A Complete Guide to SaaS Sales: Best Tips on Increase SaaS Sales


Saas stands for Software-as-a-service (SaaS). It is a cloud software product hosted, secured, managed, maintained, and serviced by a single provider, rather than being available for download. All end-users can access and customize it anywhere and anytime, provided they have a browser and an internet connection. SaaS sales, however, is a complex process that requires distinctive techniques.

You need top-notch sales reps to get the job done. The main aim is to gain new customers and upsell and retain existing ones. For this, your sales reps have to be adept in technology, possess strong sales skills, have the expertise to create strong connections, and have an understanding of their customer’s behavior and needs. So, here is a complete guide to Saas Sales. 

Saas Sales and its Unique Challenges

Saas Sales and its Unique Challenges

SaaS sales involve selling software that clients access through a website or online portal and use to address a business problem. Similar to all B2B sales, the ultimate objective is to make your clients more successful, which may be in the form of saving them time or money, or enhancing their own capacity to drive revenue.

However, due to the inherent complexity of the use of a SaaS product in comparison to a physical product, it is tough to make SaaS sales. Sales reps need to educate and train potential clients before developing a purchase intent. For, only when people understand what it does and how it can solve an issue faced by them, they will buy it.

Further, SaaS products are made available under a subscription-based pricing model. Customers need to renew their subscriptions every year, quarter, or month. Over time, a customer would be spending a significant amount of money on software subscriptions. So, there could be multiple decision-makers from any client firm whom the sales reps would need to convenience.

Additionally, when you are selling a SaaS product, its features need to be highly customized, and this in turn can extend the sales cycle further. For, prospects tend to negotiate the features that they need. 

SaaS Sales Cycle

Getting to know the length of your sales cycle aids you forecast revenue accurately. The sales cycle of your SaaS product depends on many factors including product complexity, pricing, customers, etc. Here is a short discussion on each of those.

  • Software’s complexity: The length of your sales cycle is also proportional to the complexity of your software. That is, the more complex your software, the longer will be your sales cycle. 
  • Product pricing: A low-priced product will have a faster sales cycle than a high-priced product. The costlier your product, the more will be the purchase decision-makers involved, and this can extend your process.
  • Free trials: Free trials can also have an influence on SaaS sales cycles. If you offer a lengthy free trial, your sales cycle would also become significantly lengthy.
  • Market: If the market you are selling to is new, the longer will be your sales cycle. This is because you’ll be spending longer durations in conveying the use and value of your product to prospects.
  • Customers: If your customers are solo entrepreneurs or small businesses, there will be fewer decision-makers involved. So, it will take less time for them to decide to purchase your product. However, if your customers are large companies, there will be multiple decision-makers and steps involved in approving purchases. So, the sales cycle will be longer. 

So, sales reps do not have much control over the sales cycle’s length. However, as a SaaS business owner, you can take certain measures to cut it short. For instance, if your sales cycle is too long, you may consider cutting the period of your free trial by half. 

Another step is to employ a professional content writer to communicate the offering of your complex software in a simple and easily comprehendible manner. Yet another sales technique is educating new markets before reaching out.

Finally, for lengthy sales cycles owing to well-established clients or other factors, including that duration into your budget. This way, you will be setting realistic goals for your sales reps.

The Vital Metrics for SaaS Sales

There are many metrics for evaluating SaaS sales, but the most vital ones for your profit-making are the following. 

1. Monthly Recurring Revenue and Annual Recurring Revenue 

Monthly recurring revenue (MRR) is the revenue your company anticipates to make each month, based on your existing customer subscriptions’ value. And Annual recurring revenue (ARR) is the expectation of revenue your company would make in a year based on the same value. Sales forecasting can help you measure these metrics. 

2. Customer Acquisition Cost

Customer Acquisition Cost

The customer acquisition cost (CAC) is the average expense spent on acquiring a new user. Your marketing and sales effort and your advertising costs influence it. 

3. Customer Lifetime Value

Customer lifetime value is the amount that an average client will pay you throughout your association with him. Your business would be successful only if your LTV lavishly exceeds your CAC.

4. Churn Rate

Churn Rate

Your churn rate is the percentage of clients quitting each month or year. You can evaluate the success of your firm by comparing this value against industry benchmarks.

5. Activity Volume and Type

SaaS sales reps employ a lot of online and offline communication techniques to nurture prospects. This makes it crucial to find those activities that are bringing in the highest profit. It may be emails, calls, demos, meetings, or any other activity. 

6. Win Rate

The win rate is the percentage of your total leads that your sales team closes over a specific time. It reveals how your sales reps or teams are advancing. 

