still logged on to their computers. At this point, the product is still fresh in their minds, and they’ll most likely respond positively.
  • When prospects respond immediately, you’ll also be able to understand the prospects’ needs and wants quicker. This can speed up the qualification/disqualification process for prospects/leads.
  • Immediately calling the prospect optimizes a SaaS solutions company’s chances of handling objections successfully and maximizes the chances of closing sales.

RELATED: 11 Insanely Effective SaaS Sales Secrets Right From The Salesforce Playbook

5. Adopt a Relentless Follow-Up Strategy

Businessman Making Phone Call Sitting At Desk In Office | Tips On How To Sell SaaS | monthly recurring revenue
Most sales happen after several calls or engagements and are rarely one-call closes. To learn how to sell SaaS effectively, start-ups must be unrelenting in following up their leads.

By relentless, how often should start-ups follow up on leads? They must follow up every three days after the first contact until the lead makes a final decision.

If their leads still haven’t decided after two weeks, it’s time to move on to other leads.

6. Compete with Value, Not with Price

Some start-ups learn how to sell SaaS by underpricing their competitors. This indicates a lack of confidence in their products, which devalues their solutions.

Consider the following when pricing products for value, not for undercutting competitors:

  • About 30% of prospects will think the product is too expensive and will never buy it;
  • Another 30% of prospects will say that the product is cheap; and
  • About 40% will think it’s expensive but worth purchasing.

Regardless of how start-ups price their SaaS products, there’ll always be prospects who’ll think they’re too expensive. And if start-ups have a high closing rate, chances are, they priced their products too low.

7. Don’t Sell at a Discount

Start-ups that want to learn how to sell SaaS in the most profitable way possible should avoid giving discounts.

Selling products at discounts can be more disadvantageous than advantageous to start-ups because:

  • Selling at a discount makes it easier to sell products. When this becomes a habit, it can make start-ups’ salespeople lazy and ultimately undercut profits.
  • Regularly giving discounts can make it hard for startups to come up with reliable cashflow and income forecasts.
  • Frequent discounting “cheapens” products and hurts their branding.

Start-ups should limit giving discounts to annual prepaid plans only. Otherwise, leads won’t have any incentive to sign up for prepaid yearly plans.

8. Offer Annual Prepaid Plans

Business statrup executives discuss while meeting in office | Tips On How To Sell SaaS | sales reps
One of the biggest reasons why many start-ups want to focus on how to sell SaaS products is consistent monthly income. However, post-paid plans tend to provide slow income drips to start-ups.

Like the need infants have for lots of food for their rapid growth, SaaS start-ups need lots of quick income to sustain growth. One of the best ways to get this is by offering annual prepaid plans to customers, which come with a trade-off.

Prepaid annual plans provide a lot of revenue instantly, even as much as a year’s worth of revenue per account. However, they also tend to reduce start-ups’ annual revenues because customers only go for annual plans that offer discounts.

Considering huge immediate cashflows are essential to start-ups, the slight reduction in revenues – at least during the first year or two – is worth it. With the influx of money from annual prepaid plans, they can invest in an even better sales team that can ensure continuous sales growth over the years or make the product even better.

9. Never Settle for Bad SaaS Sales

Yes, cashflows are crucial for start-ups, which why they need to learn how to sell SaaS properly.

However, this doesn’t mean closing deals that are disadvantageous to the company and settling for scraps (i.e., unqualified customers). The cost of churn will never be worth the short-term gains from such deals.

Unqualified customers are bad deals because:

  • They complain a lot.
  • They can be more demanding than the best customers.
  • Unqualified customers can eventually smear your brand online, considering their tendency to complain so much and make unreasonable demands.
  • They’re likely to bail quickly, and in the process, provide minimal revenues to start-ups.

As cliché as it sounds, prevention is the cure. It’s easier to solve problems that never appear.

To avoid getting into bad deals, start-ups should:

  • Come up with their ideal customer avatars or profile.
  • Know their prospects’ needs and wants through their ideal customer avatars.
  • Create and implement an efficient and effective process for customer application decisions.
  • Know their competitors well.

Learning how to sell SaaS isn’t easy for start-ups, but it’s something they can learn to do effectively. Armed with these nine tactics, their success can’t be far behind.

Do you have experience or other ideas on how to sell SaaS and boost sales of start-ups?  Let us know in the comments section below.

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