5 Key Elements for High-Converting SaaS Demos (2023)
Founder of Saas Camp
In the last decade, the SaaS market has seen tremendous growth. Let me repeat that: tremendous.
Since 2015, the global SaaS market has increased its value by more than 500%,reaching $195 billion this year. That exponential rise is a testament to the immense potential and opportunities within the SaaS industry but also the evolving SaaS trends shaping its future
In simple terms, if you want to make a mark in the industry and make a profit, now’s the time. As a B2B businessperson, you’re quite aware that product demos play a central role in your sales process. When done correctly, SaaS product demos are incredibly powerful. But when poorly executed, product demos can actually hinder your ability to close deals.
So what makes a good SaaS product demo?
How SaaS Sales Demos Work
You can skip this part if you're not a newcomer to the SaaS world. If not, let's discuss the role of SaaS sales demos.
For most B2B SaaS companies, the sales cycle looks something like this:
Step 1: Lead Generation - You find a prospective customer through either inbound or outbound lead generation. Leveraging the right SaaS leads tactics can make a significant difference at this stage.
Step 2: Customer Discovery - Then you qualify the lead and make sure they match your ideal customer profile.
Step 3: Sales Pitch - Sales reps pitch your product to individual prospects, usually in a single product demo format, to show off product features. For a deeper dive into crafting an effective demo, read how to deliver B2B SaaS demos with a 47% close rate.
Step 4: Customer Conversion - After a positive product experience, you close the contract and convert the opportunity.
Your target demographic has a certain problem. And your software can solve it. To communicate this effectively, dive deep into SaaS content marketing. It's essential to ensure that your product demo clearly demonstrates the value of your software to potential customers.
How important are product demo videos and presentations in your sales funnel? It depends on a few factors, the biggest one being Annual Contract Value (ACV).
ACB is defined as the average yearly revenue per customer contract. As a rule of thumb,if your ACV is lower than $1,000, it makes no sense doing personalized product demos.
But if it's higher, the demo is undoubtedly the most powerful component of your sales process.
How Well Software Product Demos Work for SaaS Companies?
How effective are personalized demos, really? Are they really so good as marketing tools? Or is it all just hype? It’s far from hype, my friend. For a vast majority of SaaS companies in the B2B sector, demo close ratesrange between 20% and 50%.
But if you want to enjoy success, you need to put in work. You see, many product teams go overboard talking about key features and specifications, which often leaves prospects disengaged. That's there are high- and low-converting types of product demo:
Low-converting product demos are usually delivered as long monologues. They're not personalized, nor do they show any features in action.
High-converting demos show the setup process, show off primary as well as secondary features, and demonstrate how your product solves specific customer pain points.
You can't let one of your sales team members talk for half an hour about your product and its key features and call it a "demo." According to MindTickle, best performing sales repsspeak less than 45% of the time, while trying to close a deal.
The best product demo needs to diagnose the pains of the potential prospect and prescribe the solution to the situation.
5 Elements of an Effective Demo for SaaS Companies
Let's take a look at five distinct elements that make a demo successful.
1. Format (Choose It Wisely)
SaaS demo effectiveness depends a lot on the format you choose. Different people have different preferences, naturally.
Here are a few common types of product demos for SaaS Companies:
Non-Live Demo: This type of demo involves a pre-planned presentation that showcases the critical tool features without any interaction with the potential customer. Product videos, as they're often referred to, allow you to control the narrative and focus on highlighting key features of your tool.
Interactive Demo: Interactive product demos encourage active participation from the prospective customer. This type of product demo videos allows trial users to gain hands-on customer experience of your tool and its benefits without spending a dime.
Self-Service Demo: Unlike interactive product demos, self-service product demo allows prospects to access and explore your product independently. A self-service demo allows prospects to evaluate your product at their own pace and convenience.
Pre-recorded Demos: Pre-recorded demos are scripted presentations by your marketing team, recorded in advance and shared with prospects.
However, one thing is certain — a successful demo means you're that much closer to closing the deal.
