Building a SaaS (Software as a Service) business from the ground up can be challenging. Having spent a lot of time coming up with a unique idea that generates value for your customers, you want to see the business grow.
Growing a SaaS business is not an easy road to follow. Dozens of obscure SaaS startups never take off or fail during the early stages of their existence. To grow and sustain your SaaS business, you need to find a way to onboard new customers and keep their churn rate low.
In this article, I’ll describe five ways to hook users on your SaaS product. But first, you need to understand what a SaaS company is.
What Is a SaaS Company?
SaaS is a software licensing and delivery model in which companies license software to customers on a subscription basis rather than for a fixed, one-time cost. SaaS applications are also known as on-demand software and Web-based or Web-hosted software. SaaS is also part of cloud computing. Spotify, Dropbox, Adobe, and Slack are the best examples of modern SaaS companies.
The Importance of User Experience to SaaS Success
Believe it or not, your product’s UX design is the first thing that can make or break your SaaS company. Implementing a well-thought-out UX design can help you reduce customer churn rates, streamline the user journey, and eliminate user frustration.
UX Challenges of SaaS Products
The SaaS business model can be both a robust and a fragile model at the same time. Everything depends on how you treat your users and how well you help them accomplish their goals. UX design plays an important role here. There are lots of challenges that are unique to SaaS products.
On average, users spend about ten seconds on a Web site before leaving it for good. So, the first and most significant challenge of a SaaS UX designer is surviving those crucial ten seconds and interesting the visitor in exploring further. To reduce churn and increase conversions, you need to design an efficient onboarding experience.
How Do Decade-Defining SaaS Companies Stay on Top?
Dropbox, Slack, Figma, and DocuSign are all great examples of decade-defining SaaS companies. They changed business trends and customers’ thinking in their respective markets. Dozens of SaaS startups rise and fall every day, so these companies must be doing something right to stay on top. Let’s explore what they’re doing to achieve success.
Creating an Appealing First Impression
An exciting, informative landing page—the page the user encounters when using the product for the first time—plays a vital role in user acquisitions. The landing page is responsible for converting your visitors to loyal customers. These decade-defining SaaS companies make a great first impression!
Delivering a Great Onboarding Experience
The onboarding experience is one of the secret weapons of success for SaaS companies. First-time users must always feel comfortable getting started and using these services. Figure 1 shows how Slack successfully onboards new users.
Successful SaaS companies have unique ways of rewarding their users. People feel comfortable with a software product that provides rewards and appreciates their actions. Figure 2 provides an example.
Showing and Telling Users
How can users learn about your excellent, new feature? You need to tell them about it. Since no one likes to read long paragraphs of text, what should you do? Show and tell. Clear microcopy and exciting illustrations help SaaS companies stand out. Figure 3 shows some examples of best practices.
Hooking Users on Your SaaS Product
Now, let’s look at those five ways of getting users hooked on your SaaS product.
1. Make it easy to get started.
In the 21st century, consumers are skeptical. They spend very little time exploring a new product. Unless a product makes an excellent first expression, users tend to abandon it and forget it for good.
Software products don’t get a second chance to make an excellent first impression. That precious first impression relies on an efficient onboarding experience. A well-developed onboarding process helps users familiarize themselves with your product. Figure 4 shows onboarding to Airbnb.
2. Create an efficient information architecture.
Information architecture is all about organizing content so the user can quickly understand it. A smooth information architecture is fundamental to the user’s exploring a software product’s value proposition. Therefore, the information architecture should be minimal and easy to understand. A well-designed information architecture ensures that users spend less time searching for information to get what they need. Figure 5 shows Office.com’s navigation, which lets the user easily explore the app’s features.
Nike.com has an excellent, detailed navigation system that helps users very quickly find what they want at any time. Figure 6 depicts the Nike.com navigation page.
