Feeling lost in the sea of marketing automation tools, customer communication platforms, and whatnot? Want to choose the right tool for your SaaS but you’re afraid that you’ll end up with something that’s a bad fit and be stuck with it for ages? Liked a tool, but you have read horror stories about startups having to pay a small fortune to afford it?
Don’t worry; we’ve all been there.
In this post, I’ll try to provide a holistic overview of the marketing automation landscape and give you some practical tips on how to approach your evaluation process. By the end of the piece, you should have a clear idea on what tool you’re looking for, what questions to ask the sales reps you talk to on demo calls, and learn the most common mistakes SaaS businesses make when choosing a marketing automation tool for the first time. Let’s dive in!
What’s a marketing automation tool?
For this guide, I’m calling a marketing automation tool every tool that can be used to communicate with your leads, users, and customers via automated email, in-app messages, push, etc. AND automate tasks across your marketing stack (for example, “When a user hasn’t logged in in our app for more than 30 days → Add them to our CRM”).
I know this is a broad range of use cases. I’m purposefully keeping this description vague because I want to give you a top-level overview of the market and cover as many tools as possible.
The truth is that every company and team calls these tools with different names. I’ve seen email companies branding themselves as “customer messaging platforms”, and I’ve seen people calling sophisticated platforms “email marketing providers”.
It doesn’t really matter what you call them, as long as your whole team is on the same page and understands that you’re evaluating the same type of tool.
Which leads us to the next question:
How to evaluate a marketing automation tool?
Here’s the process I recommend to our potential customers:
Step 1: Start with your short-term goal but keep your long-term strategy in mind.
You’re paying a tool to solve a problem you have in your SaaS business. The bigger the problem, the bigger your allocated budget for that tool would be.
Start with 1 to 3 most critical problems that you want to solve in your business. I encourage you to target problems that span across one stage of the funnel rather than trying to fix your whole funnel.
Most early to middle-stage SaaS companies don’t have the resources to improve multiple stages of the funnel simultaneously. For instance, trying to increase your visitor to trial CR while working on reducing your churn.
A more sensible and realistic approach is, for example, to try to improve your trial to paid conversion and focus on that alone. With that in mind, you can map the top 3 problems, for example:
- Poor in-app onboarding.
- Poor email onboarding.
- Lack of personal hand-holding with new accounts
Some of our potential customers come with very specific problems in mind. Others know that they could do better at “converting trials” but have no idea what are the best practices or how to approach the issue. If you fall under the second category, you can still come up with your best guesses as to why your trials are converting.
This approach will give you much more structure when evaluating platforms, as you can now compare how each app is trying to solve your problems.
Once you have the most pressing problems cleared out, it’s important to consider your long-term strategy. Integrating a marketing automation platform is a tedious process that can take anywhere between a couple of weeks and a few months. You want to make sure that the tool you choose aligns with your philosophy and the way your team works.
Step 2: Choose your tool philosophy — all-in-one vs. best-in-class
The next step is to figure out what your team thinks about all-in-one tools vs. best-in-class tools.
All-in-one tools provide the whole suite of marketing (and sales) tools you need — email marketing, CRM, chat, support, blogs, social, and the list goes on. HubSpot is the quintessential example of an all-in-one tool.
Best-in-class tools are focused on a single use case or problem and are trying to be the best tool in the category. Encharge helps SaaS companies convert more trial users to customers with effective, action-driven emails, and this is what we have dedicated 100% of our efforts to. Userpilot is trying to be the best tool for in-app product onboarding, Helpscout for support docs, and so on.
Half-in-one tools (a term I just came up with 🙂 ) are tools that fall somewhere in between. For instance, Intercom has a live chat feature, help docs, in-app onboarding, and emails, but won’t provide you with the full suite of marketing tools like HubSpot does. Half-in-one tools will cover a big portion of your needs, but you’d still need to fill the gaps with other apps.
So, which one is the best?
The choice of all-in-one vs. best-in-class is not a battle of tools, but a question of how your company thinks about software and how your team prefers to operate.
Of course, being a best in-class tool we’re a strong advocate for that approach, but occasionally we get someone asking for an all-in-one tool. We send those people over to HubSpot, or something else that does everything. After all, we’re trying to help you solve your problems in the most efficient way.
The all-in-one vs. best-in-class debate is a topic worth exploring in its own post, but I still want to give you some advantages and disadvantages to use in the conversation with your team.
Broad but not deep
Relatively broad. Deeper than all-in-one but not as deep as best-in-class
Narrow and deep. Focused only on emails, or in-app onboarding, etc.
Expensive and potentially confusing
Expensive and potentially confusing, especially with Intercom
Cheap for a single tool. Can get expensive if you use many tools.
SaaS focus (niche)
Not focused on SaaS. Focused on offline businesses and agencies. You will hit a wall when you need robust SaaS-related features. Often ending up with compromises or workarounds.
Some good features for SaaS but not as robust as best-in-class.
Extremely focused on SaaS.
Best. All of your data is in one place without external integrations.
Average. You’d still need to connect your half-in-one tool with the rest of your stack.
Your data is spread across multiple tools. Connectivity requires setup through integrations and connectors like Segment, Zapier.
Provides good support at a price (i.e, consultants and premium support plans). Even when you pay, Support ≠ SaaS experts/SaaS advice.
Decent product support, but lacks SaaS-related help
Personalized product support. SaaS experts at your fingertips helping you solve your SaaS problems.
