Optimizing a SAAS business — And We Have Conversations! Month 3 report.
This is a multi-part series of reports on a real-life case study helping a SAAS business find its PMF and reduce the friction of user on-boarding to drive up signup-to-use-to-buy metrics.
In the first part of this series, I covered the broad issues and challenges and the areas that we identified for improvement. The second report presented the changes made and their impact on the top of the funnel. This third part shares the journey as we see prospects move down into the funnel and our attempts to add richer qualification and user experience.
Moving prospects down the funnel
One of the most critical sales functions in a SAAS company is moving prospects down the funnel.. more so in a DIY experience model. Making the on-boarding simple enough that new sign-ups are motivated to try out the core product feature and experience the benefit they would get if they started using on production basis is the secret sauce to high customer growth. Failure to do so may impact deep product trial, conversion and even add negative value as a prospect who did not understand the product may provide negative feedback to his circles.
Instrumenting trial “depth” and identifying the “Aha!” moment
How does a SAAS startup know when its trial user has reached the “Aha!” moment on the customer journey — a place on the product experience path where the core value for the pain-point / solution offered is experienced by the prospect. Does your trial setup have deep instrumentation to record and trigger notifications?
We added several trigger points to our trial setup and linked the same to drip-mails. From the prospect “viewing” critical screens, reports, databases which would give us a sense of the “area of interest” to a prospect to monitoring what data a prospect “updated” on his/her copy of the demo.
These triggers were then used to initiate contact with the new-signup for a personalised qualifying session. Also the drip mails would flag that their “trial” had reached its goals and encourage them to contact the team for further conversations.
The tyranny of the “simple” email sign-up
As we rolled out the newly instrumented trial journey and trigger drip-mails, we could quickly see prospects move down the funnel from sign-up to view to view deeper levels. We could watch the Hotjar videos of the view journey to validate our own assumptions of how a customer would experience a solution (and in many cases modify our opinion). The drip-mails were going out as planned. Great!
But there was a problem. With multiple channels of communication, emails have become the “least” priority for folks to respond to. The %age of drip-mails that were “not seen” was high.
As we tracked trial user journeys from deep view to update to deep update and they reached the “Aha!’ moment we had planned, we were elated. But problem — we had no way to speak with the prospect and move them into a sales qualification process. Why? Because many signups were gmail sign-ups with no phone number. We were at the mercy of these folks and had to wait for them to show some interest in sending us an enquiry.
The tyranny of the simple email sign-up meant that we were hurting our ability to offer useful service to the prospect and accelerate the sales process.
It’s a Business. Let’s do Business. Let’s Mean Business.
A young SAAS startup spends money building the product, keeping an engineering team that extends the product and handles bugs, requests and issues. Pays for the servers and data bandwidth for its cloud based services. And spends money acquiring trial accounts. So when the trial users are anonymous and not approachable, it loses money significantly. And more importantly an opportunity to do a great service to its customer.
We had a long debate on not accepting gmail addresses for sign-ups. Losing sign-ups by preventing this. And losing sign-ups by adding phone number (verified by OTP) as an additional requirement. At the end the wisdom of a fellow SAAS founder prevailed — Quality is everything. Quantity is only vanity.
We were running a core business support product. And we wanted serious folks who had a real business need.
We changed the sign-up to accept corporate emails directly and ask for phone number for gmail based sign-ups. In the case of corporate sign-ups we could approach trial users via alternate channels and also understand their profile better and for the case of gmail signups we could call folks thru their numbers.
Sign-ups drop 30%. Conversations go up 100%!
We are happy to report that the new sign-up process has resulted in 30% reduction on new sign-ups. Of course our cost per acquired prospect is higher. However, the moment the prospect reaches the “Aha!” moment in their trial journey, we can now start a conversation with the prospect across multiple channels (email, LinkedIn, Twitter, phone) and move them down the funnel.
The company awareness is also giving us insights into what type of prospects find our offering of value to them and helps us further refine our marketing and story telling.
The drop in sign-ups / higher cost is a bummer but totally worth it.
Now that we have a stable pipeline management process — from sign-up to conversation, we feel confident that we can open up the throttle a bit and try outbound marketing / lead generation activity and some partnerships with SMB communities to accelerate the PMF test. More on this in the next month’s report.
As usual, we will be happy to share some more numbers / metrics on our instrumentation and pipeline if you are interested to know more. Pl share your email in the comment below and I will mail you the same. Pl share work email only. No gmail please :-)