Building a new SaaS is quite a task. From conception to execution, you want to create something useful, something which customers will flock to and recommend to others.
The thing is, so does every other SaaS founder out there and there are a lot of them. The situation is only projected to explode further, with research from IDC finding; “worldwide spending on public cloud services will grow at a 19.4% compound annual growth rate (CAGR) — almost six times the rate of overall IT spending growth – from nearly $70 billion in 2015 to more than $141 billion in 2019.”
There are huge numbers of SaaS being launched every year, but many of them will fail inside that year. CB Insights found that one of the key reasons for SaaS failure is poor product/market fit.
If you’re creating another “me too” SaaS, you risk that you too will face poor product/market fit. You might see a very popular app and think you’d like to target that market too, but how will you be any different to prominent players who are already there?
What you need is your own unique tilt. You’re not likely to take out the big players in a category all of a sudden, but you can deliver unique value which they are not and develop an audience of your own.
Identify Your Core Purpose
There has to be a good reason for the existence of your SaaS, and “SaaS seems lucrative so I thought I’d build another Dropbox” really won’t fit the bill. The chances are, there are several competitors already in any vertical you might choose, many of them with cash to burn when it comes to developing.
You might be building a product in a big category, but avoiding “me too” means you should have a unique take which will truly deliver additional value to customers.
Some places to start might include:
- Identify something you are passionate about but seems to be lacking.
- What annoys you about SaaS that are already available?
- What annoys your potential customers? You should always conduct research to validate your market and that could include starting conversations in online forums such as Quora or Hacker News.
Solve a Real Problem
Why do SaaS exist? Generally speaking, it’s to somehow make life easier for the customers they serve by solving problems that matter to them.
The challenge is to find a problem that is “real” enough that the potential customer is going to care about it. As Kenny Fraser points out in this Medium post: “There is no easy formula to define a business problem. At heart it is always about change.”
One of the first hurdles for any SaaS is to convince prospects that a problem matters enough for them to make a change and adopt the SaaS solution. People are naturally resistant to any kind of change, so you’d better be making a compelling argument to overcome their natural inertia.
Your Value Proposition
Why should a client choose your app over your larger, better-known competitor? Well, all apps were unknown at some point, the key to taking off is that you’ve really nailed down a unique value proposition which differentiates you in your category.
Here’s the thing; many SaaS fall into a trap of believing their value is based on price, but this is tenuous at best. If that’s all you’ve got, how easy is it for someone else to offer a similar feature set and edge you out by offering it at a lower price? You will always find those customers who are highly price-focused and they’ll be gone overnight when a cheaper option comes up. The key is to have something more tangible, something which goes toward really solving the customer problem in a unique way.
Bootstrapped forum hosts regular discussion around creating SaaS, including whether building a SaaS designed to be a low cost alternative to a competitor is a good idea. While people agree this could be a strategy that works (at least in the short-term), you might find that you’re only “stealing the bottom-feeders” from your competitors (those who will quickly leave you for a cheaper option).
You’ve really got to think about it in terms of unique benefits to the customer which don’t include price, here’s a good answer from user Rich Buggy:
“I think there’s always room for a cheaper alternative but I wouldn’t position it that way. Some better options that come to mind:
1. If there’s a big service component then be the self serve version.
2. Be the cut down version for people who don’t need every feature your competitor offers.”
Your value proposition isn’t a trite slogan or aspirational statement you fasten to the office wall, it’s where you clearly communicate the unique benefit to the customer which your feature set provides.
Think about aspects such as:
- Any unique features – how are they solving a real problem?
- Customer support – perhaps you offer better support options?
- Integrations – you might be able to offer integrations with popular tools which others are not.
- User experience – a common complaint about SaaS is that the in-app experience doesn’t match the shiny “packaging”, or that it’s overall too complicated to use. How is your in-app experience better?
Deliver on Value
Why should your customer stick around with your SaaS? There are plenty of relatively expensive options out there which have engaged, loyal customers. Why? Usually they are delivering exceptional value and genuinely helping the customer reach a desired outcome they have.
Lincoln Murphy is a prominent SaaS marketer and coach who writes regularly on anything SaaS marketing at his Sixteen Ventures blog. Out of the many pearls of wisdom from his years of experience, when it comes to why customers stay he says this:
“If you say they’ll stay “because it’s hard to take their data with them” – while I commend your attempt at vendor lock-in – that’s the wrong answer.
Lock-in doesn’t make you unique… it makes you frustrating to deal with. Frustrating situations often inspire determined creativity to resolve… and that resolution is your pissed off customer leaving you for your competitor who put themselves in a better position in your customer’s brain than you…. and has a nice little import tool for your hard-to-get data.”
Retaining the customer is about helping them to continuously realize value from your SaaS. For that to happen, you need to always be looking for ways to deliver; how can you make innovative additions to what you offer, whether they are new features, improved UX, better service or exclusive offers?
The “me too” SaaS tends to spend a lot of time focusing on what their competitors are up to and paddling furiously to try and keep up. If you want to be truly unique, spend more of your time listening to your customers and what they really want. This is how you can not only deliver value, but deliver something that is not so easily copied or found elsewhere.
If the core aim of your SaaS is to solve those “real” problems while delighting your customer, not only will you set yourself apart from the “me too’s”, but you’ll probably even find yourself able to draw customers from any of the behemoths who are already in your vertical.
Creating Your Unique SaaS
The SaaS market is huge and becoming increasingly crowded in every category. How will you avoid being another “me too” and carving yourself a unique position in your vertical?
It starts with researching your potential market, identifying your customer and having a true core purpose other than “SaaS could make me a lot of money.”
Your SaaS needs to solve a real problem that actually matters to the customer, have a unique value proposition and constantly be delivering on value. This way you create a loyal audience of “your people” and truly carve out your own space in the market.
Need help with creating your own unique app? Talk to Koombea about your needs today.