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Does Email Marketing Work for SaaS? Your Comprehensive Guide
How to Leverage Email Marketing To Grow Your SaaS Company
Brandon Storey
October 19th, 2024
Software as a Service (SaaS) is one of the best business models in the world.
You have the opportunity to generate revenue on repeat for years without the hassle of dealing with physical inventory.
But, the reality is that most SaaS businesses don’t get off the ground.
One of the main reasons?
They struggle to get investors and customers on board due to poor communication.
While social media can help spark a fire to get the word out for your SaaS, you’ll struggle to keep your fire lit without email marketing pouring gas on it on the backend.
In this guide, we’ll break down everything you need to know about leveraging email marketing to grow your SaaS so you can ensure you reach your goals.
Let’s dive in!
Table of Contents
What Is Email Marketing for SaaS?
SaaS email marketing is the process of marketing your Software as a Service business using email. Email is one of the most effective ways to market SaaS, boasting a 36:1 return on investment (ROI).
That means for every $1,000 you invest in email, you should expect about $36,000 back in revenue.
The reality is that most SaaS businesses have complex customer journeys, and can often be quite long. It can be weeks or even months to transition leads down your sales funnel. So, your marketing team should look at every possible opportunity to speed up the time from prospect to lead to customer.
That’s where email comes in.
Most SaaS marketers and business owners think of email as a necessary evil. Instead, you should begin thinking of email as the backbone of your marketing engine.
Email gives you a direct line of communication with your leads and customers so you can continuously market to them without interference, leading them towards your product.
SaaS companies can do this through automated emails, trigger-based emails, product updates, broadcast campaigns, weekly newsletters, sales emails, and more.
Now that you know what SaaS email marketing is, let’s dive into why the top SaaS companies lean on an email-heavy strategy to succeed…
Why Listen to Me? I’ve generated over $1 million with email and written over 1,000 blog posts. I run Storey Time, a newsletter where I teach people how to become full-time digital writers. Feel free to reach out to me on X anytime!
Why You Need to Leverage Email Marketing in SaaS
If you want to acquire more SaaS users (and retain your current customers), you need to deploy an email marketing strategy for your SaaS.
Why?
Because it’s the most reliable medium to regularly communicate with your audience.
Here’s why you need to leverage email marketing in your Saas company:
Before we dive into email, let’s back up a bit.
How are you currently marketing your SaaS?
Odds are pretty good that you’re relying on some form of organic strategy like social media, search engine optimization (SEO), or YouTube.
These three organic mediums are some of the best ways to draw in an audience.
But, they’re a double-edged sword.
They also come with shifting algorithms that can (and do) change on a whim.
One moment you’re going viral, growing your audience, and turning cold traffic into prospects.
And, the next moment, your posts are falling flat and you have no idea why.
This is the nature of SEO and social media. Big tech is always updating their algorithms, and it often results in high-quality content creators and SaaS owners getting suppressed or penalized.
Email solves this.
Email isn’t primarily a top-of-funnel strategy (although it’s becoming increasingly top-of-funnel with the emergence of paid acquisition via sponsored ads and Boosts). So, you still need top-of-funnel channels to create brand awareness and draw your audience into your funnel.
But, your main goal with your top-of-funnel channels should be to turn people into your leads and get them on your email list.
Email combats the shifting algorithms that prevent your communications from getting through to your audience. Your messages can’t get blocked from algorithms because Mark Zuckerberg or Elon Musk’s teams decided to change their algorithm for the ninth time this year.
With email, there is no algorithm that can get in the way of your audience communication. Whenever you want to reach your people, simply hit “send” and it’s in their inbox immediately.
It’s a direct line to your audience without interference.
2. You Don’t Need to “Pay to Play” Like Paid Ads
If you want to get your SaaS out there, you likely rely on paid media like Facebook ads, Google ads, and more.
But, the reality is that media buying is an uphill battle. It will always go up in price over time. If you want to fuel your marketing, then it can be a great way to heat up your strategy. But, the moment you decide to pull back a bit, you’ll start shrinking.
Email is different.
While it’s not completely free, it’s pretty close.
Most email software like beehiiv starts at $0.
And, even with advanced plans, you’re typically only looking at a few hundred to a few thousand dollars per month, even with a large email list.
