Tuesday, December 3, 2013

Another task for 2014 planning: review your messages

I'll start by apologizing.

I know you’re up to your eyeballs already with your 2014 planning, but I’m going to add another chore to your “to do” list.  Sorry.

Besides working through your budget, marketing programs, headcount, and whatever else you need to have in place when the new year rolls around, I’d suggest you add another item:   

Review your value proposition and messages.

Here’s why.

Most of your marketing plans are meant to deliver your messages to your target audience.   That’s what email campaigns, presentations, webinars, press campaigns, website overhauls, white papers, data sheets, events, customer conferences, and search engine marketing are all about. 

So before you do any of this stuff, you should think about the messages themselves.

  • Do they mean anything to the people you’re trying to reach?  
  • Do they address their problems?  
  • Do they distinguish your solution from alternatives?  
  • Do they compel the prospective customer to act?

In other words, is your value proposition still valid and effective?

Things do change

A value proposition and messages aren’t things I recommend you tinker with very often.  Consistency and repetition are good.

But they are worth revisiting from time to time.  After all, things do change. 

The things customers care about might change.  For example, for some buyers, mobile is much more important now than it was a few years ago, so you’ll need to address that.

Or new competitors may be have come into the market.  That may mean you’ll need to update the way you talk about the unique advantages of your solution.

The best way to figure out if your messages are still valid?   Ask your customers.  

There are a few ways to do that:  surveys, focus groups, interviews, A/B testing, monitor relevant conversations on social media, etc. 

Many companies I work with find it especially useful to have an outsider talk with customers.  (Contact me and I can tell you more.)

However you decide to do it, it’s worth going through the effort from time to time.  Why not now?

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This work by Peter Cohen, SaaS Marketing Strategy Advisors is licensed under a Creative Commons Attribution 3.0 Unported License. Images obtained via iCLIPART.com.

Monday, November 4, 2013

Most demos are useless

When you're selling business solutions to companies, at some point in the sales process you're likely to end up doing a demo.

Too bad.  Most demos are useless.

They usually don't help the prospective customer make a good choice. They just confuse and bore them.

And they don't help the vendor make the sale, either.  That's especially true for software-as-a-service (SaaS) solutions.

In this short video, produced with help from the good folks at Openview Labs, I explain why most demos are dreadfully dull, and how we can do better than bore our prospective customers and waste our own time.

Tuesday, October 8, 2013

SaaS Marketing Requires Focus

There's a guy in my town who advertises himself as "The Bulkhead Man."  What he does is install the entryways that go from the outside of a house into a basement.  Most are heavy steel doors that are mounted onto the concrete foundation.  Here's a photo of mine, partially obscured by a very healthy holly bush.

I assume "The Bulkhead Man" could probably handle a lot of other construction projects around the house: build a deck, hang new cabinets, replace siding, whatever.  He could rightly call himself a "contractor" or "handyman." 

But that would be a bad idea.

Then he'd be just another guy in the long list of other "contractors" and "handymen" who advertise in my local paper.  His ad would be stuck in with about two dozen others, instead of being the one and only "bulkhead man."  

Companies want solutions for their particular problems

If I needed a new bulkhead, believe me, "The Bulkhead Man" is the guy I'd call.

And I'm probably like most people in that way.  Most of the time when we're looking to fix something, we're looking for someone with particular expertise, a specialist in delivering just exactly what we need.

This same logic applies to people searching for business solutions.  They're usually not looking for something that can "do anything for anybody."  They're looking for a solution to their particular problem.

How can software-as-a-service (SaaS) companies can take advantage of that logic?  One word:  Focus. 

Focus lets companies build visibility and a reputation as experts in their particular niche.  It lets them distinguish themselves from the pack.

When someone searches for solutions like theirs, they rank at the top of the list.  When someone sees them at a show or receives an email from the company, they pay attention.  "Hey, these folks have something that's exactly what I'm looking for!"

Focus on a problem, a customer, a geography, something

A SaaS company can focus on a particular problem or task.  For example, "our solution is specifically designed to help eCommerce companies more quickly and accurately update the inventory they present online."

Or it can claim that its solution is developed for a particular kind of customer, as in "this product is built for companies with teams of 5-40 customer support reps."

A company could even claim a specific geographic specialty.  For example, "our solution is designed to help public school administrators meet the unique reporting requirements of the State of Florida."

If you think about it carefully, you may find other ways to identify your particular market segment.  Contact me if you need help.

Focus isn't easy

Believe me, I know it's difficult to narrow in on a specialty and there's lots of temptation to present yourself as "we can do anything for anybody." 

