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  • #36 ๐Ÿฐ Bite-sized case studies to grow your SaaS

#36 ๐Ÿฐ Bite-sized case studies to grow your SaaS

[+Free Resource]

Hey, It's Mariano.

Wishing you a lovely Saturday from ๐Ÿฐ SaaS-HQ.com

Welcome to my newsletter. Every other week, I send:

โœ… 1 to 3 bite-sized case studies to grow your SaaS

โœ… 1 to 3 curated resources from top-notch experts

Letโ€™s dive in!

[Bite-sized case studies]

REVENUE

1) Doing what you did in your early stage phase for too long will kill ๐Ÿ’€ your startup.

In the early stage, you fuel hyper through acquisition.
You rock a low CAC Payback and reinvest the $ in more growth.

With scale, your ARR composition changes.Most of the ARR comes from existing customers.

example:

ARR = $100M ($50M New, $50M Existing)

To maintain a 3X growth ($300M) on this composition through acquisition, you need to 5X your New ARR ($250M).

Itโ€™s not doable, especially while maintaining a low CAC Payback.

Hence, relying mainly on acquisition is no longer a viable option.

What to do?

The game has changed.

Itโ€™s about monetizing and expanding ($) your base (NRR / GRR).
AND maintaining the efficient acquisition engine.
You have to do both.

How do you expand ($) your base? More value!

The second product add-ons, new services, and additional monetization layers.

Value! Value! Value!

Itโ€™s a mindset and a strategy shift.
People tend to keep doing whatโ€™s working.
But in this case, your startup will stagnate if the switch is made too late.

Growth tactic by Eugene Segal

ACTIVATION

2) Try before buy

Love to see Grammarly implementing โ€œtry before buyโ€ for their premium suggestions. It's such a smart move!

1๏ธโƒฃ It tickles my curiosity, and I really want to tap it to see the correction. Especially the sneak peek at the bottom left corner.

2๏ธโƒฃ Three free usages every ๐—˜๐—ฉ๐—˜๐—ฅ๐—ฌ ๐——๐—”๐—ฌ. Not every month, or capped at 10 total. 3 every day. This costs them nothing but quickly builds the habit loop. Ideal Grammarly usage frequence is daily, and they continue pushing for that.

3๏ธโƒฃ Instant gratification once I click it, I implement their corrections in 99% of the cases.

Growth tactic by Dani Pavlu

ACTIVATION

3) Top 5 activation mistakes you're probably making โ€“ and what to do about them.

โฑ๏ธ It doesn't happen fast enough.

๐Ÿ‘‰ What to do: time-bound your activation metric.

We care about activation as a leading indicator of future outcomes.

Speed matters: the faster you know whether a user has activated, the faster you can get a readout on growth experiments and marketing channels.

๐ŸŒˆ Your expectations are too high.

๐Ÿ‘‰ What to do: plan for a 20-40% activation rate. Adjust your business case accordingly.

With PLG, you'll pull in lower intent users who are self-educating on your product, but aren't ready to buy. 40-60% of new sign-ups never return to the product on a second day.

Lenny's benchmarks show a 25% median activation for prosumer SaaS and 33% for enterprise SaaS. Plan for it.

๐Ÿ“บ You're not connecting activation with marketing.

๐Ÿ‘‰ What to do: segment your activation rates by marketing source, then focus on improving this metric.

The biggest influencer on your activation rate isn't your growth team. It's your marketing team.

You'll want to measure activation by marketing source. Bonus points if activated sign-up volume is the top KPI of the marketing team.

๐Ÿ”ฎ Activation isn't predictive.

๐Ÿ‘‰ What to do: measure whether improvements in activation flow-through to business outcomes. If they don't, change the metric.

Activation isn't the goal. It's the leading indicator of the goal.

Conversion, $$, retention, PQLs, etc. -- that's what you really care about. Your growth team might be laser-focused on improving activation only to find out that all of their work didn't improve business outcomes.

๐Ÿ“ It's one-size-fits-all.

๐Ÿ‘‰ What to do: as you scale, start to segment users and personalize activation paths to different audiences.

Not all of your users are trying to achieve the same thing. So why do you push them down the same onboarding path?

Folks often focus on simplifying onboarding, reducing friction, etc., but can't crack the code on improving their activation rate. The problem: you shouldn't have only had one definition of activation.

Growth tactic by Kyle Poyar

+25 SaaS Onboarding Flows

The people from Optiblack have reviewed onboarding flows of the top SaaS products.
 
They created this Miro board to help you understand how leading SaaS companies convert faster and to help you match the common patterns in onboarding.

๐Ÿ“ฌ SUGGESTION BOX

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Thanks for reading!

Have a great one.

Best
โ€” Mariano Martene