How verticalized SaaS companies can accelerate their growth in 2024

April 29, 2024
0 minute read

This article originally appeared at Forbes.com.



Undeniably, vertical SaaS is having a moment. Companies across industries have achieved unicorn valuations with cloud-based, industry-specific software expertly tailored to their customers’ unique needs. The team at Bain Capital does an excellent job explaining why the current climate is the perfect time for vertical SaaS to shine.


However, while the future might look bright for these companies, growth isn’t cheap. Customer acquisition costs are some of the largest growth expenses any tech company will face. This is compounded by the fact that vertical SaaS companies have an inherently smaller total market than their horizontal counterparts who work with a variety of industries regardless of vertical.


That’s why, instead of hunting down new customers, the smartest move for vertical SaaS companies right now is to extract more value from existing customers. How? By going multi-product.


What does it mean for a company to go multi-product?


A multi-product strategy is exactly what it sounds like: a business strategy that revolves around multiple complementary products. These products are tailored to the customer’s particular industry and typically meet a need that would otherwise have been met by a more generic, horizontal piece of software.


What are the benefits of a strong multi-product strategy?


One reason why a vertical SaaS company might start offering multiple products is pretty obvious—revenue. It is meaningfully cheaper to extract additional revenue from existing customers than it is to acquire new ones. However, there are many more benefits than just that.


Multiple integrated products create a form of "ecosystem" effect that can increase customer retention and drive loyalty. That’s because integrated software offers an inherently better experience, especially for business owners. Having all of your data available and one less piece of software to manage, when executed well, drives efficiency in a way that businesses really value.


There’s evidence to back this up, too. Research shows that organizations retain just 30% of their small- and medium-sized business clients over the course of two years when they offer a single product. However, expanding to just one additional product can increase that retention rate by nearly 20%, while expanding to four products delivers a retention rate of 80%.


When packaged well, multiple products can also help you acquire new customers. Your core product may not have offered all of the features these holdouts needed before, but now, with additional products, you can meet and even exceed their needs in an enticing way.


How can you develop your own multi-product strategy?


A strong multi-product strategy begins with your core software. The best candidates for going multi-product are companies whose software acts as the "control point" or "source of truth" for a particular business. This can look different across a variety of industries, but the most important piece is always the same—the data.


For a restaurant, the control point may be the order management system. In real estate, that could be the property management system. For gyms, that could be a member management system. The theme here is that this software aggregates an extremely important piece of data that you can leverage across additional products in a complementary way.


Going back to our earlier example of websites, the gym SaaS company may create a website builder that integrates directly with their software. This website would allow individuals to manage their membership, join the gym and even register for classes. All of this would be available without any development from the business owner.


You can probably see how this is a superior experience for the business owner than an off-the-shelf website builder. By leveraging your customer’s data and your knowledge of their particular vertical, you can create high-quality experiences that impress your customers and grow your business.


However, like all things, going multi-product is easier said than done. Sometimes, building software in-house will make the most sense. You can do it easily with minimal additional hires and a reasonable amount of ongoing expense. Other times, you simply can’t create something competitive in an otherwise saturated market.


That doesn’t mean you have to give up, though! There are plenty of opportunities for vertical SaaS companies to thrive in a competitive market.


Acquire another company.


This is a pretty expensive option, but not always a bad one. The benefit is that you can absorb a competent team and a quality product very quickly, severely reducing your go-to-market time. However, you still have to maintain this product in the long run. Additionally, you now need to bring in enough profit from this product to pay ongoing costs and recover purchase costs. For those two reasons alone, this is a very strategic decision that should be made with the utmost care.


Partner with another company.


A good partnership can give you all of the benefits of a purchase (a speedy go-to-market, a high-quality product and an expert team at your fingertips) without the downsides (high costs and maintenance responsibilities).


However, these relationships are only beneficial when your partner is on your team. Their software should be high-quality, white-label and easy to integrate. In fact, your customers should have no idea they’re even using another company’s software.


Are you ready to ship a new product this year?


Now is the perfect time to grow your company with a strong portfolio of complementary products. It might start simple with payments or websites, but before long, you’ll have a comprehensive ecosystem that your customers will love. Who knows, with enough effort, your platform may become the only software your customers use.



Headshot of Itai Sadan

Cofounder & CEO, Duda

Under Itai's leadership, Duda rapidly expanded with an emphasis on empowering web professionals with cutting-edge tools to help them create beautiful, conversion-driving websites at scale. Duda hosts more than 1 million active websites built by over 20,000 customers globally.


Did you find this article interesting?


