Software as a service (SaaS) solutions have changed how we do business. From recruiting to marketing, many of our workflows rely on subscription-based tools.
SaaS companies diversify their products to meet the needs and abilities of customers by offering multiple packages. Generally speaking, there are three tiers: individual, business, and enterprise.
This guide discusses how to target high-value enterprise customers. You’ll learn about the most effective marketing channels, and approaches that you should be using to connect with key decision-makers so your team can win those high-value accounts.
Why Should SaaS Companies Target Enterprise Businesses
One of the critical decisions SaaS companies make is deciding which customers to target – enterprise or small-medium businesses (SMBs).
Many SaaS companies adopt the longtail targeting strategy because SMB buying cycles are shorter with low friction conversions and lower customer acquisition costs.
Also, there are a lot more SMBs than there are enterprise firms.
There’s safety in numbers.
However, research shows that 22% of small businesses fail in the first year, 32% in the first two years, and 50% within five years.
Enterprise companies boast higher survival rates and, despite a smaller pool, promise higher average revenue due to the number of seats and a higher customer lifetime value.
Dealing with enterprise businesses requires a different approach to SMBs. There’s lots of bureaucracy, and the sales cycle tends to be longer. You’ll have to build out a sales team and spend lots of resources on strategies like Account Based Marketing (ABM) to attract and retain enterprise clients.
Your SaaS product developers will also have a headache, creating unique features that an enterprise may ask for.
So, is all this trouble really worth it?
Ultimately, it depends on your goals and approach to market.
Creating an enterprise customer base is one of the best ways to reduce churn and boost your net revenue retention. These clients have more money to spend and stay with you for longer. You just need to give them a product that matches their expectations.
Key Considerations for the Enterprise SaaS Business model
Enterprise SaaS is here to stay, dominating the forecasted $702 billion growth of the cloud app market. But before you take a slice of that pie, there are a few things you need to consider.
1. Platform Expectations
Enterprise SaaS is a software solution that gives enterprise-level businesses a robust package with lots of customization options to meet their insanely high demands.
Let’s use Slack as an example.
Slack is a popular messaging app that has revolutionized the modern workspace. But like most SaaS brands, Slack understands that enterprise businesses have unique needs.
For instance, they have higher security, collaboration, and customization expectations. As a result, they provide unique features to enterprise businesses.
Among others, they provide large-scale collaboration, higher security and compliance, custom terms of service, and so on. You can see how they differentiate this service by looking at the price comparisons.
It’s not just about the needs, though.
Enterprise businesses cannot afford bad publicity. Can you imagine the headlines (and repercussions) if Microsoft was on the news because they used software that resulted in a massive data breach?
That’s why enterprise businesses have such high software stack requirements. You’ll need to keep this at the top of your mind if you want to secure enterprise clientele. That brings us to the next question.
2. Customer Service Experience
Enterprise businesses don’t just pay premium prices for your product. They pay for a seamless experience.
You need to provide a superior customer experience. That’s why SaaS brands like Zapier use dedicated support and enhanced security to differentiate enterprise products from lower-tiered plans.
You have to make peace with the demands of enterprise customers too. You’ll have to invest in account managers and significant product improvements to retain these customers.
3. Effective Marketing Channels
Enterprise buying cycles are long (six or more months) and complex, involving costly investments, higher risks, and many stakeholders.
You’re not only persuading them your product is the solution they need. You must also convince them that your SaaS brand is the right fit for their business. That requires relationship building.
The most effective marketing channels for building relationships are events like SaaS conferences and ABM.
Content marketing does work. But thought-leadership SaaS content marketing is more effective than top-of-the-funnel definition terms. A 2020 report by Endelman discovered 88% of decision-makers found thought leadership to be an effective approach for enhancing the perception of a company.
Unfortunately, the same survey discovered only 17% of the thought leadership content they read was good or excellent. There’s clearly an issue here.
Take Writer as an example.
The company launched an effective enterprise SaaS SEO strategy to establish thought leadership in its niche. They did this by investing in AI guides.
The content they are producing helps decision-makers understand how companies are investing in AI for content marketing. It’s produced to educate prospects about the market, not generate an instant conversion.
4. Enterprise SaaS Churn Rate
Enterprise customers tend to have lower churn rates than SMBs.
The graph below shows the churn rate declining as the account value increases.
Higher prices, lengthy contracts (enterprise firms tend to opt for annual subscriptions), and increased friction from switching products result in higher retention.
But this doesn’t mean you should take it easy. When annual-based subscribers churn, the compounding effect hits your bottom line hard.
5. Enterprise SaaS Pricing
Are you looking at your competitors to price your SaaS product? If you are, you could be leaving money on the table.
Your pricing strategy should be driven by value, but only 39% of SaaS companies do that.
Enterprise prices should reflect exclusivity to justify the premium tag – whether it’s more features (tiered pricing), more users (per-user pricing model), or higher limits (per-usage model).
The objective is to center price points around the product’s perceived value.
Whatever model you choose, don’t forget to factor in your costs and customer behavior.
How to target Enterprise Customers
So, how do you get the big catch? Two ways:
1. Create a Robust Go-To-Market Strategy
You won’t catch a whale by casting a wide net. You need a strategic plan of action to position and launch your product in the market.
It should have the following:
- Ideal customer profile
- Clear value proposition
- Pricing strategy
- Outline of sales and marketing activities
Loom (previously Opentest) launched its video messaging app on Product Hunt, a community-driven platform where tech creators share and showcase their products.
The community provided valuable insight into use cases and ways to innovate the product.
