SaaS marketing funnel - what is it?

Liam Dunne

8 minutes

As the SaaS space grows the tide is shifting from a seller’s market to a buyer’s market. Buyers know this, becoming increasingly savvy and harder to sell to. This means SaaS companies must be creative when it comes to acquiring new users, otherwise you’ll be left behind and growth will come to a standstill.

Hammering the phones and emails will get you somewhere, but if you want to keep up with your competitors and build a long-term, profitable business then you’ll need to build a marketing funnel, or two.

In this post we’ll talk through what a SaaS marketing funnel is, the different types, and how you can create your own one so you’re not left behind.

What is a SaaS marketing funnel?

As with most things in marketing, it’s easy to get bogged down in the complexity of everything. Funnels are no different.

In its simplest form, a SaaS marketing funnel (also known as a funnel or conversion funnel) is a series of actions or stages that take a lead from being cold all the way through to being ready to purchase your product. For most, this could simply be a website that you drive traffic towards. For those serious about growth, your funnel will involve several steps and uniquely communicate to leads depending on what step they’re at.

Image by Drip Digital

As you can see in the image above, funnels have different stages. These stages may differ depending on the funnel - more on that later. The typical journey for a lead is to start at the stop (awareness), where they first interact with you, then trickle down to the bottom where they perform your desired action, e.g. converting to a paid customer. How you interact with leads depends on what stage they are at within the funnel.

You might also see funnels broken down into: top of funnel (TOFU), middle of funnel (MOFU), and bottom of funnel (BOFU).

The best marketing funnels don’t feel like funnels. You scroll the internet, stumble across a piece of valuable content that helps you with a current problem you’re facing, you download it, then slowly over time you’re introduced to a solution that can also help you with that problem but now it’s a product. Perhaps you can trial this product for free or you start to explore other content about this product, next thing you know you’ve got a new subscription coming out of your bank every month.

Marketing funnels are everywhere. The ads you see on Facebook, the freebies that get handed out at events (love those), even the post you’re reading right now is part of a funnel. Sorry about that.

Why you should build one

In the early stages of building your SaaS company, you most likely have a few leads here and there, jumping with excitement at each one that comes through. However, as time goes on and as your SaaS company grows, certain avenues will start to dry and the leads will become increasingly difficult to manage.

Also, not all leads are made the same. A lead is simply a person whose contact information you have, perhaps they signed up to your newsletter or downloaded a piece of content. This does not mean they are likely to become a customer.

So eventually you start to ask “how do we avoid bad leads?” or “how do we get more of those good leads?”. This is what a marketing funnel can help with.

With a marketing funnel you can build a systemised way of generating leads, measure the quality of those leads, and nurture them to become customers - the end goal. A good marketing funnel will track specific metrics at each stage of the funnel so you know where the bottlenecks are and what areas are performing well. An example metric could be the % of website visitors that perform a desired action.

Different types of SaaS marketing funnels

There are different types of marketing funnels, the type of funnel you use typically depends on the channel you’re using (e.g. email marketing or paid ads), the product you’re selling, or the end result.

However, generally speaking, the stages of the funnel will remain similar regardless of what your end result or product is. Odds are that you’ll still be taking a lead from Awareness to Action.

Below are some types of funnels you’ll see in the SaaS space:

Funnel type Purpose
Lead generation Get more leads
Webinar funnel Increase reach of your content
Onboarding funnel Learn about customers and increase adoption
Video sales letter Drive purchases

Creating your SaaS marketing funnel

Creating your marketing funnel can be as complicated as you want it to be. My preference is to start lean, validate if it works, then iterate based on the data. The goal here is to get results, not have the shiniest funnel on the internet.

Here are a few steps to get started:

Identify your goals

When it comes to anything in life, always start with your goals in mind. Otherwise how do you know what you’re working towards?

Whether is be more website visitors, trial sign-ups, or webinar attendees, list 2-3 goals that you want to achieve with your funnel. I’m personally a big fan of OKRs, you set the high-level objective and then the key results that get you there.

Identify your ideal customer profile

Similar to goals, you need to know who you’re targeting before you get started. This is incredibly important and honestly, where most SaaS companies go wrong.

Who you target will determine your positioning and messaging. You wouldn’t speak with your grandmother the same as you would your best friend, is an analogy I like to use for this. It’s critical that your messaging resonated with your target audience, otherwise it simply won’t convert.

Create your messaging

Brilliant, you now know what goals you’re working towards and who you’re targeting. Now you need to build the messaging that’s going to hook the leads in and push them into your marketing funnel.

Your messaging will change depending on the stage of the funnel your leads are at and the way you’re presenting it (e.g. a blog post vs a landing page). At the top of the funnel, your objective should be building awareness so you want to avoid selling. Your messaging should mainly be focused on your lead’s problems. As the lead travels down the funnel and becomes warmer, this is when you should start talking about your product - sharing social proof to gain credibility and describing how it will make the lead’s life easier.

A common mistake most SaaS companies make is talking about themselves all the time. Leads don’t care much for your product, they mostly care about their own problems and then eventually, when you’ve nurtured them enough, how your product can help solve some of those problems. Always lead with value.

This is where copywriting comes in handy. The ability to hook the attention of a visitor with compelling copy and emotional language is a superpower and something we love doing at Digiseed.

Launch your campaign

Dependent on your goals and target audience, you might want to launch your campaign with specific channels such paid ads or email. You can start small, collect initial data, then scale if needed.

If running paid traffic, be sure to test multiple creatives and angles within your ads. Similar with your landing pages, be sure to A/B test your copy so that you’re constantly maximising results. This is how great marketers operate - always testing and optimising.

Final thoughts

Now you should know what a SaaS marketing funnel is, the different types, and how to create one.

The market is quickly pushing power into the buyer’s hands so it’s now more important than ever to be creative and lead with value. Hard-sales tactics won’t work.