We know that the key to success as a SaaS business is to reduce churn by retaining existing customers. SaaS is different to many other products and services in that it has a closer relationship with its users, over a longer period of time. So, more so than for many companies, whose marketing revolves around understanding new customers in order to serve appropriate content and gain leads, SaaS is also about understanding existing customers.
This duality makes the job of the SaaS marketer both more difficult and yet at the same easier. More difficult, because there are potentially two sets of people to understand and market to. Easier, because the level of contact with customers/users over a period of time means there is more data on existing customers. This should allow for a greater understanding of their needs and therefore, by extension, potentially make it easier to predict what new customers are looking for too.
That understanding of what prospects and customers want is enabled through buyer persona development. Notice the plural here, not all customers are the same. In almost any business, no matter how small the niche, there are usually a number of different buyer types. Generally, companies use around three buyer personas, but your situation may require more or possibly less. SaaS companies can add an additional set of buyer personas – existing customers – to their pool.
Here’s a quick reminder of how essential these buyer personas are: in Cintell’s 2016 study, “Understanding B2B Buyers” they found that 71 percent of companies that exceeded revenue and lead goals were using documented personas.
And according to ITSMA, 56% of businesses have created higher quality leads, 24% have generated more leads, and 39% experienced higher conversion rates by using personas.
Because reducing churn is so important to SaaS companies, and understanding customers is crucial to retaining them, buyer personas are essential.
Hand in hand with buyer personas goes the mapping of the buyer’s journey – the process buyers go through to become aware of, evaluate, and purchase a new product or service. The journey is a considered to be a three-step process:
- Awareness Stage: The buyer realizes they have a problem.
- Consideration Stage: The buyer defines their problem and researches options to solve it.
- Decision Stage: The buyer chooses a solution.
Here again, the very nature of SaaS means that the journey should be extended. Once buyers have chosen your service, they need to be retained, so you need to understand why they leave, or why they stay. What are the factors that trigger a decision and what are the elements that influence that decision? It’s important to recognise that the buyer’s journey continues and becomes the customer’s journey – which should also be understood and mapped.
What should you include in a buyer persona?
In broad terms there are five key elements to explore along with some basic demographics.
Start with an internal workshop. Usually this would involve just the Sales and Marketing teams, but with SaaS marketing there is a very good case for including other departments as SaaS companies have multiple points of interaction with customers. Personas developed by multiple departments tend to be more useful, especially where the understanding of existing customers in order to boost retention is concerned. In addition, because of the multiple touch points, there should be plenty of data that can be gathered from existing customers and added into the process.
Interviewing existing customers, gathering information from social media and looking at typical industry job descriptions on recruitment advertising can all supplement the process and add insights.
Basic demographic information should be included such as age, gender and job role. Their position within the company hierarchy and length of service, along with their role and influence over the buying process, are also fundamentals.
It can be useful to look at their lifestyle, potential dreams and life goals too – remember that this will be the basis for developing content, so what media they consume and where they shop can give you an insight into their interests and their preferred style of content.
As an exaggerated example, readers of the Guardian are likely to be comfortable with a totally different style of content than readers of the Daily Star would be. Knowing which your buyer persona is more likely to read gives you a steer for writing style, complexity of language and depth of concepts when creating content.
Knowing their personal fears and aspirations can also guide you as to their motivations when it comes to business decisions.
After the basic demographics have been explored and defined, the five areas to look at are:
What triggers them to start the search? What changes have to take place within their situation to prompt a search for solutions like yours?
What are the goals they are trying to achieve with the solution? What operational results are they expecting? What personal gains are they expecting to make by investing in a solution like yours?
What are their likely concerns or objections to your solution?
What is their evaluation process – their buyer’s journey? Where do they go for information – what sources will they use for their research? What questions are they likely to be asking?
What are the crucial factors that govern their decision? Is it reputation, price, service, support, reliability, specific features etc?
Here, interviews with customers, ex-customers and lost prospects can help; what reasons do they give for choosing you over the competition? What are their most common objections to your solution? Why did they stop using your solution?
When workshopping personas is it best for each participant to produce their responses separately and then collate them, before discussing, evaluating, solidifying and documenting them.
We’ve talked a lot about defining buyer personas, and you can see that it can be quite a task to develop and document them. You might think that this is a one-time excercise, but like everything else, people change, buyers change, customers change and circumstances change.
If you stand idly by, your carefully crafted personas can become stale and obsolete, so it’s important to continually update them. Cintell’s survey (mentioned earlier) found that almost 65 percent of companies that revised their personas within the last six months beat out the competition when it came to exceeding revenue and sales goals, with over 47 percent reporting they consistently maintain their personas. So review, research and update your personas and your understanding of the buyer’s and customer’s journeys on a regular basis.
For SaaS companies, success is simply delivering what the customer wants. Knowing what they want comes from a deep understanding of their persona and their journey. Developing solidly researched and meaningful buyer AND customer personas is the key to that understanding.