Get your SaaS customers off to a healthy start

I recently switched to a new health club. It's better maintained, friendlier, and less crowded than my old club. I also like that there's no up-front membership fee, just a monthly subscription.

But making a change from my well-worn routine, set in place over 12 years, could have been a difficult jump. New location, new equipment, new people.

But all worked out well. Here's why.

On my first visit to the new club, the manager introduced himself, gave me a card with his contact information on it, and introduced me to an assistant manager who was at the front desk.

Then the manager showed me through the facility. He explained how to sign up for spin classes, where to find the jump ropes, and how to adjust the steam room controls.

Finally, he introduced me to a trainer to set me up with a workout regimen. We didn't go through every elliptical trainer, Bosu ball, and Cybex machine in the club, but the trainer put in place a basic program for me.

Renewals are vital for both health clubs and SaaS companies

Health clubs, like software-as-a-service (SaaS) businesses, depend on renewals. And the customer's first experience with the service - the on-boarding process - is critical. Get off to a good start and it's much easier to retain customers.

How did my new health club get this right and how can SaaS companies do the same?

Create a connection to a person with responsibility

On my first visit as a paying customer, I was introduced to the club manager, his assistant, and I knew how to reach them. I now had a direct connection to someone I could talk to with suggestions, complaints, or compliments.

It also works for SaaS companies. Let the customer know who they should talk to with any issues related to the service. It might be one person or it might be two or three (for example. one for support, one for billing, etc.) but try to make a direct connection. A simple letter - "Thank you for becoming a customer. If you need anything, ask me." - can suffice.

Help the customers help themselves

The manager showed me around the club and offered specific instructions on how to take care of basic tasks myself. Of course, I'd had a tour before I signed up, but he walked me through again, this time providing more detail on where things are and how things work.

SaaS companies should do the same. Help new customers to find their way around the service. Walk them through the basics, so the next time they'll have the knowledge to manage it themselves. Better yet, they'll have the confidence to explore further and find new features on their own. A written guide on how to take the first steps, with lots of screen shots, can be helpful.

Deliver immediate value

On my first visit to the health club as a paying customer, a personal trainer got me started on a basic routine. She showed me how to use a few basic machines, adjusted the seats properly, and set a "don't hurt yourself" weight. She even wrote it down for me on "Personalized Workout" tracking sheet. This wasn't a $60 per hour personal training session... it was just part of the welcome process. Following that session, though, I had an established commitment to a new routine.

Likewise, SaaS companies should concentrate on getting their new customers to start to actually use the service. Make sure they know how to login. Help them enter data and walk them through a few basic tasks. Get them using the product and make it part of their routine.

Getting customers successfully on-board is critical to health clubs and SaaS companies. A positive initial experience likely means happy customers. And happy customers means more renewals. (See more on why retention is critical: "SaaS renewals and the multiplier effect")

By the way, on my 3-times per week visits to the health club, I've been making good use of the steam room. The spin class... not so much.





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

What do you mean by "marketing?"

I'm not always sure what people mean when they say "marketing."

PR agencies sometimes call themselves "marketing agencies." So do some graphic design firms. Even the outfits that sell tchotchkes - the stuff you give at away at tradeshows, annual sales meetings, and holiday parties - call themselves "marketing firms."

It can be hard to tell what "marketing" is or what it's supposed to do.

Here's how I think about it: Marketing's job is to help acquire and retain customers.

Marketing supports the entire customer acquisition process:

• generating awareness
• building interest
• attracting leads
• nurturing leads into qualified opportunities
• converting opportunities into paying customers.
  

And in the case of software-as-a-service (SaaS) companies, marketing is also responsible for helping to retain and renew existing customers.

Don't squeeze marketing

Yes, it's a broad scope of responsibility. That may explain why folks sometimes squeeze "marketing" into a narrower role.

For example, they call it "marketing," but they're really only talking about building visibility, and the sole focus is on search engine optimization or social media.

Or they call it "marketing," but the primary focus is on establishing credibility and thought leadership. These companies tend to rely heavily on webinars, white papers, and speaking at industry events.

Or they call it "marketing," but their entire task is to generate leads.

Of course, each one of these activities is part of the marketing function, but they are not all of it. And if companies focus solely on one isolated element, they may fail to achieve the overall goal: acquiring and retaining customers.

How can you tell when a company is confused or doesn't recognize marketing's broader role?

Counting the wrong things

For one, you'll see them counting the wrong things. If the primary assignment of marketing is to build visibility, they'll tend to focus on metrics such as "impressions," "followers" or "likes."

Counting these things might be important, but only if they're connected to the overall goal. How many impressions are required to generate a lead that can be nurtured into a qualified opportunity and eventually converted to a paying customer?

Lead tossing

A second symptom is "lead tossing." A marketing group that is tasked and rewarded exclusively for generating leads, for example, will often accumulate a long list of names, phone numbers and email addresses which they periodically toss over to the sales group.

Whether or not sales can actually close any of those leads and secure a paying customer isn't marketing's concern.

Pig in the python

When marketing's role is too narrowly confined, you'll often see a "pig in the python." That is, a large number of prospects stuck somewhere in the sales funnel. For example, marketing attracts lots of website visits, but few visitors provide enough information to become a qualified lead. Or marketing generates a lot of trialers, but the company can't convert them into paying customers.

In these cases, marketing is performing one particular task very well, but the overall process is failing.

SaaS firms in particular can't afford to pay for ineffective customer acquisition. If the role of marketing is too narrowly defined and doesn't span the entire customer acquisition and retention process, it will be difficult for a SaaS business to succeed.




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