Constructing a SaaS firm is arguably essentially the most simple option to change into rich.
The entry barrier is low, the revenue margins are excessive, and the income is recurring. Furthermore, scaling is simple, a minimum of in comparison with different in style enterprise fashions.
Nonetheless, regardless of all that, most entrepreneurs who launch software program startups fail as a result of they will’t determine the right way to purchase prospects in a sustainable method.
They rapidly be taught that creating software program is simple however getting folks to pay for it may be extraordinarily troublesome.
That’s why as we speak we’re going to talk about buyer acquisition for startups and share the methods that we used to develop ClickFunnels from zero to $100M+ in annual income.
Buyer Acquisition Metrics
Let’s begin with the fundamentals of buyer acquisition.
Buyer Acquisition Value (CAC)
Buyer acquisition price (CAC) is a enterprise metric that reveals how a lot cash on common it’s essential spend to accumulate a brand new buyer.
You may calculate it utilizing this system:
Buyer Acquisition Value = Value of Advertising + Value of Gross sales / The Variety of New Clients Acquired
For those who don’t know what your CAC is, it’s essential calculate it ASAP!
Buyer Lifetime Worth (CLV)
Buyer lifetime worth (CLV) is a enterprise metric that reveals how a lot income the typical buyer brings in over their total lifetime as a buyer.
Calculating SaaS CLV may be considerably difficult due to the variables concerned.
Right here’s a easy SaaS CLV system that you need to use.
CLV = Common Income Per Account (ARPA) / Income Churn Charge %
Say, if the month-to-month ARPA is $1,000 and the month-to-month income churn charge is 15%, then your CLV will probably be $6,666.
Nonetheless, this system doesn’t account for gross margins, which is why it’s higher to make use of the extra superior SaaS CLV system:
CLV = Common Income Per Account (ARPA) x Gross Margin %/ Income Churn Charge %
Say, if the month-to-month ARPA is $1,000, the gross margin is 40%, and the income churn charge is 15%, then the CLV can be $2,666.
As you’ll be able to see, CLV can change drastically when you introduce the gross margin variable!
We perceive that each one this may occasionally appear complicated however for those who don’t know what your CLV is, it’s essential do the maths, doublecheck that math, and just remember to have the proper quantity.
The Relationship Between CAC and CLV
It’s additionally essential to grasp the connection between buyer acquisition price and buyer lifetime worth.
Your CAC can’t be greater than your CLV if you need your corporation to be sustainable.
Consequently, CLV is the first limiting issue on the subject of CAC!
“Whoever Can Spend the Most To Purchase a Buyer Wins“
Our co-founder Russell Brunson usually quotes Dan Kennedy:
“Whoever can spend essentially the most to accumulate a buyer wins.”
He lately had a chance to debate this with Kennedy himself and requested him to elaborate on this concept:
Outspending your opponents on buyer acquisition means that you can purchase velocity, sustainability, and scale.
That’s why we advise entrepreneurs to maximise their CLV in order that they might enhance their CAC.
We are going to clarify the right way to maximize your CLV later on this article!
Greatest Gross sales Funnels for Buyer Acquisition
Now it’s time to get into the nitty-gritty of buyer acquisition.
Listed below are 5 confirmed gross sales funnels that you need to use to develop your corporation:
The Product Launch Funnel
The product launch funnel is designed that will help you construct a pre-launch e-mail record, get your e-mail subscribers enthusiastic about your product, after which launch that product.
Right here’s the way it seems like:
Web page 1: A squeeze web page.
Web page 2: Video #1.
Web page 3: Video #2.
Web page 4: Video #3.
Web page 5: Video #4.
Web page 7: A product order web page.
Web page 8: An order affirmation web page.
You must ship one video each day or each different day.
Don’t make all of them out there instantly as a result of that might beat the entire goal of the product launch funnel!
Construct a Product Launch Funnel With ClickFunnels 2.0!
ClickFunnels 2.0 features a product launch funnel template, a visible editor that you need to use to customise that template, and an e-mail advertising and marketing performance that means that you can acquire potential prospects’ e-mail addresses and promote them your services and products through e-mail.
The Squeeze Web page Funnel
The squeeze web page funnel is the preferred gross sales funnel on the market as a result of it’s so easy and simple to construct.
