When we think about SaaS customer marketing, we often feel like we're on the climb of our lives. We're training, we’re pushing our limits, we're dodging roadblocks, and we're falling down a lot.
While it's thrilling, it's also challenging.
Fortunately, there are strategies to cut through the clutter and reliably grow your business at the benchmark of 15% to 45% year-over-year.
In this article, I’ll review the differences between customer marketing and acquisition marketing. Then I’ll dive into five customer growth strategies to drive the growth of your business, including:
- Knowing Your Customers
- Scale Intentionally and Make Trade-Offs
- Build Strong Segmentation
- Educate Your Customers
- Treat Every Customer as a VIP
These strategies apply to every segment, small and medium-sized businesses, agency mid-market, and worldwide enterprises.
First, let's get on the same page about customer marketing.
What is Customer Marketing?
There is no road map for customer marketing, and many roles are yet to be defined. If you Google customer marketing, you won’t find much. Similar results apply if you are looking for strong key performance indicators (KPIs) or benchmarks.
“Many organizations still haven’t clearly defined the role of the customer marketer. Rather than placing it at the forefront of their growth strategy, customer marketers are often left to their own devices.” - Influitive
Think about what marketing solves. If you are an acquisition marketer, you often think it’s about generating demand.
Marketing = Generating Demand
While driving revenue back to KPIs is essential, it’s your customer’s choice to buy from you at the end of the day. That is a choice you strive to earn every month or year, depending on your business.
You aren’t merely trying to generate demand – the objective is to generate value.
Marketing = Generating Value
Generating value is emphasized when you execute marketing to activate, engage, and expand your customer base.
A healthy SaaS business sees 70 to 95% of revenue from upsells and growth, whereas only 5 to 30% comes from acquisition.
The data shows we need to generate value to generate demand.
Customer Marketing vs. Traditional Marketing
Marketing is generally about identifying a target audience and promoting your product or service to them through relevant channels.
With traditional marketing, your primary focus is attracting the attention of first-time customers. You’re marketing with the idea of engaging prospects. But with customer marketing, your goal is to keep customers over the long term.
Consider this question: would you rather have 50 new customers who purchase one time and then leave for a competitor or 25 repeat customers who support your business year after year? You know the answer.
Customer marketing isn’t better than traditional marketing. Knowing when to employ both types of marketing is the key to product-led success. If you focus 100 percent on traditional marketing, you’re missing out on the opportunity to build loyalty within your existing customer base.
If you never acquire new customers through traditional marketing, you won’t have any customers to retain through customer marketing.
What Are the Benefits of Customer Marketing?
Acquiring a new customer is five to 25 times more expensive than retaining an existing one.
The high cost of generating leads through traditional marketing, such as paid Google and Facebook ads, is why customer marketing is critical to the long-term viability of your SaaS business. The right strategy improves customer retention and reduces churn.
As noted above, customer marketing focuses on keeping your existing customer base satisfied. When they’re happy with your product and feel connected to your company, there’s a greater chance of maintaining a long-term relationship.
Another benefit of customer marketing is referrals. According to a study by the Incite Group, 91% of B2B buyers say that word-of-mouth influences their purchasing decisions. Who better to provide positive word-of-mouth than your long-term, satisfied customers?
Finally, customer marketing helps you understand what resonates with your customers, and these insights help to create and carry out a traditional marketing strategy.
One method for collecting feedback is to survey your customers on why they continue using your product over the competition. Answers such as customer service and affordable pricing will help you tailor better traditional marketing messaging.
5 Customer Marketing Strategies to Grow Your SaaS
The key to unlocking growth is determining what marketing can do for the customer.
By now, you should understand the difference between traditional and customer marketing. But we haven’t touched on the types of customer marketing strategies that supercharge the growth of your SaaS business.
#1. Knowing Your Customers
Knowing your customer and bringing a rich voice of insights into every aspect of a business is critical for successful SaaS growth.
The significant impact of customer research has been tied to the following:
- A significant increase in annual company revenue.
- A substantial increase in customer satisfaction or Net Promoter Score (NPS).
According to Google Survey, less than 40% of marketers are doing this research. That’s a lot of missed growth opportunities.
The best thing you can do to grow your company is to layer customer insights into every element of business and tie it back to value.
So, where do you start?