Generally speaking, best-in-class marketing automation platforms like Encharge are better suited for SaaS businesses, because the features are laser-focused on particular SaaS needs — like in our case, onboarding emails.
To tackle the drawback of siloed data, Encharge supports Segment.com and Zapier integrations that you can use to glue your tools. We have also built a number of native integrations that allow you to keep your data current, create segments with live data from other tools, and automate tasks across your marketing stack. Best part is you can still use HubSpot as your CRM and Intercom for live chat/support docs, as we have native integrations with them, too.
Step 3: Consider user events/actions
What separates SaaS products from other businesses like agencies, eCommerce, media outlets, and so on?
The plethora of actions your users can take in your app. These actions indicate how far along the customer journey your users are. Events allow you to see if a user has experienced value with your product and reached important value moments.
Having access to these events in your marketing automation tool is very important for you as a marketer. You want to be able to automate things when people do stuff in your app. For example:
- Send a reward email, when a user creates their first task
- Send a nudge email if a user hasn’t created any tasks and only has 4 days left on their trial
- Send an internal team notification on Slack when a user subscribes to one of your paid plans (we all love to celebrate!)
Can you go with a platform that doesn’t support user events?
You can always start with a simple time-based email sequence. That’s in fact, how most early-stage startups start. But if you’re serious about your SaaS and plan on creating relevant, timely communication with your users, you’d soon want to switch to triggered emails, and moving all your emails could be a pain.
Once you decide that you need user events in your marketing automation tool, it gets much easier to choose one, as your list of choices has decreased significantly.
To make your life easier, I’ve put together a list of tools that support and don’t support user events.
Tools that don’t support user events
- ConstantContact and other small biz email marketing tools
Tools that support user events but are ridiculously expensive
- A few months ago, Mailchimp launched support for user events but their “Event property segments” feature (being able to segment people based on their actions) is only available on their Premium plans, which start at $299 a month for 10,000 contacts.
- HubSpot offers support for user events on their Enterprise plan, which costs…wait for it… $38,400 a year + a required, one-time Enterprise Onboarding for a fee of $6,000. So, $44,400 to get started.
The reason these tools have user events on their highest tiers only is because they don’t target SaaS. For instance, HubSpot is a platform built for offline businesses, agencies, consultants, and other service-related businesses. As you could imagine, only the most enterprise, top-tier service companies would need API events to operate their business.
That pricing structure, however, doesn’t make sense if you’re catering to SaaS.
Tools that support user events and are affordable.
Going beyond triggered emails with event-based segmentation
You have narrowed your list of tools to the top 5 mentioned above, but your evaluation for user events shouldn’t end there.
All of these 5 tools will enable you to trigger automation workflows and email campaigns when a user does something in your app. However, if you really want to push the envelope, you need a tool that also allows you to create User Segments based on your user behavior.
Let’s say you want to target people that have “Created a project” in your app but “Haven’t created a task in the last 5 days”. This segmentation is possible with our new segments, and in Encharge it will look like this:
Out of the 5 tools mentioned above, only Encharge.io, Customer.io, and ActiveCampaign support event-based segmentation!
Step 4: Consider the channels that you want to use
You must have a good idea of where your users hang out and what is the best channel to reach them out.
If you run a B2B SaaS, you need a marketing automation tool that is focused on emails and gives you flexibility when creating email flows and campaigns. Encharge is a good fit for that. In fact, we have a lot of customers switching from tools like Intercom because they want to visualize and build robust email campaigns for onboarding and retention.
Conversely, if you run a B2C SaaS or a mobile app and want to reach your users on their phones, you need a tool supporting multi-channel communication — SMS, mobile, and web push notifications. In that case, you need to look into something like Leanplum.
Step 5: Consider native integrations
Are you going to use your marketing automation platform simply to send emails to your users or you also want to automate other tasks across your stack? How important is your marketing tools’ data for your email campaigns — do you need billing data from Stripe, survey responses from Typeform, or custom fields from your CRM in order for your automations to work?
Integrations in marketing automation tools enable you to do two primary things:
Enrich your user profiles with live data from your marketing tools
Once you connect your Stripe or Typeform accounts with Encharge, you can enrich your user profiles with billing and survey data. This allows you to:
- Build precise segments of users and customers. For instance, “people on the Gold plan who have responded that they’re not happy with the latest feature”
- Deliver extremely personalized experiences and email campaigns with dynamic live data. Thanks to our Liquid tags feature, you can use this data to create personal one-to-one messages instead of canned, one-size-fits-all emails.
Automate tasks across your marketing and sales stack
Marketing automation doesn’t end up with emails. You can automate tasks like:
- Add users at risk of churning to your CRM, so your sales reps can follow up with them.
- Add new trial users to a Facebook Ads audience, so you can broadcast relevant ads to them.
- Notify your team when a new trial user signs up.
- …and a whole lot more. I have covered a lot of these examples in my essential guide to marketing automation for SaaS.
If you want to automate tasks like these, you need to look for a tool that has native integrations with the apps that you use.
Encharge integrates with Facebook Ads, HubSpot, Stripe, Typeform, and more. Of course, you can always go with a tool that has a Zapier integration, but do I need to tell you why native integrations are better? (We also have a Zapier integration, too 🙂)
Fortunately, most marketing automation tools have their Integrations page, so that task should be relatively easy. That said, be careful of websites listing thousands of integrations — those integrations are usually through Zapier.
I hope this guide has made selecting the right marketing automation tool for your SaaS at least a little bit easier. It’s a challenging project, but once your automations are up and running, they will become your hardest-working marketer.