The 5 stages of a successful B2B SaaS marketing funnel

Business-to-business (B2B) marketing has always required unique tactics, and software-as-a-service (SaaS) customers often take a very different path from retail or B2C users. That’s why it’s important to design a marketing funnel with these differences in mind.

A strong B2B SaaS marketing funnel helps you understand your user’s journey and build a more customer-focused product.

In this article, we’ll break down each stage of the B2B SaaS marketing funnel and explain how B2B funnels differ from ecommerce or traditional marketing funnels. We’ll explain why each stage is important and how to measure their success, so you can optimize each step and guide your users on their unique customer journey.

What’s unique about a SaaS marketing funnel?

A SaaS marketing funnel is different from a traditional marketing funnel because the conversion stage isn’t at the bottom of the funnel. In fact, the first customer purchase or download happens in the middle of the SaaS marketing funnel, while the retention stage serves as the bottom of the SaaS funnel.

Instead of focusing on getting customers to their first conversion, SaaS funnels focus on what happens after they convert. Do users renew their subscriptions? Do they recommend your product to friends and family? What is your customer lifetime value (CLV)?

Tracking these SaaS marketing funnel metrics and creating a solid funnel helps your team measure performance and build a better product for your users. Getting users to stay loyal to your product is key to driving growth in your SaaS business and preventing customer churn.

The 5 stages of a SaaS marketing funnel

While each stage in the SaaS marketing funnel is essential to drive conversions and build your brand reputation, understanding the customer journey is the key to creating a successful and effective marketing funnel. To do this, you need to conduct research and tailor your funnel and strategy to fit your customer journey so you can provide a great user experience (UX).

Let’s look at the 5 stages of the SaaS marketing funnel and which metrics to track to measure their success:

1. Awareness

During the awareness stage of your SaaS marketing funnel, potential customers become aware of the existence of your product. They might not even be conscious of the problems they’re experiencing yet, or how your company can provide solutions.

This first customer touchpoint typically occurs through a search engine result or social media post. Since the awareness stage is all about building your brand and getting users to make that first click, focus on your search engine optimization (SEO) strategy at this stage, and consider investing in paid search or advertising.

Metrics to track:

• Website visits: the number of users who visit your website

• Social media engagement: likes, comments, and shares. You can use a tool like Sprout Social to track mentions of your brand and business across different social media platforms

• Search engine ranking: your position on the search engine results pages (SERPs) for target keywords

• Bounce rate: users leaving your website without interacting with your product

2. Engagement

Users move to the engagement stage when they come back to interact with your product a second time and sign up to receive extra material—an email list or a newsletter, for example. This means they’ve found your content interesting enough to learn more about your company and products.

“A great call to action (CTA) at this stage is something that extends your content, such as a downloadable guide relating to the topic of the post. This will help users understand their problems better. You can still include information about your software in this guide and include a CTA, secondary to the download, inviting the reader to book a demo.”

Jess Percival

Digital Marketer, Exposure Ninja

During this stage, request information from your customers, so you can ask them questions to learn more about their pain points and user journey. The most common type of information to capture at this stage is the customer’s email address.

💡 Pro tip: as users move into the engagement stage of your SaaS funnel, pay attention to how they’re interacting with your content. Some users will move down your marketing funnel faster than others. If they sign up for free materials and seem highly engaged, tailor your communications to fit their process and start highlighting the ways your product can help users solve problems and reach their goals.

Use heatmaps to track the exact elements potential customers interact with on your website. Are they clicking on your free trial button or subscribing to your newsletter? Are they even making it that far down the page?

Heatmaps help you go beyond just knowing the number of page visits you get in a day.

Heatmaps in Contentsquare show you which parts of your site attract the most user attention, and which ones go unnoticed

Metrics to track

• Website metrics: time on page, views, and clicks (specifically where on your website users are interacting, and whether visitors are new or returning)

• Email signups: how many users provide their email to receive content

• Newsletter subscriptions: how many visitors sign up to receive your newsletter

• Social media engagement: the interactions (likes, comments, shares) your users have with your content on your social media platforms. 

3. Desire

At the desire stage of your SaaS funnel, you’ve already established a relationship with potential customers: people view you as a credible source of information and their interest in your product has grown. Here, offer users a free trial of your product or a ‘freemium’ version, so they can test it out and feel more comfortable paying for a full version.

This stage proves to customers that your product can help them achieve their goals. And, to validate your product’s quality, you’re giving them the chance to test drive it, free of charge.

