The competition prevailing in the SaaS industry makes it almost impossible to stand out.
Brands are working extensively to gain awareness and grow their customer base.
In such a scenario, affiliate marketing has come as a much-needed saviour. Research suggests that it can boost revenue by up to 30%!
Affiliate marketing has gained traction ever since the growth of SaaS as partnerships have always been one of the most effective ways to amplify growth in tech.
SaaS affiliate marketing is an advertising model that involves adopting individuals or companies to promote brands, products, or services for a commission.
You can use affiliate marketing across a wide range of channels such as blogs and social media. Ultimately, you strive to increase your audience to subscribe to the product that the affiliate is promoting.
Check out some of the best practices SaaS companies are following in affiliate marketing to grow their business and some latest programs by top brands.
Making use of Tracking and Automation Software
Marketing automation is at the core of all marketing strategies in the SaaS industry. Affiliate tracking platforms are helping SaaS brands launch, manage, and optimize their referral and affiliate programs. From tracking to designing, companies are extensively using automation tools to ensure their campaigns are a success.
You can use online free image editing tools to create attractive creatives without incurring additional costs and tracking software to measure program performances. You can track your progress using features such as dashboards and real-time statistics that help you easily calculate commissions, track conversions, and consolidate all data under a single platform.
While choosing an affiliate tracking software, check for the integrations, features, reputation, customer support and onboarding support. SaaS brands can also track subscription payment modes and follow trial signups when they become paying customers.
Setting Affiliate Marketing KPIs
Before diving into the affiliate marketing territory, you need to set campaign-specific objectives to monitor the results later on. Some of the top metrics that business track are:
Revenue goals/ quarter or year – A realistic amount of money to earn within a specific time frame
Conversion Rates – The percentage of prospects who end up turning into customers after clicking the affiliate link. This helps especially if you want to compare the effectiveness of affiliate marketing to other marketing channels.
A number of qualified leads – The number of potential customers who expresses a genuine interest in paying for your software.
Number of sales from Affiliate marketing – Total number of sales generated from the affiliate marketing campaigns. The metrics also reflect the rising stars that require an individual approach.
Selecting the Right Affiliates
Choosing the right partner in affiliate marketing is very critical. Your target audience needs to align for the program to actually bear any results.
Choose affiliates after due diligence. You only pay attention to the ones that are most compatible with your brand and product. For example, if you want a reputed blogger that wants to talk about a SaaS product management platform, you would want to target an individual or a publisher who has authority in the SaaS B2B domain like TechCrunch or Entrepreneur rather than a B2C domain. Only then will your audience align with each other and both will reap equal benefits.
Some of the metrics that you can check before narrowing down on the right affiliates are:
- Brand Fit – Does the content, personality, tone and voice of affiliates match your brand?
- Status – Does the partner have credibility and authority in the SaaS industry as a whole? The reputation of your partner can eventually play a role in the success of your campaign.
- Ability to work together – Is your partner flexible with your ideas and working schedules? More importantly, are they transparent and does the program benefit both parties equally?
Setting a Realistic Commission Strategy
There are four ways of choosing a commission structure.
- The first one is a one-time commission where you pay the affiliate a minimal fee for every signup or visitor on your website. While this seems very straightforward, it’s tricky regarding SaaS since every customer brings in consistent revenue through subscriptions.
- The second type of commission structure is recurring commissions where the brand pays the affiliates whenever the user pays for a limited time frame.
- The third type is the tiered commission model where you pay commissions to the affiliates on set tier levels. For example, for the first 100 users you pay 5% of each sale and for 200 users you pay 8% of each sale and so on.
- In the last model, known as the non-revenue-based commission, you offer a non-monetary value to the affiliate instead of cash. For example, you can offer advanced features for free for a particular period.
Before choosing a commission structure, do some research regarding other affiliate programs. It will give you an insight into setting a realistic commission structure while also generating long-term sustainable profits.
Diversifying Affiliate Programs
When you’re starting, it’s ideal to choose one or two affiliate programs since you have budget constraints and lack experience. However, as you grow, ensure that you diversify your affiliate programs. SaaS companies are maximizing their program potential since it helps them tap into new audiences and create future opportunities.
You can explore more opportunities within your existing affiliate programs. If a particular program is consistently performing well, you can consider increasing your affiliate marketing budget for a more elaborate campaign.
Partnering with Influencers
You can affiliate with individual influencers who have a substantial following to promote your products and amplify your sales. Contact influencers who enjoy credibility and authority in your industry. Explain your value proposition and product offering and decide on how you want them to design the content in a way that illustrates how the software works and how they will highlight its key features and benefits. Just make sure they demonstrate brand fit before you proceed.
Signing Agreements and Discussing the Terms
Just like all marketing scams, affiliate marketing suffers from a few too. Many affiliates may use bots to show better performance and trick you into paying commissions. It is ideal to be professional and sign a formal agreement with affiliates for a safe partnership.
You can clearly pen down the commission terms, KPIs, and payment terms. Companies are ensuring that they have a formal agreement through the legal team to include the terms and conditions and discuss all the relevant details.
Top 5 SaaS Affiliate Marketing Programs
As a pioneer in accounting automation, FreshBooks helps with automating invoicing, time tracking, and payment collection. It allows you to manage finance from anywhere in the world and is a top choice for SaaS firms in the US and other countries.
Its affiliate marketing program is for freelance writers to large corporations where their pricing starts from $15/month. An affiliate can earn up to $10 on a free trial and $200 for every paid customer.
If you want to partner with ActiveCampaign, its commission starts from 20%. The catch is for the customers to use the service for as long as possible. The program also includes a dashboard where the partners can track performance and get access to other marketing assets.
One of the major benefits of this program is that it makes it less challenging for its partners by providing more resources for a customer that ultimately makes a purchase via the affiliate link. The partners don’t have to invest efforts in retaining the customers.
It’s very common for businesses to use more than one SaaS tool for their day-to-day operations. Coupler is a tool that automatically exports data from one tool to another say for example, from Shopify to Google sheets to excel. It integrates different tools to help businesses seamlessly process and store their sales and marketing data.
For each subscription purchase that the customer makes within 30 days, Coupler provides a 50% one-time payment and a 20% lifetime revenue share. On average, this fetches you anywhere from $150 to $500 depending on the subscription plan.
A SaaS tool that offers everything from campaign management to SEO essentials, Semrush has established itself as one of the best brands to look out for. It also boasts of an exclusive clientele like Tesla and Forbes.
The affiliate program allows affiliates to earn a commission of $200 per new subscription sale. It also offers $10 for every new trial and $0.01 for every signup. Since the brand enjoys popularity, companies searching for its services will likely have heard about them.
Pipedrive offers CRM solutions that aid businesses organize their sales activities and monitoring their performances. It allows companies to track calls, emails, and contact history with complete visibility. Their plan starts at $15 per month. If you opt for Pipedrive’s affiliate marketing program, you can earn a 33% commission for every referral for the first 12 months that the customer is with Pipedrive.
Affiliate marketing can work wonders for SaaS businesses. Since it’s a mutually beneficial marketing activity, there’s potential for growth for every brand that’s involved in the campaign. If you’re looking to start, one of the programs mentioned above can be the best for you.
As SaaS tools leverage affiliate marketing, they’re cautious about choosing partners with a good reputation and aligning with their brand objectives. If done right, SaaS affiliate marketing can help you drive growth through expanded reach, more conversions, and earn a stable source of long-term alternative income.