The AchieveUnite 555 – Why a Channel is Critical to Your SaaS Company is a three-part series designed to help SaaS business leaders understand why a channel is so important, how it’s different, and what they need to do to stay ahead.
SaaS businesses are here to stay and growing rapidly. With the Rule of 40 being a guide for most VC firms, SaaS companies are reaching for growth rates of 40% or higher, but they can’t go it alone. Healthy SaaS companies need partners to succeed and here’s why.
1. PARTNERS AMPLIFY GROWTH
Similar to your favorite goat yoga picture getting a million views on Facebook, most SaaS applications are looking for and building ways to exponentially amplify their market awareness and position. From share and refer functionality, to creating communities around their technology, virality is the goal, and a network of partners who have a vested interest in your success help to drive that expansion is key. Consider Hubspot; a quarter after introducing its reseller program into the market, the program was driving 42% of new customers and 22% of revenue.
2. PARTNERS ATTRACT BUYERS
SaaS companies are changing the customer journey and the sales experience. With the advent of freemium models, free trials, and direct-to-paid models, customers can self-serve their technology purchase from any role in the company. No longer are companies marketing to the CIO or CTO. Instead, buyers become ubiquitous across an organization. With buying patterns changing, 60% of purchase decisions happen online without ever engaging the vendor. That means anything that amplifies search results, amplifies growth. Partners that are referring and reviewing your service, have large social footprints, or are engaging in thought leadership that gets SEO traction, are essential parts of an acquisition strategy.
3. PARTNERS FILL PRODUCT GAPS
Ever heard the expression, “there’s an app for that”? Well, it’s true. Search just about any need and you will find an app to solve that problem. Need an AI bot for your support page? Check. Need to add review functionality to your software? Check. The list goes on. With niche and expert code available, SaaS companies can stay focused on their core technology and partner to provide the rest. In fact, whether built as an integration or embedded in product, technology app partners are essential to SaaS product roadmaps and growth.
4. PARTNERS DRIVE INCREASED VALUE
Businesses have many opportunities to adopt SaaS products and find partners who offer services to onboard, manage, and integrate these offerings. This solves a critical business need. By being thought leaders and providing the bridge between multiple SaaS offerings, partners become invaluable to the customer, increasing customer satisfaction. As a result, customer churn decreases. With lower churn, customer loyalty increases and lifetime value increases.
5. PARTNERS VALIDATE YOUR SOLUTION
Learning new technologies requires an investment in time and resources. When partners believe in your solution enough to learn the technology, how to sell it, and commit valuable resources to discussing it with their customers, it validates the solution for you and for their customers. If you capitalize on their investment with social posts, thought leadership, and co-marketing, the undeniable value is proven to your next customers as well. By extending your partners’ engagement and success through your marketing efforts, you create momentum around a successful tool that demonstrates the solution and attracts new customers.
Conclusion
Now that we understand why your SaaS company needs the channel, and the impact partners can make on the rapid growth of your business, it’s time to understand how a SaaS channel is different. Stay tuned for part two, which will explore the five ways the SaaS channel model is different and how this impacts your overall strategy and process.
