The Hidden Cost of Missing Out on Integrations in Your SaaS

Integrations are crucial to staying competitive in the crowded SaaS ecosystem today.

As end-users, we’ve all experienced those moments where we wished our apps were perfectly integrated with each other.

Whether it’s to pass data between platforms, get notifications in our Slack/Teams apps, or have workflows with more complex logic, we would all save a lot of time and headache if our apps worked together cohesively.

In this article, we’re going to cover the 3 key growth benefits that you can leverage by expanding and scaling your product integration roadmap.

TL;DR

• Forcing users to build their own integrations with workflow automation tools like Zapier leaves money on the table for other vendors
• Beyond improving efficiency, integrations can unlock additional value in your product through account expansion and co-marketing campaigns
• Create expansion opportunities with integrations through tiered pricing or via an a-la-carte model
• Building partnerships and co-marketing campaigns with complementary products through integrations can unlock new audiences
• Providing native integrations can drastically reduce the Time to Value of your product and increase product adoption and retention
• Users who activate at least one integration demonstrate measurably higher retention rates (up to 40%)

Resource constraints when it comes to adding integrations to your product

If I had to guess, you currently have multiple integrations in your backlog because of limited engineering resources.

In most scenarios, it is hard to prioritize your team’s valuable time towards integrations when you want to continue building out your core product competencies.

It’s a common challenge – building out integrations typically takes teams 6-8 weeks of engineering, depending on the complexity of the workflow. That doesn’t even take into consideration the indefinite maintenance required, not to mention building out tools to monitor issues with your integrations.

Building integrations with Zapier

Many SaaS companies leverage iPaaS platforms such as Zapier to meet the demand for integrations. While this is a great temporary solution, it has many inherent drawbacks by nature of requiring your users to set up the integration workflows themselves:

• Your users will be paying for Zapier, which prevents you from monetizing the integrations (we’ll cover how you can do this in a bit)
• The time to value for the integration becomes significantly longer
• It requires your users to be technically proficient in setting up the workflows and maintaining them
• Your customer success team will need to help troubleshoot workflow errors at an individual user level

This is precisely the challenge that platforms like Paragon address.

By handling authentication, the end-user UI, and providing a low-code workflow builder with pre-built actions (while maintaining full API access), you can build out integrations in as quickly as 10 minutes!

Now let’s get into the first growth benefit integrations can provide – driving expansion revenue.

Driving account expansion with integrations

Let’s look at the most common ways you can leverage integration to increase expansion MRR.

Monetizing Integrations

Integrations create significantly improved product experiences, providing opportunities to monetize the value add provided and increase your expansion MRR.

Before we get into the strategies and frameworks for monetizing integrations, keep in mind this:

If any integration is fundamental to your product functioning and delivering value, it should not be treated as an upsell.

Given the nuances, here are a few tried and true approaches that you should consider.

It’s important to segment your integrations (or integration roadmap) based on how much additional value they would bring your users.

Out-of-the-box integrations

Any integrations that are fundamental to the core function of your product should come out of the box, as already mentioned.

For example, if your product relies on ingesting data from other platforms (such as CRMs or accounting platforms) to provide value, those integrations should not be used as levers for expansion.

Additionally, with simple integrations such as Slack/Teams notifications, while they can be very effective in keeping users up to date, the perceived value may be too low to justify monetizing them.

Segmenting by Workflow Value

Generally, integrations within the same category will provide similar benefits to one another, which lends itself well to bucketing integrations by category.

This can be effective as certain product types are going to be more complimentary to your app than others.

Here’s an example of how a lead qualification software could segment its integrations:

• Out of the box integration: CRM tools – they are fundamental in passing leads to lead qualification apps
• Premium integration: Marketing automation tools – they enable automatic follow up with leads
• Subjective integrations: Calendar tools – they make it possible to send meeting invites from within the lead qualification app

Subjective means, the calendar integration can either be free or premium, given that the marginal benefit may only be a minute or two of time savings per meeting booking.

Once you’ve decided on the buckets that each integration falls into, you have a few options on how to approach the pricing models.

1. Price per premium integration

For more complex integrations and premium ones, consider offering these as an add-on to your main subscription plans.

2. Specific integrations included per tier

Lemlist build its subscription packages based on different needs and included different integration options in each tier.

3. Set of integrations per tier

Going specific is one way, you can also include a fixed number of integrations and let the customers choose the ones they want. Like MainStem does.

As with the pricing structures for any product feature, it is important to run experiments and measure the impact of the different models on your conversion rates and ACV.

Segmenting by User Types

Since different apps target different types of users – an alternative method of segmentation is via the firmographics of the 3rd party app’s user base.

For example, typically Salesforce is used by larger, enterprise-oriented organizations, whereas HubSpot is tailored towards startups/mid-sized companies.

By that logic, you can assume that users who want a Salesforce integration are further upmarket and can afford to pay more vs. those asking for a HubSpot integration.

This logic can be applied to practically any vertical:

• for accounting: Oracle Netsuite vs. QuickBooks
• for marketing automation: Pardot vs. Marketo
• issue management: ServiceNow vs. Zendesk

Leverage partnerships through integrations

By the nature of most SaaS companies having a public API, you don’t need anyone’s permission to build integrations with their apps.