But what if you already have a functional product and you’re simply looking to go upmarket and target enterprise businesses?
The bad news for you is that this process is anything but easy. You’ll need to possibly make significant changes to your product to fit the enterprise market. That’s in addition to implementing a hiring strategy that supports enterprise customer acquisition and retention.
Essentially, building out your sales team and customer support teams.
The whole process may require making some really tough decisions too.
For example, Sujan Patel, the co-founder of Mailshake, ended up firing most of his marketing team, stopped investing in the SMB market, recruited a sales team, and made a bunch of other changes to move upmarket.
I recommend listening to the interview where he discussed his approach on Youtube.
2. Focus on Account-Based Marketing
SaaS ABM weeds out unqualified leads early in the sales and marketing process by identifying and targeting specific high-value customers.
Think of it as a VIP invitation. When event planners court the attendance of high-profile individuals, they ensure the event is relevant and beneficial to the VIP.
The concept holds in SaaS marketing. Sales and marketing teams work together to deliver personalized messages that speak to these companies’ pain points and goals.
LiveRamp used ABM to drive $50M annual revenue from 15 accounts. The data enablement cloud platform sourced its targets from Fortune 500 companies with at least $50 million in annual revenues.
They then deployed a multichannel outreach approach featuring display advertising, email marketing, and outbound sales calling.
Examples of Enterprise SaaS Solutions
We’ve compiled a list of enterprise saas market leaders and up-and-coming contenders to give you an idea of the features you should offer enterprise buyers.
Salesforce is a leading customer relationship management (CRM) tool. It helps businesses build strong connections with customers. Enterprise businesses get:
- Unlimited user roles
- Forecasting customization
- Workflow automation
- Web services API
The professional plan is marketed as a complete sales solution for any sized team. To up the ante, Salesforce makes customization the selling point of the enterprise plan.
Google Analytics 360
Google Analytics is a free tool for people who want to track web traffic and page performance. Analytics 360 is tailored to the needs of large enterprises with features such as:
- Machine learning automation
- Real-time reporting
- Integration with Google and partner solutions
- Access to dedicated support specialists
The big draw of the Analytics 360 product is advanced tools like unsampled reports, BigQuery, and data freshness that help enterprise teams get the most out of their vast and complex data.
Writer’s AI writing tools help marketers create SaaS inbound marketing assets faster and align them with brand guidelines. Enterprise users get these added features;
- Custom language training
- Different style guides for multiple teams
- Customized writing rules
- 24/7 phone, email, and video support
For businesses with multiple teams and content distribution, the enterprise plan provides additional controls to ensure consistent brand messaging across the board.
Ahrefs offers one of the world’s leading SEO solutions, with tools for keyword research, link building, and competitor analysis.
In addition to the features in the lower plans, enterprise teams get;
- Unlimited backlink history
- Access control management
- Listing on the company’s exclusive directory
- Payment options
Data is king, and Ahref’s enterprise users have access to more SEO data than competitors on other plans, allowing them to leverage the best keywords and backlinks.
Atlassian’s collaborating software enables IT and business teams to deliver faster product deployment with intelligent, automated workflows.
All Atlassian users have access to its suite of products. What sets the enterprise account apart is;
- Unlimited instances
- Technical account management
- 24/7 customer support
- Data residency controls.
The selling factor for enterprise accounts is the user experience, with features, functions, and content designed for scaling businesses.
What Distinguishes Enterprise SaaS from B2B SaaS
The main difference between Enterprise SaaS and B2B SaaS is scale. Enterprises generate billions in revenue, use global supply chains, and have thousands of employees.
So, while they have similar needs as B2B businesses, enterprises require dynamic solutions to manage massive workflows.
Enterprise solutions are usually the most expensive option, requiring potential customers to contact the marketing team for a quote. The higher price tag covers integrations, features, and support not available in lower tiers.
Slack’s enterprise-level plan, for example, is designed to meet the needs of global companies with unlimited features, regulatory compliance, and 24/7 priority customer support.
Enterprise workflows are complex, requiring unique customizations with multiple software. Integrations build ecosystems with the apps enterprises already use. That creates value by simplifying workflows and increasing productivity.
The above graph shows that the number of SaaS apps a company uses grows with the number of employees. To attract Enterprise buyers, you must support as many integrations as possible.
Enterprise SaaS should be able to manage large-scale operations and provide the best-in-class features like intelligent automation and real-time analytics.
And with a price tag in the thousands, the customer support must be nothing less than excellent. Think consultation and training services.
Enterprise SaaS FAQ
Enterprise SaaS is a business model that allows cloud-based software companies to sell solutions to enterprise organizations on a recurring basis. Software companies typically create a special package with advanced features that meet the unique high demands of enterprise businesses.
Your SaaS company should target enterprise companies through account-based marketing and in-person events. These strategies are markedly different from what works for the SMB market. Read the article to discover how to target enterprise SaaS customers.
When businesses scale up, they turn to enterprise SaaS to meet their growing and complex needs. High-value products with higher limits, advanced reporting, and dedicated customer service are just some of the things large and scaling companies expect from SaaS providers.
Hopefully, this guide has opened your eyes to the vast opportunities that come with going upmarket. The long sales cycle and specific product requirements may seem daunting, but the reward is worth the effort.
High revenue and low churn make enterprises great customers for stable, sustainable SaaS growth.
Nico is the founder of Crunch Marketing, a SaaS marketing agency. He works with enterprise SaaS clients like Writer, Right Inbox, and Surfer SEO, helping them scale lead generation globally across EMEA, APAC, and other regions.