SaaS Startup Sales Strategy: How to Develop a Winning Approach

Have you created a well-defined SaaS startup sales strategy for your company?

The answer, for many SaaS (software as a service) businesses, would be no. Of course, everyone uses sales techniques to acquire new customers, but only a few have a clear and well-documented sales strategy.

The global SaaS market generated about 197 billion U.S. dollars in revenue in 2023 — accounting for around two-thirds of the entire public cloud services market revenue. Even though revenue growth for SaaS is not expected to decrease in the coming years, its share of the overall cloud services market is expected to dip in the face of growth in the face of cloud platform and infrastructure services.

Image via Statista

Hence, a SaaS startup should have a solid sales strategy to get those first few customers.

The question is:

How do you create a winning sales strategy for your SaaS startup?

That’s what this post is all about. In this post, you will learn an effective process to create a sales strategy for your SaaS

A 9-Step Process to Create a Successful Sales Strategy for Your SaaS Startup

Here is a step-by-step process that you need to follow to create a robust SaaS startup sales strategy to grow your SaaS company.

1. Understand Your Sales Cycle

The first step towards creating a successful sales strategy for your SaaS startup is understanding your company's sales cycle. This is the approach your team follows to turn leads into customers.

For SaaS startups, sales cycles can be short or long based on the product’s complexity, pricing, and target audience.

Knowing your sales cycle lets you predict how long it takes to close deals and where prospects might drop off. It also helps you plan better since you’ll know when you’ll need more resources or how long it will take to generate revenue.

By understanding your sales cycle, you can improve your sales process, focus on the right leads, and close deals more efficiently.

Pro Tip: Analyze each stage of your sales cycle to find out where potential customers lose interest.

2. Choose Your SaaS Sales Model

The second step is choosing the right SaaS sales model for your startup. Your sales model is largely influenced by the nature of your product and your target audience.

In SaaS, there are primarily three selling models to choose from:

1. Customer Self-Service Model

The Customer Self-Service Model is suitable for low-cost SaaS products that aim for high-volume sales. This model prevails among popular B2B SaaS solutions like Mailchimp, Figma, and Lavender.

In this model, the sales process is streamlined to encourage customers to sign up and use the software. There’s no direct involvement from sales representatives until a certain threshold is met.

One of the main features of the self-service model is its reliance on automation. Businesses often provide automated onboarding processes that guide customers through account creation and initial product usage. This approach not only minimizes operational costs but also enhances user experience by allowing customers to explore the product at their own pace.

To attract a larger audience, many companies employing this model utilize a ‘freemium' strategy. This allows potential customers to try the product before making a financial commitment, thereby widening their reach.

The self-service model empowers customers by allowing them to manage their accounts, access resources, and troubleshoot issues through a dedicated portal.

Here’s something to think about.

Consider Figma, a design tool that operates primarily on a self-service model. Users can create free accounts to access vital design features, which allows them to experiment with the tool. As they become more engaged, Figma promotes its premium features, encouraging users to upgrade based on their growing needs. This self-driven exploration usually leads to organic growth through word-of-mouth and referrals.

2. Transactional Sales Model

The Transactional Sales Model is often used for SaaS products with higher price points and more comprehensive features. This model is particularly effective for small to medium-sized businesses that require a more personalized approach.

In the transactional model, sales representatives play a significant role in establishing strong relationships with potential clients. They engage in detailed discussions to understand the pain points and requirements of each customer. By offering customized solutions, tailored deals, and flexible pricing, sales reps can better align the product’s value to the customer’s needs.

Companies like HubSpot and Asana are great examples of companies with a transactional sales model. These organizations offer a variety of features and functionalities that create a flexible and personalized sales approach. Sales reps focus on understanding individual client needs, which enhances customer satisfaction and creates long-term relationships.

3. Enterprise Sales Model

This sales model is tailored for high-value software products designed for big enterprises. This model is represented by fewer deals in the sales pipeline at any given time but with a more extensive commitment per deal.

