For SaaS companies, coming up with an effective upgrade strategy is sometimes like blindly navigating a dark ocean. If you hold back on product features that add value, then customers may not see the full value of your product. However, if you give them full access to your service up front, then you’ll have nothing left to offer as an upgrade. It’s a delicate balance. A successful strategy starts with understanding the thinking and needs of your customers. After all, marketing a product or service is all about providing a solution to a problem. Consider these 10 reasons why your users may not be upgrading and our top three ways to overcome those obstacles.
Why aren’t my users upgrading?
- Costs too much. A perception of being overcharged for an upgrade will scare off customers or leave them feeling like they are being treated unfairly.
- Low-valued upgrades. Some SaaS companies mistakenly include their most valuable features in the basic or entry-level product. That leaves little left of value for the upgrade. If no one cares about what’s offered in the upgrade, you are unlikely to sell to them.
- Not enough value in the basic purchase. Another pitfall for SaaS companies is not including enough value in the original purchase. They mistakenly hold back all of the valuable features, hoping to sell them as upgrades. As a result, users cannot fully experience the value of the product. For example, never withhold features having to do with user engagement. These are key to your clients building a relationship with your product — a step that will keep them around long enough to upgrade. Tweet
- Afraid of commitment. This may seem silly because they are already your client. However, many customers need to be reassured that their upgrade does not change the fact that they can cancel their subscription at any time.
- Security concerns. Some feel that allowing an upgrade offers unnecessary access to their network.
- They feel bullied. Be sure your upgrade sales pitch does not sound like an ultimatum.
- The process was complicated. It may seem simple to you, but be sure your upgrade pitch includes a clear process. If it is an e-mail, a clear call-to-action should take the user directly to a page to complete the upgrade.
- Just not needed. If your client only has 10 salespeople and you are trying to upgrade them to a product for 20 users, it’s doubtful they will make the leap until they really need the upgrade.
- You’re not giving them social proof. Users need to know others like them are upgrading and finding value. Include testimonials or a simple subject line like, “Five users just like you became premium users this week.”
- Lack of customer service. If customers have not received personal attention, had their questions answered, or their problems resolved, they are not likely to upgrade.
Overcoming the obstacles. Try these three strategies to upgrade more clients.
- Use your content marketing strategy. Almost every obstacle is about educating the client. Use your blog, ebooks, or other original-research content to talk about security concerns, interview happy customers, and discuss common problems that your product upgrades solve. Address the “it costs too much” objection with a catchy title like “Myth or Fact: SaaS products are too expensive.” Be sure your clients see your discussions by including a link to the resources in an e-mail or on your social-media account.
- Measure engagement. A client’s perceived valued is directly linked to use. Tweet A customer who is not getting the most out of his or her subscription is not likely to upgrade, but is likely to drop their subscription all together. Monitor engagement. Reach out to clients not fully utilizing their current subscription. Offer tips. Find out what they are lacking. If you make them happy, they will be more likely to listen when you recommend an upgrade.
- Have an e-mail strategy. E-mail is the most personal way to reach out to individual clients. Follow these tips to win them over. Be personal. Always include a direct phone number and use your direct email address so they can reply easily. Offer options. The upgrade option should not be “do or die.” Offer a clear call-to-action to upgrade, or “click here to read the latest research on how our clients are successfully managing [insert problem your product offers the solution for].” Lastly, surprise them with a bonus. “Upgrade now to take advantage of 10 percent off for the next six months.”
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