Marketing & Partnerships

5 Simple Ideas to Immediately Improve Your Conversion Rates in SaaS'

Jason Lemkin


Recently, I was asked a great question about Improving Conversion Rates.  If you haven’t done this in the past, I’ve got my 4 best suggestions that will work to get your conversion rates up.  If you’re past this point — my apologies.

However, before we get there, let me state the obvious, that there are limits here. Many obsess about improving conversion rates — which is important — in the early days, when their real issue is the denominator, i.e. insufficient growth in the user base.  I.e., you aren’t growing qualified leads fast enough.  If you are, I believe it all works itself out.  If you aren’t growing the denominator fast enough — I’d focus on that first, and conversion rates second.

If you look at the chart in the upper right, which I want to use again in a few more posts … it illustrates the point … what really moves the needle in the early days is simply getting the user number way, way up.  Increasing conversion rates of free-to-paid by 4% is great and all, but increasing the user base 1000x sure helps a lot more.

Having said that, 5 things that work/worked for us to improve conversion rates — and that are easy to implement quickly:

1.  Overinvest in Pre-Sales/Free User Customer Support.  This is expensive but clearly, unambiguously works.  Have more people available to answer every question on the front-end.  Have someone answer the phone, every single call — not just respond to tickets.  Expensive, but it works.

Note that while suboptimal, you can outsource this, at least some of this.  Prior to our acquisition we had a primary internal team but also a secondary outsourced team to answer the phones.  It worked.  Better if your own team answers the phone, but far better someone smart on your product answers than no one.

2.  Drip Marketing.  This clearly works and isn’t that expensive.  Tools like Marketo, Eloqua, Pardot, Hubspot, etc. that enable you to on a recurring basis — but without being a total nudge — remind your sign-ups about how great you are and to consider trying again / buying / etc.  If you aren’t doing drip marketing over an extended timeframe (months and then years), you’re leaving a ton of money on the table.  Some users / leads will take years to convert.  For us, sometimes even 7+ years! 😉…

3.  Dynamic Landing Pages.  Consumer marketers swear by this, I think it’s a lot less effective for business / SaaS apps because the lead volume is lower — but it does work to a measurable extent.  Get different segments seeing the right messages when they come to your site.  You can do a B+ version of this out-of-the-box with most of the drip marketing tools listed in point 2 above.

4. Optimize Your Choke.  This works.  Even if you optimize nothing else, get the “choke” from free to paid optimized, and/or optimize your free trial duration length if you do that but not Freemium.  At EchoSign, for us, on the Freemium side of the business, you can see 5 transactions / month (with some dynamic tweaks) turned out to be optimum after a great of testing in the early days.

5.  Hire Your First Sales Guy(s) Early — As Soon As You Have 10 Customers if You Can.  Don’t Wait.  Having someone to answer every call in Point 1 is key, but that’s not the same as pre-sales and sales.  Having someone besides you and the core team, that can take more time with any potential customer, and lead … it will work.  It may not be ROI positive on Day 1.  But it will work.  And hire 2 if you can.  Granted, this is a bit more work and $$$ than steps 1-4, and you may be forced to wait a bit if you are running it lean … but I wanted to include it nevertheless.  Because just one good sales person will dramatically increase your conversion rates  — and your revenue per lead.

Again, I believe growing the denominator is key.  That gives you the base to play with and optimize.  Then, conceptually at least, you can optimize how you monetize it.

Published on January 17, 2013
  • Another great post. I’m starting to realise that building the product itself is really only the beginning of this journey! Can’t wait.

  • Mohammad Ocean

    Since you won’t be shameless, I will – especially since I’ve been on the buying side of the equation:

    Rule #6: Buy EchoSign for every producer and watch as conversion rates soar.

    At TownHog we took a 20% conversion rate up 68.5% simply by making it easier for our customers to sign contracts. Fair warning – whoever is responsible for that decision may ultimately quit their job and join the EchoSign team too.

    • It’s a good point. I stopped — chronologically — at just hiring a first sales rep before you have one.

    • @mohammad Agree with this point. It helps with contract workflow and also does some ‘drip’ marketing for you 🙂 (by providing periodic reminders to e-sign).

  • Really love your blog. How much does your product have to cost for it to make sense to hire a sales person?

    • Good question. We’ll do a post on this but a $2000 ACV is probably the lowest practical point. 200 a month.

  • Pingback: The Best of SaaStr: Our Top 100 Posts, Organized by Topic (Sales, Marketing, Customer Success, etc.) | saastr()

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