The prolific growth of the SaaS industry, which is accelerated by the Pandemic, continues to gain momentum. With unique forces at play, the industry relies much more on creating a lifelong value than just mere initial sales.
A report published in Gartner conveys the same. The said report forecasts end-user spending for the SaaS industry will reach $171.92 billion by the end of 2022 from $120.69 billion in 2020. That’s well over 40% growth in just two years.
SaaS business owners can leverage the same growth by planning ahead and utilizing the top SaaS marketing trends. Staying on top of the SaaS trends will help your business gain an edge over your competition.
Here, we present the top 10 SaaS marketing trends that are bound to rule in 2023 and beyond.
To quickly sum it up, Native Advertising is a form of paid ads that are consistent with the look, style, and tone of the website or platform they appear on. Unlike traditional display ads, they do not come across as advertisements.
A survey by Sharethrough to better understand the visual attention of users found consumers looked at native ads 53% more frequently than display/banner ads. Also, it found native ads to uplift the purchase intent of consumers by 18% and brand affinity by 9%.
The biggest advantage of native ads is they can easily bypass the ad blockers. Moreover, They help fight ad fatigue which most audiences may go through while watching ads too frequently. Once they hit the saturation level, they either stop paying attention to banner ads or use ad blockers.
The Global State of Digital 2021 survey by Hootsuite found 42.7% of the internet users worldwide have ad-blocking tools installed on their devices. Many other studies have also found declining growth of display ads and their ineffectiveness to bring conversions. This has resulted in billions of dollars of loss in revenue for many PPC advertisers as stated by Statista.
But thanks to the ability of Native ads to blend with the existing content of the page where it is advertised, their usage will keep on rising in the coming years. Also, the declining growth of display ads has forced marketers to leverage this SaaS marketing trend going forward.
The only thing to ensure is the content should be valuable to visitors and resolves the queries and problems they have. Your best bet would be to educate users through your native ad content as seen in the above example and not come across as an over promotional article. An experienced SaaS content marketing agency may help you reap the maximum benefits out of your native ads.
Video Marketing isn’t a new SaaS marketing trend or buzzword, it has been here for a long time now. In fact, video marketing has become an integral part of digital marketing that SaaS marketers can leverage to their advantage if they haven’t already.
A survey by Wyzowl about Video Marketing found 86% of businesses use video as a marketing tool and 93% of marketers feel video is an important part of their marketing strategy. Further, the survey discovered 84% of the people were convinced to buy a product or service after watching a video.
Another State of Video report by Wistia reveals video consumption in 2021 was at an all-time high. We saw 14.6 billion min of video being watched in 2021 even when the video uploads were lower. This is almost a 121% gain in consumption compared to 2019.
These statistics prove the worth of video and how it will govern the marketing sphere in the coming years.
Since this SaaS Marketing trend is on route to becoming mainstream, it’s vital for businesses to utilize video for their benefit. However, merely creating & sharing videos is not enough these days, you’d have to market it on the right platforms as well.
Most people would start their video marketing journey on YouTube. But today, there are several other platforms available where your ideal SaaS marketing team can promote your SaaS products. Platforms such as Instagram, TikTok, Facebook, etc. are outperforming YouTube in bite-sized, snackable content.
The best way to approach video marketing is to find where your target audience spends most of their time. Such insights will help you power up your video content strategy to test different video formats to find what works best for you. SaaS companies can leverage video marketing in 2023 for the following things:
In essence, if the content is the king then the video will hold a place no less than a king as it is increasingly becoming part of mainstream content strategy and marketing. Also, video marketing and social media are interlinked with each other and one cannot thrive without the other in 2023 and beyond.
Software-as-a-Service has grown reliant on Artificial Intelligence and Machine Learning. Modern SaaS products have a common underlying factor, i.e. they are built on AI and ML. These modern technologies have a significant part to play in the evolution of the SaaS industry and have become fundamental constituents.
As per the State of AI in 2021 survey by McKinsey & Company, AI adoption by businesses is on the steady rise from 50% in 2020 to 56% in 2021. Another report published on Gartner forecasts the global AI software market will touch $62 billion in 2022.
Realizing its potential, SaaS companies have already started leveraging artificial intelligence and machine learning to improve user experience. Another common trend to use AI capabilities is in chatbots. Further, SaaS brands can utilize AI & ML for running data-driven marketing campaigns, hyper-personalization, creating dynamic pricing, predictive analytics, detailed consumer profiles, etc.