I talk with a lot of companies that are rightly very proud of what they've built, all the things it can do, and all the markets it can serve.  "Yes, it solves that one problem well... but wait.  It does so much more."

My advice in most cases: focus.  Or at least take on a carefully selected handful of well-defined segments.

Focus is especially important if you're competing in an established market with a few 800-lb gorillas.  In the market for CRM solutions, for example, if you get head-to-head with companies like salesforce.com, they'll easily out-spend you with their vast marketing and sales budget.  You'll be buried.

Focus is essential to the SaaS business model

The key to survival in the SaaS world is getting your money's worth from what you spend on customer acquisition.  (See "Marketing Spend;  How Much is Enough?") Once you've spent money on developing your product, sales and marketing expenses are likely to be among your largest on-going expenses.   For your business to thrive, the return on that spending - the long-term customer value - must exceed the acquisition costs.

With focus, a company can distinguish itself from competitors, make itself easier to find, attract more leads, and close more business.

What does that means in terms of the "customer acquisition cost (CAC)/ long term customer value" (LCV) formula?  If the company spends $1 on sales and marketing, it's got a better chance at earning back much more than that in long-term customer value.

Don't just be another company that does everything that everybody else does.  Be the one and only "bulkhead man."

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This work by Peter Cohen, SaaS Marketing Strategy Advisors is licensed under a Creative Commons Attribution 3.0 Unported License. Images obtained via iCLIPART.com.

Friday, September 6, 2013

Turning SaaS Buyers into Satisfied Users

If you subscribe to a software-as-a-service (SaaS) solution, in most cases you can quit whenever you want.*

That's great for SaaS customers, but not so great for SaaS providers.

It puts a special burden on providers:  They need to be sure that the folks buying their solution are actually using their solution.

If buyers don't become satisfied users, they'll eventually leave.  The result: attrition, slower growth, higher customer acquisition costs, and other bad things.  (See "SaaS Renewals and the Multiplier Effect").

In this short video, produced with the good folks at Openview Labs, I talk through 3 ways that SaaS providers can turn buyers into users. 

*We'll talk about long-term contracts some other time.

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This work by Peter Cohen, SaaS Marketing Strategy Advisors is licensed under a Creative Commons Attribution 3.0 Unported License. Images obtained via iCLIPART.com.

Wednesday, August 7, 2013

How not to waste $30,000 on marketing

An entrepreneur who's just been accepted into a start-up accelerator that provides cash for young companies asks:

"How would you spend a $30,000 budget for marketing an SMB software-as-a-service (SaaS) application?" 

He's selling into "a huge but highly competitive market."  Based on feedback from about 10 active users, he explains, "I feel confident my application is ready to go to market."

Now it's just a matter of where to spend the $30,000.

Don't spend a dime yet

My advice:  Put the checkbook away.

Sure, the company could try several marketing tactics that might be helpful and reasonably cost-effective:  search engine optimization (SEO), Google adwords, PR, and others.

But in a highly competitive market, $30,000 won't go far.  The company could easily spend that amount on adwords in a single month, and good SEO or PR professionals need to get paid.

Before it spends any money on specific lead generation activities, the company should first figure out why anyone would buy its product.  And in a highly competitive market, why would they buy it from them?

If the company is facing well-established and well-funded competitors, it'll need to articulate a significant advantage over these other solutions.  A few extra features aren't nearly enough.

A new solution can't just be better; it needs to be a lot better.   

Don't promote before you know what you're promoting 

There's a lesson in here for all SaaS companies:

Don't spend money on search engine marketing, PR, or any other channel, until you have a
compelling message to promote.

Once the solution is built is not the time to start marketing.  Companies should think through these messages and their value proposition much earlier in the process.

If you're interested in building a viable business, developing a compelling value proposition is just as important as developing a sound technology solution.  Marketing and messaging are not after-thoughts. 

If you don't know who should buy your solution, what problem it solves, and why it's better than anything else out in the market, no amount of money - not $30,000, not $300,000, not $3 million - will help much.

Monday, July 15, 2013

Don't do tradeshows the wrong way

Tradeshows can be an effective way to get in front of prospective customers.  But not if you do them the wrong way.

You'll know it's the wrong way when you find yourself standing in a small booth in a remote corner of a vast exhibition hall, desperately hoping that some lone soul will meander their way past and glance in your direction. 

You'll know it's the wrong way when you're checking your email every two minutes, trying to relieve the monotony.

And you'll surely know it's the wrong way if you've spent thousands on exhibition space, booth set up, shipping and drayage, electrical, carpet, and give-aways, plus the travel expenses for everyone who staffed the booth, and you've attracted no new prospects.