It seems like this:
Web page 1: A squeeze web page.
Web page 2: A thanks web page.
Construct a Squeeze Web page Funnel With ClickFunnels 2.0!
ClickFunnels 2.0 features a squeeze web page funnel template, a visible editor that you need to use to customise that template, and an e-mail advertising and marketing performance that means that you can acquire potential prospects’ e-mail addresses and promote them your services and products through e-mail.
The Reverse Squeeze Web page Funnel
The reverse squeeze web page funnel additionally seems like this:
Web page 1: A squeeze web page.
Web page 2: A thanks web page.
So what’s the distinction between the common squeeze web page funnel and the reverse squeeze web page funnel, then?
With the common squeeze web page funnel, you retain all of the free worth behind the opt-in wall.
In the meantime, with the reverse squeeze web page funnel, you present some free worth proper there on the squeeze web page itself then ask for the potential buyer’s e-mail deal with in trade for extra free worth.
In observe, this usually implies that you show a video in your squeeze web page that the potential buyer can watch with out opting in, then encourage them to get your lead magnet on the finish of that video.
Construct a Reverse Squeeze Web page Funnel With ClickFunnels 2.0!
ClickFunnels 2.0 features a reverse squeeze web page funnel template, a visible editor that you need to use to customise that template, and an e-mail advertising and marketing performance that means that you can acquire potential prospects’ e-mail addresses and promote them your services and products through e-mail.
The Survey Funnel
The survey funnel means that you can direct potential prospects to totally different gross sales funnels from a single place to begin.
It seems like this:
Web page 1: A survey.
Web page 2: A squeeze web page primarily based on the survey outcomes.
Web page 3: A thanks web page primarily based on the survey outcomes.
We suggest utilizing this survey construction:
- Ask them who they’re.
- Ask them concerning the scenario they’re in.
- Ask them what’s their talent stage.
- Ask them what they’re fighting.
- Ask them what they’re fighting on a private stage.
- Ask them one thing that you’re curious to study them.
The primary query is named the “bucket query” as a result of it determines which gross sales funnel that particular person will probably be directed to.
Survey funnels are an amazing answer for startups that serve a number of distinct buyer segments that require totally different gross sales messaging!
Construct a Survey Funnel With ClickFunnels 2.0!
ClickFunnels 2.0 features a survey funnel template, a visible editor that you need to use to customise that template, and an e-mail advertising and marketing performance that means that you can acquire potential prospects’ e-mail addresses and promote them your services and products through e-mail.
The Webinar Funnel
The webinar funnel is a funnel the place you employ a webinar as your lead magnet.
It seems like this:
Web page 1: A webinar registration web page.
Web page 2: A thanks web page.
Web page 3: A webinar web page.
You then pitch your product on the finish of the webinar and direct the attendees to its gross sales web page.
This gross sales funnel holds a particular place in our hearts as a result of Russell used it to get ClickFunnels off the bottom throughout our first yr in enterprise.
Again then he aimed to do 5-7 webinars every week however would typically find yourself doing 2-3 webinars a day. Fairly loopy nevertheless it labored!
And he nonetheless swears by this method a decade later:
Construct a Webinar Funnel With ClickFunnels 2.0!
ClickFunnels 2.0 features a webinar funnel template, a visible editor that you need to use to customise that template, and an e-mail advertising and marketing performance that means that you can acquire potential prospects’ e-mail addresses and promote them your services and products through e-mail.
Maximize Your Buyer Lifetime Worth (CLV) With the Worth Ladder Gross sales Funnel
We imagine that the Worth Ladder gross sales funnel is the easiest way to maximise buyer lifetime worth.
It was created by Russell who then used it to take ClickFunnels from zero to $10M+ in annual income in only one yr (it’s at $100M+ now!).
This gross sales funnel has 4 levels:
- Bait. You supply the potential buyer your lead magnet in trade for his or her e-mail deal with.
- Frontend. You supply the potential buyer your least costly and least useful services or products.
- Center. You supply the shopper a costlier and extra useful services or products.
- Backend. You supply the shopper your most costly and most dear services or products.
Ideally, you additionally supply a continuity program of some type, that means, a subscription product that generates recurring income.