In this model, sales representatives focus on value-based pricing, where the price reflects the solution's value to the enterprise rather than just covering development or operational costs. The sales cycle is normally longer, often stretching six months or more, due to the complexity of enterprise-level needs and the involvement of multiple stakeholders.

Companies like Salesforce, Gong.io, and ServiceNow effectively use the enterprise sales model. They cater to large organizations with intricate sales needs.

Let’s understand this better with the help of an example using Salesforce.

When engaging with a potential client, Salesforce reps conduct in-depth consultations to assess the company’s needs and challenges. They build relationships with multiple stakeholders, ensuring their proposed solution aligns with the organization’s goals.

Pro Tip: For mid-value products, create a customized sales strategy using a mix of SaaS sales models.

3. Define and Understand Your Target Audience

The next important step towards creating a sales strategy for your SaaS startup is to define your target audience.

Are you targeting enterprises and need to sell your product to the decision-makers of large companies? Or, can your product be used by individuals like bloggers and influencers as well?

Understand who your target audience is and remember that you can have more than one buyer persona. Your software solution could be good enough for an enterprise as well as a small business. So, clearly define your target audience and then create your SaaS startup sales strategy keeping your ideal customer groups in mind.

Pro Tip: Conduct an in-depth competitor analysis to understand your target market and customers. Also, identify the inbound marketing or sales strategies your competitors leverage to boost enterprise sales.

4. Identify Your USP and Customer Avatar

After deciding which sales model aligns best with your go-to-market (GTM) strategy, the next critical components of your SaaS sales plan are your unique selling proposition (USP) and customer avatars.

A well-defined USP addresses a pain point that your product resolves in a way that competitors cannot. To develop a strong USP, consider these three basic questions:

• What real-world issue does your product address? Your B2B SaaS solution must provide a clear answer to a critical market need. Failing to do so can lead to significant setbacks that cause many startups to fail.

• What makes your product the ideal choice for your intended market? A thorough understanding of your target audience's needs will help you in designing your customer avatar. This step ensures that your product aligns with what potential customers are seeking.

• Which method works best for explaining the advantages of your product? Your USP should reflect your understanding of your audience and be woven into all forms of communication, from sales pitches to website content.

Creating a detailed picture of your ideal customer and their needs provides vital insights for crafting a compelling USP. This understanding also inspires your marketing strategies and improves the efficiency of your sales funnel.

For established businesses, leveraging real-life examples from current customers can present valuable insights into your customer avatar.

Collaborate with your support, customer success, and marketing teams to analyze your most successful client relationships. Identify common themes and pain points in their purchasing journeys. What challenges did they discuss, and which ones did they overlook? How did you address their concerns?

However, don't ignore the value of learning from your less successful customer interactions. Analyzing these cases can refine your lead qualification criteria and help you avoid similar pitfalls down the line.

For newer startups lacking extensive data, market research tools are your friend. Using focus groups, surveys, LinkedIn insights and competitor analysis can help you gather relevant information about potential customers.

Additionally, leveraging a sales analytics platform can provide quick access to data from your initial leads and offer rich insights into your existing customer base. This information is required for accurately defining your customer avatar and crafting a successful sales strategy.

5. Create a Sales Funnel

Once you have a clear understanding of your product and who your prospective customer is, you can create your SaaS sales funnel.

A sales funnel is a visual representation of all of the stages that a consumer goes through when buying your product. It usually starts with generating brand awareness and ends with a sales conversion.

Need an example?

Let’s say a consumer saw a social media post or ad about a cool SaaS product that might be useful to them. They clicked on the link and visited the website to check out the product and its benefits.

They saw that the product was indeed useful for them, did some online research to compare it with other products, and then made a purchase.

That’s a short and simple sales funnel that includes leveraging social media marketing tactics, lead nurturing, content marketing, and conversion optimization.

