Business scalability is about setting your organization up for sustainable growth, accessibility, and profitability, both now and in future years.
Scaling a SaaS company requires a vastly different approach than other business models. Instead of promoting consistent one-time sales, your aim is to establish long-term relationships with clients who will regularly pay for access to your services over the next few years or longer.
To encourage and achieve sustainable growth for your business, there needs to be an emphasis on future-oriented establishment and optimizing your delivery of services. You also need to create a supportive community that facilitates ongoing growth and expansion.
When it comes to selling Software as a Service, you need to play a long game. And in this guide, we’ll take you through a list of industry-approved tips and steps for scaling your business, as well as touch on what that actually means today.
Business scalability – What it means and why you need it
Business scalability refers to a company’s capacity for growth and ability to meet increased demand over time. Truly scalable businesses are those that can benefit from economies of scale, where costs of production are dispersed across more units, driving higher profit margins.
When a business is fully scalable, it can not only sustain itself financially over an extended period of time, it can also keep up with its own demand for service from consumers.
Software service businesses need a slightly different approach to scalability than, say, commerce businesses because their value offerings are renewable, not once-off. This drives a higher need for sustainable scalability, which every SaaS company should take seriously.
10 tips and steps you need to successfully scale your SaaS business
Scaling your business successfully will give you the strength, profit, and position to move forward without risking financial loss or losing key clients over time.
In order to reach a healthy scalability status, your business must adopt a strong scalability strategy that takes all aspects of business sustainability into account. In the following ten tips and steps, you can gain a broader understanding of scalability and how to implement it.
From onboarding to influencers and everything in between, there are many ways for software service brands to make their operations more scalable.
Here are the top strategies for success:
Create a strong onboarding and training program
A lot of your business scaling relates to the efficiency and flow of your internal operations. Without a cohesive, productive, and well-functioning team of employees, you’ll struggle to maintain good relationships with clients or hold a solid grip on profit growth.
Onboarding is a crucial step in the employee integration process. Help new recruits assimilate onto your team from the get-go, thus setting a high standard for productivity and welcoming them into a healthy company culture that extends well beyond their first few months.
Make sure that your new hires have access to everything they need for adjusting to the team, such as educational resources, technology and tools, and, of course, a welcoming environment.
Developing an excellent onboarding program is beneficial for so many reasons. It promotes scalability and enhances employee engagement, and increases retention rates.
Reassess your sales strategy – and use sales metrics
The right sales model can make or break your scalability strategy. You need to make sure you have enough staff on board to meet performance targets, outline your sales strategy, and automate any relevant tasks for a more efficient overall system.
You can use sales metrics to track the progression of your profit growth and measure how effective your sales tactics are with clients. Some of the most important sales metrics include:
- Churn rate – The yearly percentage rate at which clients unsubscribe from your services
- Activation rate – The number of total users divided by the number of users who take the desired action (such as a purchase or subscription)
- Customer lifetime value – The total worth of a customer for the entire length of their relationship with your business
- Customer acquisition cost – The financial costs of acquiring a new customer
- Conversion rates – How many people are annually converted from a lead to an active consumer/client
- Growth rates and margins – Profit and growth changes between set periods of time
- Monthly and annual recurring revenue (MRR/ARR) – Your month-over-month or year-over-year percentage increase in revenue.
Getting familiar with these important sales metrics can help you track the growth of your business and gain much-needed perspective on the longevity of your sales strategy.
With these metrics, you’ll also be able to create a much more informed scalability strategy. Additionally, considering a digital twin implementation can provide a comprehensive view of your service operations, allowing for real-time adjustments and improved scalability.
Make sure your prices are right
Pricing is key to business scalability. If your prices are too high, your target audience may drift away and choose companies with a more competitive cost. If they’re too low, you’ll lose money.
To reach peak scalability, your pricing system needs to ride a balance between these two extremes. Unfortunately, we can’t tell you what to set your prices at, but you can find the sweet spot by carefully considering your service’s value, market average, and production costs.
You can experiment with different pricing systems until you find one that customers really respond to. Different tiers of payment can also help you gauge what people are generally happiest to pay.