We additionally suggest including downsells, upsells, and cross-sells to those core provides with a view to maximize your income.
The explanation why this gross sales funnel works so effectively is that it means that you can:
- Begin the connection with that particular person by providing free worth.
- Nurture that relationship by persevering with to offer free worth through e-mail.
- Construct belief by offering progressively extra paid worth at every stage.
Right here’s how Russell explains it:
The overwhelming majority of SaaS firms solely have one supply: they cost subscription charges for his or her software program.
Sure, there are usually a number of pricing plans, however their software program is their solely income.
For those who begin including extra provides and construct out your Worth Ladder, you’ll inevitably enhance your buyer lifetime worth with these extra sources of income.
Your rivals who solely have subscription income will battle to maintain up with you as a result of it is possible for you to to outspend them on buyer acquisition!
Startup Case Research: ClickFunnels
Let’s check out one in every of our gross sales funnels.
Russell has written three best-selling books:
All three books can be found on Amazon however we additionally use them as lead magnets so you may get them immediately from us totally free.
Right here’s the gross sales funnel that we constructed for “DotCom Secrets and techniques”. See how as an alternative of only one supply there’s a complete Worth Ladder?
We’ve got tons of direct opponents however most of them are utterly reliant on software program subscription income.
In the meantime, now we have:
- Software program subscription income.
- Data product income.
- On-line occasion income.
- Reside occasion income.
- Membership neighborhood income.
Is it any surprise that we had been in a position to develop extraordinarily quick, change into the dominant participant in our area of interest, and attain $100M+ in annual income?
We would like you to take a web page from our playbook. Sure, you could have a SaaS startup, so that you promote software program. However what else are you able to promote?
Work out how one can present extra worth to your dream prospects and begin constructing your Worth Ladder!
The Prime 3 Methods to Drive Site visitors to Your Worth Ladder Gross sales Funnel
Listed below are 3 ways to drive visitors to your gross sales funnel:
#1 Social Media Advertising
Don’t have a advertising and marketing price range?
Selling your corporation on social media is free!
Right here’s the final method that it is best to comply with:
- Create a content material schedule which you can sustain with indefinitely.
- Decide to that content material schedule and cling to it religiously. You may produce content material in batches after which use social media scheduling instruments like Buffer or MeetEdgar to schedule and publish it.
- Be sure that every piece of content material that you just publish gives worth to your followers.
- Use your social media to advertise your lead magnet however don’t be obnoxious about it. Offering worth to your followers must be the principle focus.
- Work together together with your followers. Ideally, you need to reply to every remark, tweet, and reply that you just get.
That’s just about all there may be to it however you will have to maintain at it for a minimum of a yr if you wish to see outcomes. Consistency is the secret!
#2 Affiliate Advertising
Online marketing is one other nice option to promote your software program if you don’t have a advertising and marketing price range.
Establish folks whose audiences overlap together with your audience, chilly e-mail them and pitch them an affiliate partnership:
- They promote your webinar to their viewers.
- You host the webinar and pitch your software program on the finish of it.
- They get a 50% ongoing fee from every sale.
Say, in case your software program prices $20/month, your associates ought to get 10$/month for every buyer they create in for so long as these folks stay prospects.
#3 Paid Promoting
We imagine that paid promoting is the easiest way to drive visitors to your gross sales funnel as a result of paid visitors is fast, focused, and scalable.
All main social media platforms permit you to run adverts on them so decide the one which’s favored by your dream prospects, arrange an advert marketing campaign, and begin working it with a small each day price range.
As soon as you determine the right way to run adverts profitably, you can begin scaling your marketing campaign by step by step rising its each day price range!
Construct Your First Gross sales Funnel in Simply 5 Days!
Let’s maintain it actual:
Constructing a gross sales funnel from scratch can seem to be a frightening job.
That’s why we created our 5 Day Lead Problem the place Russell walks you thru it step-by-step.
You’ll:
- Create your first lead magnet.
- Construct your first squeeze web page funnel.
- Arrange a 6-email welcome sequence.
- Launch your funnel.
- Begin driving visitors to it.
…in simply 5 days!
So don’t hesitate. Take motion. It could possibly change your life!
Be a part of Our 5 Day Lead Problem Right now!
P.S. This problem is totally FREE!