A shorter version of this cycle could be when a consumer is already interested in making a purchase and does online research. In this case, they might read comparison posts, consider their options, choose your product, and visit your site to make a purchase.

There can be many different ways in which you can bring customers to your website and each would constitute a different sales funnel. So, design your sales funnels and use different marketing tactics to attract, engage, and convert consumers into customers.

Pro Tip: Use popular models like AIDA (awareness, interest, desire, action) to create your sales funnels and then customize those according to your business.

6. Use Content Marketing to Generate Leads

One of the best ways to generate leads for your SaaS startup is to use the right content marketing tactics. Content creation and distribution should be the focus of your sales strategy.

Almost all prospective customers conduct online research before they invest in a product. For SaaS businesses, it is quite beneficial to have good online reviews and listings in comparison posts.

But, how can you get that?

You can always pay bloggers and influencers to mention your product in their in-depth reviews and product comparison posts. You can start an affiliate program and have them promote your product on various platforms.

The more positive online mentions and reviews you can get, the better it will be for your SaaS startup. Also, don’t forget to ensure that all such mentions direct traffic to your website.

Remember, this is one strategy that is common for all SaaS companies, irrespective of the type of product they sell. Content marketing is the holy grail of marketing for all SaaS startups and should be the core of your marketing and sales strategy.

Pro Tip: Pay the best industry experts to create sponsored content for you and make sure that yours is the first link anyone finds when searching for a similar product.

7. Offer a Trial or Demo

This is another common SaaS startup sales strategy but is especially important for companies selling low-value SaaS products. After all, for these products, the entire strategy to generate individual and enterprise sales revolves around getting more people to sign up for the free trial.

Beginning with effective lead generation tactics, you should focus on bringing more and more people to your website. Then, you win them over with your highly optimized landing pages and encourage them to try your product.

Once they try your product and find it valuable, chances are that they will upgrade to a paid subscription as well. That’s the sales strategy that most SaaS startups follow, especially if they have a low-value product.

Offering a free trial is also a good option for increasing enterprise sales of mid-value and high-value SaaS products. It’s just that your team has to try harder to get people to sign up for the free trial.

That is why product demos work better for such SaaS companies. If you have a premium SaaS product, do include a product demo option in your sales strategy.

In this case, your goal would be to get people on your website and pique their interest enough for them to book a product demo. Make sure that it is extremely easy for anyone to book a demo directly from your website.

See, for example, how Salsify has added a “Request a Demo” call-to-action button right on their homepage.

Image via Salsify

Someone from your team doesn’t always have to provide a live demo and can also create a demo video for your prospects to watch. This sales strategy can work well for SaaS startups that sell low to mid-value SaaS products.

Here’s an example of a useful demo video by SurveyMonkey. You can create such videos to help your prospective customers make informed purchase decisions.

Image via YouTube

Many SaaS startups also opt for a freemium model where they offer a lifetime free plan. However, it works only if you have a product for which users will want to access more features.

Don’t adopt a freemium sales model if people can keep using your free plan with certain limitations and might never need to upgrade.

You can offer a freemium version of your tool with something like a limited number of reports or a limited number of email recipients. This will encourage people to upgrade to scale their efforts and business growth.

Pro Tip: Use free trials and demos to prepare your prospective customers to make a purchase and then direct them toward the next stage.

8. Close the Deal

This is probably the most crucial part of your entire sales process as this is where conversions happen. By now, you should have enough leads ready and prepped for making purchase decisions.

But, how can you close the deal?

Well, that again depends on the type of product that you offer and that’s why we have divided this section into two parts.

Curious to learn more?

Here you go:

Closing the Deal for Low-Value SaaS Products

For these products, the one thing that you need to focus on the most is conversion rate optimization. Use CRO techniques to optimize your website and landing pages as most of your conversions happen there.