Thanks for the feedback!
A computer screen with a graph on it and a purple background.
By Santi Clarke April 24, 2025
Learn how platform ecosystems drive revenue and why they are essential for the growth of SaaS businesses.
By Santi Clarke April 24, 2025
One of the greatest challenges for SaaS platforms is keeping users engaged long-term. The term “stickiness” refers to a product's ability to retain users and make them want to return. In the context of SaaS platforms, creating a sticky product means that users consistently find value, experience seamless interactions, and continue using the product over time. The following are 7 practical strategies you can take to improve the stickiness of your SaaS solution. 1. Offer websites that help customers build their digital presence One of the most effective ways to make your SaaS platform sticky is by offering websites to your users. Many businesses today need an online presence, and by providing a platform where your customers can easily build and manage their websites, you increase their reliance on your product. When you offer users a website-building solution, you’re helping them create something foundational to their business. Websites, in this case, aren’t just a tool—they become a part of their identity and brand. This deepens their engagement with your platform, as they need your product to maintain and update their site, ultimately making them less likely to churn. Plus, websites naturally encourage frequent updates, content creation, and customer interactions, which means your users will return to your platform regularly. When you can give your users the tools to create something so essential to their business, you make them more dependent on your platform. This creates a higher barrier to exit, as migrating a fully built website to another service is no small task. In fact, websites are some of the stickiest products you can sell, so adding them to your product portfolio can be one of the best decisions you can to keep your customers using your technology for the long haul. 2. Deliver continuous value through product innovation The key to keeping users coming back to your SaaS platform is ensuring that they consistently see value in it. This means not only meeting their immediate needs but also evolving to address their growing demands. Constant product innovation is essential for keeping your users satisfied and invested in your platform. One way to achieve this is through regular updates that add new features or improvements based on user feedback. A SaaS platform that evolves with its users will keep them engaged longer, making it harder for competitors to steal their attention. Encourage user feedback and prioritize updates that create tangible improvements. This creates an ongoing relationship with your users, which boosts stickiness. 3. Offer a multi-product solution Another powerful way to increase your platform’s stickiness is by offering a suite of products or features that integrate well together. When your users adopt multiple products, they are more likely to stay because they become embedded in your ecosystem. The benefits of this strategy are clear. Research shows that once users adopt more than one product, especially when they integrate >4 tools into their workflow, their likelihood of churn decreases significantly. This happens because the more a user integrates into your suite of products, the harder it is for them to switch to a competitor. These users have invested time in learning your ecosystem and rely on it for their day-to-day operations, making it much harder for them to make the switch. 4. Create a personal connection with your users Human connection is one of the most powerful drivers of user retention. People don’t want to feel like they’re using a cold, faceless platform. By offering exceptional customer support, personalized communication, and community engagement, you build a relationship with your users that goes beyond the product itself. Make sure your support team is responsive, knowledgeable, and empathetic. You can also consider offering tailored onboarding experiences to ensure users understand how to make the most of your platform. When users feel like their success matters to you, they are more likely to remain loyal. 5. Leverage data to personalize the user experience Using data to drive personalization is another strategy that can significantly increase the stickiness of your platform. By tracking user behavior and usage patterns, you can tailor the experience to each individual user’s needs. This could mean recommending features they haven’t yet explored or sending them reminders about tools they may not be fully utilizing. Personalization gives users the feeling that the platform was designed specifically for them, making it harder to walk away from. By demonstrating that you understand their unique needs, you can build a stronger connection and ultimately increase retention rates. 6. Focus on seamless integrations and API capabilities To further increase stickiness, consider expanding your product’s ability to integrate with other tools your users already rely on. Whether it’s email marketing software, CRM systems, or social media management tools, seamless integrations add tremendous value by making it easier for users to incorporate your platform into their existing workflows. The more your product can work in tandem with other popular tools, the more indispensable it becomes. In fact, users who depend on integrations are less likely to churn since their entire ecosystem is tied to your platform’s functionality. 7. Encourage user advocacy and community building User advocacy is another powerful tool in building a sticky product. When users feel a sense of community or even ownership over the platform, they become your most passionate promoters. Encourage your users to share their success stories, join community forums, or contribute to product development through beta testing or feedback loops. A thriving user community not only increases user engagement but also creates a sense of loyalty. When users are part of something larger than themselves, they are more likely to remain committed to your platform, reducing churn and increasing lifetime value. Create deep, lasting customer relationships Making your SaaS platform sticky is all about creating a deep, lasting connection with your users. This requires building a platform that continuously delivers value, creating a seamless and personalized experience, and integrating features that keep users coming back. By focusing on product innovation, offering a multi-product ecosystem, and fostering strong user relationships, you’ll be well on your way to reducing churn and boosting user retention. Stickiness isn’t just a nice-to-have; it’s essential for long-term success. Focus on creating a platform that users can’t imagine living without, and you’ll see them stick around for the long haul.
By Shawn Davis April 24, 2025
Your team is likely pretty familiar with the products they built, but what about the ones they didn’t? Integrated tools can throw a wrench into your support operations, but they don’t have to.
Show More

Latest posts