The Implication of Secular Increases in SaaS CAC

One of the major trends facing SaaS companies today is the rising cost of customer acquisition. Data on this trend has been difficult to find. Fortunately, Patrick at ProfitWell sent me his survey results across about 800 companies. The chart above shows the increasing cost of customer acquisition on a per company basis. Those surveyed have observed a ~65% increase in cost of customer acquisition over the last five years. This increasing customer acquisition cost likely has two root causes. The first is competition. The second is scale. As a company grows, the initial customer acquisition channels become less efficient with saturation. Consequently, the business must develop a portfolio of customer acquisition channels. Typically, each marginal channel has a higher cost of customer acquisition. Regardless of the cause, the impact to unit economics remains the same. Over the next year, companies doing businesses internationally will face a compounding factor: GDPR.
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2017 SaaS Survey Infographic

The third annual forEntrepreneurs SaaS Survey Infographic shares top highlights from this year’s SaaS Survey results! You can find the full 2017 survey results here: Part 1 shares growth rates, go-to-market trends and cost structure Part 2 covers application delivery methods, operational costs, gross margins, contract terms, churn rates, capital requirements and accounting methods. To download the...

2017 Private SaaS Company Survey – Part 2

We recently released Part 1 results of our private SaaS company survey in partnership with KBCM Technology Group (formerly Pacific Crest Securities). This is the sixth annual survey we’ve produced together, which provides data to help SaaS companies benchmark their performance against their competition. In Part 1, we covered growth rates, go-to-market trends, operational aspects, and cost structure. We’re excited...

2017 SaaS Survey Infographic

The third annual forEntrepreneurs SaaS Survey Infographic shares top highlights from this year’s SaaS Survey results! You can find the full 2017 survey results here: Part 1 shares growth rates, go-to-market trends and cost structure Part 2 covers application delivery methods, operational costs, gross margins, contract terms, churn rates, capital requirements and accounting methods. To download the...

2017 Private SaaS Company Survey – Part 2

We recently released Part 1 results of our private SaaS company survey in partnership with KBCM Technology Group (formerly Pacific Crest Securities). This is the sixth annual survey we’ve produced together, which provides data to help SaaS companies benchmark their performance against their competition. In Part 1, we covered growth rates, go-to-market trends, operational aspects, and cost structure. We’re excited...

How the Customer Acquisition Process Is Changing in SaaS: Don’t Tell Prospects About Your Product, Let Them Try It!  

It’s getting harder for enterprise software companies to justify the need for a complex buying process in a world where frictionless customer experiences are on the rise. As we experience brands and buy and consume great products and services in our personal lives, we question why enterprise software products and services do not match our expectations. If you can purchase a consumer product or service without interacting with a representative, then why must you go through a complicated purchase process? Why should you need to submit a lead form to try a software product? You shouldn’t need to. And the most forward-thinking SaaS companies are capitalizing on that fact.

The Traditional Customer Acquisition Process Misses the Mark

To understand why so many SaaS companies are embracing a new approach to customer acquisition, you need to understand why the traditional approach falls short. In the traditional process, prospects are forced
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How could I spend $10,000 to market a SaaS product?

It’s not much! But some ideas:
  • Go to the top 2 events / trade shows in your industry. With $10k you can’t afford a booth, but you can afford to hustle and try and meet everyone. You can even try to sponsor a cocktail hour or something similar. Usually, though, any event outside of the top 2 don’t have enough scale, and thus, not enough decision makers. See you at Dreamforce and SaaStr Annual 2018 | The Biggest SaaS Event on the Planet 🙂
  • Hire a content marketer to help you with blog + website + webinars, etc. But keep it authentic. The voice needs to be of the founders in the early days, not an outsourced author. But hiring someone to help accelerate content marketing is a good investment, usually. $10k doesn’t pay her salary but it will pay part of it (a few months).
  • Get some press and PR. Continue reading "How could I spend $10,000 to market a SaaS product?"