Every business lives or dies on its ability to understand its customer. That knowledge underpins everything it does – from product development and messaging through to sales strategy.
And nowhere is that truer than for B2B SaaS startups.
There are no two ways about it, though: marketing research is easier for consumer tech companies than B2B SaaS organizations.
After all, if you’re building a consumer product, you can research it by talking to family, friends and friends of friends. You can also easily test competitors, as they tend to be easy to access.
For B2B SaaS businesses, finding interviewees requires more work. You’re unlikely to find many relevant business decision-makers among family and friends. And the people you are trying to engage are time poor and reluctant to participate in an interview. For some products, the list of prospective buyers could be very small.
Additionally, it can be more challenging to conduct competitor research. Competitor products often require significant payments, especially for enterprise software.
Marketing research in B2B is therefore more expensive and time-consuming. This puts limits on the type of research that is possible for B2B SaaS companies. Only certain types of project make sense and only certain types of methodology are possible.
How Marketing Research Can Help B2B SaaS Companies
Right across the board, marketing research can help businesses with a variety of sales and marketing objectives. (And companies that invest in marketing research on average grow 2–3 times faster than those that don’t.)
But some project types make more sense for B2B SaaS companies than others. Let’s start by looking at the project types that would be useful, but aren’t essential.
Useful but not Essential
First, marketing research can be used to test marcomms (e.g., test ad copy), or to test a product that you have developed, ahead of launch. While it can be useful to know how the target audience is likely to react to each, it’s questionable whether this sort of project should be prioritized.
After all, you don’t need to test a message or product if you already have a strong sense of what customers want, and who they are. Testing your messaging is like ‘being given a fish’ when you really need someone to ‘teach you how to fish’.
Marketing research can also help businesses to monitor and track how their brand is perceived by the target market. For most B2B SaaS startups, this sort of project is often an unnecessary luxury.
Most early-stage B2B SaaS startups aren’t well-known, so there isn’t much information to gather regarding perceptions.
A brand might be able to use a tracking study to prove that awareness is low, and it would be interesting to monitor how awareness grows over time.
But a tracking study won’t be able to monitor other metrics, such as whether the brand owns its preferred values. After all, if you don’t know that a brand exists, you don’t have any perceptions of it.
And while it would be useful to know how this changes over time, you should be able to obtain a lot of this information from existing data, e.g. support tickets and sales feedback.
Finally, marketers often use research to develop a better understanding of the competitor landscape. For example, some companies conduct research to explore perceptions of competitors, and where their brand fits into the landscape.
This sort of project tends to be a poor use of B2B SaaS companies’ time and budget. The focus for B2B SaaS companies should be on what customers want, not what competitors are doing.
After all, as Jeff Bezos puts it:
“If you’re competitor-focused, you have to wait until there is a competitor doing something. Being customer-focused allows you to be more pioneering.”
What to Prioritize
B2B SaaS startups should focus on marketing research projects that help them to understand what’s going through the minds of prospective buyers.
What are their priorities and challenges? What trends are impacting them? What problems are they trying to solve, and what outcomes are they trying to achieve, with the solutions they are using?
Startups should also undertake research studies to explore the buying journey. This sort of project can help to identify who’s involved in the decision-making unit, what the decision-making process looks like, and which criteria drive supplier choice.
If a B2B SaaS startup knows the target market’s needs, wants and buying behavior, it can more easily create its sales and marketing strategy. This knowledge informs product development, messaging and go-to-market strategy, and there is no need to test each message or product that is produced.
This information can also inform buyer personas that help to inform a more targeted approach to sales, marketing and product development.
B2B SaaS businesses can build personas for different business types, or job titles, for example ‘the IT Director’ or ‘the HR Director’. But, generally speaking, the most valuable personas are based on buyers’ needs or attitudes, or on the ‘jobs’ they are trying to achieve with your solution. For example, ‘the productivity-focused’ or ‘the price-focused’.
Which Research Methodologies to Use
Once a company decides what it would like to achieve through research, the next consideration is how to conduct the research.
Looking at each option in turn…
In most B2B marketing research projects, primary research interviews typically tell only part of the story. Secondary research – also called ‘desk research’ – can be a cost-effective, easy, and quick way to access even more information.
There are a few information sources that B2B SaaS companies can use to explore the target audience’s needs, wants, and buying behavior:
- Online communities: B2B decision-makers tend to be more private in sharing opinions of their vendors than consumers. But that doesn’t mean there isn’t any useful information out there. In our experience, you can still find a lot of interesting information about buyers’ needs and behaviors if you look in the right place: LinkedIn, review sites, industry blogs or specialist online forums.
- Academia: The business departments of academic institutions conduct a lot of research about the business world. This research is valuable because it is accurate and reliable, and because it lays down a theoretical foundation for understanding an industry or issue. Much of the output from academic research can be accessed through specific journals. Google Scholar is a great way to find the article or journal that suits your needs quickly. Alternatively, some professors provide consulting services in their spare time.