Let’s have closer look:
Having a customer-centric mindset is vital for optimizing retention rates. It takes a lot of effort and time to bring in new customers. An article published on Invesp mentions acquiring new customers is almost five times more costly than retaining existing ones.
Thus, in 2023 and beyond, SaaS companies should aim to build and maintain relationships with their prospects. The best approach to go about creating meaningful relations is by coming up with more user-centric content and stories.
Turning your business into a brand that customers stay loyal to requires much more than just marketing. SaaS companies must pay significant attention to their branding effort for an impeccable customer experience.
A study by Zendesk found 57% of the customers said the quality of service and experience they received from companies strongly influenced their loyalty. Another study published in 2021 on Hyken mentions that 52% of customers are willing to pay more if they receive a great customer experience and 70% would if the service was convenient. How much do you ask?
Well, that totally depends on the industry and can vary from 1% to over 31%. Here’s a breakdown of the same:
If anything, the reports clearly say customer experience and satisfaction is going to be the pillar for SaaS companies to grow. So, going forward companies must adopt this SaaS marketing trend to build a better brand experience. Since we are on the subject, let’s talk about our next SaaS trend to build a brand experience.
Branding today is not only limited to slapping a logo on your website, anchoring a statement, or a slogan. It’s much more than that. Offering a brand experience to customers is critical for increased engagement and revenue generation.
But does your SaaS company offer a comprehensive brand experience?
To determine that, first you need to understand that customer needs are constantly evolving. They seek more from SaaS companies and engage with them based on the value propositions they receive. Thus, to acquire and retain customers, SaaS companies would need to work on their brand positioning and messaging.
The message you send out and the brand you create must revolve around your value proposition. The value proposition is a unique combination of your brand, the product you offer, and the experience you provide to your customers.
Thus, to cornerstone your success in the SaaS industry, focus on creating an impressive brand experience and value proposition that drives performance and results. A comprehensive branding strategy is what follows for SaaS companies to acquire and retain customers by providing real value.
Feature marketing is not a new trend per se. But it was not as popular before as it will become in the near future. The term refers to marketing your SaaS product extensively to attract new customers by constantly adding new features to your products.
Feature marketing does not only offer new prospects a reason to join the bandwagon but acts as a means of incentives for existing ones to stay with you. To embrace this SaaS trend in your ecosystem, you’d have to continuously collect feedback from the existing customers to make improvements in your products.
The corresponding product marketing, which most companies focus on, fails miserably. An article on Inc.com mentions that over 30,000 new products are introduced every year and 95% of them fail. Also, another report by McKinsey found that over 90% of the software, especially SaaS companies fail if their growth rate is 20% or less.
So, how can you prevent your SaaS product from failing? Well, by introducing new product features. If the report by Salesforce is to be believed 69% of customers expect existing products with new ways by adding new features or improving the existing ones.
Moreover, you get hands-on content for your SaaS content marketing efforts on a silver platter. This lets you target new keywords, improve SEO, and give opportunities to acquire new customers.
Through feature marketing, you can convert your freemium users into paying customers, retain existing ones, and also boost overall revenue. What else SaaS startups can do is create tools or plugins that go along with the primary SaaS product and enhance its features. This is also called unbundling which is next on our list of SaaS marketing trends.
Unbundling SaaS products deal with stripping down the core SaaS product into small series of product chunks to solve a specific user problem.
Many VC funds have agreed that unbundling is critical for creating razor-sharp SaaS products that fit perfectly well into the use-cases of prospects. Being one of the disruptive SaaS marketing trends, unbundling is a great way for SaaS marketers to target audiences with a clear & concise message that delves around resolving specific problem cases.
Here, marketers have a clear problem their audiences face and give clarity on what solutions to offer, which lowers the failure risks too. When you know who your ideal customers are, it’s much easier to make them like and even love your products and improve conversions.
For example, people use Excel/Spreadsheets for multiple reasons: tracking finances, task tracker, CRM, etc. But many other companies have unbundled Excel into specialized SaaS tools that bring more value and solve a particular problem better.
The more precise and focused your SaaS products are, the more chances you have to increase your conversion rate. What more you can do is offer different choices to prospects to select the unbundled products based on their exact needs. This way, your prospects don’t have to go through a whole lot of unnecessary stuff that’s not relevant and may fend them off.
