Improve SaaS Customer Retention by helping your customers Continually Realize Value When we buy something without trying it first, this is based on what I call “Perception of Value.” When we buy something after trying it, this purchase is based on our “Realization of Value” during the trial. Makes sense, right? But what about Customer Retention? […]
SaaS Customer Retention Requires Ongoing Realization of Value
October 15, 2012 Article by Lincoln Murphy
Free Trials: Not just for Startups or toy Web Apps
October 3, 2012 Article by Lincoln Murphy
I am frequently asked to help SaaS, Web App, and Cloud companies on strategies to Accelerate Profitable Growth. One way we frequently achieve rapid and long-lasting results is by Accelerating Customer Acquisition through the Optimization of their Free Trial Strategy.
Why $1 Trials are a REALLY Bad Idea
September 22, 2012 Article by Lincoln Murphy
It is well-known that I help B2B SaaS and Cloud companies achieve Profitable Growth, often by accelerating Customer Acquisition, improving SaaS conversion rates, and optimizing Free Trials. Because of that, I am often asked for my opinion or advice in public forums, like recently when I was asked about $1 Trials on Quora. At first, I […]
SaaS Pricing Model: How a 10x Price Increase lead to Happier Customers
August 22, 2012 Article by Lincoln Murphy
Stormpulse adjusted their SaaS pricing model by raising their prices 10x… and getting happier customers in the process. So I just had a Progress Check and Planning meeting with a retainer client, Matt from Stormpulse, who told me since they moved away from Freemium just 4 months ago to a Premium-only SaaS offering with a […]
Free Trial Frustrations from a SaaS CEO
August 22, 2012 Article by Lincoln Murphy
Have you ever wondered why people who sign-up for your Free Trial don’t turn into customers? Well, I got an email from the CEO of a SaaS document management company the other day and she was at her wits’ end wondering the same thing! She wrote me to vent her frustrations about her Free Trial […]
SaaS Free Trial: How Self-Service fits with a High-Touch Sales Process
August 22, 2012 Article by Lincoln Murphy
How do you determine whether a self-service SaaS Free Trial is appropriate for your otherwise high-touch sales process? A SaaS Free Trial is an integral part of the sales process and not something separate… never forget that. So, whether you have a 100% automated, self-service sales model, a high-touch sales process, or a hybrid (many […]
Simply Offering a SaaS Free Trial Increases Conversions
August 14, 2012 Article by Lincoln Murphy
For those companies who’ve offered a SaaS Free Trial and had it fail, it is hard to see how it could ever work. For those who’ve never offered a Free Trial, the idea of adding an extra 30 or 60 days to the sales cycle seems like a bad idea; they’re doing just fine, thank […]
SaaS Free Trial: Your Customer Qualification Machine
August 14, 2012 Article by Lincoln Murphy
I believe in the saying “high-tech allows for high-touch” and that we can use the self-service nature of the web – including your SaaS Free Trial – to not eliminate the human-powered sales force, but to scale it efficiently to let each salesperson work better leads and close more sales. In my experience, SaaS Free […]
7 Tips for Software Vendors Moving to the Cloud
July 26, 2012 Article by Lincoln Murphy
As a Strategic Consultant, I have worked with the Executive Teams of many Enterprise Software and Independent Software Vendors (ISV) to develop strategies for becoming Software-as-a-Service (SaaS) and Cloud Services vendors. …and I must say that I’ve come to what I consider to be a shocking conclusion: Far too many people think the Cloud is […]
What’s the biggest issue you’re dealing with right now?
January 26, 2012 Article by Lincoln Murphy
I do what I do for one reason… to help SaaS & Web App vendors be more successful. Period. If I’m not doing that, I’m not doing my job. Some I will help be more successful by working with them 1-on-1 or through programs like the Free Trial Dominator (which is awesome, IMHO). But others […]
SaaS Customer Retention: The Secret to Reducing your Churn Rate
January 4, 2012 Article by Lincoln Murphy
When it comes to SaaS Customer Retention, I get questions like this frequently: Hi Lincoln, I’d like to hear your perspective on minimizing churn, especially in an industry with steadily declining prices, Adding more value with a better customer experience and more product functionality to mitigate price erosion and churn helps. Better segmentation. What else? Churn […]
What’s Your Biggest Challenge in 2012?
