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6 Important Customer Journey Stages in a SaaS Business

When it comes to understanding customers, one of the first steps a SaaS business should take is mapping out customer journey stages. Once you know how your customers interact with your company and your product and how they do it, you can optimize these touchpoints and improve the customer experience.  

There are different ways to think of how customers interact with your business. The popular consensus is that customers first feel the need, then start on their quest to find the solution, and then find your product and buy it. Retention, then, is all about whether they are satisfied enough to stay or leave for another product. 

There are nuances to this model. To optimize the touchpoints between you and your customers, you need a more granular and realistic customer journey model. Let’s see what customer journey is and what it looks like for a SaaS business. 

What is the customer journey?

Customer journey is the set of interactions a customer completes when they buy a product/subscription. It includes all the stages and touchpoints customers navigate as they engage with your brand.  

A customer journey starts when the customer realizes they have a problem and need a solution. When interacting with the SaaS company, the company uses a user-centric approach to drive them toward a desired outcome that aligns with the customer’s needs.

As per this report, 77.3% of brands understand that customer experience is a key performance indicator for a brand’s success. However, there’s a significant contrast between how companies perceive their own customer experience and the actual sentiments of their customer base. 

Even though most companies rate themselves 8 or 9 out of 10 in terms of customer experience, their customers don’t think so. A mere 11% of companies score above 9 in terms of customer experience when viewed from a customer’s perspective. Moreover, only 41% of the organizations score seven or higher on the above scale. 

A good customer journey can close this gap by aligning customer interest with the organization’s. It is a detailed interaction strategy that creates lasting relationships between the company and its customers. 

6 Critical customer journey stages 

  1. Initial out-of-market stage 
  2. Trigger and evaluation stage 
  3. Acquisition stage
  4. Adoption and experience stage 
  5. Renewal and expansion stage 
  6. Advocacy stage

1. Initial out-of-market stage 

This is the first stage of the customer journey in which the organization tries to target customers through awareness campaigns. They try to use organic and inorganic channels to capture customer attention. This may include social media branding, email marketing campaigns, pay-per-click campaigns, and top-of-the-funnel content such as blogs and infographics. 

Of course, your touchpoints may not always engage targeted decision-makers. However, they might help you connect with people who are in a position to influence those decision-makers.  

From a customer’s perspective, users at this stage might be someone who faces a specific problem regularly and is searching for a solution to fix it. They might do random searches and read blogs related to their problem. Even if they are aware of products that might potentially solve their problems, they might not not be looking to buy just. 

Hence, at this stage, it’s crucial to create top-of-the-funnel content that triggers customer curiosity and gets them started on their customer journey. 

Blogging is a popular way to do so. As per Orbitmedia, bloggers who publish more report stronger results than those who don’t. Furthermore, companies who blog generate 67% more leads than those who don’t. This is unsurprising, as 72% of all B2B buyers start their customer journeys with a simple Google search. 

You can use metrics such as website views, number of clicks, ad/YouTube click-through rate, and search engine traffic to understand the effectiveness of your campaigns. If you’re running email campaigns, you can also track metrics such as open rate, newsletter signups, etc. 

It’s important to mention that B2B and B2C selling are vastly different from each other. This means customers might have different touchpoints, and different metrics need to be tracked for B2B and B2C selling.  

2. Trigger and evaluation stage 

During this stage, customers start looking at software products to solve their problem. They could create a list of comparable, functionally similar solutions.  

This stage is also called the trigger stage since the customers at this stage are often triggered by a specific problem, i.e., they might even have a particular use case in mind while searching for a solution. They also want to know how your product differs from your competitors. 

As per this report by Demand Gen, 55% of new B2B buyers rely on content for researching new solutions to their problems. They use seminars, survey reports, and case studies to research new information related to their topic. 

That’s why, at this stage, organizations use top-of-the-funnel content that educates customers and guides them toward the company’s product offering. This includes highly targeted lead magnets such as listicles with the pros and cons of different products and comparison charts that compare their product with a known competitor. 