Here are some strategies that you or your team can use to close the deal and get people to buy your product or at least try it:

• Design visually appealing and engaging product pages.
• Clearly explain what your product does and how it can help them.
• Mention the price upfront and also justify it by detailing all of the product features.
• Encourage prospective customers to try the product for free.
• Alleviate concerns by clearly mentioning that they can cancel their subscription anytime.
• Show comparison between different plans in terms of usage limits, features, etc.
• Use the right CTAs throughout your website.

Try these CRO strategies to ensure that your website visitors try your SaaS product at least, if not directly buy it. Once you get people to enroll, provide them with a best-in-class user experience and turn them into paying users.

Closing Deals for High-Value SaaS Products

For premium products with longer sales cycles, your goal should be to set up a call or meeting to discuss requirements on an individual basis and give a product demonstration.

So, you need to provide plenty of options to your website visitors to be able to connect with your sales team. Live chat, request form, email address, and contact information are some of the ways to go about it.

Once you finally have the meeting then it is up to your sales team to convince the prospects about why they should buy your product. Your team has to convey the same information (features, benefits, etc.) as mentioned above, but in person.

Pro Tip: Train your sales executives well, especially on how to give a great product demo, and you should be good.

9. Provide Great Customer Service

Your job is not done once you acquire a customer. For SaaS products where users need to continuously renew their subscriptions, the sales process is ongoing.

So, for SaaS startups, even customer service is a part of sales strategy. You need to train your team to provide exceptional customer support to make sure they remain loyal to your brand.

Pro Tip: Assign a point of contact or relationship manager to each client and make it easy for every customer to be able to contact you.

FAQ

Q1. How do I succeed in SaaS sales?

A. Understand the market and your target audience well to formulate a solid sales strategy for your SaaS startup. Use consumer insights to succeed in generating SaaS (software as a service) sales and keep learning from your experiences.

Q2. What is a SaaS sales strategy?

A. It is the basic process that you follow to get more sales for your SaaS startup. It includes understanding your target market and then finding the best ways to target and engage them.

Q3. How much do SaaS sales reps make?

A. It differs from company to company and country to country. However, you can get approximately $50K or more per year. You can earn a lot more from commissions.

Q4. How do you make a SaaS startup sales strategy?

A. Follow the process mentioned above to create a winning SaaS startup sales strategy. Here’s a quick recap of the key steps:

• Understand your sales cycle.
• Define and understand your target audience.
• Create a sales funnel.
• Use content marketing to generate leads.
• Offer a trial or demo.
• Close the deal.
• Provide great customer service.

Q5. How do you generate SaaS leads?

A. Content marketing is one of the best ways to generate leads for your SaaS startup and should be at the core of your marketing strategy. Get lots of free or sponsored content published on authoritative websites that link back to yours.

Q6. What is B2B SaaS?

A. B2B SaaS brands are companies that sell products targeting other businesses as clients. It’s like any other B2B business, just with a SaaS (software as a service) product.

Q7. What is SaaS Digital Marketing?

A. It refers to the digital marketing techniques that you use to sell your SaaS (software as a service) products.

Q8. Why is SaaS marketing different?

A. It differs from regular marketing because the end objective is usually to get people to try your product. So, rather than selling a product, you sell a subscription with SaaS marketing.

Q9. How do SaaS companies work?

A. SaaS companies work on a subscription model where customers pay a monthly or annual fee to use a product or platform.

Q10. How do you grow a SaaS startup?

A. Ultimately, it all boils down to how satisfied your customers are with your product and customer service. Keep providing an excellent customer experience to boost the growth of your SaaS business.

Conclusion

If you want to grow your SaaS startup, you need a clear and well-defined sales strategy. You can’t shoot arrows in the dark or use a trial-and-error method as it is a waste of time and money.

Use this post as your reference to create a solid sales strategy for your SaaS startup.

So, what are you waiting for?

Get started with it right now and create a customized sales strategy for your SaaS startup right now. All the best!