SaaS Customer Stratification: 11 Strategies You Are Not Aware Of

In today’s tech-savvy world, Software-as-a-Service (SaaS) is one of the fastest-growing industries, presenting new challenges for businesses to attract and retain customers. With a plethora of SaaS products flooding the market, SaaS owners must devise a strategic plan to target the right customers, optimizing their marketing and sales efforts.

Customer stratification holds the key to success in every business, and SaaS is no exception. This captivating blog post reveals 11 unique strategies to help SaaS owners effectively stratify their customers and unlock maximum revenue potential. Let’s dive in!

What is SaaS customer stratification?

SaaS customer stratification is a strategic approach used by businesses to categorize or ‘stratify’ their customers into different groups. The stratification process is based on various factors, which can include customer behavior, product usage, customer lifecycle, and economic value, among others.

For instance, let’s say you run a SaaS enterprise that offers project management tools. You might have one group of customers who use your software daily and another group who only log in once a week. By stratifying your customers into these two groups, you can tailor your marketing efforts more effectively. The daily users may benefit from features of higher-tier plans, and thus, upgrading their plan could be a key focus for upselling campaigns.

On the other hand, lighter users might need more education about the benefits of your product. Improving their product usage through informative content could be a more apt strategy.

Here is a simplified example of how a SaaS company might stratify its customers:

1. High-Value Customers: Those who purchase premium plans and frequently use the product.
2. Growing Customers: Those who have recently upgraded their plans and show an increasing usage pattern.
3. At-Risk Customers: Those who exhibit a decrease in product usage or have downgraded their plans.
4. Dormant Customers: Those who signed up but have minimal-to-no activity.

By identifying and focusing on these groups differently, a SaaS business can create more personalized customer experiences, ultimately leading to better customer retention and increased revenue.

Problems faced in the absence of customer stratification

Without customer stratification, businesses face a host of challenges. Here are a few significant ones:

1. Ineffective Marketing Strategy: Businesses may end up deploying a one-size-fits-all marketing strategy. It could result in a lack of engagement, as the promotional content may not resonate with all customers. For example, a high-value customer may receive an email about a beginner’s tutorial when they would be better served by an advanced tips and tricks guide.
2. Decreased Customer Retention: Without understanding the specific needs and behaviors of different customer groups, businesses may struggle to provide personalized experiences. It could lead to a decline in customer satisfaction and retention. For instance, at-risk customers might leave if they don’t receive the necessary support and engagement to rekindle their interest in the product.
3. Inefficient Allocation of Resources: Resources may be wasted on customers who don’t provide much value to the business. For instance, investing in customer retention for dormant customers instead of high-value customers can lead to poor ROI.
4. Missed Growth Opportunities: Businesses might miss out on opportunities to upsell or cross-sell to customers. For example, growing customers could be interested in additional features or services, but without appropriate stratification, these opportunities could be overlooked.

Top 11 Strategies you must implement to attain SaaS customer stratification

1. Activation Triggers: Activation triggers are the events that customers perform after they sign up for your SaaS product. Activation triggers are used to determine how engaged a customer is and their likelihood of becoming paid customers. Identifying the right triggers helps to engage the customers and convert them into loyal, paying customers.
2. Customer Lifecycle Analysis: Analyzing the different stages that a customer goes through in their lifecycle helps SaaS businesses understand their customers’ behavior, preferences, and expectations. This information is then used to offer targeted marketing campaigns that are relevant to the specific customer’s lifecycle stage.
3. Churn Analysis Customer: It is one of the most significant challenges for SaaS owners. Performing a churn analysis helps to identify the reasons why customers are canceling their subscriptions, enabling businesses to create targeted retention strategies that reduce churn and increase customer retention.
4. Market Segmentation: It is the practice of dividing customers into smaller, targeted groups that share similar needs, characteristics, or purchasing patterns. SaaS owners can use market segmentation strategies to target specific customers with customized marketing messages that lead to higher customer engagement and conversions.
5. Product Feature Analysis: Understanding which features of your SaaS product are most valued by your customers is key to creating a product that meets their needs. Analyzing the usage and engagement rates of different features helps to prioritize product development efforts and improve customer satisfaction.
6. Price Elasticity: It is the degree to which demand for a product changes with price. Analyzing price elasticity helps SaaS owners determine the most appropriate pricing strategy for their products, maximizing revenue without sacrificing customer satisfaction.
7. Promoter Score: It is a simple and effective way to measure customer satisfaction. It indicates the likelihood of customers recommending your product. The score helps SaaS owners identify areas for improvement and enhance customer satisfaction.
8. Predictive Analytics: It uses data, statistical algorithms, and machine learning techniques to analyze historical data to make predictions about future events. SaaS owners that leverage predictive analytics can use data-driven insights to optimize their marketing strategies, personalize their customer experiences, and forecast their revenue.
9. Persona Development: A customer persona is an idealized representation of your target customer, including demographics, behaviors, and preferences. Creating customer personas helps SaaS owners design focused marketing and sales campaigns that resonate with their target audience, boosting engagement and satisfaction.
10. Cohort Analysis: It involves analyzing groups of customers who share the same characteristics and behaviors over time. This analysis helps to identify patterns that can be used to enhance customer satisfaction, optimize marketing campaigns, and tailor product features to meet specific customer needs.
11. Lifetime Value: It refers to the total revenue expected from a customer throughout their relationship with your SaaS business. It helps assess customer profitability and develop strategies like loyalty programs to enhance CLV.

