SaaS Marketing Blog

How to adapt SaaS marketing for tougher times

5th November 2019

Economists and the predictions business

In August 2019 there was growing speculation based on surveys of economists that the US economy might experience negative growth and that we might see the onset of a recession. However, as September and now October have progressed, these fears are subsiding., the ‘data journalism’ business and website founded by Nate Silver who made uncannily accurate predictions for the US elections of 2008 (49 out of 50 states) and 2012 (50 out of 50 states), pointed out that economists have a terrible track record when it comes to predicting recessions.

“Very, very few recessions have been predicted nine months or a year in advance,” Prakash Loungani, an economist at the IMF, told Amelia Thomson-DeVeaux, writing for

The predictions business for politics and economics is loosely related to the principles powering the new generation of SaaS apps which incorporate AI and Machine Learning. Many in the SaaS industry will know that commonly seen uses of this technology include apps that can predict when website visitors are about to exit and present some compelling conversion offer.

Regardless of whether the theory is applied to politics or marketing, the fact remains that in the predictions business there can be no absolutes. Predictions can only be expressed as a percentage, reflecting the likelihood or unlikelihood of an event occurring.

Whatever the chances of a recession next year (or at any given time for that matter), the operating environment is subject to change, sometimes sudden unexpected upheavals which can take the market and businesses by surprise. This is why SaaS ventures need to be prepared to adapt their marketing activities come tougher times.

Tighten your belt

A recession is officially defined as ‘two consecutive quarters of negative growth’. This means that should these market conditions arise, we’ll see it coming and have time to prepare.

Ok. Bad case scenario. Say the economy experiences negative growth in Q4/2019… Chances are that midway through Q1/2020 we are likely to have an indication of whether it’s a trend that’s going to continue…

If it’s not looking good, there’s a couple of months or so before it becomes official, however, speculation is going to be rife and there is no point in waiting for official figures…. Act immediately!

The first thing you’ll do is to look at your costs and see where you can make cuts. That is exactly what your customers and prospects are going to do as well. When it comes to looking at the software stack they use for running their businesses, they are going to look for opportunities to rationalise. For software and everything else, non-essential items are set to go. And anywhere there is duplication or crossover might come under close scrutiny.

Some are likely to be asking questions like these of their software stack:

  • Collaboration – e.g. Basecamp Vs. Slack – are both really necessary?
  • Expenses and timesheets – why use separate apps when many products track and manage both?
  • Creative – are that many Adobe subscriptions really needed?
  • Productivity – are there lower cost Microsoft Office 365 plans? Or are there free/lower cost alternatives that might suffice?
  • Project management – is a traditional, heavyweight PM tool actually necessary when there are lower cost project boards-based apps that are equally effective?

And what about your vertical or horizontal?

Questions that they might ask about your SaaS app:

  • Do we really need this product?
  • Could we get the same functionality at a lower cost from a competitor?
  • Would they reduce the cost if we said we were thinking about switching?

For many, there is a strong urge to cut marketing…

Don’t! A recession is an opportunity. Continuing marketing investment makes it an excellent time to aim for growth as competitors make cutbacks. Across acquisition and retention, at a minimum, there is a need to maintain the budget. If you want to continue to power growth, then you are going to need to increase the level of investment.

Many are likely to share the sentiment that… ‘Well, you’re a marketing services agency, so you would say that wouldn’t you…!’

And we can’t fault the logic behind that. But the fact is that in a febrile environment, where opportunities are going to be fewer and competition fiercer, there is a real need for your SaaS business to increase promotional activity to try to pull the opportunities that are there into your pipe.

Of course, the temptation is to close deals by discounting. Potential new customers are likely to bargain hard. And when competitors are likely to be cutting deals based on price, then you need to make considered choices about what to do. One way to maintain the argument for not giving way on price (too much) is to provide more value. Can you provide more than competitor products for the same money?

Ignore existing customers at your peril. Retention is equally, if not more important, given the costs of acquisition. Replacing lost customers in a falling market is going to be no mean feat. Once again, the value argument can be pivotal and offer a compelling case for staying loyal to you. Can you offer a wider range of functionality that other cheaper alternative products that customers might be thinking of switching to?

If you don’t already do it, consider how the ‘freemium’ business model might work for your product and how it could be used to aid retention and acquisition of customers in a declining market.

SaaS businesses market better in tougher times with Xander Marketing

In global and local economies, uncertainty continues to hold back business. However, for the right SaaS products there is the opportunity to succeed, whatever the prevailing conditions. Marketing and promotional activity remains one of the keys to growth.

Xander Marketing has helped hundreds of B2B SaaS businesses succeed in achieving their business objectives with marketing. Get started with better marketing today. Click here to arrange your free one-hour consultation.

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