They might also use social validation features such as customer testimonials, reviews, etc, to entice them towards their product. Furthermore, you can use customer success stories that focus on specific use cases. 

These are important for highlighting the organization’s grasp of customer issues and showing how they can solve those issues.    

3. Acquisition stage 

Customers at this stage start their buying phase and get on board with the platform/product. This stage is important because it marks the point at which potential customers officially become product users. This also means that this is the stage of final hesitation, i.e., if your signup process is time-consuming or confusing, customers might drop off from this point. 

Read more: Push Unfinished Registrations to Complete Signup

Many SaaS businesses give their customers demos and free trials of their product. Generally,  companies that offer free trials experience higher conversions than those that don’t. As per this data, more than half of buyers converted to a monthly or annual subscription at the end of the free trial. 

Businesses use specific touch points such as the landing page, checkout page, and FAQ section to make this process as seamless as possible in order to increase trial conversion rates. After the customer signs up for the free trial, they can add additional touch points to the process, such as a welcome kit, onboarding emails, and registration confirmation to the list. 

The organization uses these touchpoints to ensure customers understand how to use the product and reach the value of solving their issues as soon as possible, also known as the Aha moment

You can also track different metrics, such as the number of demo signups, average time spent on a purchase, cost of customer acquisition, and responsiveness to email newsletters, to understand the effectiveness of your customer acquisition strategy

4. Adoption and experience stage 

After customers start using your product/platform, they embark on the next stage of the customer journey, i.e., product adoption and experience. At this stage, first-time/casual users get converted into paying customers, i.e., they renew their membership and provide their credit card information to the organization to charge them. 

This is a huge step since this is the first opportunity for businesses to generate revenue from their customers. It also allows the company to collect user feedback, which can then be used for improving your products.  

Organizations use several touchpoints at this stage to retain customers and convince them to renew their subscriptions after the initial trial period. They provide in-app guidance and phone call support to guide customers towards the best features of the product. They can also use pop-up ads and video tutorials to convey their point. 

You can also create a customer knowledge base so your users don’t have to contact support for trivial issues. Creating customer forums and communities also goes a long way in improving your customer experience, reducing churn, and increasing customer lifetime value. 

This is important since Harvard  Business Review has famously stated that increasing customer retention by 5% can lead to a 25-95% increase in business profit

At this stage, you can track metrics such as email open rate, number of support tickets raised, content engagement, user churn, etc., to understand if your customers like your product and if it can fulfill their needs. 

Often, when a product doesn’t satisfy user requirements, it can turn them away. Therefore, to improve adoption, it’s a good idea to prioritize 24/7 customer support.  

Read more: 9 Customer Retention Strategies to Try in 2024 (+ Real Examples)

5. Renewal and expansion stage 

This stage primarily focuses on retaining existing customers and moving them towards the high pricing tiers of your product. In this stage, businesses try to introduce advanced features of their product to their users. 

Businesses at this stage try to remind customers why they first bought the product. They also perform A/B tests to determine which features resonate with their customers. This information is used to enhance customer experience continuously.  

In SaaS businesses, this is also the stage where vendors identify opportunities for cross-selling and up-selling. Customers who use typical versions are pushed to advanced/exclusive versions of the product by highlighting advanced features and benefits. 

As per this report, SaaS businesses can earn 70-95% of their revenue through upsells. That’s why, for many businesses, it is more cost-effective to cross-sell old customers than to find new customers.    

Organizations use several touchpoints to facilitate this process. They use customer success stories to identify opportunities with existing customers. They might also monitor customer-specific behavior to identify opportunities. For example, if your customer clicks on a blog about the advanced tier’s benefits, you can send targeted emails to them to convert them. 

You can also use sales calls and promotional emails to pique customer interest. Moreover, you can create custom forms to understand what’s stopping customers from upgrading. This can help you start generating user lifecycle and create 

Several metrics are used by the companies at this stage to track success. For example, Daily active users, renewal rate, click-through rate, ROI, etc. 

6. Advocacy stage

This is the stage when your happy customers become advocates of your product. They are now fully dependent on your product and also acquitted by it. This is a precious currency in the SaaS world.

