Think your internal marketing and sales are enough to win the market? Think again. To reach every prospect, you need to reach outside your team.
To successfully market and sell software, SaaS companies need to build both distribution and trust in their target market.
Distribution is how a product’s prospective customers actually discover it, or how it’s introduced to them. For example, it could be through an organic search query, a paid ad or a referral from another customer — whatever channels a product gains awareness through.
Trust determines how willing a prospect is to purchase a product after discovering it. This is especially true in the context of B2B software, where these decisions are often high stakes and involve multiple decision makers comparing competing products.
Succeeding at one of these alone isn’t enough. A product that’s trusted by its core customers will ultimately fail if new users can’t discover it. On the flip side, well-distributed, highly discoverable products will struggle to close sales if prospective customers (or their coworkers) distrust their product and the business behind it.
Typically, SaaS companies build out their internal marketing and sales teams to handle all of the above, and this works perfectly well… to a point.
While every SaaS company needs a solid internal marketing and sales process to drive distribution and build trust with its target audience, there are hard limits on what internal teams can accomplish alone — along with certain situations where internal teams are actually at a disadvantage. This is where partnerships come into play.
In this article, we’ll cover:
- The limits of internal marketing and sales teams
- Why you need partners to reach the entire market
- The types of partner programs that make sense for SaaS
The limits of internal marketing and sales
The most obvious challenge in relying solely on your internal teams to market and sell your product is that your success is limited by your team’s headcount. Even when your team is running smoothly, bringing on new talent requires significant investment in both ramp-up time and fixed costs.
Eventually every business hits a point where growing revenue proportionally to the team is no longer feasible. This is often the stage when growth at a startup plateaus, as reaching and acquiring new customers becomes increasingly difficult and costly, with the most obvious optimizations to the marketing and sales funnel having already been done.
This can lead many companies to conclude that the total addressable market for their product is simply smaller than they thought — when in reality, they’re reaching only a fraction of prospects that are a great fit for the product.
Those prospects are just shopping for something else.
When internal teams lose on distribution
If you’re selling software to businesses, there’s a good chance that your customers aren’t just in the market for a single product, or looking to solve a single problem. They’re likely about to make a shift in their business strategy and looking for what’s necessary to make that shift happen, whether that’s one tool or (more than likely) multiple tools working together.
In this situation, looking for a product might not be your target customer’s course of action at all. They could instead look for a partner to work with them to build the strategy, implement their entire plan and select every tool in their tech stack.
If your target customers already have relationships with consultants, resellers or distributors that they trust, your product might never have an opportunity to enter the conversation at all — they’ll simply go with what their partner recommends. This presents a massive risk if your competitors have partner programs of their own and you don’t, because it means consultants, agencies and resellers have every incentive to not sell your product to customers.
It also means affiliate marketers have no reason to even mention your product in the same breath (or blog post) as your competitors. Even if your target customers do decide to select and implement a solution on their own, if you’re not coming up in comparisons to the competition, you’re unlikely to make the cut for consideration.
When internal teams lose on trust
You might be thinking that this can all be offset with great marketing and a stellar sales team. Surely if your internal teams can create useful content, get as much reach as every affiliate marketer, and understand your customer’s needs as deeply as any agency they’ve worked with, there’s no way you could still be at a disadvantage?
First of all: good luck! Secondly, even if you accomplished all of the above, you’d still be disadvantaged by the simple fact that the smoothest marketing and sales teams are still ultimately a company speaking on behalf of itself, with the clear intention of selling its product. Your customers see this. But that isn’t how your customers see partners.
Even if affiliates and resellers get paid for promoting, selling or implementing a product through its partner program, their ultimate incentive is in retaining and growing their business through their customers. Their commitment to their customers goes beyond any particular product. The tools they decide to sell to customers are the ones that both solve their customers needs and give partners meaningful incentives to sell them.
None of this is to say that internal marketing and sales don’t matter — they’re absolutely vital to any SaaS business. But if you rely solely on them, you’re missing out on countless qualified opportunities and artificially limiting your revenue growth.
In his article “5 questions to answer before launching your partner program”, PartnerStack co-founder Luke Swanek explains how internal success can translate into success for potential partners:
“If you’re not able to close customers on your own, you won’t be able to close partner referrals — and resellers won’t get the resources they need from your team to succeed. And if you can’t retain the customers that partners are bringing to you, it’s impossible for a program to generate positive ROI.
But if you do know who your audience is and how your product provides value, partnerships can help you reach even more of the right kinds of customers.”
How partners scale the SaaS pipeline
The type of partner program that makes the most sense to launch first depends heavily on which metrics you want to drive.
- Marketing partners — such as affiliate marketers and content creators — are best for driving traffic to your site or campaigns, and driving awareness of your product within a specific market.
- Referral partners include consultants, agencies, and even existing customers that refer qualified leads to your internal sales team to close the deal.
- Reseller partners manage the entire sales process and customer relationship, working with your internal team to support their customers.
For example, when the team at leading landing page tool Unbounce launched their first partner program, they chose to launch a marketing partner program focused on getting new audiences to discover the product and start a free trial.
Anca Bujor, Unbounce’s Channel Partnerships Manager, explained in a case study of their program: “Unbounce’s most important KPI by far is New Trial Starts. Over half of the people that try out Unbounce as free users end up converting to paid users — an exceptional rate for any SaaS company.”
Today, 25% of Unbounce’s New Trial Starts come from partners in Unbounce’s partner program. Partners are incentivized to bring in the most qualified traffic possible, because they only earn money when those free trials convert to paid accounts — and then continue to earn 20% of the revenue for as long as those referrals remain paying customers.
While Unbounce’s program contains over 5,000 partners and drives a quarter of its new users, it’s managed largely by Anca herself. That type of scale wouldn’t be possible if the program was managed over email and spreadsheets. “A crucial step in launching our program was finding a partner relationship management platform that supported our subscription-based payment model, and could scale up quickly.”
Partner relationship management (or “PRM”) platforms are geared towards ecommerce affiliate programs with single conversion points, not B2B SaaS companies with complex conversion paths. What made PartnerStack stand out to the team at Unbounce was its ability to to automate and track the entire partner journey.
“I love that now, other teams in the company feel like they own KPIs connected to partnerships. Partnerships isn’t an experiment for us — it’s an integral part of how we acquire customers. PartnerStack has helped make this possible, giving us a single source of truth to measure and optimize program revenue, for both us and every partner we work with.”
Next steps for exploring SaaS partnerships
Launching a partner program for your SaaS business helps you drive recurring revenue from all-new audiences, while supporting your marketing and sales teams by bringing in more qualified traffic, leads and customers.
Interested in learning more about how partnerships can drive SaaS revenue?
- It’s almost always the right time to get started with partner programs, but you can make sure you’re ready by reading “5 questions to answer before launching your partner program.”
- Learn about how Unbounce launched and scaled their partner program to success in “How Unbounce drives 25% of trial signups from 5k+ partners”.
- Check out the different types of PRM platforms. We’ve already mentioned PartnerStack, but you can see all of the most popular platforms (and how PartnerStack compares) on software review website G2.
Learn more about how PartnerStack supports fast-growing SaaS companies like Unbounce, Asana, Adzooma and more at partnerstack.com.
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