Employ multi-channel marketing to expand reach
Don’t just rely on one or two channels to connect with audiences. Expand your reach by employing multi-channel marketing that meets a much wider demographic of potential clients.
Multi-channel marketing is the marketing version of not putting all your eggs in one basket. By diversifying your marketing channels, you can gain much more recognition at a much faster rate, thus obtaining more clients and achieving a higher scalability level.
Some of the highest-ranking marketing channels to use in 2023 include:
- Search Engine Optimization (SEO) – Where would any business be without SEO? Arguably the most effective marketing channel in the world aside from social media, SEO will help you prime your website for peak traffic and search engine rankings.
- Paid advertising – Paid advertising is another extremely effective way to promote your business online. You can opt for PPC, Google Ads, or Point and Click for best results.
- Influencers – You don’t need to be a fashion brand to leverage influencer marketing. In fact, if you aren’t, you’re missing out. You can align your business with all sorts of positive online influencers, such as creative professionals and industry leaders who use your services.
- Email marketing – Don’t sign off email marketing just yet. It still has a great track record with current marketing performance. Use newsletters to expand your visibility and facilitate deeper client connections.
Don’t just settle for one marketing channel. Look beyond social media or website ads and see what happens when you diversify your recognition streams.
Create high quality content
If you want to work on scaling your business upward, it needs to appeal to a wide audience of consumers—an audience that grows and evolves as trends do over time. One of the best ways to do this and ramp up website traffic is to create and upload a consistent stream of quality content.
Use your website as a platform for educating, inspiring, and bonding with your audience by implementing a topical blog with informative, well-written articles and stories.
Let analytics guide you
Analytics programs are essential for tracking metrics and gaining a clearer perspective on the performance of your business. It’s also the key to growth and scalability measurements. Some of the best analytics software programs include:
- Google Analytics
These analytics apps all come with a fully kitted-out dashboard that gives you valuable insight into the back-end activities of your consumers. With the information you find, you can adjust your business strategies to organically enhance growth.
Offer freemium services
When it comes to SaaS, people can be wary of paying premium rates because they just don’t know if they like your product yet or whether it fits their needs. You wouldn’t ask someone to buy a year’s worth of baked goods without tasting them first. So, why subscribe to a software service without a free trial?
Offering freemium services is vital in the SaaS industry. It not only makes your service more accessible, but it also gives people the opportunity to familiarize themselves with your product before committing to the long haul.
This opportunity plays a crucial role in long-term scalability. It gives consumers a clear idea of what to expect and encourages them to want to stick with you in the future.
Focus on customer happiness and satisfaction
To reach peak scalability, your business absolutely needs to make customers happy. This is true of all businesses, but especially those who aim to be around ten, twenty, or thirty years (or longer) into the future.
Think about your mission statement, your values, and your workplace policies and procedures. Putting customer satisfaction first should be part of your mission statement and your business values. These should be outlined in your employee handbook, and there should be no doubt as to how important they are.
Customer satisfaction is about investing in quality customer service, delivering exceptional support for problems that arise, and of course, providing a high-quality product. These are the kind of incentives for loyalty you’ll want on your side.
Regularly assess your customer support system and identify any areas for improvement. Listen to reviews, tap into testimonials, and do everything you can to make your customers happy.
Use referral programs as leverage
Referral programs are highly effective when it comes to scaling your business and growing customer retention. In fact, studies show that customers who are acquired through a referral from friends have 37% higher retention rates than other customers.
This is because people tend to trust their inner circle more than corporations, no matter how charming or reputable yours is. You can incentivize existing customers to refer your services to their friends and family by offering small rewards, such as discounts or freebies.
Fine-tune customer product adoption
If you want your business to be sustainably scalable, you need to make your product easy to adopt. And this is especially true for SaaS businesses or those with non-physical products.
SaaS services may seem simple to you, but to the average consumer, they may need some softening around the edges. Make your software or system intuitive, simple, and easy to navigate, thus encouraging your audience to adjust to using it faster and promoting long-term use.
The bottom line
Every business needs a scalability strategy to meet consumer demands and remain in a strong financial position. Developing a healthy scalability plan is made simple by fine-tuning the operational aspects of business management and investing in quality client connections.