At this stage, customers turn into loyalists, and they start using your product exclusively. They also begin referring your services to others. This leads to evangelism when you create die-hard fans of your product. 

What’s more, loyal customers start creating and sharing user-generated content on social media channels. They might also answer support questions on your behalf or point potential customers to your support pages. 

In this stage, you can also ask your loyal customers to promote your product. For example, you encourage them to create testimonials, either in text or video form, and post them on social media. You can then use these testimonials for marketing purposes. Furthermore, you can ask them to be part of the product community and answer other users’ queries. 

This is important since, as per this data by Neilson, 92% of consumers trust recommendations from friends and families more than any other form of advertising. Online reviews are a close second, with 70% of users saying that they use online reviews to check things before buying. 

At this stage, you can use metrics such as NPS and number of user-generated posts to track customer loyalty. You can also track customer referral rate, CSAT score, and website engagement to analyze this data. 

Customer journey mapping 

Mapping your customer journey can help you reduce product adoption issues and address pain points before they happen. It also allows you to understand customer requirements and guide them towards relevant solutions. 

It enables companies to make the customer journey more customer-centric and improve customer engagement

This can also be a source of innovation, as mapping customer journeys may help leaders identify relevant opportunities for selling to clients. That’s why it’s important to track customer lifecycles through customer journey maps.  

1. Understanding customers and creating user persons 

Before creating your customer journey, you need to identify who your ideal customer is. This will help you create specific subsets of customers and target them. You can use this to engage specific segments of target customers, such as customers who are more likely to convert to higher pricing tiers. 

Businesses create user persona based on different factors such as demographics, age, gender, product usage, etc. To create more detailed profiles, they collect information through surveys and feedback forms and run sentiment analysis on collected data. 

You can also use this information to identify decision-makers for B2B sales. This helps you create more targeted marketing campaigns that convert better. You can use different segmentation strategies for user persons

Trial expiration segment in Encharge

2. Defining touchpoints 

After you have created your user personas and identified your target customers, you need to determine how to engage with them effectively. These interactions are called touchpoints, which companies use to interact with potential and current customers. 

Establishing meaningful touchpoints is important for successful collaboration between the organization and customers. The touchpoints are vital in aligning customer milestones with the organization’s achievements. They are also very useful for guiding customers in the right direction. 

There are two types of touch points – direct and indirect touch points. Direct touch points include direct engagement between the brand and the customer, such as contacting the support team via help desk software or VoIP phone service, referral program, etc. Examples of indirect touch points include blogs, social media shares, and LinkedIn snippets. 

Touchpoints are also helpful in identifying customer issues and understanding customer satisfaction. Customers in different stages of the customer journey might respond to various touch points. 

For example, if a customer is in the awareness stage, they might interact with the organization through social media channels, PPC ads, blogs, etc. If they are in the activation stage, they might read blogs, webinar scripts, knowledge-base articles, etc. The customer in the later stages of the customer journey might respond to sales calls and emails/newsletters. 

3. Creating a visual customer journey map

A customer journey map is a graphic or narrative representation of the customer journey. This mapping enables the organization to understand the customer pain points and create a way forward that encompasses all the required stages of their journey. 

After the company has collected the data related to touchpoints and user persona, they analyze it and create a visual representation of what an ideal customer journey looks like. This is also useful for identifying cross-sell opportunities. 

Marketers can use this information for reporting and identifying specific personas. A customer map also allows us to empathize with customers and identify gaps in customer-business communication. You can also use lifecycle management and automation tools to map these customer journey stages

To wrap up: 

SaaS customers are typically businesses with educated decision-makers with technical needs. To provide the best experience, you need to identify who these decision-makers are and what their needs are, how they research and find solutions, what they expect from these solutions, and what keeps them loyal to these solutions. 

For SaaS businesses, mapping customer journeys is especially important because touchpoints and acquisition channels are traceable using various marketing and sales tools. 

Use the 6 customer journey stages listed above and develop a realistic customer journey model for your customers. Track the touchpoints in your customer journey and try to make customer interactions as smooth as possible.

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