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How To Build A SAAS Product

SAAS (software as a service) is arguably the best business model because you can sell the product once and charge a monthly fee and that generates a recurring revenue for the indefinite future.
 
The first thing you need to do is to select a niche. If you have done the work in the video about the Theory Of Pii you already have a niche. If not, watch it now.

1. BUILD A SAAS PRODUCT: IDEAS

Make a list of the specific SAAS product and features that you plan to offer and the proposed pricing. These are not final decisions.
 
Just make a list based on your best judgment for now because it will be adjusted (or replaced) based on the work you will do in the next steps.
 

2. BUILD A SAAS PRODUCT:
CUSTOMER RESEARCH

 

After deciding on the product and features that you ‘plan’ to offer you need to make sure that your prospective customers really do want those features.
 
The question you’re trying to answer is this: is there an unsatisfied demand for the product that you want to offer?
 
If the answer is yes, you’re good to go. If the answer is no, then you need to spend time looking for an unsatisfied demand that you’re capable of addressing.
 
Go to social groups (like Facebook groups), Quora, and old-school industry forums to see what your prospective customers are talking about.
 
What are their pain points?
 
How can you reduce or remove the pain?
 
Is there a genuine demand for your features?
 
Based on this research, adjust your product features and/or price accordingly.
 
Check out our guide about ‘Customer Research’ to get more detail about how to do this.
 

3. BUILD A SAAS PRODUCT: COMPETITOR RESEARCH

 

The simplest way to do competitor research is to look at the products, website, social presence, and reviews of your competitors.
 
What are they doing well? What are they not doing well?
 
How do your planned product and features compare to your competitors?
 
Based on this research, adjust or refine your product features and/or price accordingly.
 
Check out our guide about ‘Competitor Research’ to get more detail about how to do this.
 

4. BUILD A SAAS PRODUCT: UNIQUE SELLING PROPOSITION

 

Before finalizing the features you’re going to offer you need a “unique selling proposition” (USP).
 
The one question that every potential customer will ask is, why should I choose you?
 
You cannot reasonably expect to succeed if you don’t have a good answer to that question.
 
Your answer to this question could be the difference between success and failure.
 
This is not just a marketing tactic.
 
The thing that makes your product unique is often something that needs to be established at the product development stage, not something that you try to add on after creating your product.
 
Check our guide about ‘Unique Selling Proposition‘ to get more detail about how to do this.
 

5. BUILD A SAAS PRODUCT: UI/UX

 

It’s not enough to offer the features. You also need to think about the ‘user experience (also known as the UX) when they use the features.
 
It should intuitive, efficient, and ‘pleasant’.
 
There’s an endless number of examples of apps and tools that provided powerful features with a bad UX and had trouble competing with other products that had less powerful features but offered a better UX.
 
Your primary goal should be to make the experience as painless as possible and exceed the expectations of your customer because it will help you to retain existing customers.
 
It will also result in good reviews and testimonials which will help you get new customers.
 
Customers want:
  • Functionality that solves the specific problem stated in your sales copy
  • No unpleasant surprises relating to pricing
  • An intuitive user experience
  • An aesthetically pleasing user interface
  • Clear and obvious ways to get support if required
 

6. BUILD A SAAS PRODUCT: SOFTWARE DEVELOPMENT

 

You will need a budget for software development and you will need to know how to manage developers.
 
The best and simplest way to start is to create a list of features (or a Statement Of Work) then post an ad on a freelancer website like Upwork and Freelancer.com and ask them to give you a fixed price quote for the completion of the project.
 
These quotes might not be very accurate but, if you get several quotes (and feedback), you will start to get a feel for what you can build, how long it will take, and what it will cost.
 
In most cases, this will not be the time to go ahead and start development.
 
You should use this feedback to add and subtract features as required and maybe adjust your budget, timeline, and business model if necessary.
 
This is where you have to make a decision about what will be included in version one of your product.
 
This is your minimum viable product or MVP – the smallest version of your product that is required to validate your idea.
 
Then, after making these adjustments you can go back to the developers that provided quotes and select the best one for the job.
 
Keep in mind that it is typical for budgets and timelines to multiply by a factor of two.
 
It’s critical to factor this into your planning.
 
There are endless stories of ideas that were only partially built due to the founder running out of time, money or both.
 
Check out our guide about how to hire and manage freelancers.
 

7. BUILD A SAAS PRODUCT: CUSTOMER SATISFACTION

 

SAAS products are never finished. You will always be fixing bugs, improving existing features and adding new features.
 
This means that you will always have a development ‘roadmap’ that outlines what will be developed and when.
 
The question is, how do you prioritize all of this work? You need to get feedback from your customers.
 
After your customers have had an opportunity to use the product you need to review everything:
 
Send your customer a survey that includes two or three multiple choice questions that can be completed in less than 60 seconds.
 
After completing the survey, ask your customers for a review/testimonial/case study.
 

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8. BUILD A SAAS PRODUCT: MARKETING

 
Content Strategy
 
For most people I strongly suggest the following content strategy regardless of the product or service you’re selling:
  • Creating one new piece of high-quality content (article, video or audio) once per week
  • Post it on your blog and social channels
 
This is the long list of benefits that come from this simple strategy:
  • The content demonstrates your skills and expertise in your niche
  • Publishing content frequently is an important trust factor
  • Your social channels will be active and this is also an important trust factor. Some people think that a dormant social profile means a dormant business.
  • Your content can potentially rank well for some keyword searches and generate free traffic from multiple platforms.
  • You can send a weekly email to people on your email list that includes a link to new content. This gives you a “legit’ reason for emailing them instead of spamming them with offers to buy your product or service.
    • People on your email list will be reminded of your product, see more evidence of your expertise and you will be “top of mind” when they need your products or services in the future.
  • If you decide to use ads, this content will help you to increase your conversion rate because it increases your authority
  • If you decide to partner with other businesses this content will make them feel more confident about working with you
  • If you decide you want to generate referrals from other people, your referral partners and the referrals themselves will all be more likely to work with you if you have demonstrated your skills and expertise in your content.
 