Personalized product demonstrations allow you to showcase your product and highlight key features in action. You can host them on your website, YouTube, or any other video hosting platform, making them easily accessible to your target audience. A vast majority of B2B companies use pre-recorded demos.
Depending on product, audience, and company goals, you can choose one of the many B2B SaaS product video formats.
2. Research (Tons and Tons of It)
Before meeting with the prospective client, you need to do your due diligence. You need to research, research, and research some more.
You should be actively looking for clues about customer problems and pain points if you want to come up with effective demos. Take a look at their website, social media, and look up news about their company. Just find something that will show you how their company is doing at the moment.
You should ask yourself and write down the answers to the following questions:
What is this company potentially looking for?
What is my ICP (Ideal Customer Profile)?
What ICP signals can I identify before the demo?
What industry or niche is the company in?
Is the prospect the only decision-maker in the process or not?
Your product has a specific audience. Find out who they are and what they're looking for. Only then, you'll be able to convert leads and make sales on a consistent basis.
3. Questions (Have Them Ready)
You thought that we were done with questions? Not by a long shot. During the demo, you want prospect engagement to be at a high level. You can do that by creating a dialog and keep it going.
Categorize your questions into two types:
1. Factual questions about their current operations. Example:
How many people inside your company need access to a POS service?
What's the turnaround time for your current SaaS provider?
Are you using a CRM platform and if so, which one?
2. Questions aimed at uncovering pain points and challenges.
Are you completely satisfied with your current system?
Have you experienced any problems with your SaaS system?
What are your company goals, and what’s stopping you from accomplishing them?
Now, there's no need to ask these questions specifically. That's not the goal. The goal is to find out what motivated the prospective customer to submit a demo request to your SaaS company in the first place. Why are they interested in your product?
Once you establish "why” you'll have a much easier time prescribing solutions to their symptoms.
4. Testimonials (Real People, Real Results)
Social proof is a phrase you hear all the time when talking about modern marketing. And you better believe it's for a good reason.
Social proof instills a lot of confidence and trust in potential clients. As a matter of fact,8 out of 10 people consider testimonials more credible than a brand talking about its products.
Remember, your demo agenda isn't only to show off your product in action and list its fractures, but to create a narrative that will resonate with your prospect.
Frame your demo around relatable use cases or success stories of existing customers. Highlight the problems they faced, the solution your product provided, and the positive outcomes they achieved.
The storytelling approach helps prospects visualize how your product can solve their own challenges and creates an emotional connection that drives engagement and interest.
5. Participation (Both Yours and Clients)
Customer interaction is the last element we need to discuss.
One-sided demos can be monotonous and disengaging. To keep your prospects actively involved, incorporate interactive elements into your demo. This can include live demonstrations where prospects can interact with the software, allowing them to experience its features firsthand.
Interactive visuals like clickable prototypes and simulations will make the demo more dynamic and engaging. To ensure your customers' success after the demo, it's worth diving into SaaS customer success best practices.
Your marketing team needs to be prepared to make a lot of Zoom calls. For a high-caliber demo presentation, you need to ensure a smooth and seamless call experience for a high-caliber demo presentation.
According to Dialpad’s “State of Video Conferencing” report, audio-related issues are the biggest pain point for 50% of professionals engaged in video conferencing. To avoid any potential technical problems, you need to make sure:
Your internet speed is up to par
Your browser isn't bogged down by too many tabs
You have a high-quality camera.
By taking these proactive steps, you eliminate the risk of encountering issues on your end, ensuring a seamless demo experience for your leads.
Successful Demo = Successful Deal
A SaaS product demo can be a powerful marketing tool in the right hands.
A well-executed product demo can be a game-changer in your sales process. It has the power to engage potential customers, showcase your software's value, and lead to higher conversion rates.
By following the step-by-step guide above, you can make your demo successful in no time. If you need any guidance and expertise, you can alwaysget in touch with me. As the founder ofSaaS Camp, I've helped countless SaaS entrepreneurs get their products off the ground. And wouldn’t you know – I can do the same for you.
Pre-recorded and interactive demo presentations – I've seen them all. Contact me on social media or shoot me an email and allow me to unlock the full potential of your SaaS venture.
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