Customer research starts and ends with building and optimizing the customer journey. Without a proper understanding of what your customer’s journey looks like – broken down by milestones – your team doesn’t know what to prioritize to increase growth, along with how to decrease churn.
The goal is to go from a disorganized user experience to a clearly defined customer journey map.
The customer journey map in the image above lays out the following:
- What the user is thinking.
- What the user is feeling.
- What the user is doing at every different stage.
- How they are engaging with your product.
Organizing your customer journey is essential to discovering opportunities to focus your teams on prioritizing low-hanging fruit or long-term gains.
Through this foundation, you will understand the importance of qualitative insights.
Qualitative Insights: How to Get There
Customer research is understanding what users do and why they’re doing it. The process is long, and you don’t have to do it all at once.
Begin by breaking your customer research into parts.
- Interviews
- Surveys
- Mining Data
- Social Listening
If you have a lot of users, start with your target market when doing interviews and surveys. Or even develop an annual survey or data from an NPS.
If you’re at the beginning phase of business, go to online sources like:
- G2
- TrustRadius
- Social listening tools
- Try mining online data.
These resources will provide rich customer insights and help you understand competitors’ actions.
Questions to Ask Customers
After mining and collecting data, look at your users and answer the following questions:
- What was going on in the user's life that caused them to start looking for a solution?
- Once the user realized they had a problem, what did they do next?
- Before the user signed up, did they imagine what life would be like? What were they expecting?
- Now that the users are working XYZ, what’s the #1 thing they can do now that they couldn’t do before?
- What would users change about your software if they had a magic wand?
By focusing on value and understanding your user’s differentiators, you will know their “Aha! moment.”.
Key Takeaways
There are two key takeaways from this section:
- Excellent customer knowledge is just as necessary as great product knowledge. It takes months to win a customer but only seconds to lose one.
- Customer feedback to learn how to improve continuously makes up the backbone of learning how to scale.
So make sure you have a feedback mechanism for everything you’re rolling out to continue meeting your users’ needs and expectations.
#2. Scale Intentionally and make Trade-Offs
Start with your customer journey to see where the most significant drop-offs are with your customers and the areas you need to solve to grow your teams.
Most companies have a team of one to two customer marketers with an overwhelming list of responsibilities, trying to keep up instead of making an impact.
As a result, small teams have limited insights into their KPIs. They’re executing low-impact tests or, in some cases, becoming the customer swag management department, making them ineffective.
As you dig, identify those drop-off points. Then deprioritize and focus on them. Now, hone your efforts.
There are hundreds of tasks you could be working on, but only a couple that matter.
As you build your team, be ruthless at identifying what needs to be focused on and removing obstacles. Stay on track, focus on the areas you know are critical, and execute them brilliantly.
From there, you can start scaling your team to grow specifically in the areas that are your biggest bets.
How to Build Out Your Customer Marketing Team
When you think about building your customer marketing team, look at the data.
- InsightSquared researched how large your workforce should be on the marketing side based on the size of your business. If you're less than 50 employees, marketing is typically 5 to 6%.
- If you're over 50 employees, your marketing team is roughly 7 to 8% of your team.
Start considering the importance of retention and growth marketing and how much effort you put into that side of the business versus acquisition.
When we started at Sprout and now Teamwork, we only had one person in customer marketing. For both organizations, building our customer journey map and understanding those drop-off points was where we started.
In activation, there is likely always an opportunity to scale up our onboarding program and create more marketing initiatives to bring in users at a faster velocity. As you build that out, you can start to layer in the other areas where there is an opportunity within your journey.
Fast forward to scaling; the image below is a glimpse into what a built-out customer marketing or retention marketing team can look like.
Know What KPIs to Focus On
Knowing your KPIs and what you need to drive growth across the board is crucial.
Some biggest successes come from scaling based on customer and business needs.
Doing so from a KPI perspective looks like this:
- As a team, focus on net dollar retention (NDR). Try to understand how your customers are growing and retracting. Then, work backward and build inputs on how you got there within your KPIs.
- Activation focuses on daily or weekly active users, product adoption, and logo retention.
- Adoption should focus on your product’s core components that drive customer health, often measured by a health score in partnership with success and/or product.
- On the experience side, focus on customer satisfaction, net promoter scores, customer engagement, and advocacy.
- For growth, focus on hand-raisers, which are essentially leads, but can also leverage a product-qualified account (PQA) model.