While paid ads will cost you every time you show them to your audience, it won’t cost you to send more emails. Email, on the other hand, doesn’t require you to “pay-to-play” like paid media buying demands of SaaS companies.
Email is extremely cost-effective for what you get out of it. This is one of the reasons the ROI of email is way higher than other channels like SEO, paid ads, and social media.
Relying too heavily on SEO, paid ads, or social media means relying too much on big tech that’s quite frankly unstable.
Email is the only channel you can properly own. It can be a game-changer for SaaS since you can continuously hold that relationship with your audience closely without interference.
3. Increase Traffic to Your SaaS
As mentioned above, only relying on paid media and organic channels like social media means building your SaaS’ marketing foundation on sand. If you want to build on rock, you need to control the flow of traffic more effectively.
Email helps stabilize your traffic flow because you get full control over that traffic. Imagine your SaaS customers have to travel by car to use your SaaS. In order to get to your headquarters and use your product, they have to drive in their cars through the roads in your city.
But, what happens when there’s construction? What about a car accident? What about a random event like a marathon?
The traffic will slow down or be diverted to take a detour. This means delays and sometimes your traffic can come to a complete standstill.
Email is like having a secret highway that your audience can take to your product no matter what’s happening in the rest of the city (social media, SEO, paid ads). Email enables your customers to always reach your product through a direct path.
The result is you have more control over your SaaS traffic. More traffic means more leads. More leads means more people using your product. More people using your product means more customers. And more customers means more revenue.
4. Increase Your ROI
As mentioned above, the average ROI of email is 36:1. Investing your time and resources into a strong email strategy only has upside for the potential of your SaaS.
But, did you know that marketers have been seeing even higher returns from email as of recently?
In 2023, nearly 52% of marketers reported their email marketing ROI doubled from 2022. Plus, 5.7% reported they experienced an ROI four times greater than the previous year.
Why is this happening?
For one, more and more people are using email every year (as we’ll touch on below). More email users means you’ll get more out of every email you send.
And the second reason is that no-code email software has simplified the email game. Thanks to email platforms like beehiiv, it’s never been easier to start, grow, and monetize your email marketing.
5. Email Usage Continues to Grow Every Year
If you ask most people whether they think email is growing or shrinking, they’d probably say it’s shrinking.
Why?
Because most people assume social media has replaced email as the way customers prefer to hear from brands. But, this is far from true.
In fact, email isn’t shrinking, or even remaining flat.
It’s growing every year.
In 2022, the number of email users worldwide reached 4.26 billion, which is over 50% of the global population. And, by 2026, that number is projected to reach 4.73 billion. That’s an 11% increase in only 4 years.
With more and more people using email every year, it’s never been more important to design an email strategy to market to your SaaS audience.
Different Types of SaaS Emails (Real Examples)
Now that you know why email is crucial to help your SaaS business thrive, you’re probably wondering what a SaaS email looks like.
You may be wondering, “What am I supposed to email my SaaS audience about?”
Don’t worry, I’ve got you covered.
Here are nine different types of SaaS emails you should consider sending to improve acquisition and retention:
The first (and easiest) email to start with is a traditional newsletter.
This is an email you send on a regular basis (daily, weekly, or monthly) to stay in touch with your audience.
If you’re wanting to take things slow with your email marketing and get your feet wet, then this is the best place to start.
TicketTailor sends out a monthly newsletter from the founder, Johnny. TicketTailor does a great job of sending out a nice, personal email with their monthly newsletter coming directly from the founder, with updates on his life and future updates on the software.
2. Product Updates
One of the highest-leverage emails you can send as a SaaS company is a product update (feature release) email.
If you don’t tell your audience about your new features, how will they find out?
You should regularly send a product update email to your email list to ensure they’re getting the most out of your software. It’s also a good reason to remind them to leverage your tool.
People love anything new. Leverage this with regular product update emails.
Like TicketTailor above, beehiiv’s product update email also comes directly from its co-founder and CEO, Tyler Denk.
Every few weeks, Tyler sends out a feature update email to over 100,000 email subscribers on beehiiv’s email list showing off the latest addition to the beehiiv email newsletter platform.