Tradeshows can be expensive, especially for software-as-a-service (SaaS) companies that need to be especially careful with sales and marketing expenses. (I write extensively on the need for SaaS companies to spend wisely on customer acquisition in my "Practical Advice on SaaS Marketing" newsletter.)

One option is to skip tradeshows, dropping them from your budget altogether.

A better option, which I discuss in the video, is to select tradeshows carefully and get as much out of them as possible.

Thanks to the good folks at Openview Labs, who helped produce this video.

(By the way, I imagine there's a way to get a better still shot from the video than this rather unflattering one, but I've not yet figured out how to change that.)

Monday, June 3, 2013

Customers don't care about you

Sorry to break this news to you, but customers don't really care about you.

Even when they ask about you, it's really about them:

  • "What problems can you solve for me?" 
  • "What experience do you have with companies like mine?" 
  • "What do you know about my business, my market, my product?" 
  • "How can you help me?"

You may have a broad range of expertise.  You might have solved problems for all kinds of different companies in all kinds of different industries.  You might know a lot about a lot of different markets.

It doesn't matter. 

Prospective customers really only care about themselves. What do you know about their market?  What can you do for their business.

There's no problem with that.  After all, it's their business and their money.

Present yourself as an expert

So what does that mean for software-as-a-service (SaaS) marketers?  What does it mean for your messages and how you present yourselves?

Look at it from the prospective customer's point of view.  They'll be relying on your SaaS solution to support a key part of their business - customer management, finance, ERP, HR, whatever. 

They need to trust you.  They need to feel confident that you understand their particular needs. 

You need to present yourselves as experts at solving their unique challenges.  You need to focus, to specialize. (See "Don't market to the wrong people," Practical Advice Newsletter, April 2013.)  

For example:

  • "Our billing management system is focused on the meeting the special needs of veterinarians in the US"
  • "We deliver an HR recruiting solution built specifically for K-12 public school administrators"
  • "We've built an inventory management system based on our deep understanding of the food service industry."

You can specialize by industry, by geography, or by company size.  Those are fairly common. 

Or the focus could be on a particular kind of problem.  For example:

  • "We've built a solution for companies that need to coordinate long sales cycles that include multiple decision makers throughout a large enterprise"
  • "We're ideal for small companies struggling to attract software developers"
  • "Our solution eliminates the paperwork from tracking warranties and processing claims."  
That is, you could stake a claim to having the perfect solution to one special need which may be common to multiple industries.

SaaS is about a relationship, not a transaction

Of course your company probably knows a lot about other industries and other markets.  And it might be easy to configure your SaaS solution to work in a variety of environments to solve a whole slew of problems. 

But your prospective customer usually doesn't care about what you can do for other companies in other industries with different challenges.  They care about themselves.

Remember, SaaS means a relationship, not a transaction.  And customers want a relationship with someone that they are convinced knows their market, their business, their problems.  Someone they can trust.

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This work by Peter Cohen, SaaS Marketing Strategy Advisors is licensed under a Creative Commons Attribution 3.0 Unported License. Images obtained via iCLIPART.com.

Tuesday, May 7, 2013

SaaS Marketing Tactics: Do Whatever Works

Like most conventional wisdom, ideas about the "best" way to market software-as-a-service (SaaS) solutions make sense for some companies.  But for other companies, those same ideas don't work at all.

Take free trials, for example. 

For applications and markets where the prospective customer can actually get a good sense of how the solution works over the course of a short trial, where the company has the resources to support the trial, and there's an effective process in place to move prospects from trial to purchase, a free trial can be a very effective tactic.

But that's not always the case.  If the prospect won't see much value from a trial for months, or it costs the SaaS provider lots of time and money to support it, a free trial doesn't make sense. 

Here's the point:  Don't buy into the conventional wisdom: "SaaS companies must offer free trials."  Instead, go your own way and offer alternatives.  (See "Free trials don't always make sense.")

Certain social media make sense; others don't

Conventional wisdom also points to social media as a "must do" SaaS marketing tactic.

Facebook, Twitter, or LinkedIn can be effective in the right circumstances.  But if your target market isn't active on those media, don't bother. 

Or at least don't bother with all of them.  If your prospects participate in relevant LinkedIn discussion groups, spend time on LinkedIn, and ignore the other media.

Blogs can be useful too.  If they convey helpful information, they can organically attract a well-qualified audience.  But don't follow the pack here and start a blog just because "everybody's got one." 