- When looking at revenue, align numbers with those of the Sales team, growth team, and business as a whole. And then look at how renewals play into those different areas.
Growth or customer expansion is generally linear. Still, having teams focused on singular goals helps you achieve the numbers that drive higher-level revenue and overall NDR.
Qualities to Look For in a Team Member
Approach building your team as a journey. Find drop-off points and then prioritize ruthlessly. If you start with a one-person team, look for somebody who is:
- Experience in SaaS
- Obsessed with customer feedback
- Knows enough about customer journey mapping to build a roadmap based on the biggest growth opportunities
Once you start to test and learn what those opportunities look like, you can invest more where you specialize.
Key Takeaways
Remember, it's easier to scale a team showing impact, revenue, and ROI than make decisions based on your intuition.
Focus on:
- Figuring out your KPIs.
- Addressing what’s important to your business.
- How you want to measure what’s important.
- How to consistently monitor and build data around what’s important.
#3. Build Strong Segmentation
The segmentation stage in SaaS customer marketing is critical to a company’s success and demands constant work.
Taking a step back, let’s focus on the fact that our expectations truly have changed as consumers.
Think of the most recent email from a SaaS product you loved and used.
Now ask yourself, why did you love it? What stood out that made that email or communication more enticing? Was it an email you wanted to respond to, or did you feel that need or urge to forward it?
Chances are, the SaaS email stood out because it was personalized to your needs somehow.
When you think about your products, remember it’s too easy to send a mass email. On the other end, people are inundated with messages and mass delete them.
Communication is not just a lever for marketing to customers. We use email across departments for various reasons, from billing with the Finance team to discussing security with our Engineer team. Make sure not to bombard your customer experience with unnecessary internal messages. Instead, strip communications down to segmentation and context.
There are a ton of ways that you can build segmentation into your strategy. Some of the most popular are:
- Jobs-To-Be-Done: Best for product-led.
- Persona: Best for marketing-led.
- Ideal Customer Profile (ICP): Best for sales-led.
We use all of them for various reasons.
Using Jobs-to-be-Done to Segment Customers
Let’s focus on leveraging jobs-to-be-done (JTBD) because the strategy involves several product communications and approaches for getting customers to grow with the products and themselves.
JTBD is founded on the principle that people don't buy products, and products don’t match people – they match problems.
Users sign up for free trials and subscriptions to have access to a product that solves their pain points. It’s essential to understand your users’:
- Struggle
- Motivation
- Desired outcome
The graphics below illustrate a basic example of the stages a customer goes through during onboarding.
The dotted line above represents a healthy customer (yellow face icons) as they go through activation to think through value realization. When we get users into a habit and introduce new products, they go through various levels at each stage.
The dotted line below (pointing to black and white face icons) represents where customers are starting to see a decreased value. By focusing on where users experience a reduced weight in the first stage before they get to value discovery, you help reduce churn. Acknowledging the line below is vital for growth.
The graph example also emphasizes the importance of onboarding. Across every SaaS business, 40 to 60% of trial users log into your product once and never come back. And 75% of users are lost within their first week.
Those are terrifying statistics regarding managing churn and ensuring customers accomplish their unique Aha! and value-driven moments.
For a quick win, consider context and roll out a simple email re-engagement campaign focused on different JTBD.
Begin by composing simple variants of an email addressing why users first sign up for your product (dependent on your value-driven moments). Then, prioritize your testing to see what drives more customers back into the app.
You’ll quickly find that these simple re-engagement campaign emails are effective at triggering users to log back in.
Segmentation context and content are critical, and it speaks to more than understanding who your customers are but also how you prioritize the communications across your entire business.
Based on that segmentation, you're looking at those customer attributes and the value they're seeing in your product and reminding them of the value.
Marketing should help generate value, which helps create demand and helps generate growth.
This leads us to the next strategy.
#4. Educate Your Customers
Let's shift gears and talk about tactics to take your customers to their next level and stimulate growth.
Sometimes users drop off because they aren’t aware of the scope of your product’s helpful features. This happens more often than you think. On average, 61% of Marketing Tech users across products don't utilize the features available.
Sometimes that number feels generous.
The more you learn how to scale your customer marketing or retention marketing team, the more you’ll realize the opportunity isn't necessarily in generating pipeline and demand.
Instead, the key is unlocking the ability for your customers to understand the value that your product brings and identify actions you can take to help them grow.