7. Deal Velocity

Deal velocity is the average duration of time that a lead takes to pass through your sales pipeline. It is a key performance indicator (KPI) that aids firms in maximizing the full value of a deal. 

8. Market Data

This includes market and customer attributes like which industries need your product the most, in which geographic location you do well, how big are your client company sizes, and if they are private or public. 

Different Techniques Employed in SaaS Sales

There are several techniques employed by sales reps for SaaS sales. Here are the best-performing ones. 

  • Custom/Live Setup Call: Sales reps need to enlighten their prospects on how a product will work for them. An expert in the field can provide personalized education and support to a potential customer over a call. This is especially critical to those products that have many details. 
  • One-to-Many Demo: Sales reps host semi-personalized webinars where they invite a few interested prospects to attend a live walk-through of their SaaS product. After the host has finished the demo, the guests are individually allowed to ask questions about the product.
  • In-Trial Nurturing: Here, the SaaS firm subscribes every user who signs up for a trial to their automated emails that send them support in the form of demo videos, resources, etc. This also opens up the opportunity for a sales rep to directly reach out and offer individualized guidance, which can motivate the prospect to become your customer. 
  • Automated Follow-Up System: A complete and well-documented follow-up system provides your sales reps with a guideline to the subsequent steps to take. This helps in avoiding the chances of prospects quitting you.
  • Prepaid annual plans: Offering a small discount to those customers who make yearly subscriptions as opposed to monthly paying is another important tactic employed by SaaS companies. This gives customers the feeling that they are getting a winning bargain, while the firm gets a significant amount of money and doesn’t have to bother about the churning of that customer.

Tips to Increase SaaS Sales

Here are some of the proven sales tips to increase SaaS sales

  • Educate every prospect: One of the sure-fire ways to lower customer churn is to thoroughly educate each prospect before moving him to the subsequent sales pipeline stage of the SaaS sales lifecycle. For, un-primed prospects are more likely to raise issues than well-trained ones.  They are more presumable to face difficulties, criticize, and, ultimately, churn. So, provide your sales team with an ideal customer profile that they can refer to while qualifying prospects. This will help them save time and direct their efforts on the right leads.
  • Keep following up: SaaS sales reps rarely can close on a deal after the very first conversation. You need six to eight touches on average to generate a sales lead. So, instruct your sales team to follow up on the initial contact sooner and frequently. And since there is no one-size-fits-all guideline in this regard, just experiment around to find what works and what doesn’t.
  • Experiment with your pricing. Some SaaS firms set low prices, while others have high prices. The former claims affordability while the latter argues for conveying high value. However, both approaches have their critics. Although pricing shouldn’t be determining the worth of your product, you still can experiment with pricing to find what works best for your firm.
  • Take efforts to retain customers: You certainly spend a lot of money and effort toward earning a customer. So, make sure to retain them. It is easier to keep existing customers than to acquire new ones. And the chance of selling to a current customer is much higher than selling to a new prospect. So train your sales team to take a collaborative effort to retain their hard-earned customers. 
  • Nurture: Nurturing is a great way to retain customers. So, offer great customer support for fulfilling all their post-sale needs. You may also consider offering occasional training to new users on existing accounts. This will help new joiners get acquainted with your software’s seamless usage, and thereby, avert any potential complaints from them. Another way to retain customers is to ask them for reviews and feedbacks. And yet another way is to send them hand-written thank-you notes on every anniversary they celebrate with you. 
  • Upsell to existing users: Provide your sales team with a CRM solution from which they can analyze customer data to discover potential upselling opportunities. You may also consider suggesting a more full-featured product line that would suit their needs better. You can also send automated surveys and email campaigns. All these can increase each customer’s lifetime value. 
  • Know when to say goodbye: Every SaaS Company faces times when they realize that a specific customer is a poor fit. It may be that the customer wasn’t rightly educated, or their needs have changed with time. Whatever the cause, it at times makes more sense to say goodbye to that customer than let them continue to deplete resources with a narrow payoff. Bidding farewell to tough or futile customers will earn your company a reputation for being discerning. And this, in turn, could make you more competitive.

Final words….

Our guide to SaaS sales has completed everything from SaaS sales, its unique challenges, cycle, and techniques, to best tips. If you need more help in increasing your SaaS Sales, PeppyBiz can help you with its range of products. You can make use of its tools for email marketing, email marketing automation, lead generation, SMS marketing, and more to target customers and boost their bottom line. So, do get in touch with us today.

Sara is a Content Writer at PeppyBiz. She is not only a creative writer but also paints a beautiful canvas. She makes sure that you are left with no doubt about keeping up with marketing and sales.

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