December 30, 2011 Article by Lincoln Murphy
I believe in moving forward, not looking back. So my question as we go into 2012 is this: What’s Your Biggest Challenge as a SaaS or Web App Vendor in 2012? Is it making your Free Trials more effective at creating customers? Coming up with the right Pricing? How to handle Competition? Whether to go […]
Classical Freemium Doesn’t Exist At Scale
December 25, 2011 Article by Lincoln Murphy
“Classical Freemium” is the marketing tactic where a SaaS or Web App vendor offers a Free-in-Perpetuity version of a product or service, often feature- or usage-limited, as well as a version of the same product or service with less limitations to which the vendor will attempt to up-sell the user. NOTE: I originally published this […]
The SECRET to $1M ARR in 6 Months is 9 Customers
August 30, 2011 Article by Lincoln Murphy
It’s easier than you think to get to $1M in annual revenue with your SaaS app. To have a $1,000,000 per year run rate, you need to bring in $2740 per day… roughly. Pardon me if my math is off a bit… this is just one of those posts to get you thinking… your mileage […]
There are 7 Types of Freemium and Why That Matters…
August 23, 2011 Article by Lincoln Murphy
You think you know Freemium in SaaS? Think again! In 2009 I released the version of “The Reality of Freemium in SaaS” PDF and since then the “Freemium” landscape in SaaS has continued to evolve rapidly. Freemium use in B2B technology / software / SaaS / Web Apps / Cloud (whatever) is evolving and I […]
SaaS Business Model Resource Guide
December 18, 2010 Article by Lincoln Murphy
I put together this list of my BEST SaaS Business Model & Architecture resources just for you. I hope it helps! Software Vendors: The Cloud is Not Magic (but it can be very Profitable!) SaaS Business Architecture Overview (PDF) The 7 SaaS Revenue Streams Report (PDF) Think You’re Ready for SaaS? Think Again! (PDF) SaaS Companies […]
SaaS Pricing Model: Value Metrics Are Key
December 7, 2010 Article by Lincoln Murphy
Your SaaS Pricing Model should be built around what the customer values, which probably means staying away from “commodity” metrics like storage. I find most articles about “SaaS Pricing Model” to be less-than-helpful because they almost always fail to take into consideration the WIIFT of the customer – the What’s In It For Them. Most […]
Your Revenue Crutch is Killing Your SaaS Startup
November 12, 2010 Article by Lincoln Murphy
Web Apps and Software-as-a-Service that comes from consulting companies or other service businesses can be lucrative but can be held back by non-scalable revenue streams. Do you have a less-scalable revenue stream that you rely on even though it is holding your business back? We’ll call this a Revenue Crutch. It is something you keep […]
Web Apps use Customer Support to Increase Revenue
October 4, 2010 Article by Lincoln Murphy
SaaS vendors know getting the sale is just the first step; keeping the customer means keeping them happy and that a happy customer will generate more revenue over time! A client that I am working with on their Pricing Strategy just sent me the following question (you can send me questions, too): Lincoln – This […]
Does Goldilocks Pricing Work for SaaS?
September 15, 2010 Article by Lincoln Murphy
A Pricing Strategy for SaaS built for the sole purpose of nudging customers away from a decoy price to the middle version can work. I was asked for my thoughts on this question someone posted on Quora: “Based on your real-world experiences, does Hal Varian’s ‘Goldilocks pricing’ result in most buyers choosing the middle option?” […]
As SaaS Matures, so will SaaS Pricing
June 21, 2010 Article by Lincoln Murphy
The common SaaS per-user, per-month subscription revenue model is rapidly evolving. From time to time I feel I must remind everyone – buyers, sellers, pundits, commentators, & analysts – that SaaS is not a pricing model or pricing strategy. From the vendor side, Software-as-a-Service (SaaS) is a unique Software Business Architecture where service is the […]
SaaS Pricing: Please Learn From the Zendesk Fiasco
May 18, 2010 Article by Lincoln Murphy
It is time for SaaS & Web App startups to sit up and pay attention. SaaS Pricing is very important to your venture but not just to ensure you make a profit or cover expenses. It is so much more than that and you should seek to get it as right as possible out of […]
Cloud Acquisitions Create New Opportunities
May 12, 2010 Article by Lincoln Murphy
So you’ve built a killer SaaS product and [Google or Oracle or Microsoft or…] just bought your big competitor; is this good or bad for you? NOTE: This post is originally from May 2010, but the last two years have been full of Legacy Software vendors snapping up SaaS and Cloud providers. From SAP buying […]
SaaS Distribution: Time to Change the Channel
May 12, 2010 Article by Lincoln Murphy
Do SaaS products require, or can they benefit from, distribution through a 3rd party? I’ve written in the past about SaaS channels and how most people are doing it wrong, and there seems to be renewed interest in this topic. Unfortunately, things haven’t changed much. Since this is “software” as-a-service, people cannot get away from […]
SaaS, Web Apps, or Just ‘Apps’?
