How is marketing a Software-as-a-Service (SaaS) offering different from marketing a licensed software product? It's a question I hear a lot...

1. It's a Solution Sale, not a Product Sale

First, it comes down to a fundamental sales/marketing difference between SaaS and a licensed software product: you're selling a solution and not a product. That means marketing a software service is about solving a customer pain point, and the benefits of your solution to the customer... It's not about marketing a list of product features.

2. Think Pull versus Push Marketing

Since you're selling a solution, you want your service to come up first when/where a potential customer is looking for that solution. That means being on the first page on Google when they search for that need, being responsive and answering questions in user groups and on forums, participating in social networks, etc.

3. Keep Customer Acquisition Costs Low

SaaS marketing and selling is all about keep customer acquisition costs low. Even if a prospect turns into a sale, you don't know how long they will be a subscriber (or what their ultimate lifetime value will be). So you no longer have the luxury of the traditional marketing "push": meeting with customers FTF, sending out expensive direct mail, having a big booth at the annual tradeshow, etc.

4. Continue Marketing to Existing Customers

With SaaS, marketing is not only about driving leads into the sales funnel. A prospect that turns into a sale is only a customer for one subscription period if they don't see the ongoing value of your service... and you're not likely to make a profit from that. You must proactively market to existing customer to keep them using the service: newsletters, how-to tips, requests for feedback, etc.

What do you think? For those of you that have SaaS offerings - how have you found marketing software services different from marketing a software product?

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