In this article we’ll introduce B2B SaaS marketing, we’ll cover what B2B SaaS is, how it started, where it's going and what are the current strategies and tactics that companies use to grow their businesses.
In this article we’ll introduce B2B SaaS marketing, we’ll cover what B2B SaaS is, how it started, where it's going and what are the current strategies and tactics that companies use to grow their businesses.
B2B SaaS can seem like a pretty niche acronym in itself but there are lots of sub-categories of companies within B2B SaaS in the tech industry. All of which share some commonalities but also with their own unique characteristics.
These are some of the most popular and largest sub-categories of software within the ‘b2b saas’ category:
Each of these categories have unique characteristics and approaches but generally the strategies used by marketers are very similar.
Why are there so many B2B SaaS companies around and why are people interested in investing in them? Well it’s pretty simple, money.
In the old days when software was hosted ‘on-premise’ (some still is) when a large company wanted to buy a new software system it would involve a huge project of implementation and upheaval.
Skip to 1999, Salesforce where one of the pioneers of SaaS buy launching their platform online. Another was WebEx that launched in 1995.
Taking software to the cloud with Software as a Service meant it was more affordable and accessible for more businesses and allowed companies like Salesforce to grow without having to support the implementation of lots of ‘on-premise’ systems.
So what does this mean? Well large enterprises and basically any company needs tools to function. Accounting software, HR tools, marketing & sales tools you name it every department uses different technology. These can all be classed as a B2B SaaS tool - that is why the industry is so big and why so many companies invest in it and come up with ideas for it too. And everybody is looking for the next Tech Unicorn
In the SaaS world, the term "unicorn" is used to describe a privately held startup company valued at over $1 billion rather than a fluffy pointed headed horse. This is because of their rarity.
So, it is a pretty low bar to be called a SaaS company. You basically sell software online to other businesses. The best SaaS companies however build products that sell themselves and have functions to enable growth through referrals and free trials etc.
Companies that build products that can do the heavy lifting in terms of growth will benefit from more scalability, happier customers and lower costs of acquisition.
You will often hear people in marketing talking about a go-to-market (GTM) strategy, but what does that actually mean? A GTM strategy is a comprehensive plan that outlines how a company will bring its products or services to market and reach its target customers effectively.
It encompasses a lot of different components and decisions related to marketing, sales, distribution, pricing, and customer engagement. The primary goal of a GTM strategy is to ensure a successful product launch or market entry while maximising revenue and market share.
Marketing strategy and the execution of that is just one part of the GTM plan. In-fact the GTM plan is more attuned with a business plan than anything else. It is essentially the business strategy for growth. One major component of the GTM strategy for B2B SaaS companies is the choice of pricing model.
B2B SaaS companies have a few common got-market strategies (GTM), all of which will include an approach to pricing and sales. The most cost effective pricing model in terms of acquisition costs (CAC) is the one that requires the least amount of work from a sales team, this is typically the Freemium model. Google uses the Freemium model as one popular example - you can use the products for free, but you will need to pay to access more sophisticated features.
The least efficient method is a ‘sales-led’ approach which requires lots of product demonstrations and presentations, but, having said that if your product has a very high average sales price and you are selling to an audience that expects that kind of sales approach then this is sometimes the best way.
The reason this method is not as efficient is because Cost of Acquisition totals the costs it takes to acquire a customer. So, if you are paying a large sales team salary vs a company that has no sales team and solely relies on product driving sales then your acquisition costs are going to be very high.
Both the freemium strategy and the high value sales approach typically yield the most tech unicorns because they are at both ends of the spectrum. One being very cheap and high-volume, the other being very expensive and low-volume.
Most companies however sit somewhere in the middle and use the ‘free trial’ approach.
Free trials are one of the most popular ways SaaS companies generate new business. A free trial allows a potential customer to ‘try before they buy’.
The challenge with B2B software is that buying is not as simple as taste testing a cookie freebie. Software can be complex and take time to understand and set-up, this is why the ‘free trial’ feature on a platform can make or break the success, you end up relying a lot on the design of the free trial and the on-boarding phase, which, can sometimes be an afterthought for some businesses, this is why product design and development is so important to marketing, sales and growth of a SaaS business.
In the majority of B2B SaaS companies there are Sales, Marketing & Product teams, along with customer success and support these are mainstays when it comes to defined teams.
It’s not a revelation to say that the best companies encourage a lot of collaboration between these teams as this creates a more joined-up approach to building and selling software. When it comes to growing a SaaS company, you need marketing and the product team to work as one, building the product to market itself.
The most successful software companies understand that building a great product goes beyond simply solving the problem. They understand you also need to build a product that is easy to sell and best of all, sell itself. This means building the product in a way that reduces the friction to try and buy.
A product that can sell and market itself will benefit from a lower cost of acquisition and higher rate of growth.
This is where the challenge lies for many businesses. Historically selling a product is assigned to sales to sell, marketing it to ‘market’ and of course building it to engineering and product teams. However the future of building successful software companies is one where the product is built with the user-first and these teams are moulded into one team with a lot more cross-pollination in terms of skills.