Ensure you’re not just tracking how many users download a free trial of your messaging software, you also need to pay attention to how many activate that trial by sending messages. This metric is significant because it tells you how many customers are actually testing out different features during the trial. Those users are more likely to move further down the marketing funnel and make a purchase than those who download the trial but never activate it.

If your business model doesn’t allow for a free trial, consider offering a free demo or custom presentation instead.

Metrics to track

• Free trial downloads: how many users sign up to try out your product

• Free trial activation rate: how many users actually interact with the downloaded trial

• Demo requests: how many users request a personalized demo from your organization

4. Conversion

Conversion happens when a customer makes their first purchase or completes a milestone—an initial sign-up or subscription to a paid version of your product. For example, if a customer purchases a monthly plan for your user onboarding software, they have converted. 

At this stage, ask yourself specific questions:

• How many users who entered your marketing funnel reached the conversion stage?

• Are you seeing an increase or decrease in your churn rate? 

These questions help you determine if you need to make tweaks to your SaaS funnel to get more users to convert.

Learn more about your SaaS customer journey and how users reached the conversion stage—or why they ended up contributing to your churn rate—by giving them an opportunity to provide user feedback.

Use Contentsquare to capture user feedback and understand what causes them to convert—or leave

Metrics to track

• Number of purchases: how many customers pay for a product or subscription

• Customer acquisition cost (CAC): how much it costs your organization to get a user to convert

• Conversion rate: the proportion of your users who make a purchase or download

• Churn rate: the percentage of customers who unsubscribe or stop using your product over a period of time

5. Retention

While most marketing funnels end with an initial conversion or purchase, SaaS business models rely on recurring revenue. Therefore, there’s an extra stage in the SaaS marketing funnel: customer retention. The retention stage focuses on getting existing customers to continue their subscriptions and building customer loyalty and product advocacy.

This stage is also an opportunity to focus on upselling and cross-selling other products from your company. For example, a SaaS video recording tool might offer an upgraded version with more features or a special add-on with enhanced effects.

One of the best ways to acquire more customers is through referrals or positive word of mouth from existing users. Consider offering incentives for customers who refer your product to others or provide them with custom promos and content, like exclusive newsletters.

If you notice customers are unsubscribing or contributing to your churn rate after a certain period of time, ask them why. Use Voice of Customer (VoC) tools like surveys, user interviews, and feedback widgets to get insights into user pain points and learn how you can improve their customer experience (CX).

Metrics to track

• Customer retention rate (CRR): the proportion of converted users who remain customers

• Net Promoter Score® (NPS®): how loyal customers are to your brand and products

• Customer satisfaction (CSAT): how satisfied customers are with your product and experience

• Churn rate: the percentage of customers who unsubscribe or stop using your product over a period of time

6 marketing funnel metrics your SaaS business needs to track for better product adoption

The SaaS funnel metrics mentioned above are all indicators that help your business measure how well you’re performing at each stage of the marketing funnel. They shine a light on areas where your product is succeeding and where you can make improvements.

However, it’s important to gather quantitative and qualitative data to get a clear overview of your user journey as they move through your SaaS funnel. This helps you make user-centric, data-driven decisions so you can build the best possible product and CX for your customers.

Let’s take a closer look at some of the key metrics outlined above and how to track them.

1. Website visits and email opens

Website visits and email opens are great indicators of how many potential buyers are seeing your company’s messaging and brand. After all, if users don’t know your product exists, they can’t buy it. 

If you’re noticing your key web pages aren’t getting much traffic relative to the market size and search volume, ramp up your SEO efforts and direct resources toward paid search campaigns. This is a top-of-the-funnel (TOFU) metric, so higher page visits and email opens give you more opportunities to nudge buyers further down the marketing funnel. You can then familiarize them with your brand and products and show them how to use them to achieve their goals, or jobs to be done (JTBD).

💡 Pro tip: use Contentsquare to see how users really engage with your key web pages. Get an aggregated view of where people click, scroll, and tap with Heatmaps, then jump to Session Replay with one click to watch relevant playbacks of individual user sessions for more context.

Combine Heatmaps with Session Replay to understand the user behavior behind your page view numbers

2. Customer acquisition cost (CAC)

Monitoring your customer acquisition cost (CAC) shows how much effort your business needs to invest to get a user to engage with your product and, ultimately, make a purchase or download. CAC, combined with customer lifetime value, is a great way for SaaS companies to determine if they’re operating at a sustainable rate. An increase or decrease in this metric helps you decide whether to continue a current campaign or change direction.