3. Listen to your customers.
Ensure that help is always available to your users. All successful products provide easy access to a Help and support system throughout their platform, in case users get stuck or confused. A content-rich, well-designed Help and support system is also an indicator of the product’s authenticity and trustworthiness. In some cases, SaaS companies even charge extra for premium support, and users happily pay for it. No one likes to get stuck, with no way out.
Modern users expect to receive help via email, discussion forums, and live chat rather than talking to someone on the phone. According to a survey by Econsultancy, 73% of customers who use live chat say they are satisfied with the product experience. This is a higher rate of user satisfaction than with phone or in-person support.
4. Give something away.
People love to receive gifts. Giving something away is always an exciting way of retaining users, as well as of acquiring new users.
Back in its early days, PayPal gave users $10 if they referred a friend. Who wouldn’t love to receive free money? By giving away money, PayPal achieved growth that wouldn’t quit. Now PayPal is a role model for modern financial SaaS.
Another classic SaaS path to huge growth is the freemium model. By providing a free subscription, you can get lots of users and fuel buzz. Plus, some users would potentially pay for your premium-subscription tier. Mega, PCloud, Google Drive, and Yandex all did this to garner lots of user attention.
Offering a reward for referring other users is another popular way of rewarding users and growing their loyalty. If you’ve ever used Mega, you’ve probably referred a friend because Mega gave you lots of extra storage space for every referral. Rewards for referrals is one of the growth techniques that made Dropbox a billion-dollar company in just four years. Figure 7 provides an example of Mega’s rewards.
5. Use microcopy to keep users engaged.
Microcopy is text that is an essential part of the digital product experience and helps users achieve their goals when using a product by guiding them as they interact with its calls to action, onboarding journey, navigation, and more. Microcopy can also build trust and empathy with users and help them form a more substantial relationship with the product.
You need to pay special attention to microcopy that is part of a user transaction. It helps ensure a smooth flow through the user interaction. For example, telling the user what will or will not happen when he presses a button reduces the user’s anxiety and increases his comfort when using your product.
LinkedIn does an excellent job with microcopy when telling users why they need a credit card. It clears up any concerns users might have and increases their confidence in using the product. Figure 8 shows LinkedIn’s free-trial messaging.
Tips for Generating and Retaining Habitual Users
Increasing your number of habitual users is one of the best ways of reducing your customer-churn rate. But what are habitual users? Well, obviously, they use your product habitually, and they’re so into the product that many of them would struggle in trying to look for an alternative. Many marketers seeking growth consider this the most crucial aspect of the funnel. Let’s look at some tips for generating and retaining habitual users.
Accelerate users finding their Aha! moment.
People sign up for your product because of the promises you’ve made to them. You’re going to save them A, provide them with B, or make C much simpler. Show the value of your product quickly so people realize: Aha! This is what I’m looking for!
Keep users informed.
Whenever there is a software update, you must report a task’s progress and completion, or you need to communicate any other relevant information, keep the user informed through an alert, push notification, or email notification. This lets people quickly get back to your product and might possibly convert them to habitual users.
Reward your users.
As I discussed earlier in this article, rewards are a great way of retaining users. Rewards might include a shout out to your best users via an email message or tweet, sending them some swag, or just awarding special, in-app badges. Such rewards make users more loyal to your product and convert them to habitual users.
Achieving growth for SaaS companies is very challenging. Getting new users and keeping them hooked on your product is crucial for SaaS business success. But there are some easy ways to achieve this goal. In this article, I’ve discussed five ways of getting users hooked on your SaaS product. Plus, I explored what successful SaaS companies do to stay on top and offered a couple of tips for generating and retaining habitual users. Hopefully, applying these tips will help you grow your SaaS business and retain more loyal users.
An expert in SaaS growth marketing and user onboarding, I am currently working with UserGuiding to help SaaS companies increase their product adoption and retention rates through smooth user onboarding processes. I also host a podcast called “No-Code Growth Stories,” where I interview company founders and growth marketers all around the world. Read More