The Challenges of Selling Industry-Specific SaaS (and How to Overcome Them)

Selling Software-as-a-Service (SaaS) is exciting, but not without its challenges. Did you know that the global SaaS market is projected to be worth over $1 trillion by the end of 2032? With such rapid growth, it’s no surprise that competition is fiercer after over 20 years of development. 

Are you struggling to stand out or finding it hard to convert leads into loyal customers? Well, that’s understandable as the growing market means growing competition, given the fact that over the past decade, the SaaS market has seen an annual growth rate of 25%. 

This only means that many SaaS businesses also face these very same hurdles. But don’t worry. With the right strategies, you can tackle these challenges and turn them into opportunities for growth. 

13 SaaS Marketing Challenges

1. Building Trust with Prospects
2. Outpacing Competitors
3. Complex Buying Journey
4. Saas Lead Quality
5. Smaller Lead Pool
6. Not Enough Resources
7. Acquisition Cost
8. Reaching the Right Audience
9. Dealing with Resistant to Change
10. Managing Long Sales Cycles
11. Leads Lost In the Long Sales Cycle
12. Addressing Customer Churn
13. Explaining the Value of Your Product

Let’s dive into the challenges of selling SaaS and how to overcome them.

1. Building Trust with Prospects

One of the biggest hurdles in SaaS sales is earning the trust of your prospects. Unlike physical products, SaaS is intangible. Imagine being in their shoes—they’re being asked to invest in something they can’t physically see or touch.

Your potential customers can’t hold it in their hands or see it in action until they’ve tried it. They need to be sure your product can deliver what it promises, and that hesitation is completely understandable.

So, how can you ease their worries and have them trust you?

• Offer Free Trials: A free trial gives prospects a no-risk opportunity to experience your product’s value firsthand. Highlight the key benefits during this period.
• Show Social Proof: Share testimonials, case studies, and reviews from satisfied customers. Real-world examples go a long way in building credibility.
• Be Transparent: Clearly explain pricing, features, and how your product works. Avoid hidden fees or surprises—this can make prospects wary.

2. Outpacing Competitors

Any type of business is competitively vying for attention in its specific marketplace. SaaS is no different. In fact, as of November 2024, the United States accounts for 9,100 SaaS companies approximately. This is followed by the United Kingdom’s 1,500 SaaS companies (that’s a 7,600 difference from the leading SaaS market, the US).

Competing in such a vast landscape requires a strong strategy. With so many options, your prospects may feel overwhelmed and unsure of which solution to choose. It’s not that they don’t want to hear you—it’s that they’re bombarded with choices every day.

So how can you make your target audience notice you?

• Focus on Your Unique Selling Proposition (USP): What makes your product different? Whether it’s the ease of use, a specific feature, or exceptional support, make your USP clear.
• Narrow Your Target Audience: Instead of trying to appeal to everyone, focus on a niche. For example, if your software helps small e-commerce businesses, tailor your messaging to that group.
• Create Educational Content: Blogs, webinars, and videos that address common pain points can position you as an expert in your field and attract the right audience.

Outpace your competitor with sales strategies for SaaS sales reps.

3. Complex Buying Journey

Selling SaaS frequently requires negotiating a network of decision-makers, budget holders, and influencers. Each stakeholder has unique priorities, which might complicate the process.

To overcome this, make sure to:

• Map Stakeholders: Identify all decision-makers and their specific concerns.
• Create Tailored Pitches: Address the unique needs of each stakeholder group.
• Use Collaborative Tools: Provide shared resources like demo recordings or detailed proposals to keep everyone aligned.

4. Saas Lead Quality

Unlike mass-market products, SaaS businesses often target a narrower audience. This makes every lead valuable, but finding high-quality leads is difficult. To generate quality leads, make sure to:

• Leverage Intent Data: Identify prospects already searching for solutions like yours.
• Optimize Lead Scoring: Focus your sales team’s efforts on leads most likely to convert.
• Partner with Specialists: Work with agencies or platforms specializing in SaaS lead generation.

5. Smaller Lead Pool

Industry-specific SaaS providers focus on solutions to niche problems of the niche enterprise. At some point, it can also feel like you may have exhausted your lead pool. What are the things you need to do?

First, work on scaling with your customers–grow as your customers’ businesses grow. A top priority of niche providers is to continue boosting the success of their customers. 

Second, consider expanding to similar niches where your SaaS tools are also relevant. Don’t be afraid to enter smaller markets in the same vein as your current customers. 

6. Not Enough Resources

Small SaaS teams often juggle multiple roles, leaving little time for a focused sales strategy. To address this challenge, you need to:

• Automate Where Possible: Use tools like CRMs and marketing automation platforms to save time.
• Outsource: Partner with agencies for specific tasks like lead generation or content creation.
• Prioritize Tasks: Focus on high-impact activities that directly drive revenue.

7. Acquisition Cost

Customer Acquisition Cost (CAC) can quickly eat into profits if not managed carefully. To overcome this, improve targeting by focusing on high-value accounts to maximize returns. Upsell and cross-sell to increase customer lifetime value, offsetting acquisition costs. Analyze campaigns continuously to optimize strategies and reduce waste.

8. Reaching the Right Audience

Stunted growth could be an indication of advertising to the wrong target audience. If you’re not reaching the right people, your efforts are wasted. Reanalyzing your target description may help you narrow down who your target market is. As much as possible, get more specific. 