But being proactive makes it much easier to create co-marketing opportunities with the integrated app.

Strategically, however, it is important to be intentional with which apps you integrate with for the purposes of co-marketing.

Choosing integration partners

Here are a few guidelines you need to consider.

Audience Alignment

Your product and the 3rd party SaaS app should serve the same ideal customer profile (ICP).

The more aligned your audiences are, the more likely the partnership will succeed. However, this is dependent on company size as well, which we will get to.

Value Add

The integration workflow must add significant value to a user segment (if not all) of the 3rd party app’s user base – the more complimentary your products are to each other, the better.

This can come in multiple forms, but generally, they will:

1. Save time and increase efficiency (inherently removing friction)
2. Unlock additional insights from the 3rd party app’s existing data

This does not mean that the integration needs to be complex. The integrations with the highest perceived/actualized value are often the simplest.

Take the Zoom and Google Calendar integration – can you imagine life without it?

Company Size

While it may seem ideal to try and build integrations and partnerships with large players like Slack and Salesforce, there will generally be more challenges in doing so.

Larger platforms generally serve multiple audiences, and as a result, your integration may only benefit a small sub-segment of their total user base.

On top of that, from a mutual benefit perspective, the partnership will be largely one-sided, which means incentives may not be aligned.

Certainly, this is more of a watch-out than a hard rule, but in general, the lowest hanging fruit will be integrations and partnering with companies of a similar size to yours.

Types of partnerships

Once you’ve identified the integration partnerships you want to go after, it’s time to see how you can leverage them to your advantage from a growth perspective.

Co-marketing

While integrations are not usually thought of as a core product feature, they should be promoted as such.

It is in both your and the 3rd party app’s best interests to amplify the launch of the integration, as it provides additional value to users of both of your products.

The co-marketing initiative can take multiple forms and be distributed across various different channels, depending on the level of involvement from both sides.

To get you started, here is a list of channels and tactics that we’d recommend, in order of impact:

1. Newsletter

This is the most direct and trusted channel that companies leverage to communicate with their customers/leads. Not only do newsletters provide the most accurate approximation of reach, but readers will also generally be much more receptive to the content included.

2. Social posts

Announcing the launch of the integration can be effective when both companies have a sizable social following. This can be further amplified by having partnership managers and employees at both companies promote the announcement to their own audiences.

3. Special offer

Leveraging special offers will help further incentivize users of the 3rd party app to try out your product, and vice versa. This often comes in the form of a discount or extended trial, but the sky’s the limit in terms of what you’re able to and willing to offer.

4. Joint webinar/blog post

Organizing a joint webinar and writing content that highlights the benefits of the integration can serve as powerful content when it comes to deeper integrations that unlock entirely new use cases.

5. Case study with customers who wanted the integration

While this is not an integration launch activity, for your most popular partner integrations, you can go a step further and create content that can increase brand awareness and attract new customers.

6. Paid advertising

If having the integration has consistently been a gatekeeper in your sales cycle, promoting it as a part of your value proposition for inbound marketing can be very powerful in generating interest.

Here is a great example of a successful co-marketing campaign for Calendly’s recent integration with Cisco Webex, where they leveraged newsletters, blog posts, and social shares to amplify the launch.

Additionally, beyond the direct response impact that co-marketing can provide in terms of leads or signups, the long-term branding impact can also be as, if not more, valuable.

Co-marketing campaigns will associate you with the integrated company’s brand, which can be powerful especially if you are looking to move upmarket or into new verticals.

Ultimately, co-marketing with integrations is a very powerful strategy and channel that you need to leverage if you want to unlock additional growth for your company.

Use integrations to increase product adoption and retention

We’ve talked about how you can leverage integrations to drive account expansion and build partnerships. Now let’s check how integrations can increase product adoption and reduce churn.

Adoption & Time to Value

When users first sign up for your app, your primary job is to reduce the Time to Value (TTV). The more quickly they can experience and understand the value of your product, the more likely they are to convert and remain as customers.

As mentioned earlier, this is especially true if your app requires data from your users’ other platforms to provide value, integrations are non-negotiable.

If you need your users to export & import CSVs in order to get usable data on your platform, there’s a strong chance they will drop off without ever experiencing the AHA! Moment.

This can further be facilitated by providing a seamless onboarding journey that guides users towards activating the necessary integrations.

Retention Boost

Typeform discovered that users who activated at least one integration demonstrated a 40% lower churn rate compared to users who used Typeform on a standalone basis.

As such, not only do you need to build out the integrations, you need to effectively communicate their launches to your customers to encourage their adoption and usage.

The more embedded your app can be within your users’ broader workflows, the less likely they are to churn, as it would increase the inefficiencies of their existing processes.

Conclusion

We hope this article has helped you understand all the growth levers and benefits that integrations can enable for your business, including:

• Upselling customers through premium integrations
• Generating new channels of growth through partnerships and co-marketing opportunities
• Improving product adoption and retention

Author

Brian Yam

Head of Marketing at Paragon

Leading the go-to-market motion for Paragon, and passionate about all aspects of marketing and product. If you want a sounding board around ideas for your go-to-market strategy, let’s connect! Outside of work, you’ll find me cooking, sketching, and dancing.

If you have any questions about how to approach your integration strategy and want to dive into the specifics of your roadmap, you can book a call with me here.