The SaaS industry has been thriving for quite some time now. It’s no surprise that new companies are constantly popping up, looking for a piece of this ever-growing market. Earlier SaaS concepts targeted broader markets and are referred to as horizontal SaaS, for their wide appeal. What we’re seeing now (and for the last 10 years or so) is the verticalization of SaaS platforms. Products being built for a very specific industry with benefits directly targeted to the needs of that market. Whether a platform is built for attorneys or yoga studios, SaaS companies building for a specific vertical need to provide value to their customers on every level - building towards scale. Instead of hacking for growth, below are 3 tips for solidifying growth.
Less Hacks, More Usability
What does “Growth Hacking” mean anyways? It’s a semi-strategy that consists of growth and marketing experiments used to “hack” the growth process as quickly as possible. Everyone wants the silver bullet that will make their platform grow faster, and sometimes they find it. But even if a startup discovers an initial growth hack, sustainable growth requires features and user experiences that keep the customer coming back for more.
Vertical SaaS startups are trying to solve a specific problem for a target market, but the majority have ambitions to achieve rapid growth. Many have limited funds to work with, so building out a large feature set in-house can be difficult and marketing budgets are constrained. These startups have to get creative about how they build and promote their product, and while there’s absolutely nothing wrong with a little (or a lot) of creativity, depending on growth hacking isn’t a sustainable growth strategy. The ultimate growth hack is usability and value for the customer, and that’s no hack at all.
Focus on Value
If the key to sustainable growth for SaaS companies is providing as much value to customers as possible, what does that actually mean? Is it just about building the most features? Is it being first to market? It’s better to spend your time and resources on improvements to your product than “tricks” to get a less than optimal product noticed. But how do you know which improvements to focus on?
One of the biggest advantages of the SaaS model is that you can continually improve your product, and your customers are the first place to go for feedback. The importance of a strong feedback loop is second to none. This information helps you spot trends, and easily read between the lines to discern what’s really needed - and the quickest way to provide value.
Building a feature for one customer can become difficult to scale. It can be common for customers to ask for a specific feature when their challenge can be solved in another way. Interviewing a group of customers enables you to dig into what they are saying (and how they use your product), get to the root of the problem, and build new features to address it.
Generally, the smoother the user experience the stickier the product. Customers, whether consumers or businesses, expect your product to be intuitive and easy to adopt. Anything that adds additional steps or training could potentially affect your retention rate - ultimately hindering growth opportunities.
Make Use of Integrations & Technology Partners
Your customers rely on you to build the most stable, scalable platform that makes their lives easier. Diverting resources, attention, and budget towards building net new products can result in asking yourself the timeless question: “to build or to buy?”. We see the value in not doing everything yourselves; instead, relying on experts where possible.
With SaaS industry growth comes the ability to partner and integrate with 3rd party apps or technologies designed to add value to your platform faster and easier. Your internal teams stay focused on your core product, and your customers gain access to all the tools they need to be successful in one place - win/win.
The types of integrations or technology partners you might want to consider are:
- Subscription Billing
- Product Analytics
- Payments Technology
- And pretty much anything else you can think of...
One of the best parts of working with technology partners is that they are experts in their area, the same way you are an expert in yours. It’s virtually impossible for one company to be the best at everything. Working with another team that can bring that expertise to the table is invaluable.
Growth Potential for Vertical SaaS Companies
We’ve seen how working with a technology partner can fuel growth for SaaS companies. In our case, Finix helps SaaS companies provide more value by integrating payments right into their platform. This results in a smoother user experience for users of the platform as well as their customers (the end consumer making payments).
Payments is just one piece of the puzzle, but it’s a pretty huge one. We don’t want SaaS companies to leave money on the table by working with an ISO or Referral model payments company, so Finix provides a managed, integrated payments system that allows SaaS platforms to bring additional value to their customers and additional revenue to their bottom line.
When the user experience is simplified, growth becomes simplified. After all, you want to build products that people enjoy using. When you’re bringing additional value to your customers through 3rd party integrations or working with a technology partner, you will see increased and sustainable growth due to the added value, without having to distract your internal team from your core product. It’s never too early to start thinking about and researching options when it comes to integrations, because when you successfully add value you can roll your increased revenue back into your product development, continuing to fuel growth.