April 20, 2010 Article by Lincoln Murphy
On my last trip to San Francisco I sat down with Matt Childs of DreamSimplicity to talk about the state of SaaS. We shot some video as we talked about how Google & Apple have changed the distribution landscape for SaaS & Mobile making App Stores & Marketplaces a new reality for SaaS vendors and […]
SaaS Pricing: Commodity Metrics and the $240 GB
March 31, 2010 Article by Lincoln Murphy
SaaS pricing strategies that use low-value commodity metrics – like storage – to differentiate tiers force customers to make price comparisons that shouldn’t be made. Updated for 2014 This topic came up with a client who wanted to pass on the storage costs associated with the use of the system to their end-customer. We quickly […]
SaaS Pricing: Versioning for Market Segments
March 5, 2010 Article by Lincoln Murphy
Rags Srinivasan posted a great article titled “The Science of Optimal Versioning in SaaS” to his blog that talks about SaaS pricing. In the article, Rags talks about taking apply SaaS pricing to through different bundles of features at different prices for various market segments. The whole article is great, so I encourage you to […]
SaaS Network Effect: Companies Should Exploit Aggregate Data
September 21, 2009 Article by Lincoln Murphy
SaaS providers must understand the difference between consumers of their apps, producers of SaaS network effect data and how to monetize both. ADP: A Case Study in Network Effects A quick update for 2013: ADP now processes payroll payments for 1 in 6 American workers. Because of this massive “network effect” they’ve created, ADP has […]
SaaS Business Model – You Break It, You Buy It
September 17, 2009 Article by Lincoln Murphy
Web Apps don’t get forked without a massive payday as motivation! When you draw the line in the sand and adopt the SaaS business model, you might be tempted by people asking you to break that model. These requests could include: A competitor wants to license your application A client wants a copy of your […]
SaaS Business Model is About Rules, Not Exceptions
September 16, 2009 Article by Lincoln Murphy
SaaS Apps should be flexible, but never customized. For the vendor, the SaaS business model is about rules, not exceptions. Exceptions aren’t scalable. For business scalability, you must shift focus to automated, repeatable processes. For pure-play SaaS startups, this isn’t as big of deal since they are likely starting with a clean slate. For those […]
SaaS Success Requires Dropping the Legacy Baggage
August 26, 2009 Article by Lincoln Murphy
Don’t try to force an on-premises, packaged software product to the cloud. Legacy software is a square peg and SaaS is a round hole. No matter how hard you try, forcing legacy, on-premises software to fit into the “SaaS model” is at worst not going to work and at best, requires cutting corners. It is […]
SaaS Companies Should Learn from Netflix
May 19, 2009 Article by Lincoln Murphy
Web Apps with Proactive Customer Service will win more – and keep more – customers than their competitors and Netflix should be the model. I often extol the virtues of the SaaS Business Architecture for vendors beyond just the typical “cost savings” and “operational efficiency” that most pundits and analysts like to talk about. I […]
ASP vs SaaS – What’s the difference?
May 12, 2009 Article by Lincoln Murphy
Not all Web Apps are created equal and many people don’t understand the difference between ASP vs SaaS or Software-as-a-Service. ASP vs SaaS – What’s the difference and why is ASP a failed business model? This post was originally written in 2009 and – while still very relevant – I suggest you also read this post for […]
The SaaS Single-Tenancy vs. Multi-Tenancy Debate
April 14, 2009 Article by Lincoln Murphy
Web Apps built from scratch rarely aren’t Multi-Tenant; the debate only comes up with legacy software vendors migrating to SaaS and trying to justify their cutting corners. This post was originally written in 2009 and – while still very relevant – I suggest you also read this post for a more up-to-date take on the Business Architecture […]
Actionable Business Intelligence at your fingertips
October 18, 2007 Article by Lincoln Murphy
Originally published on October 18, 2007 You probably capture a lot of data in your web or SaaS app, but how often do you mine that data for Actionable Business Intelligence; information you can use to solve business problems, such as slumping revenue, high client turnover, etc? It might be time to stop everything else […]
Fallout from Enterprise SaaS Series
March 10, 2007 Article by Lincoln Murphy
Originally published on March 10, 2007 I have received an amazing amount of feedback on the Enterprise SaaS series; just about everyone who read it has contacted me with mostly positive comments, but usually someone has at least one concern. I am going to try to address all of their concerns at one time. Hybrid […]
Pureplay Enterprise SaaS and Vendor Sustainability – Overview and Part 4
March 9, 2007 Article by Lincoln Murphy
Originally published on March 9, 2007 This series is to help Enterprise SaaS vendors with two potentially business-stopping problems; scalability and sustainability. I am attempting to address both the real-life objections seen in Fortune 1000 enterprises when selling a SaaS solution and some ways to work around them. This series is also meant to get […]
Pureplay Enterprise SaaS and Vendor Sustainability – Part 3
March 9, 2007 Article by Lincoln Murphy
Originally published on March 9, 2007 After overcoming all of the objections in your control: existence, reliability, support, and scalability, you must now overcome the objections that are not in your control. These are the real show stoppers and come from not understanding your target market. The SaaS industry obviously agrees that SaaS is the […]
Pureplay Enterprise SaaS and Vendor Sustainability – Part 2
March 7, 2007 Article by Lincoln Murphy
Originally published on March 7, 2007 Starting a software company from scratch, on-premises or SaaS, is no small task. The barriers to entry into the Enterprise software market are significant to say the least. To top it off, there are a number of things that can hinder adoption of your solution in large corporations, putting […]
