SaaS Sales Funnel: Stop Optimizing for the Wrong Customers

1. SaaS Sales Funnel: Stop Optimizing for the Wrong Customers A guide by SaaS Marketing expert and Growth Hacker Lincoln Murphy of Sixteen Ventures

2. He was Frustrated... “OMG… That’s not who’s signing up for my app!” exclaimed Jerry, after we discovered who his ideal customers are and that he’s been optimizing his Sales Funnel for the wrong customers. Copyright© 2013 Lincoln Murphy. All Rights Reserved.

3. A Broken, Leaky Sales Funnel Jerry told me that he didn’t know what was wrong He kept “optimizing” the marketing site, the on-boarding and engagement process, kept running and testing new ads on BuySellAds, he even created an email course for those who weren’t ready to buy yet so he could nurture them. He was doing everything he’s supposed to do, right? Copyright© 2013 Lincoln Murphy. All Rights Reserved.

4. The Wrong Kind of Traction It turns out he wasn’t without “traction”… people were signing up for his Free Trial, and some were even becoming “active” users... but none converted to paying customers In fact, because of that, whenever he would get a sign-up for his Free Trial it was more frustrating than something to celebrate. All of these people trying his stuff and not converting to paying customers. That’s it! http://sixteenventures.comCopyright© 2013 Lincoln Murphy. All Rights Reserved.

5. No More Mr. Nice SaaS Jerry told me that he was done messing around and it was time to get serious with his Free Trial conversions. First… no more 30-day free trials for you… he was going to take it down to 7 days! Oh… and you have the audacity to want to evaluate his software without a credit card? No way, son. Not anymore! Time to put up that Credit Card wall! http://sixteenventures.comCopyright© 2013 Lincoln Murphy. All Rights Reserved.

6. Punishing Prospects Won’t Help Conversions! Yep, he basically wanted to trap people and make them have to actively cancel the subscription and payments if they wanted out. I told him those were 100% the wrong things to do and would likely result in even fewer people trying his product (there wasn’t a whole lot of downward potential, but it was there). Okay… so he’s calm. But where do we go from here? http://sixteenventures.comCopyright© 2013 Lincoln Murphy. All Rights Reserved.

7. SaaS Sales Funnel Presentation Source This presentation is based on my popular “SaaS Sales Funnel: Stop Optimizing for the Wrong Customers” post... you can find a lot more detail on the techniques and ideas presented here: http://sixteenventures.com/saas- sales-funnel Copyright© 2013 Lincoln Murphy. All Rights Reserved.

8. Who’s Your Ideal Customer? I asked Jerry who the type of customer was that would immediately see the value in this product and who – once they started – would quickly start to realize value from the offering. Jerry went from frustrated to speaking passionately as he described who would benefit from this product. He said his Ideal Customer was just like his software development company: a specific range of employees, adherence to certain methodologies, working with certain types of customers in certain ways, etc. http://sixteenventures.comCopyright© 2013 Lincoln Murphy. All Rights Reserved.

9. Ideal Customer Definition http://sixteenventures.com That criteria would yield a customer that instantly understood the value of the SaaS app, would quickly realize value once they started using it, and would continue to realize value for years to come. Oh, and it didn’t hurt that he figured these would also be the most profitable customers, stay the longest, etc. What really helped this process along though, was another exercise… Copyright© 2013 Lincoln Murphy. All Rights Reserved.

10. Who’s the Wrong Customer? Who won’t see the value in your offering? Who won’t recognize value quickly once they are in the app? Who will need lots of help and support? Who is the functionality and feature set - current and planned – of this offering simply not a good fit for? And then it hit him like a ton of bricks… http://sixteenventures.comCopyright© 2013 Lincoln Murphy. All Rights Reserved.

11. The Wrong Customers are Signing-Up! He realized as he was describing his ‘wrong customers’ that those are exactly the people that are signing up for his product! Even more, he realized that those are the ones he’s been targeting inadvertently with his advertising. And since his marketing site doesn’t clearly state who the product is for – and in the process who it isn’t for – it isn’t until they get into the app that they realize it isn’t for them… http://sixteenventures.comCopyright© 2013 Lincoln Murphy. All Rights Reserved.

13. No Matter What you Do... It’s pretty much impossible to convert the wrong prospects to paying customers. Putting up a Credit Card wall or reducing the Free Trial length to 7 days would not fix that. In fact, the CC-wall would probably just irritate people who thought it was for them and quickly realized it wasn’t. And for those who got charged – forced continuity – this would leave a very bad taste in their mouth, right? Just fix the glitch and... http://sixteenventures.comCopyright© 2013 Lincoln Murphy. All Rights Reserved.

14. Optimize the SaaS Sales Funnel the Right Way Keep your “ideal customer” definition in mind in as you develop every aspect of your SaaS sales funnel With your “Ideal Customer” definition in mind we can review your Sales Funnel for problems that will hinder your customer acquisition efforts Having the additional context of your ideal customers and their expected or known behaviors helps us look at your Sales Funnel from the correct POV http://sixteenventures.comCopyright© 2013 Lincoln Murphy. All Rights Reserved.

15. Let’s Optimize your SaaS Sales Funnel Get your SaaS Sales Funnel Optimization Review and I’ll help you start converting more customers… fast! http://sixteenventures.com/saas- sales-funnel-optimization-review http://sixteenventures.comCopyright© 2013 Lincoln Murphy. All Rights Reserved.

16. SaaS Sales Funnel Presentation Source This presentation is based on my popular “SaaS Sales Funnel: Stop Optimizing for the Wrong Customers” post... you can find a lot more detail on the techniques and ideas presented here: http://sixteenventures.com/saas-sales- funnel Copyright© 2013 Lincoln Murphy. All Rights Reserved.