Sunday Stories: The Unseen Cost of Not Integrating

In 1850, French economist Frédéric Bastiat said that looking at unseen losses is essential to consider when making financial calculations.

"Between a good and a bad economist this constitutes the whole difference — the one takes account of the visible effect; the other takes account both of the effects which are seen and also of those which it is necessary to foresee." – Frédéric Bastiat

Bastiat was a master at thinking about opportunity costs. This insight applies to SaaS companies as much as economies.

For example, when we close a big customer, we celebrate 🎉 ! But do we celebrate the customers who didn’t churn with the same gusto? How much time is spent thinking about the customer we didn’t even know we alienated, or the markets we didn’t know we missed out on?

We don’t see those costs unless we really look 👀. The best businesses think about the unseen impacts of their strategies – and as a result, they unlock revenue others didn’t even know was hiding in their ecosystem 💸.

Integrations and the opportunity cost of lost customers

Your customers want integrations. It’s hard for any SaaS company to deny that.

In fact, customers care as much about how your solution connects to their stack as they do about how well it solves a problem in isolation. In other words, your integrations can be as valuable as your core product features.

Integrations are not only fundamental to a seamless product experience, but they also enable you to win deals with prospects who may be sitting on the fence, increase engagement and product adoption, and upsell customers with the additional value created from these integrations.

Superior product experience → wins deals

Customers demand an amazing experience from each product they use, and oftentimes they will pick the more integrated product, whether that’s in their regular lives or in the context of SaaS.

Consider why people pick the Apple Watch or Airpods over other smartwatches/headphones – it's the integrated experience that keeps people in the Apple ecosystem.

This same idea applies to your product.

In most cases, integrations are there to make your customers’ lives easier and more efficient. Customers don’t want to hop between dozens of logins and tools and use them each in isolation, or patch data together manually with spreadsheets.

Think about the tech stack you use daily. Would you use Salesforce or HubSpot if they didn’t build, support, and maintain so many great integrations? Not likely.

In a survey conducted by Paragon, 96% of SaaS buyers indicated that they take integrations into consideration when making purchasing decisions, with 71% saying that integrations are often a deal breaker.

Results of Paragon's Survey

Create new value to drive revenue

Integrations can also help you expand your total addressable market (TAM). Your ICP works with many cross-functional teams within their workflows, and integrations allow you to create value for those adjacent users, bringing them into your TAM.

When you integrate into adjacent technologies, you create value in your product for the users of those adjacent technologies. When you send that kind of signal, customers who would otherwise never use your product may begin to see a use case for it.

And the more you sell into the other areas of your customer’s organization, the more irreplaceable your product becomes. Your product will begin to act as a foundation of all your customer's core processes.

Additionally, integrations are often used as an upsell lever for organizations. By gating valuable integrations to higher tiers of your product, you can encourage customers to upgrade to those higher tiers for the integration.

An integrations-first reputation

Customers are evaluating your product, before ever talking to sales. They’re lurking around your site, checking your socials, and talking with people they trust.

If you don't have the integrations they want, but a competitor does, you may never even get a chance to highlight your core value proposition. These are the unseen losses that many companies overlook.

To tap into those unseen lurkers, you need the build and market the integrations your customers and prospects are demanding. That will expand your market some. But to really tap into unseen customers, you need something else.

💡
You need to establish a reputation for providing integration.

Let’s say you have every integration a potential customer currently wants. That’s good. But those customers also want something more.

They want to feel confident that, should they switch tools in the future, or adopt a new solution, your product will be able to integrate with it. They want to know that you don’t only check the boxes of current integrations, but that you will actively update and ship new, valuable integrations.

And it’s not just about having the integrations.

It’s also the speed at which you can improve upon those integrations. Customers switch from Outreach to Salesloft and vice versa every year due to bad experiences with their CRM integrations. This type of churn wouldn't happen if they had a seamless CRM integration.

Companies committed to building, updating, and expanding their integrations quickly and at a high level of quality make customers feel at ease. They don’t worry about being stuck in an ecosystem that doesn’t let them try new tools.

💡
Those slow-to-add or update integrations miss out on forward-looking customers.

Are you the type of company that seeks to integrate with partners across the ecosystem? Or are you content with your corner of the market?

Building integrations at scale

The solution to reputation and opportunity cost is obvious - build integrations. You’ll close more deals, unlock new ICPs, and improve net revenue retention.

But your engineering team is short on time and resources. They always will be.

💡
So how do you drive your integration roadmap forward? The solution: you partner up.

Integrating with solutions like Zapier is a popular starting point, but they only take you so far. While they allow you to integrate with more products, they also place a burden on the customer to set up and maintain.

Partnering with piecemeal, 3rd party solutions means:

  • Not being able to upsell your customers on integrations
  • Time spent helping customers debug their automations
  • A frustrating experience for customers
  • Limited integration functionality (ie. Bi-directional sync)

Ad hoc solutions don’t provide customers with the seamless experience or functionality they demand. To really reap the benefits of integrations, you need to go deeper.

Building native integrations into your product has traditionally required you to allocate months of dedicated engineering resources. In recent years, a new category has emerged: embedded iPaaS.

Embedded iPaaS solutions enable your engineering team to offload a majority of the development effort required to build and scale your integration roadmap.

Ultimately, your engineering team’s capacity shouldn’t hold you back from building meaningful tech partnerships. If your engineering team can build integrations in under a week, it's much less of a lift, and the cost/benefit instantly skyrockets.

Getting dev buy-in

Some of the solutions in this category are Zapier-like-iPaaS providers that have created secondary embedded products. But a few are building the embedded iPaaS solution from the ground up for the embedded use case, for developers. And since developers will always own the integration, they need a platform they enjoy using.

Getting buy-in from your devs is crucial. You know how hard it is to get your engineering team to prioritize your requests. Bring them a solution that makes sense to them. Something that has been designed with devs in mind. If you don’t, you'll be stuck fighting an uphill battle with your engineering team to get integrations prioritized.

When you create an excellent developer experience, it pays. Embedded iPaaS provider Paragon has found customers reducing dev effort by 70% to build each integration. This completely offloads the maintenance work required, and as a result, enables them to go to market much faster with new integrations.

This leads to a reduction in churn and an increase in average deal sizes by over 2.5x.

Some stats from embedded iPaaS users via Paragon

Enticing the invisible customers

Here's the key point: If you fail to build integrations that are important to your customers, they’ll find another product that fits their needs, and you won’t always see that cost right away.

Signal to the market that you’ve overcome the obstacle of building integrations with an embedded iPaaS. Take the market by storm by playing offense instead of defense.

Keep your eyes open – celebrate the wins, but be aware of the unseen costs of failing to build the integrations your customers want.


We're proud to have partnered up with Paragon on this story. Paragon is defining the embedded iPaaS category by building integrations from the ground up.

Paragon empowers engineering teams at over 100+ fast-growing B2B SaaS companies, like Mitto, Saleshood, and Tapcart, to efficiently scale their integration roadmap.

If you want to start dominating your category with a robust tech partnerships ecosystem, you need to talk to your engineering team about using Paragon. Check them out here.


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