One of the issues faced when trying to bring marketing into product development or vice versa is that many modern marketers have very little experience in product development and design as conventional training and experience is gathered at the “go to market” end of things where you are given the product to market.
That is why the best software products are often developed by product designers that understand how to build ‘growth’ and ’marketing’ into the product itself, this is because the product always comes first when you start-up a company.
Unfortunately for the majority of SaaS companies, product development and engineering are purely focused on building and not how to make money. This is often when the product is packaged up and sent on to marketing and sales to ship, and this is where the issues lie.
“Product led growth” was a buzzword coined by Wes Bush in his book. Essentially this is just the principle of building a product that is so well designed that it sells itself.
Yes there are times when marketing has a huge impact on a product's success, especially in consumer marketing - but business facing software is not the type of product you buy because of a brand campaign. Buyer journeys involve lots of stakeholders, a lot less risk and a desire to not mess things up, this means buyers spend ages researching and assessing tools.
So why do companies make it so hard for buyers to buy products? Constantly creating barriers for the buyer like “requesting a demo”, few incentives and often costly pricing. Very often a salesperson has to pick up the slack where poor product design has left having to explain things.
To really embrace a ‘product led growth’ approach as many companies will tout, you really need to prioritise investment in product development and research over sales. The main argument against this approach is that many businesses cannot survive without prioritising sales first, which practically is true but IMO you really need to draw the line quite quickly with this approach as you can soon get accustomed to winning deals with an OK product and try to turn it around later.
The main benefits of putting your product design and development before anything esle are:
Organic growth is when your business just naturally grows as if you planted it in just the right spot in the garden. But how does that work for a B2B SaaS business? Well, a lot of companies get their initial sales through selling or referrals but some manage to sell to companies on the other side of the world with very little investment, but how? Well typically they are all pretty good at Search Engine Optimisation (SEO).
Every year you will hear people talking about the death of search engines and SEO. Which, if you are selling B2C (Business to Consumer) you may well want to listen to. TikTok is a great example of a Social Media Platform that educates users with content, and most of the ‘younger’ generation prefer to use TikTok and Instagram to learn and discover new things.
It all comes back to who you are trying to sell your product to. User Centred Design (UCD) tells us you should build around your target audience, this goes for your marketing strategy too. So, if you are selling to potential customers in the age bracket of 20 - 30 you may want to consider utilising TikTok for your content. And yes, maybe in 5 years TikTok or another tool may completely replace search engines, but think about this.
So, if you are selling a B2B SaaS product to a target audience of buyers 30+ and want to grow today, then yes, SEO is still very important for you. Think about this hypothetical; you’re sitting at your desk at home looking for a tool for your business, do you pick up your phone and browse TikTok, or do you open up another tab on your browser and Google it?
Even though we think SEO is still important we don’t disagree that it hasn’t changed and we need to adapt. Tools like ChatGPT have enabled SEO teams to produce 100x more useful content than previously achievable. Anyone not taking advantage of these productivity tools will get left behind.
Content marketing is still the most important aspect of marketing, no-matter what platform gets built in the future, it will always require content to drive growth, just like Tik-tok.
I think most people will understand the simple truth that if you are high-up in a search engine for a search query you will generate more business. Most people never go past the first page of Google. This is how you generate business through SEO, it is short and sweet but that is the bottom line. Doing it requires time, effort and patience, 3 things a lot of companies don’t have.
Companies that embrace SEO will see more organic growth than those who don’t. They will benefit from a low cost of acquisition and often struggle to keep up with their lead generation numbers. But, that being said, SEO is by no means a silver bullet - there are a lot of other strategies and tactics companies deploy and they all can contribute to lead generation efforts.
There are also a lot of other buzzwords and terms you will come across in B2B SaaS marketing, terms such as ‘Demand Generation’ which is a catch-all term for lead generation really but we’ll cover that next.
Demand generation in marketing refers to the strategies and activities aimed at creating and stimulating interest and demand for a company's products or services. It encompasses a range of marketing tactics and channels to generate leads and convert them into sales opportunities.
Demand generation as a term is used as an umbrella term to group lots of different aspects of marketing together such as SEO, PPC, ABM, Marketing Automation etc. etc. So don’t get too confused by it, it basically just means marketing.
If you are looking to make a career out of working for B2B SaaS companies then the best advice we can give you is to try and work for companies where the product is the most important part - and not to take lipservice for it, look for evidence that the product is really good and the companies focus is purely in that area.
Another tip would be to specialise. As more and more companies are built, the categories they are in will grow and swell, making way for new subcategories and categories below that. If you specialise in a certain area you will find it much easier to sell your skills and yourself. Just like selling a product, having a defined audience makes your messaging and positioning much easier and much more convincing.
You can choose to specialise in a certain category like FinTech or HRTech, or you can choose to specialise in a certain area of marketing within these categories, or a combination of the two.
In summary, B2B SaaS marketing is a really interesting area to work in. Especially if you like learning about new technology and software. There are so many different types of software that you will never have heard of that helps run businesses around the globe. As with all marketing and businesses - the product is the ost important part, the companies that put the product and therefore the user first will always rise to the top.
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