Furthermore, you can create ‘How-to’ guides, videos, webinars, and many other forms of tailored content to educate your prospects about your unbundled SaaS products. Doing so will aid in your SaaS content marketing efforts too to boost conversions in 2023.
We have all seen different kinds of sales ads that marketers or companies put out. But what differentiates them from smart marketers is they are selling products and not aspirations. Smart marketers know that people are not triggered to buy a product based on how great it is but they buy them based on the emotions and aspirations these products make them feel.
When Marc Benioff started Salesforce, he launched a campaign called ‘No Software’ that helped get the word out. Their cloud-based delivery system would differentiate them from the rest of the competitors because Salesforce products didn’t require on-premise software installation.
Salesforce was not selling any software, what they were selling was the aspirations (as in ‘Aspire to’) to their ideal prospects who were in search of a brighter future. In simple words, Salesforce targeted the aspirational identity of their prospects to make them feel they need Salesforce products to advance in their careers.
From this example, it’s quite clear that the conventional way of selling your SaaS product isn’t going to work anymore. You have to go deeper into understanding how to bring out the emotions in your ideal customers while educating them about your products. They shouldn’t feel they are buying just another product/software, they should feel aspire & eager to get your product to excel in their field.
So, going forward your motto should be to not sell just another SaaS product but to sell aspirations. Incorporating aspirational selling in your branding budget will become essential for 2023. That’s where a SaaS content marketing agency comes to your rescue. But there are certain things to consider before hiring a SaaS marketing agency in 2023.
Acquiring new customers, especially in the SaaS industry is a tough nut to crack. As mentioned earlier, offering a comprehensive brand and customer experience will be the key to optimizing customer retention rate.
In one of the Salesforce reports on customer experience, 91% of the respondents said they are more likely to make a repeat purchase after a positive experience. But an average SaaS startup spends 92% of their first-year contract value on new customer acquisition.
Clearly, there’s a huge gap between customer expectations and fulfillment. Customers expect brands to provide a positive experience in order to stay loyal to them, while brands are trying to acquire new customers.
Prioritizing the customer experience, particularly for SaaS companies that earn around $1 billion in revenue can expect to earn an additional $1 billion. This staggering number indicates SaaS marketers should focus on ways to optimize their customer retention rate.
One such way to do so is by focusing on providing a positive experience and also turning a negative experience into a positive one. This will also boost satisfaction levels in customers and increase revenue overall.
The best way to improve customer experience is to be available and offer them support whenever, wherever needed. Social media is a great place to start with. Twitter and Instagram are the most commonly used channels by customers to reach out to brands for asking queries and resolving issues they face. Simply, be present on these channels. This will help you improve the experience of your customer and even retain them to almost double your revenue.
Last but not least on the list of top SaaS marketing trends is implementing flexible, usage-based pricing strategies. Among many other factors, pricing strategy is a major element that directly impacts the buying decisions of customers.
Pricing acts as the most influential lever for your business. It is a factor that constantly needs re-evaluation to make changes to it by adopting the usage-based pricing model. As per a report, SaaS companies spend only six hours in their entire business lifetime on forming pricing strategies.
This is a problem because even if we utilize the usage-based pricing model, many variables and attributes affecting the price are constantly changing. Variables like new competitors, evolving technology, and many others pop out every day which can reduce the perceived value of your SaaS products.
The best recent example we can think of is Netflix. The streaming service provider reduced its prices in certain Asian countries due to the cut-throat competition and lower average income levels. So, if Netflix had to survive, it had to increase its user base and the only way to do so was to reduce prices for its streaming platform.
We are not saying reduce prices of your SaaS products just like what Netflix did but optimize it based on what value proposition you are offering.
An article by Profitwell on pricing changes says that subscription-based businesses are missing out on as much as 30% growth becausethey haven’t optimized their prices. Thus, SaaS companies should ensure their prices always reflect the ever-changing value equation to also ensure you are making as much profit as possible in 2023 and beyond.
As a SaaS founder or a marketer, it’s crucial to stay on top of the evolving SaaS marketing trends and reap maximum benefits from them in 2023. With increased focus on native advertising, video marketing, unbundling strategy, aspirational selling, and feature marketing, 2023 may turn out to be the most profitable for the SaaS industry. Moreover, AI/ML, brand experience building, a customer-centric mindset, and usage-based pricing will have a big role to play in customer retention & optimization. So, keep the weather eye on the horizon to see what SaaS marketing trends will skyrocket in 2023.