CRM for SaaS Companies

SaaS companies are on their toes to meet the surging demands of their customers and rising competition. Research shows that possibility of a lead-conversion fails drastically if a SaaS company fails to respond in five minutes' time. This, and the need to be available round the clock puts SaaS companies in tough spot most of the time. Customers cannot wait, and SaaS companies cannot afford a delay. In order to push their sales revenue, SaaS companies have changed their approach to business. Rather than taking control manually, SaaS companies are now investing in CRM software to take control of the overall sales outcome. SaaS and CRM kind of go hand-in-hand now.

What is the use of CRM for SaaS Companies?

Almost 64.2% of SaaS companies have rated CRM as an important tool to increase sales revenue. A CRM or customer relationship management tool offers an improved way of handling sales and customer relationships. It provides a centralized location where customer details, conversation history, and other customer information are stored. This offers transparency, leading to effective communication between a sales rep and customers.

A SaaS CRM platform streamlines sales opportunities, automates sales conversations, runs campaigns, analyzes deal values, and keeps you updated with detailed insights that are useful in improving sales results.

Reasons why a SaaS company should invest in a SaaS CRM Solution

SaaS companies need application CRM. Despite detailed CRM comparisons, often SaaS companies are clueless WHY exactly should they invest in one.

The SaaS ecosystem plays home to complex sales. They require a SaaS CRM solution that is not just focused on selling, but is also equally focused on building a relationship with customers to retain them after conversions. Reports show that it is almost 4X cheaper to make an upsell to an existing customer than acquiring a new customer.

Hence, it is logical for a SaaS company to invest in a CRM tool and get a step closer to its customers by earning their trust and loyalty. All these come riding high on excellent customer buying experience, which the CRM provides.

Manage important customer data

A CRM has the capability of putting all customer data into a cohesive unit for easy access. You can connect with potential sales prospects using this unit. It stores every conversation you have with each sales prospect giving you enough history to analyze and understand your potential buyer.

Trigger sales automation

Sales CRM can automate repetitive activities so that you save more time. You can create sales workflows which may include sending your sales prospects drip emails at specific intervals. All these automation workflows are sales behavior-driven which means your campaigns are never out of place.

Pipelining sales prospects

A CRM can help in increasing the sales velocity of your sales cycle. Using a CRM, you can analyze the deal value of each sales prospect. Based on their deal values, sales prospects can be added inside the sales pipeline with proper status tags like contact now or contact later. Track the progress of each deal and follow up on time.

Insightful sales reports

A CRM also gives insight into actionable SaaS metrics that can help you in reducing your churn rate and increase the conversion rates. Using detailed customer relationship reports, you can identify what is going wrong and where you need to focus more. A SaaS CRM helps in pinpointing exactly where in your sales process your sales reps are facing troubles to resolve them.

SaaS Metrics to track using a CRM

The SaaS model is based on recurring revenue. The services continue to an extended period which is also known as customer lifetime.

A recurring revenue model is different from traditional software selling. With traditional software selling, the focus is only on capturing a single sale. With the SaaS model, there are two major objectives:

  1. Acquire the customer (first sale)
  2. Retain the customer (maximize revenue and lifetime value)

To do both of these smoothly, you need to track a specific set of SaaS metrics. The right metrics can help you understand the efficiency level of your sales team. These metrics are also important in analyzing the validity of your pricing model. Lastly, it helps you understand your customers better, including details like the profitability of a deal.

CAC or Customer Acquisition Cost

CAC measures how much cost you need to acquire a new customer, and how long it takes for you to recoup this initial investment. CAC largely depends on two factors – first, the cost of generating this lead, and second, the cost to converting it. In lame terms, these are your sales and marketing costs. To calculate CAC: (Sales + marketing costs)/(Total number of new customers).

CLV or Customer Lifetime Value

CLV (or LTV) is the total amount of revenue a single customer generates over the “life” of their subscription to your SaaS product. It includes their initial investment in your product along with other purchases (upsells, renewals, and add-ons). CLV denote how much each customer contributes to your company revenue. CLV = (Average revenue per account)/(Customer churn rate).

MRR or Monthly Recurring Revenue

MRR tracks all monthly sales, upsells, and churns. Since large sales have longer sales process, it can consume more cash in between sales. That is why MRR is essential. It makes sure you are focussed on generating a recurring revenue which is consistent and can boost your monthly inflow of cash. To calculate MRR = (Total number of paying customers in a month) X (Average revenue per account).

LVR or Lead Velocity Rate

LVR measures the m-o-m (month over month) sales growth. It helps in quantifying your sales growth in terms of leads. While data like MRR is based on historical data, LVR is a metrics that uses current data to predict the future of your sales. To calculate LVR = [{Qualified leads in the current month – Qualified leads in the previous month}/{Qualified leads in the previous month}] X 100.

Your SaaS CRM should be Power-Packed

Proper billing integrations

A SaaS company requires a CRM that comes with proper billing integrations because a SaaS model Thrives on recurring billings. With billing integrations in place, generating receipts and triggering transactional emails can happen automatically as and when the customer makes a purchase or renews a subscription.

Call automation

SaaS companies try to be available round the clock for their customers. But it sometimes become difficult to keep a track when your customer base increases. A SaaS CRM system ensures that all sales lead conversations are monitored. If a lead needs to be called, it can be automatically scheduled inside the CRM. Reminders are sent so that you never miss out on your potential buyers.

Improve your SaaS business marketing and conversion funnel

Acquiring new customers or retaining customers, a SaaS company builds their sales system on analytics. This helps in having detailed insights on how the sales team is performing, the status of the sales pipeline, and how is the overall customer buyer experience. Improving your SaaS business marketing and conversion funnel is important, and it can be done in four ways.

Provide solution-oriented content

Research shows that 89% of buyers start their buying process on Google. This means your customers are searching for solutions for their problems. Design solution-driven and data-driven content for your prospects to gain their attention.

Nurture your target prospects

You may be targeting the wrong leads. Make sure your system can filter unqualified leads. Also, ensure that you are providing the right kind of services to the ‘right’ clients. Evaluate your target market, segment them properly, and tailor relevant messages only.

Build trust to drive sales

Reminder: Customers don’t buy products from a ‘Company’. This means that a customer is more likely to make a purchase form a company that is recommended by their friends or family. That is why building trust is very important. If your customer trusts your brand, it will pull down the purchase resistance wall. This will lead to brand advocacy, which means more sales.

Retain your loyal customers

reduce any friction whatsoever during the onboarding process. Make sure your customers have a smooth run in the first attempt. Bend some rules if needed for a better user experience. Be ethical when time comes for renewal. Personalized renewal messages trigger re-subscriptions faster.

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