Given that you understand your audience, your SaaS company turns into a Bollywood movie where everyone is happy and dancing.
Customers get exactly what they want, exactly where they're looking for it for the price that is optimal for them. They gladly pay that price, therefore you have no issues with churn, revenue and customers’ lifetime value.
But how can you know the “audience”? It’s a generic term for thousands and millions of potential buyers. It seems also impossible to understand all the individuals hiding under the “audience” term — it's just more than human brains can process.
What is a buyer persona
To move closer to understanding our customers, we need a tool that sits somewhere in between the “audience” that is too generalized to explain anything and “my 1,123,654 buyers” that is too detailed to explain anything.
That's where segmentation of target audience comes in. It generalizes clusters of your target users who exhibit similar attitudes, goals, and behaviors relating to your product. As a result, you have a manageable number of audience subgroups.
SaaS buyer personas are the next step after the audience segmentation. Made out of complex user data they take the form of real people to highlight specific details and important features of the group. It helps product teams to create empathy with users.
Remember why every Amazon meeting has at least 1 empty chair?
Amazon CEO Jeff Bezos believes that obsessing over customer experience is the only possible competitive advantage. One problem is that customers aren't there at every meeting, so it's easy to forget about their needs. Using his trick with a chair, Bezos makes it impossible for the team to forget about the customer.
Buyer personas serve the same goals — because empathy is really important and really elusive.
What’s wrong with personas
Say you start developing personas to understand user needs. You seek a simple buyer persona template and call it SaaS Sally. You add photos, some demographic data, some assumptions.
And then, the pretty slides you’ve made move to the dustiest digital shelf and never go back. You don’t use them because they don't help you reach buyers.
You google more info about personas to find out what went wrong. You read a buyer persona guide that makes fun of your pathetic SaaS Sally and say you need to “go dipper” and feed your personas with more insights and data.
All right, but making decisions while keeping in mind tens or hundreds of persona features becomes unwieldy. And it's unrealistic to find universal segments of customers with similar motivations, goals, information needs, attitudes, and behaviors across a broad array of situations and scenarios.
How to make personas work?
Here at Eleken design agency, we’ve got a bunch of people that know the answer. Our designers research user personas every time they need to build multiple user flows (like all the time). And here’s what the masters say:
There’re no one-size-fits-all personas, only situational ones.
This is worth repeating:
There’re no one-size-fits-all personas, only situational ones.
Before you make buyer persons, ask yourself, “what are my personas for?”
How to create personas for marketing
How to build buyer personas for better marketing? Let’s see how with SaaS buyer personas deals Beamer, the marketing tool that helps you to send targeted notifications. They must be good at targeting!
On its main page, the company pitches itself for three groups of customers — those who need their services for SaaS, ecommerce, or a website.
The three personas apply not only to the main page — Beamer makes targeted landing pages focused on the goals and pain points of each persona so that they resonate with them.
Moreover, as you sign up, Beamer asks you to specify what is your website for, and makes it
for purpose — after I’ve chosen that I’m writing for a blog, the next screen I see is talking to me as a content writer.
To make its offer convincing, Beamer needs to pick its strongest selling points and put those front and center. What information does Beamer need to gather for building customer personas?
The key is to have insights that reflect customer pains and customer gains. As we collect such data by running a survey or a series of interviews with the customers, we may notice that the answers vary depending on the type of site or app the client is running.
Website managers want to grab the newcomers’ attention. SaaS owners need in-app messages to increase user engagement and retention when ecommerce guys want to announce special deals and discounts.
Thus, Beamer can roughly divide their buyers into three groups according to their needs and build marketing messages that include what is important to each persona.
But when it comes to pricing, we can notice that Beamer slices the audience pie in a completely different way. Here they divide users not by a company type, but by a company size. Why so?
How to make buyer personas for product pricing
When you work on pricing, personas will help to figure out what features of a product different groups of people would find most valuable and least valuable, and what they would be ready to pay for them. Thus, you’ll be able to build a pricing grid that contains a satisfying option for each group of users.
Also, since it’s a matter of money, you need to look at some financial KPIs for SaaS companies. If a group of customers is willing to pay less than you spend to acquire that group, the unit economy doesn’t click and you’re going to lose more than you gain.
On the picture below, we can see a starter kit of data you need for developing personas for a SaaS pricing strategy.
Having data collected, you’ll notice that it needs to be segmented into personas along another axis, when compared with the marketing personas we reviewed above.
SaaS and ecommerce startups have more in common with each other when it comes to buying software than an ecommerce startup and Amazon. That’s why marketing and pricing personas can be segmented differently.
How to create personas: UI/UX design
Once we at Eleken designed a product website for Abode, a security-focused smart home solution.
The security systems market is huge, and to help Abode bite a piece of this market, we needed to understand users’ motivations, needs, barriers and more in the context of how they would use a design to ideate, iterate and usability-test optimal design solutions.
The goal and the scope of focus for this design task are very granular. Just imagine using Beamer's broad marketing personas mentioned above trying to understand how different users navigate down the site. The information in marketing personas would not be specific enough. It’s just for other purposes.
For Abode, we conducted user interviews to find out what people are looking for as they open the website.
We figured out that according to their intents all website users can be divided into four groups:
- those who want a security solution but no security hassle;
- people who already have a security system and need some additional devices;
- users that are looking for an optimal price/quality ratio;
- and security geeks looking for sophisticated solutions.
With this knowledge, we could understand what information users need to reach their goals and how they want to feel as they move down the page.
We used personas to explore different user journeys and brainstorm how we could implement a UI/UX design solution to give all 4 types of customers what they're looking for.
Crafting Useful Buyer Personas
As we remember, there’re no one-size-fits-all personas, only situational ones.
When creating user personas, tailor them to a specific task whether you need to wrap your value proposition in the right way, make a pricing grid, or app redesign.
Think of the information you need to gather about the audience to complete the task. There’s a ton of data you can get, so it’s vital to figure out what really matters.
If you need a broad bird's-eye view for high-level understanding and decision making, make broad personas, but remember that you can't see the small details flying high.
If the task requires any specific insight, you need to get closer. Thus, you narrow the view to be able to focus on important details. With a narrow scope, there is less context to consider, so we can get the richer data.
As you learn what your customers love, what are their gains and pains, the precise design will help you to build a deep empathy with your users into the product you’re making for them.
So, with that said, craft your buyer personas, and in the meantime, visit our article about the human-centered design — that’s the next milestone on the road to a successful SaaS startup where customers get exactly what they want, exactly where they're looking for it for the price that is optimal for them.