What data should I collect to segment my customers?

To properly segment your SaaS customers, you should consider collecting a variety of data on their behaviors, preferences, and demographics. Here’s a list of some specific data points you may find helpful:

1. Usage Data: This refers to how often your customers use your service, the features they most frequently utilize, and the time they typically spend on your platform. Do they log in daily or merely once a week? Which features do they love, and which do they ignore? Their usage patterns can offer deep insights into what they value in your service.
2. Purchase History: This includes the type of package or subscription plan your customers have chosen and any add-on services they have purchased. It may also be beneficial to understand their overall spending habits – are they quick to buy new features, or do they prefer sticking with their basic plan?
3. Company Size & Industry: The size of the customer’s company and the industry they operate in can drastically impact their needs and usage patterns. A startup might have different priorities and resource constraints than a large corporation.
4. Customer Feedback & Surveys: Direct feedback from your customers can provide a wealth of information about their preferences, pain points, and the features they would like to see in the future.
5. Demographics: Though not always relevant in B2B scenarios, demographic information such as role in the company, location, and even age can occasionally provide useful insights.

How can I use customer segmentation to improve my customer experience?

Customer segmentation can significantly enhance your customer experience in several ways:

• Personalized Communication: By classifying your customers into specific segments, you can tailor your communication to meet their unique needs. For instance, a startup may appreciate resources on scaling strategies, whereas a large enterprise might value in-depth technical guides. Aligning your messaging with their specific needs and interests can increase customer engagement and satisfaction.
• Customized Products or Services: Understanding your customers’ usage patterns and purchase history can guide you in developing tailored products or services. If a certain segment regularly uses a specific feature, you might consider enhancing that feature. If another segment rarely upgrades their subscription, you could offer them a custom plan that better fits their usage.
• Targeted Marketing Campaigns: Knowing your customer’s industry, company size, and role can help you design more effective marketing campaigns. For example, a campaign aimed at IT managers in the healthcare industry will likely differ from a campaign targeting CEOs in the retail sector.
• Enhanced Customer Support: Feedback and survey data can aid in improving your customer support. If a segment reports frequent issues with a particular aspect of your service, your support team can be prepared to address those problems more effectively.

What customer data should I focus on analyzing in order to improve my customer experience?

Analyzing customer data is essential for enhancing customer experience. By paying attention to certain key data points, businesses can tailor their offerings to their customer’s preferences and predict needs before they arise. Here are some critical pieces of customer data you should focus on:

1. Demographic Information: Data such as age, gender, location, occupation, and income level can provide valuable insights into your customers’ preferences and buying behavior. For example, a company selling sports equipment might find that their products are primarily purchased by males aged 18-35.
2. Purchase History and Product Usage: By analyzing a customer’s past purchases and how they use your products or services, you can identify patterns and trends. This information can guide product development, marketing strategies, and customer support services. For instance, if a tech company notices that a large number of their customers only utilize a specific software feature, they could invest more resources into enhancing that aspect of their product.
3. Customer Feedback and Reviews: Customer reviews and feedback are a treasure trove of information. They can highlight areas of your product or service that are particularly appreciated, as well as areas that need improvement. By addressing the issues raised in negative reviews, businesses can demonstrate responsiveness and commitment to customer satisfaction.
4. Social Media and Online Behavior: Today, customers often interact with brands through social media. Analyzing customer behavior on these platforms can provide insights into their engagement, interests, and preferences. Similarly, understanding how customers behave on your website, such as the pages they visit and the time they spend, can help you optimize their online experience.
5. Customer Support Interactions: Data from customer support interactions can help you identify common issues and bottlenecks in your customer service. It can also highlight the aspects of your product or service that may be difficult for customers to understand.

Conclusion

SaaS customer stratification is not just important. It’s essential for any SaaS business’s marketing strategy. But here’s the exciting part: by employing these 11 powerful tactics, SaaS owners can dive deep into their customers’ needs, behaviors, and preferences. And guess what?

It leads to not just higher customer retention, engagement, and revenue but also the ability to truly stand out in a crowded market.

Remember, every SaaS product is unique, so finding the perfect strategies for your specific business needs is crucial. So, go ahead and implement these customer stratification strategies to unlock your SaaS business’s full potential. Trust us, you won’t be disappointed!

Haris Mirza

With 5+ years of content marketing experience in finance, B2B, sales, SaaS, and health, I am Haris Mirza. I excel in attention to detail and understanding keyword intent. My expertise helps businesses achieve content marketing goals and drive results. I love creating engaging content that resonates with target audiences. In my free time, I read books and explore new places for inspiration.