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Product Adoption Challenges Of University Saas Product And Potential Solutions

by Vatsal Juvariwala, Vice President - Global Sales (SaaS), Campusknot Inc October-2017

People will not use what they don't know how to use. People will not figure out how to use it if they cannot find the right information instantly. People who don't use the SaaS application (or large features/ modules of it) will not renew the contract, and most certainly will not expand their subscription to cover more users. College SaaS product adoption by innovators, followed by the early adopters, early majority, late majority, and finally, somewhat reluctantly, laggards is not a smooth bell curve.

Several technical challenges are also encountered such as ‘working offline’ is not an option anymore with a cloud computing SaaS product. Client has data security concerns when migrating from traditional local software ERPs to a cloud-based platform. Clients are worried about what backup procedure will be applied when the need arises. Universities are actively involved in cutting edge research work and are constantly questioning “where” their academic data would be “exactly located”.

Referencing Geoffrey A. Moore's intriguing book ‘Crossing the Chasm’, the key observation is that a SaaS product adoption progressing through the different market segments, actually has a number of gaps in it.

Each segment of the market is looking for different aspects when they buy technology. The wider the difference, the bigger the gap:

1. Technology enthusiasts want the latest technology first, and don't care much if it has all possible features incorporated or is very useful.

2. Visionaries can see the potential for exponential enterprise growth by implementing the new technology, and want to have an influence in shaping the SaaS technology to fulfill their vision.

3. Pragmatists only buy technology when the used cases are market proven and there are endorsements.

4. Conservatives only buy technology when they strongly believe they will experience loss by not adopting the product.

5. Skeptics only buy technology when they absolutely have to or are forced to by external policies, market competitiveness or when it is bundled in with some rudimentary ERP they already use.

The biggest product adoption gap is clearly between the visionaries and pragmatist and is a huge challenge for EdTech SaaS companies.

One of the best solutions is to specialize. By initially specializing for a niche industry, we create case studies and experiences among technology enthusiasts and visionaries that the pragmatists can use to determine whether to buy or not. By cornering a small segment of the addressable market, we can develop an array of similar success stories which will more effectively convince pragmatist buyers.

There is a higher probability of success by going niche, cornering one segment, and tackling additional segments as the company grows.

Technology Enthusiasts, instead of purchasing a SaaS product because of its track record, established case studies and proven ROI, they will adopt because of its unique status as new and innovative. In order to sell to them, it’s essential to identify their pain points, and develop marketing strategies to systematically address them. Think of them as paying beta testers, helping to refine and shape the direction of the product, so one must focus on technology and not just business; highlighting its innovations, and the potential to disrupt. So, it's important to be explicit about our vision for future technology and product innovation. Appeal to a tech enthusiast’s experience and ego, and request for their insight and help in developing the SaaS product. They are almost investors, as well as first users.

In contrast, Visionaries are interested in its potential use case, and seek out the products that offer the maximum scope for business benefit. When a visionary buys into the SaaS product, they are essentially making a bold declaration of their faith in your business. We can leverage this by creating explicit competitor comparisons, highlighting the benefits of our product over the rivals.

Pragmatists represent the first segment of the mainstream market, and together with conservatives, make-up over two thirds of the entire market for a typical SaaS product. Once they've committed to purchase, their desire for maximum ROI makes it relatively easy to cross-sell and up-sell training and professional services. Accurate performance data, and realistic targets will convince them of the low-risk return they're looking for. They will look for case studies, social proof and market research reports that repeatedly show consistent growth, across a range of universities and colleges similar to them.

Conservatives are highly risk averse, only willing to adopt a new technology when all those around them have already done so. They are usually driven by price; seeking to adopt the same technology as their competitors at the lowest possible cost. In order to encourage conservatives to buy, emphasis should be on the risks associated with not adopting, and a salesman can play on their fear of being overtaken by their competitors.

Skeptics are the final barrier to total market saturation; with a clear refusal to adopt new technology, irrespective of its impact on their business. Skeptics hate and fear change due to job insecurities from technology adoption or negative experiences from other new forms of technology. The only way to sell is to secretly integrate the product into another solution that they already use.

A wizened salesman, instead of spending energies on skeptics, forms new partnerships with open minded and technologically driven universities and colleges that are excited to use the SaaS product. Sometimes business is not just about the YoY growth trajectory and P/Ls, but, sustainability and the right customers.