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March 28, 2022

  

 mins to read

How to Differentiate Your SaaS Value Proposition on a Market Full of Similar Offerings

Gartner's research on the New B2B Buying Journey shows that when B2B buyers are considering a purchase, they spend only 17% of their time meeting with sales representatives. Most of the time buyers run their own independent research on the web. 

People are looking for an offer that suits their needs in the best possible way. A clear and distinctive value proposition is something that can catch the prospect's eye just like good packaging stands out even at the loaded supermarket shelf.

saas value poposition meme

But you can rarely find a clear and distinctive value proposition on the SaaS market because the statements companies use to self-identify are usually…

  1. meaningless,
  2. unfocused,
  3. lack points of difference.

In this article, Eleken UI/UX agency will help you to figure out how to build your SaaS value proposition in a way that you'll avoid the three pitfalls from above. 

If you want more information on the idea of the enterprise value proposition and frameworks that help to coin one, take a look at our article on defining a product value proposition.

Find the core value your customer gets

The value proposition is your SaaS business and its competitive advantage in a short, memorable promise of value to be delivered, that you can communicate through marketing, sales, and customer success messaging.

The idea seems easy and straightforward if you sell something you could actually grasp, like coffee, furniture, or cat food. But for SaaS companies that sell non-physical products, it's hard to find the right words. Thus, the SaaS market is full of senseless landing pages with pompous titles. 

bad saas value proposition examples

Words like “world-class” or “cutting-age” are just white noise, they don’t give any information to the user. The rest of the titles name the product category at best but communicate no value to draw the attention as the viewer's eyes skim through the page. 

To make your value proposition meaningful, start by boiling it down to the key benefit your customers get. According to Tomasz Tunguz, a venture capitalist at Redpoint, all value propositions of SaaS startups can be broken down into three fundamental categories.

1. Apps that increase revenue

“Buy our software and you’ll double your leads.” Who wouldn't want that?

Software that increases revenue is the easiest to sell since for most companies, growth is the top priority. Most lead generation, marketing automation, and sales acceleration apps fall under this category.

Look at what Salesforce claims on its main page. The company literally sells users their future profits. The company backs its promises with a specific figure and makes it trustworthy by quoting a real company and a real person behind it.  

2. Apps that reduce costs

“With our software, you’ll save millions of dollars.” Not so impressive as the promise to earn millions of dollars, but still works. Software that cuts down the costs offers efficiency as their value proposition. Such solutions optimize workflows, automate operations and remove silos out of your work. 

Take PandaDoc, a business document processing app, as an example. Making your processes more efficient, the app can reduce the amount of work to be done, and, as a result, operational costs. Thus, PandaDoc promises to “take the work out of your document workflow”. 

3. Apps that improve productivity

“We’ll help you collaborate better, therefore you’ll be able to increase your revenue/reduce your costs.” To this category belong collaboration tools like Figma, Zoom, or Slack.

Productivity apps’ value proposition is one step away from revenue increases or cost reductions, therefore it may sound somewhat blurry. But since the word went remote, the correlation between team productivity and business success became obvious. So productivity as a value proposition requires no further explanations.

Here’s a value proposition example from Figma. The company allows the work to be done remotely, and therefore, the revenue to come.

Narrow the target market

The product or service you are selling matters, but the people you are selling to are equally important. The better you know your target audience, the easier it will be to offer them true value. And the best way to know your target audience for a startup is to narrow it down to a specific group of people.

Let’s see how it works on the example of Gridle, one of Eleken’s clients.

Gridle (later changed its name into Clientjoy) is a growth operating system, it belongs to the same product category as Salesforce and sells its users the ability to increase their revenue.

Salesforce, as well as most large CRM (customer relationship management) companies, focus on large or medium-sized enterprises. To stand out from their competitors, Gridle decided to focus on a narrow niche of small creative agencies and freelancers.

What Gridle offers on their website

Small businesses and freelancers, who used to run their businesses in a fast and flexible way, feel especially keenly that CRM systems are too damn complicated. Using the CRM doesn’t help with customer management, it rather slows the workflow down. Looks like an opportunity window for a niche lightweight CRM.

Make your value proposition distinctive

Have you managed to determine your audience and the core value that the audience gets? You're halfway there, but it’s time to think about your points of differentiation.

Each software category has a multitude of providers with similar offerings. Although each provider tries to differentiate their offering, most of them appear to be equal to a potential user doing a cursory review.

To make your software value proposition more specific, figure out how you can do your job differently.

Everyone in the business of CRM shouts with a megaphone that “CRM is easy,” but if you ask a crowded room how many find their CRMs easy, there would hardly be a hand showing. 

Customer relationship management apps are elephants in the world of SaaS products. They are huge and sluggish, they have a hard time trying to mediate conflicting needs of sales and marketing staff. The former need to enter minimal client information quickly. The latter need to be able to profile and segment customers, which requires more detailed information. Trying to satisfy both parties, CRMs often end up satisfying none.

With the CRM niche’s bad rap in mind, the Gridle team decided to make simplicity of use and a smooth user experience their distinctive feature. To turn the ambition into reality, Gridle used Eleken’s product redesign services.

It took us about three months to redesign Gridle. We conducted a UX audit and numerous user interviews to detect the product’s bottlenecks. Next, we recreated the entire platform to make it more intuitive and usable. When Gridle's CTO showed the updated design to some of their users, they were excited and said that they couldn't wait to start using the revamped app.

Gridle after the redesign

The key takeaway

So here are three questions Gridle answered to build a quality value proposition:

  1. What do they do? CRM software that helps users to increase revenue.
  2. Who is their target audience? Small agencies and freelancers.
  3. How do they do it differently? Stellar user experience is what sets Gridle apart from competitors.

Looks like Gridle’s value proposition worked out pretty well. Six months after our cooperation successfully ended, the company raised $800,000 in a Series A funding round.

If you want to build an effective value proposition for your SaaS application, be like Gridle. 

  • Don’t use an Oxford dictionary to find extravagant, yet meaningless words for your headings. Better think of the core benefit you offer.
  • Remember that you can’t please everyone. So you better decide on your target niche.
  • Think of audiences’ pain points that your competitors are missing and find a way to solve them. That would help you to excel in a crowded market.

And if you decide that exceptional user experience is going to be your distinctive feature, hire Eleken UI/UX designers.

Dana Yatsenko

Author

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