Check our guide about ‘Content Strategy’ to get more detail about how to do this.
 
Create Awareness: Search
 
Search (organic): You can use a Search Engine Optimization (SEO) strategy that allows your content to appear in the search results for a keyword in your niche.
 
If you follow my content strategy then the only thing you need to do is optimize the content for search.
 
Check out our guide about Search Engine Optimization to get more detail about how to do this.
 
Create Awareness: Social Media
 
Decide which social channels to use.
 
You should use the platform that is most popular with your target customers.
 
If there is more than one, use the social platform that you personally prefer.
 
Try to “squat” on your username on the social platforms that you don’t use so that you can maintain consistent branding if you decide to use them in the future.
 
If you follow my content strategy then you will have content for social media ready once per week.
 
The content demonstrates your expertise and reminds your followers of your features and any special promotions without doing any extra work.
 
In order to generate revenue from social media (organically), you need to build a following then direct a portion of them to your website then encourage them to buy, schedule a call, or signup for your newsletter.
 
You can build your following by engaging with your target market in the groups where they congregate on the social platform where you want to grow your following.
 
The more useful comments you make, the more people will see your name, and a portion of them will check your profile and follow you.
 
Find groups that relate to your topic then find questions by members that you can answer with your weekly content.
 
Provide a bullet point outline in the group chat and link to your article on your website for more detail.
 
A portion of them will follow you, buy, schedule a call or sign up for your email newsletter.
 
Check our guide about ‘Social Media Strategy‘ to get more detail about how to manage social media.
 
Create Awareness: Advertising
 
If people are actively searching for what you’re selling then search ads are a great way to put your product or service in front of people when they’re interested in buying.
 
If people are NOT actively searching for what you are selling then social media ads are a great way to create a highly targeted audience that can be used to promote your product.
 
Check our guide about ‘online Advertising’ to get more detail about how to do this.
 
Create Awareness: Referrals & Partnerships
 
Look for businesses that will agree to enter into an arrangement with you where both of you agree to cross-promote each others’ products to each others’ customers or followers.
 
You can do this on ‘I Imagine’.
 
Instead of ‘cold contacting’ people, just check some boxes that match your objectives and let the algorithm find people that meet your criteria and actually want to connect with you.
 
Use it to find co-founders, funding, collaboration partners, promote your brand to the social followers of another business, find sponsors for events or just connect with like-minded people.
 
Repeat Customers
 
It’s much easier to generate revenue from existing customers or former customers than from people that have never been a customer.
 
If you follow my content strategy then you will be contacting existing customers once per week and reminding them of your features and any special promotions without doing any extra work.
 
Email Marketing
 
If you follow my content strategy then you will have an effective email marketing strategy without doing any extra work.
 
People that consume your content may not be ready to buy today but they might be ready to buy in the future and the weekly email that links to high-quality content is the best way to stay ‘top of mind when your prospect is ready to buy.
 
Check our guide about ‘Email Marketing’ to get more information about how to do this.
 
Funnels
 
Create a sequence (the funnel) that outlines your customer journey.
 
For example, if you want to attract customers with Search Engine Optimization that leads to a blog post then leads to a sales page and a sale of your product, your customer journey (funnel) would be:
 
Keyword search > read a blog post > read a sales page > purchase
 
You should also give people the option to signup to your newsletter when they read your blog.
 
This allows you to build a relationship with people that did not buy anything after reading your blog.
 
You can send them a weekly email that includes a link to your new blog post each week (or whatever content you created) and also includes an offer relating to your product.
 
The blog post will typically be about how to do something and you can showcase your product as part of the solution.
 
After creating this sequence, you just need to track and optimize each step on an ongoing basis.
 
The funnel that I suggest you create is very simple and very effective. Decide on how you will create awareness then direct the traffic to content (blog, video, audio), capture an email address, send a weekly email that contains an alert about your new weekly content and offer your product or service. Repeat indefinitely.
 
Check our guide about ‘Funnels’ to get more detail about how to do this. You should also check out our guide about ‘Your PAC Strategy’.
 

8. BUILD A SAAS PRODUCT: MARKETING METRICS & ANALYTICS

After setting your marketing strategy into motion you need to make sure it actually works and that means setting up your analytics.
 
There are 5 critical metrics that you should always focus on:
  • The number of visitors to each content page or landing page
  • The % that converted to leads
  • The percentage that converted to customers
  • Average “customer acquisition cost” (CAC)
  • “Lifetime customer value” (LCV).
 
These 5 simple metrics can tell you almost everything you need to know about how effective your overall marketing strategy really is.
 
Check our guide about “Metrics & Analytics” for more information about how to do this.
 
If you’re looking for information about building software, check out this guide from Clockwise.

Download Our Free ‘Start A Business’ Guide

Use our “Impact Entrepreneurship” checklist to start your business and make the world better.

  • Adam Radly

    Founder
    Founder of IIMAGINE. More than $100M raised. TEDx Talk about passion > 1 Million views. Founder of World Reconciliation Day with Nelson Mandela. Founder of One Direct Democracy.