Tracking your customer acquisition cost gives you the opportunity to use A/B testing near the middle of the SaaS marketing funnel. For example, by trialing a new feature— like a navigation bar or pop-up—you can monitor its effect on your customer acquisition cost and other metrics to determine if it drives conversions. You can then follow up with these new customers through Voice of Customer tools to find out how they’re using the new feature.

Enrich your A/B testing with heatmaps and session replays to understand why your winning variant won

3. Conversion rate

Do you know what proportion of users who enter your marketing funnel end up interacting with your content or making a purchase? Tracking your conversion rate (middle of the SaaS marketing funnel) lets you find out. Remember that conversions don’t just mean purchases or sign-ups, but can include trials, ebook downloads, or even button clicks, depending on your goals. 

For example, track how many users who download ebooks or start free trials end up subscribing to your product. If only a few users make purchases after testing out free materials, it might mean your product isn’t what they were expecting, indicating an issue with your product adoption plan. Conduct customer journey mapping research to optimize your marketing funnel and get users back on track to converting and successfully achieving their goals with your product.

💡 Pro tip: map out your SaaS marketing funnel in Contentsquare to quickly spot drop-offs and investigate them further. With Funnel Analysis, you can identify blockers impacting your conversion rate, then zoom in with session replays to watch exactly what happened—and understand how you can improve the experience.

Contentsquare’s Funnel Analysis lets you monitor—and optimize—your conversion rate at each stage of your SaaS marketing funnel

4. Customer retention rate

Customer retention rate is an important metric for SaaS companies, which rely on subscription revenue and returning users to drive profits. A high customer retention rate indicates that users find your product helpful and believe it meets their needs, which is a clear sign you're successfully driving product adoption.

Tracking your customer retention rate applies to all areas of the marketing funnel, so it’s essential to provide a great customer experience from the first touchpoint, all the way to purchase and beyond. If you’re noticing that customers drop off after a certain point or indicate that they’re dissatisfied with a specific interaction, take concrete steps to improve that area.

💡 Pro tip: directly ask your users how you can improve to increase your customer retention rate. Use Contentsquare’s Surveys to ask simple questions and give users an opportunity to share their thoughts. Then, let Contentsquare’s AI assistant analyze the results to provide you with actionable insights. Not only will your customer retention rate go up, but your overall customer experience will improve as well.

Use Surveys to learn about areas of improvement to focus on

5. Net Promoter Score®

Your Net Promoter Score® (NPS) is a bottom-of-the-funnel statistic that measures how likely users are to recommend your product or company to friends and family after purchasing. A higher NPS® indicates that customers are satisfied with your product and feel it meets their needs. Positive NPS® results go hand in hand with higher customer retention scores, which is a good sign for any SaaS company.

NPS® data is a clear indicator of customer satisfaction, and not just how likely users are to remain paying customers.

Use Contentsquare to send users an NPS® survey and find out your score. A high score indicates your users are on their way to becoming product advocates and brand champions, showing your organization understands and meets user goals with your product. 

Launch an NPS® survey to quantify how customers feel about your brand and product

6. Product and user upgrades

After users make it to the middle or bottom of your SaaS marketing funnel and complete their first purchase, do they come back to buy more products or upgrade their plan? For example, if you sell SaaS audio recording software for podcasts, do users buy additional features, like background noise removal, or upgrade to a more high-tech plan?

Upselling and cross-selling aren’t just key growth and revenue opportunities. They also help you improve your customer's experience and increase the likelihood they'll fully adopt your products. After all, the more add-ons and features available to users, the more they can accomplish.

For effective upselling and cross-selling, define your user personas and their pain points, and ask customers for regular feedback on the features and upgrades they’re interested in. This type of data-backed, user-led development is what makes businesses thrive.

Dive deeper into your customer journey to create a successful SaaS marketing funnel

The best way to design an effective B2B SaaS marketing funnel is to learn as much as possible about the user experience (UX) and ask customers for feedback. Achieve this by understanding the customer journey, using marketing funnel tools, and tracking the right metrics.

Remember that user-led product development is one of the best ways to drive business growth and build brand loyalty. If you make a commitment to addressing user pain points and building an effective product, customer loyalty and advocacy will follow.

FAQs about SaaS marketing funnels