In recent years, it seems like we’ve heard countless examples of startups that have launched in highly competitive spaces and, despite the odds, achieved astounding success against entrenched competition. In some ways it hardly seems surprising anymore, particularly within the SaaS space.
Take, for instance, Zoom’s seemingly overnight success. The video conferencing tool has existed since 2011, but recently soared to previously unimaginable heights when the pandemic caused companies to pivot to remote working arrangements. Their sales hit an outstanding $882.5M in the last 3 months of 2020, signaling a 370% profit surge compared to the same period in 2019. Considering the fact that the audio conferencing space has been widely competitive prior to the pandemic, Zoom’s current 60% US market share is a testament to their effectiveness in standing up to competitors like Google, Microsoft, and Cisco.
So what’s the ingredient to their success?
An oldie but definitely a goodie — the Challenger approach.
Entering the Market as a ‘Challenger’ Brand
What does it truly mean to be a brand ‘toppling the Goliaths’ in an otherwise established business landscape? It all boils down to a brand’s ability to weather constant change, create an insight-driven sales process, and know what to challenge, rather than who.
One unique thing about challengers is that they push both their team members and clients to think in more ways than one, allowing these challengers to focus on providing product value and fresh ideas to their clients. Harvard Business Review presents some of these key capabilities of challenger sales reps:
- Challengers focus on the conversation. They provide customers with a unique perspective on how they can approach purchasing decisions strategically, rather than focusing only on the product itself. They challenge customers to try something new.
- Challengers strategically use personalized messaging. They prioritize specific client objectives and pain points, tailoring their sales pitch for different customer segments.
- Challengers are assertive. They know when to agree to customer demands, and when to assert themselves and take control of the sale.
What then does this mean for marketers, especially in the SaaS space where the market is more fragmented? The cloud-based services area is difficult to navigate, with tech giants like Microsoft and Google taking a massive market share.
It’s an intimidating prospect, but far from impossible. Here are some strategies to provide real customer value and stand up to the giants at the same time.
- Position your SaaS business to win.
In the SaaS space where products often have similar features and capabilities, it’s crucial to have proper product positioning to remain relevant.
Product positioning should be determined before creating the rest of your marketing campaign strategy. You must pinpoint the precise role your product plays in your customers’ lives and when they’ll need it — reviewing your market segmentation can be a helpful exercise in this regard. What is your customer’s top priority? Is your product critical enough to support a key business process, or solve a difficult problem? You’ll need to truly understand why your customers care about your product, making adjustments wherever needed.
- Differentiate your business from the rest.
Your differentiated value proposition carries the great responsibility of keeping your product a cut above the rest and forging a lasting connection with your customers. If you have a product-led SaaS business, targeting the users means you’ll have to provide significant differentiation or extrapolate your product’s value for leaders of larger companies, generating a buzz that piques the interest of other potential clients.
- Ramp it up with SEO.
Search engines generate the overwhelming majority of your website traffic, with effective SEO practices driving a conversion rate of nearly 15%. You will want your directory listing to secure a coveted first-page spot and rank with the most popular businesses in your field for better online visibility.
This was one of HubSpot’s moves that helped launch them into popularity as a young company. Their search-engine-optimized inbound strategy enabled them to generate more than 45,000 organic leads monthly, making up 80% of their total leads. Even a fractional conversion rate would drive significant sales volume for a fast-growing company.
- Offer high-value content and optimize them, too.
Unbounce is a company that almost didn’t see the success that it had in store when co-founder Oli Gardner came close to filing for bankruptcy in 2009. Fortunately he pivoted and, with a little help from his friends, developed an online course on everything landing-page related on a separate domain, www.thelandingpagecourse.com.
In the same way that HubSpot offers courses for Google certification, Unbounce strategically defined themselves as an authority to regain traction for the brand and stand up to competitors. Educational marketing was the key to their new reputation as one of the dominant players in the landing page category — a risky move, but one that embodies the challenger mindset.
Groove is another example of a company that primarily invests in content as a marketing channel and, like Unbounce, almost fizzled before achieving meaningful success. CEO Alex Turnbull changed his game plan by reaching out to small businesses, learning about their pain points, and restructuring the company’s content marketing strategy.
And how was Groove able to bounce back? Their unique, no-nonsense messaging centered on their difficult path to success, rather than attempting to compete with the saturated customer success content market within their niche. Groove’s formula of real people + real needs + real stories and solutions is what brought them $500,000 of monthly revenue to date, and around $5 million in ARR.
Despite being a decade-old approach, the success stories we’ve mentioned above demonstrate the timelessness of the challenger approach. Remember: position, differentiate, optimize, create value — these are the key steps to taking on the larger entrenched companies that are standing between your company and success.
Photography by Dan Gold via Unsplash.