It's really about meeting customers where they are and then educating them on what they're missing. Your growth and demand will follow suit.
Get Scrappy
As we talk about building an education program, I’ve always liked minimum viable launches. In other terms, get scrappy.
In the early days at Sprout and now at Teamwork, we did that by developing a landing page and live informative webinars similar to one-to-one success calls.
Of course, these early actions scaled into a more sophisticated onboarding learning program as we learned over time. However, starting scrappy helps you take the first step in scaling an onboarding program without getting caught up in self-doubt.
Focus on customer research-backed decision-making and think about how to get more users on-boarded by leveraging a market-driven function.
We empower users through four pillars of education:
- Live training and webinars.
- Self-guided within our academy or a landing page.
- Communities.
- Product tours, as they can get users beyond onboarding and looking ahead to what the product can do for them.
Each pillar of the education path has a KPI tied to it. When you think about customer satisfaction and NPS, consider content consumption, customer engagement, and satisfaction with the actual content you’re producing.
Then ask users:
- Are they getting what they need from education?
- What else would they like to learn?
- What’s missing for them as they think about their social education?
These questions provide a better idea of how to produce and prioritize content in the onboarding process.
When you think about growth and upselling, a common denominator has been that great education always equates to significant growth.
Use customer feedback as the litmus test to understand the impact of the content we produce.
Education Is a Must-Have for Your Customers.
Regardless of where it sits within your organization, producing content that aligns with your education strategy and can stand up in self-service motions is critical to scale.
Education is your content marketing platform for driving automated retention because it drives user interaction in addition to helping users realize the value of a product.
It’s about getting more users to engage with content that fuels value and drives growth.
#5. Treat Every Customer as a VIP
Approach every interaction with users as though they’re your most valued customer. VIP treatment increases customer satisfaction and can help set you apart from competitors.
Ask yourselves the following questions:
- What would we do if we treated every user as the only user?
- What would we do if we treated each user like our success depended entirely on their experience?
- How would we build differently if our success relied entirely on the user's experience?
- How would we communicate differently?
- How would you prepare for those interactions?
- And how would you react differently when a user is faced with a problem and needs your help?
Social engagement bombards our daily lives, and personalized messaging is crucial to break through all the noise.
Build exceptional customer experiences that support every action of your company.
At Teamwork, we determined what our users wanted by asking about their favorite customer experience on Twitter. Of course, each experience had a level of personalization, from a customized cake to paying off student loans to custom snacks and handwritten notes.
Our main takeaways are sending food (people love food) and taking the time to make your users feel special.
These experiences are easy to replicate, are not too expensive, and create loyal and raving fans.
A place to start that’s notably scalable is the power of a thank-you note. As a business, we put so much time and effort into custom welcome kits, but you can get the same power of customer feedback with thank you note campaigns.
When thinking of the impact of breaking through to customers through email or another approach, don't undercut the value of a personal handwritten thank-you note.
While it can be challenging to churn out so many, there are ways to get around that – whether it's rallying an entire team or even hiring an agency to do some of the work for you.
If you can't get to the custom thank you note, a personalized response is the next best thing.
Every marketing campaign should come from a person with an actual email address. Employees from every department should take on the role to:
- Respond to any questions that come in.
- Route questions to the appropriate team.
- Help find information the customer's looking for.
- Make sure the data behind these questions is processed and analyzed to ensure user happiness.
While this sounds like a ton of work, it's not.
A few minutes a day makes a huge difference. As you can see in the email below, a personal response impacts how users perceive your company.
As humans, we thrive on personal, meaningful connections. We also want that connection between our products and users.
Think from the perspective of a user. How would you want to be treated?” Don’t lose sight of that. Empathy is your secret weapon, especially on the user side.
Can These Strategies Grow Your Business?
In the age of the customer, your competitive advantage comes from your ability to better connect with and serve your users.
These are the five strategies we covered in this article.
- Know Your Customer
- Scale Intentionally
- Segment for Growth
- Invest in Education
- Every Customer Is a VIP
These strategies have become the foundation to scale in several SaaS organizations, and what sets you up to realize a successful retention marketing or customer marketing engine.
If you’re ready to take the next step, sign up for the ProductLed Accelerator live online program. Over the course of four weeks, you’ll learn more about the five customer marketing strategies above and how to implement them in your company.