- Special government reports: Government bodies often publish reports that provide valuable insights. For example, we recommend searching for rulings by global competition and consumer protection authorities (e.g. the FTC). These authorities regularly publish reports regarding potential mergers and acquisitions that can reveal a lot about a target market.
- Trade associations: Nearly every trade has a collective body to represent its interests. Most of these organizations produce a lot of relevant information about their industry, including reports about key trends, challenges and focus areas. Look at your customers’ trade association(s). Doing so will allow you to develop messaging and content which will resonate with their mindset.
- Social and search tools: These tools provide a lot of insightful data that can’t be found through other channels. For example, keyword research tools make it possible to identify what a customer or prospect does before arriving at a website, and website analytics tools deepen our understanding of how individuals behave once on a website. Together these tools can help to build a company’s understanding of the buying journey.
While secondary research is valuable, it has its limits. For example, publicly available information is often limited, so relying on secondary research will only give you some of the picture.
This is where primary research comes in. Speaking to the target audience directly allows companies to get a more complete view of the target market.
There are two main types of primary research – quantitative (surveys) or qualitative research (exploratory discussions such as focus groups). The choice between the two will depend on what a startup is trying to achieve, but qualitative research tends to be more valuable if you are trying to gather an in-depth understanding of buyer behavior and needs.
Quantitative research is a useful tool in B2B marketing research because it allows companies to conduct a lot of interviews cost-effectively.
Large quantitative data sets can be the foundation for some fascinating analysis and can help to settle internal debates.
However, quantitative research isn’t always the most suitable methodology for B2B SaaS startups:
- Many B2B SaaS startups only have a small target audience, and it may not be possible to gather a large number of survey responses.
- Quantitative research is particularly valuable for certain project types such as tracking brand perceptions, or testing product concepts. It is less useful for the sorts of projects that B2B startups should be prioritizing, such as developing an in-depth understanding of buyer needs and wants.
When quantitative research is appropriate, how should companies conduct it?
There tend to be three techniques for conducting surveys: online, by telephone and face-to-face.
Face-to-face surveys quantitative interviews are rare in B2B research. They are often more expensive, and decision-makers tend not to want to interviews at their place of work. Intercepts at events and conferences can be cost-effective, but tend to lead to a biased sample because the respondents represent a specific sub-set of the target audience.
Online, there are four potential approaches to sourcing respondents: sending to existing contacts via email; buying respondents through a panel; embedding the survey link in a website or newsletter; distributing the survey link on social media.
Online research is typically preferred because it is more time- and cost-efficient, but it is not always possible because it requires a company to obtain a contact’s email address, which may not be possible.
In those instances, the survey needs to be conducted via telephone (also called CATI). A telephone approach provides control over who participates, and generally delivers a higher response rate than an online survey.
However, it’s more expensive due to the labor costs of those calling people on the list. On the plus side, you can typically target or guarantee a specific number of responses, as telephone response rates are generally consistent and predictable.
Qualitative research is a useful tool in B2B marketing research because it allows companies to ask detailed questions about complex issues.
The B2B decision-making process tends to be opaque at the best of times, and qualitative techniques enable SaaS startups to pick up on non-verbal signs.
Business decision-makers are also accustomed to doing things on their terms, and tend to respond better to more open, exploratory techniques.
Qualitative techniques are often more appropriate for the objectives that B2B SaaS startups should be prioritizing.
So how should startups conduct qualitative research?
There are three techniques for conducting qualitative research: in-depth one-on-one interviews (in-person, by phone, or by videoconference); group discussions (in-person focus groups or online groups); observation (in-person or remotely by mobile app).
The nature of B2B markets influences how useful/feasible each of these techniques is.
Conducting qualitative research among time-poor senior decision-makers can be difficult. They often don’t have time to attend F2F focus groups, or for observation techniques that require a lot of time to set-up.
Online groups and communities can work for time-poor decision-makers, as they allow participants to respond when they have time. However, online groups can also lead to low-quality responses if the exercise isn’t prioritized or given much attention by the participant.
Many B2B decision-makers work within offices that have strict security/privacy regulations. Also, many are participating in the research in their own time, and don’t necessarily want colleagues to know they are taking part in the study.
As a result, face-to-face techniques which require interviewers to attend their offices (e.g., face-to-face interviews or observation) are often not realistic.
Additionally, the target audience for a study is often small and spread across multiple locations – getting respondents in one place for a face-to-face focus group can often be unrealistic.
Finally, decision-makers can often be unwilling to share confidential information in front of potential competitors, so group activities that require multiple people from the same sector don’t work.
As a result, B2B qualitative research tends to be dominated by 30-60 minute one-on-one interviews by telephone/videoconference, especially for senior decision-makers. For less senior decision-makers, you’ll also see remote observation (by mobile app) and group activities.
As a general rule, B2B SaaS startups don’t need to conduct that many in-depth interviews to build an understanding of their customers.
12-15 interviews is probably a good starting point, but more may be required if the goal is to identify different personas, or to explore different sectors or job titles.