Blogs take time and resources (Believe me on this, folks.  Even monthly deadlines come up quickly!)   If you can't make the commitment, don't do it.  A blog showing the latest post from 2010 is worse than no blog at all.

Don't rule out tradeshows

Conventional wisdom takes a dim view of tradeshows. 

For one thing, they are expensive.  I always figure the final cost of participating in a large show- counting in travel, entertainment, tchotchkes, shipping & drayage, etc. - will be at least 3x the cost of booth space.  That's a lot of money for a cost-conscious SaaS company.

But don't write off tradeshows out of hand.  Conventional wisdom aside, for some markets and some SaaS solutions, they're perfect venues to get in front of the ideal prospective customer. 

We recently developed a customer acquisition plan for a client selling to fitness clubs.  In talking with their target buyers - fitness club owners and managers - we found they all attended at least one of the two large national shows every year.   Participating in those events - both on and off the show floor - makes sense for that company.

So much for "conventional wisdom."

Use what works for you

When you're evaluating SaaS marketing tactics, of course it's a good idea to listen to your peers, pick up "rules of thumb," and skim relevant blogs (thank you).  But don't accept or reject ideas out of hand.  See if they fit your particular situation. 

Better yet, try them out.  Measure the results. 

If they work, do more.  If not, don't.

Friday, April 5, 2013

When marketing gets creepy

A company I'll call "NotAGreatIdea.com" is spying on me.

They know I've wandered onto their website and watched a video demo of their product.  I didn't provide my name or email address.  But somehow they think they have permission to contact harass

Perhaps "harass" isn't exactly the right word to describe the email that arrived a few minutes after my visit to their site.  It addresses me by name and mentions that they know that I've checked out their video.

Maybe "creepy" is a better word.

Nothin' for nothin'

Companies can contact me when I've asked for something from their website, like a white paper.  I actually expect that.  It's a fundamental principal of inbound marketing.  You give me something of value, and in return I give you an opportunity to connect with me.

Done well, this mutually valuable exchange can be a vital part of an effective customer acquisition strategy.  It can help companies earn credibility and move prospects along a path toward purchasing a solution.  And it can be designed and executed to fit within software-as-a-service (SaaS) companies' business model.  (See "SaaS companies can't afford to sell," November 2012) 

But when I've not explicitly provided my name and contact information, as in the case of my anonymous visit to "NotAGreatIdea.com," the company has not earned the right to contact me.

A productive relationship doesn't start with stalking

In fact, their intrusive email completely soured me on the idea of learning more about the company.  I have not the slightest interest now in taking them up on the invitation "to arrange a short meeting to answer any questions you have and to show you how NotAGreatIdea.com's easy to use patented technology can help take your marketing to the next level." (Name changed to spare public embarrassment.)

If by "take your marketing to the next level" you mean that my company too can use your technology to identify visitors - who thought they were anonymous - and try to establish a trusting and productive relationship with them... no thanks.  That sounds worse than spam; it's stalking.

Look, I'm not naive about what marketing technology can do.   I know you can use clever solutions like these to track all my comings & goings on a website, count my downloads, and even discover my name and email address.

But just because you can do it, doesn't mean you should do it.

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This work by Peter Cohen, SaaS Marketing Strategy Advisors is licensed under a Creative Commons Attribution 3.0 Unported License. Images obtained via iCLIPART.com.

Thursday, March 7, 2013

Why I'm cancelling my subscription: a failure to communicate

I just cancelled my subscription to the New York Times on my Nook.  Not because I won't be reading the New York Times any longer... but I won't be reading it on my Nook.

Why not?  Because the service provider, Barnes & Noble, routinely breaks a fundamental SaaS rule: 

Communicate with your subscribers.

What we have is a failure to communicate. 

Barnes & Noble is unable or unwilling to let me know when there's a problem with their delivery.

Several times over the last few months, my electronic newspaper didn't arrive as scheduled. 

Last Saturday morning, the New York Times icon on my Nook was showing some kind of inexplicable message:  "Connecting." Nothing about a delivery problem.

On the Barnes & Noble website, nothing about the problem.

On the customer support telephone line "hold" message (which I listened to for 15 minutes), nothing.

In my email inbox, nothing.

When I finally reached a customer service rep, she told me that their servers had been down since the evening before.  They won't be able to deliver my newspaper or anything else until the problem is fixed.

It's a daily newspaper.  It's not worth much the following day. 

Lots of SaaS applications - CRM, ERP, HR, etc. -  are time-sensitive.  You expect them to be available when you need them.  Late information is useless information.