Tyler does a great job of highlighting these new features with simple copy that breaks down why the features are important (and how to use them) directly in the email itself. Plus, the emails themselves are designed beautifully, with eye-catching visuals that grab your attention and hype up the features even more.
3. Welcome
It’s shocking how few SaaS companies are sending out welcome emails.
Imagine if a potential customer walked into your SaaS brick-and-mortar headquarters, walked up to your receptionist to say “hi” and the receptionist ignored them.
How would they feel?
The same is true when your audience subscribes to your email list. Simply put, if you don’t welcome them in, they’re not going to feel welcome!
The welcome email is the most important email you will ever send, with an average open rate of 47%. Not only is it the most-opened email you could send, but it’s also a way to set the tone with hot leads.
First impressions matter no matter what business you’re in, especially in SaaS.
Canva does a wonderful job with their welcome email by offering striking visuals that showcase their future-forward brand. They offer two call to actions (CTAs) above the fold: “Design With Canva” and “Start designing,” giving their readers two chances immediately to begin using their SaaS product without having to scroll down.
4. Onboarding
What’s the next email you should send after a welcome email?
Onboarding emails.
Your welcome email is your first chance to get your new leads into your product. But, the reality is that some people won’t see that email, or they will forget about your product within a few days.
Take advantage of that first week that new subscribers enter your email list by offering further “onboarding” emails to remind them to use your product.
Bitly does a solid job with this trigger-based, personalized email. They have an automated email sent out during a new user’s first week with a checklist to complete their onboarding.
This is an excellent approach to bring users back into the SaaS, since people don’t like to leave things incomplete. By showing them what steps they’ve done already (and how they’re 50% of the way) to complete their onboarding, it encourages people to come back.
In this example, the user’s next step is to share their bitly link, so the appropriate call to action is to “Share your link”, giving the user the most relevant action point at their stage of the customer journey.
5. Promotional
This is likely the email you’ve been waiting for.
The whole point of email marketing is to promote your SaaS product and drive revenue, right?
Yes. But, you can’t just spam salesy and promotional emails a dozen times a day. You need to mix up the types of emails you send to build trust with your audience.
But, don’t shy away from offering promotional emails with limited time offers and sales.
Slack’s promotional email is simple and effective. They keep it to the point with their copywriting, playing off of a limited time offer of 50% off Slack Pro for 3 months.
They use “Time is running out” and reiterate that the offer is only available until January 31, 2024, leaning into urgency.
After the call to action, they reiterate the features and benefits of the freemium upgrade to Slack Pro.
6. Transactional
One of the more “boring” but necessary emails is your transactional email.
But, remember, they don’t have to be boring.
Yes, you need to send a transactional email anytime a customer purchases your product, or upgrades their subscription.
But, you can also use these emails to lean into retention.
Grammarly gets right to the point by showing off a receipt for their Premium upgrade.
But, if you look below, you’ll notice that they add some additional copy. Below, they suggest that if you’re using Grammarly Premium for business use, you should download your receipt.
The implication is that you’ll be able to expense Grammarly as a tax write-off, making the software appear even more valuable.
7. Win-Back
What happens if your premium user downgrades their paid subscription?
You could try to market to them again through paid ads, social media posts, or SEO.
But, algorithms and pay-to-play marketing aren't as reliable as email.
With email marketing, you can send an automated email to any user who downgraded a paid subscription to a free subscription after a set amount of time.
Zoom’s winback email is a straightforward example of how you can market to customers you’ve lost (but are still on your email list). You can win these customers back by reminding them of your product and offering a limited time discount. In Zoom’s case, they offer 15% of Pro for two months with a bold button to Reactivate Pro.
Launch Your SaaS Email Marketing Strategy With beehiiv
If you want your SaaS brand to thrive, you need to master marketing.
But, without an email marketing strategy in place, you’ll be at the mercy of shifting algorithms and costly paid ad campaigns.
To tap into email marketing’s direct-to-user communications, you need a reliable platform.
That’s where beehiiv comes into play.
With beehiiv, you get access to:
A world-class editor that’s easy to use
Advanced analytics to understand where your users come from
Automations to send the right message at the right time
Multiple growth features to grow your user base
Engagement tools to fuel acquisition and retention
Ready to make your SaaS a success story?
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