Also, focus on the right channels, such as LinkedIn or industry forums, to connect with your audience. Run targeted campaigns by leveraging data to create personalized, effective messaging. For instance, you may soon realize that you are selling to an entire buying committee with multiple stakeholders handling different divisions in the company. 

Focus on having one-on-one conversations with your ideal customers. Listening to them can give you more information about your target customer profile. Learn how they use your SaaS tool. Identify the unique needs and challenges of the various divisions within the company. Identify how your software can provide solutions that would meet these unique challenges. In the process, you may better describe your buyer’s persona. Finally, learn to identify which decision-makers within that buying committee have more influence than the others.

Struggling to reach your target SaaS clients? Check out these SaaS lead generation strategies.

9. Dealing with Resistant to Change

Many businesses hesitate to adopt new tools, fearing disruption or failure. In fact, one of the reasons why enterprises take longer in the sales cycle is the fear of change.

They have used their systems for a long time and invested time and money in them. Asking them to switch to a more effective and dynamic solution, yet more complex can be a lot to ask. Moreover, SaaS solutions that require organizations to require their existing vendors to adapt to the new system will also take it slow for fear of damaging their relationships.

Reach out to the primary system users who may better understand the solution your SaaS tool is offering. They can help you better work with the key decision-makers since they recognize how much the solution will save them. Let your prospects use product trials so they can give first-hand testimonials on how your SaaS tool made their work simpler, more secure, and less costly in the long run.

10. Managing Long Sales Cycles

Long sales cycles in SaaS can feel like navigating a maze. Your prospects aren’t just saying “no”; they’re dealing with internal processes, tight budgets, and multiple decision-makers who must align. It’s frustrating, but understanding this can help you plan better.

“On average, SaaS sales cycles can range from 3 to 9 months, depending on the product and market segment.” – Rebecca Matias

Patience and exceptional follow-ups are secrets to thriving amid an unusual sales cycle in SaaS. In particular, SaaS providers who recently launched their sales program may lack precise data on how long it will take to close a deal. It can lead to unrealistic expectations, unnecessary pressures, and unreachable quotas. Another problem is staff turnover which replaces team members who leave the company.

SaaS sales don’t happen in a single transaction. It can take weeks or months for the buying committee to approve the purchase. The complexity and price of the SaaS tool may further lengthen the sales cycle. By contrast, less complex and less pricey solutions will sell faster.

As it is harder to predict monthly and quarterly quotas and manage overlapping sales cycles, consider benchmarking to improve your expectations. Factors to consider include pricing, the complexity of the product, your niche industry, and your customers’ needs. It can take a while to understand the buyer’s process that you can use to set more realistic sales targets. To overcome this challenge:

• Use a Clear Sales Funnel: Map out your prospect’s journey and ensure you have content and strategies for each stage—awareness, consideration, and decision.
• Nurture Leads: Use email marketing to stay on your prospects’ radar. Share helpful resources and updates about your product to keep them engaged.
• Set Expectations: During initial conversations, explain the typical timeline for implementation and results. This transparency can help move the process along.

Learn how ABM can shorten the SaaS sales cycle.

11. Leads Lost In the Long Sales Cycle

As it can take multiple decision-makers longer to approve the purchase, leads can get lost in the coming weeks, months, or years. The problem is not much of having a limited lead pool but a poor lead follow-up. It can be tempting to ignore leads when they are seemingly not ready to make a purchase decision. 

To avoid losing leads, encourage your sales team to nurture leads every step of the way in their buyer journey until they are ready to take that crucial step. Consistency is the key to the long sales cycle of the SaaS industry. Avoid neglecting leads by having a system of following-up leads over time. Help them along the sales pipeline by addressing concerns, educating them, and adding value. 

Become aware of these B2B SaaS marketing mistakes. 

12. Addressing Customer Churn

Signing up customers is exciting, but keeping them around? That’s the real challenge. High churn rates can feel like pouring water into a leaky bucket—no matter how much you add, it’s hard to stay full. Addressing churn means digging deeper into what your customers truly need. 

To overcome this, focus on onboarding by providing a smooth process that helps new users see value quickly. Offer tutorials, guides, or even one-on-one support. Stay proactive by regularly checking in with customers to address issues before they escalate through feedback surveys and customer support calls. Finally, offer incentives for loyalty, such as discounts, exclusive features, or early access to new tools, to encourage customers to stick around.

13.  Explaining the Value of Your Product

Complex SaaS features can leave prospects scratching their heads. If they can’t immediately see how your product fits into their lives or solves their problems, they’re likely to move on. And really, who can you blame them? In fact, according to B2B Buyer Trends 2024, 93% of SaaS buyers say understanding the ROI is crucial before making a purchase decision. 

To overcome this, make sure to simplify your messaging by avoiding technical jargon. Use simple, everyday language to explain what your product does and how it helps. Use visuals like demos, videos, and infographics to make complex concepts easier to grasp. Sometimes, seeing is believing. Quantify benefits by sharing specific metrics like “20% reduction in operational costs” or “50% faster workflows” to make the benefits tangible.

Before You Go

SaaS sales require a strategic approach that should be intentional and consistent. Selling SaaS may come with challenges, yes, but each obstacle is an opportunity to improve your strategy. As you overcome challenges, growth and innovation are inevitable.

By focusing on trust, clarity, and customer satisfaction, you can overcome these hurdles and grow your business successfully. Finally, remember that SaaS relies on customers continuously using and benefitting from the software over multiple contracts.