Look, I understand that applications, servers and networks go down.  Sometimes it's for scheduled maintenance and sometimes unexpectedly.  It probably happens less frequently for SaaS solutions than it does for internal networks, but it happens nonetheless.
But that's not what I'm ranting about.  I'm ranting about the lack of communication.

Poor communication will hurt you

When something does go wrong, you've got to let your subscribers know. 

That's part of your obligation as a legitimate SaaS provider.
  • Post a notice to your website.  
  • Send an email to your subscribers.  
  • Include the information in your "hold" message.  
  • Run up a distress flag.  
  • Say something!

Just don't keep us in the dark.  It can cost you subscribers.  In fact, I know one.

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This work by Peter Cohen, SaaS Marketing Strategy Advisors is licensed under a Creative Commons Attribution 3.0 Unported License. Images obtained via iCLIPART.com.

Wednesday, February 6, 2013

"Old" tactics can still work for SaaS marketing

Lots of things about software-as-a-service (SaaS) are new:  the business model, the delivery model, the development model.

But that doesn't always mean that the marketing tactics need to be new too.  You're not obligated to use only the latest tools and techniques.  Sometimes the "old" tactics will work just fine.
Not everyone lives on Facebook

Facebook, Twitter, Pinterest and other social media are certainly more glamorous than print media.  Marketers even brag about how many "followers" and "friends" they've attracted.

But print media can be very effective.  If that's where your prospective customers are, you should be there, too.

Coverage in "Modern Bee Keeper" magazine may not sound cutting edge, but if you want to get your solution in front of bee keepers, it just might do the job.

Tradeshows are very much alive

I've heard people say "tradeshows are dead."  They figure that nobody has time or budget to spend time at an event, and everything can be found on the web anyway.

Not so fast.  Big shows like the Consumer Electronics Show and the Detroit Auto Show are thriving, and small regional shows are "must attend" events for certain audiences.  School bus fleet managers in North Carolina regularly attend events hosted by the "North Carolina Pupil Transportation Association."  If that's who you sell to, that's where you can find them.

Direct mail can still work

Direct mail seems so dated in the age of email, websites, and social media.

But don't dismiss it out of hand.  After all, I counted more than 20 promotional solicitations in my USPS mail box last week, and I know that the people who manage direct mail campaigns carefully track results.  This tactic, which has probably been around since the Pony Express, must be working for somebody.

Spend to win customers, even if it's old school

SaaS companies need to be especially careful about where they spend their marketing money.  Sales and marketing costs will likely be one of their largest expenses, and spending on things that doesn't actually attract customers... that's a recipe for going out of business.  (See "SaaS customer acquisition;  Feed it or starve it")

But while you're thinking about how to spend wisely, don't rule out certain marketing tactics just because they're not new or your hip marketing brethren shun them.

Frankly, it doesn't really matter what other marketers are doing; what matters is what your prospective customers are doing.

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This work by Peter Cohen, SaaS Marketing Strategy Advisors is licensed under a Creative Commons Attribution 3.0 Unported License. Images obtained via iCLIPART.com.

Friday, January 4, 2013

Spend first, think later: Bad idea

When it comes to putting together a marketing plan, there are lots of reasons to spend first and think later. 

The "spending" I'm talking about is spending on marketing programs like PR, events or collateral. 

And the "thinking" is about developing a compelling value proposition and messages. 

One reason why marketers spend first and think later… it's more fun.

Spending money on a clever promotional video, a tradeshow party, or a new ad campaign...  that can be fun.

But thinking about a value proposition… that's not fun.  That's hard work. 

Eat your broccoli first

Spending before thinking is more fun... but it's backwards

You need the value proposition in place before you can do any of the fun stuff. 

It's like you need to eat your broccoli before you eat dessert.

You need to know who you're selling to, what problem they're trying to solve, and why they would buy a solution from you instead of somebody else.

And you need to express that value proposition clearly, concisely, and consistently. 

You need to do the hard work to answer these fundamental questions before you start spending on marketing programs.  (Or you can hire someone like me to help.)

Because until you have a well-articulated value proposition in place, it's difficult to get much value from the other stuff.

You can spend lots of money on programs to deliver your messages:  PR, search engine marketing, videos, a website, tradeshows, etc.

But it won't buy you much unless you have a compelling message to deliver.

For software-as-a-service (SaaS) companies in particular, that's money wasted… money that you can't afford to waste.  (See "SaaS customer acquisition:  Feed it or starve it?"

Eat your broccoli first, then you can have the pineapple pie!

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This work by Peter Cohen, SaaS Marketing Strategy Advisors is licensed under a Creative Commons Attribution 3.0 Unported License. Images obtained via iCLIPART.com.