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4 Key Factors for International Expansion of Your SaaS Business

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The software market is growing, and a large portion of that growth is occurring outside of the US. In fact, currently, 4/5 online software searches are coming from outside of the US, according to a recent webinar that our team conducted with Google. Data from that same webinar shows that while US software search volume is up 5% year over year (YoY), international software search volume is up 12% YoY.

As emerging markets become fully-developed nations, and businesses within these markets look to continuously automate and refine their processes, the global demand for software will only rise. Increasingly, software is becoming SaaS-based, with the deployment of those products occurring over the cloud, making expansion into new markets as easy and cost-effective as ever before.

For example, we estimate that the size of the EMEA software industry is $300B with 6% growth through the end of 2018! There’s great opportunity for expansion through strategic programs like PPC lead generation, but first, there are a few key factors to consider prior to launch. Additionally, we have some tips to help make an international expansion successful!

1. Do your homework with market research

Former football coach Paul “Bear” Bryant from the University of Alabama once said, “It’s not the will to win that matters — everyone has that. It’s the will to prepare to win that matters.”

Sports clichés aside, this sentiment rings true for those considering global expansion. An article from Inc. Magazine suggests that diligent research into any new market should shed light on the following questions:

  1. Is there a need for this product in the identified country or region?
  2. Are competitors active in this new market, and to what extent?
  3. Does pricing need to be adjusted for this new market, and will the payment system need to accept foreign currency?

The same article from Inc. recommends setting up telephone interviews with business owners from the new market, contacting government representatives, and soliciting feedback from potential customers to ascertain the new market’s viability for business growth.

Most importantly, though, software businesses ought to consider any potential language barriers which could derail initial marketing and sales operations.

2. Language considerations for International Business

If your software business lacks foreign language speakers, you’re likely going to target international expansion to English-speaking countries first (assuming that is your business’s native language). The below image from our recent webinar in partnership with Google breaks down English proficiency for a number of different countries.

As one might expect, the list includes Western Europe, Northern Europe, and Australia/New Zealand, but it also includes countries like Singapore, Malaysia, and India. US businesses looking to grow may want to keep an eye on emerging countries that have a strong English proficiency – even those halfway across the world!

That said, different countries’ command of the English language can vary. The ability to precisely articulate your product’s value proposition, as well the differences between your product and its competitors, is crucial. Concise and clear communication will always help with product advertising, engagement within the product’s free trial (or other next steps), and follow-up with any leads received.

3. Follow-up with International Leads

For businesses that lack an international sales team in the foreign country of interest, lead follow-up can be a concern. Companies can have reservations about spending marketing budget on leads that their sales representatives may have difficulty servicing efficiently. However, there are effective solutions to deal with this concern while you start expanding your reach to new markets.

The Client Success team at Capterra generally advises our advertisers to call leads as quickly as possible after the submission of a trial, demo, or contact form. But in international sales, those form submissions could arrive at odd hours, which leaves the door open for competitors to contact those leads first.

To circumnavigate this potential issue, consider incentivizing your sales team to work late, or work early, during the initial months of targeted international expansion. If bandwidth within the company is insufficient for timely follow-up by phone, create lead nurture tracks to accompany each phase of the free trial (or similar offer).

Good news! Powered by marketing automation and email marketing tools, nurture tracks have the ability to send automated emails prompting trial users to activate the trial itself, explore all of the features/functionality present within the trial, and continue using the product with a paid plan. A guide on lead nurturing from Marketo asserts that companies utilizing this strategy generate 50% more sales-qualified leads at a 33% lower cost overall – an advantageous statistic for those looking to make the most out of a targeted, international advertising campaign. Your business likely already has some email automation set up, so consider creating dedicated tracks to send to different time zones or countries to optimize that automation’s impact.

4. Remember that the journey doesn’t stop after sale

When ready, start expanding your PPC campaign (or other marketing campaigns) to strategic international markets and get ahead of your competition! Before long, you’ll start to see quality sales after executing those well-conceived advertising efforts.

To continuously build on any early success, the goal will need to be the ongoing satisfaction of these new customers. One way to reduce churn rate and retain those paying customers is to create a customized method of feedback for the new market, such as an NPS survey. Analyzing that feedback will help with enhancement of both the product and the manner in which your team services paying customers from a new country. For other churn rate reduction strategies, check out this great case study from Kissmetrics concerning software company Mention.

As your team continues to accrue a user base and lengthen those users’ paid subscriptions, it’ll be important to monitor your customer acquisition cost (CAC) and how that stands in correlation to the expected lifetime value (LTV) of a paying client. Assuming your company utilizes PPC for lead generation, tools like Capterra’s PPC Bid Calculator are helpful ways to ensure that continued growth in new markets is cost-effective and sustainable.

Want to learn more?

It’s an exciting time to think about growing your SaaS/Cloud business, as the internet has created an environment where small companies can compete with enterprise corporations on a global scale. If you’re eager to learn more about growing your business in another country, contact your Account Manager for personalized tips, or watch the webinar “Turn International Traffic into Paying Customers” below anytime!

international webinar

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About the Author

Andrew Jones

Andrew is a Marketing Adviser for Capterra and works with hundreds of B2B software companies to optimize their PPC marketing campaigns across both Capterra and its partner site, GetApp. Outside of Capterra, Andrew likes to play sports, travel, and spend time with his family and friends.

Comments

Nice article. From personal experience of selling a wide range of B2B software in India, Germany and Thailand, I’d respectfully – but completely – disagree with your classification of the three countries along the English proficiency spectrum. Even more so if you plotted them on “English willingness” – customer knows English but will refuse to communicate in English – since that’s what matters in a sales situation. When it comes to the software market, whether you take the Enterprise or SME segments, India and Thailand score far higher than Germany on English proficiency and willingness. ICYMI, Germany’s longtime Chancellor Helmut Kohl once said, “I’ll sell in any language. But I’ll buy only in German”.

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