7 things you need to know before advertising your SaaS with Google Adwords

Kamil Kluziak
01 Jul 2018
4 min read

Running an Adwords campaign for SaaS/IT type of business is different from other industries.

Let's compare it to the e-commerce industry.

In the e-commerce, we instantly see a flow of data showing us exactly which keywords are converting into purchases and which aren't.

With SaaS campaigns, we don't have instant purchases. We are entering a world of very long purchase funnels containing free trial offers lasting even 30 days. During which we have to do multiple phone calls or email sequences to increase the conversion rate.

Due to this extended timeframe, all the data is coming to us very slowly. To decide which keywords truly work in our particular situation we need months to get a substantial amount of data.

On another hand, each conversion is worth much more, especially when we count how much the new customer will spend over the lifetime.

If you tried running Google Adwords before, you may found that it was very costly, getting no or very little results. Still, you're in a different battle than most of the e-commerce businesses working on very thin margins. You have space to experiment.

Before we restart Adwords first we need to talk about metrics.

There can't be a successful Adwords campaign if we don't track what's important for us.

#1 How much you can invest to acquire a customer

One of the most important metrics is how much you can invest to acquire a new customer. The gold standard it around 3:1 ratio. In other words, you should be able to spend one-third of the lifetime value of a customer to acquire him/her.

#2 Tracking results

In e-commerce, it's very simple to decide on the campaign goals. You just track which clicks converted into orders.

With SaaS, we need a little bit more sophisticated solution.

You need to track every vital moment of a customer's journey on your site.

Starting from their first time on your site, through the signup process, moving to the trial period and finishing with the credit card details.

By analyzing all those points it's much easier to determine which Adwords campaign results in the most buying customers. By only focusing on signups it's very difficult to decide which keywords have a higher return on investment.

#3 Using trial period to the fullest

It’s the most important step in the client’s journey.

Without strong onboarding, a client can quickly get stuck in your application and just get back to their old habits.

The onboarding process should include elements like:

- Tooltips and guided tours for the first time users

- Optional followup calls if possible

- Email sequences based on the most common problems providing tutorials and explaining what are the next steps

- A webinar allowing people to ask questions and giving them answers. It’s also vital to reach out to people and ask them to attend.

- At the end of the trial cycle, there needs to be a stronger focus on activating trial users to become paying customers.

All those elements need to be backed up by Adwords remarketing campaigns.

#4 Test shorter trial period

As we already discussed SaaS businesses have longer sales cycles when compared to e-commerce. In many cases, it is worth testing if we really need 30 day trial period.

If 7 or 14 days is enough for trial users to decide if a product is worth buying then we can gather more data in less time.

It’s always worth to mention that some users will be asking for a longer trial period. In those cases, it’s better to give them those longer trial periods.

#5 Experiment with the pricing

In many cases, SaaS businesses have too low prices. This in many cases ends in the inability to grow or not having the necessary money to invest in advertising to see any return.

If your customer lifetime value is too low when compared to your competition you won’t be able to outbid them on all necessary keywords.

Optimizing pricing will provide the additional revenue necessary to stay competitive.

#6 Using freemium model

It’s very dangerous tool in inexperienced hands. You’re much better of using trial based solution than trying to convert people from free solution to the paid one, especially when you know that only 1-2% of free users turn into paid ones.

#7 Reaching out to users from the colder parts of the funnel

Advertising to people who are actively looking for a solution is lucrative but at the same time very expensive.

To lower the cost try creating free giveaway materials that people will appreciate receiving. Thanks to the reciprocity and constant communication it will be much easier to convert those visitors into buyers later down the line when they’re looking out for a paid solution.

While your competition will try to win them solely with ads, you will be already in visitors minds. Thanks to the great handouts.