Gartner estimates end-user total spending on public cloud services to reach $396 billion in 2021—and grow 21.7% Year-Over-Year to reach $482 billion in 2022. GartnerThese numbers only prove the high demand for SaaS products across different businesses and it means that this type of software brings great benefit to users and lucrative profit to creators.
Types of SaaS modelsHere are the main types of SaaS models that companies usually use for their business for the purpose of streamlining their internal workflows, making routine, manual work more effortless.
Benefits of SaaS development for businessesThese days businesses of all types and sizes use different kinds of SaaS solutions – Google WorkSpace, Pipedrive, Salesforce, Microsoft Service 365, and many-many others. All these popular apps are SaaS-based and are in high demand all over the world meeting particular business needs. The explanation for this demand is simple – SaaS product implementation automates and streamlines the internal business processes to make them well-managed and efficient. As per our experience, we would like to highlight the following benefits of SaaS applications:
- Extensive range of resources meeting various company needs;
- Maintenance from the provider’s side – customers don’t need to install or maintain the SaaS product, they just pay the subscription fee and get access to all of its features, along with any updates; that is, all functionality improvements and bug fixing are handled entirely by the provider;
- Scalable solution – SaaS products can have troves of users with no impact on the speed of the application;
- Customization – depending on the type of SaaS model, the solution can be catered to the needs of customers like being integrated with other business software
- Mobility – SaaS apps are accessible anytime and anywhere the internet is available.
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SaaS product experienceThe success of your SaaS solution among customers mostly depends on the SaaS product experience. Let’s dive into the details about what product experience includes and how you can influence its quality. Actually, the SaaS product experience is your customers’ experience of interacting with SaaS applications and their feedback related to it. This point really matters as the SaaS product market is growing and developing, meaning that competition is chasing and looking to poach your customers. They will manage to do so if your SaaS product:
- Works slowly and contains lots of bugs and errors that can actually be quickly and easily fixed;
- Complex to use and has poor UI;
- Has irrelevant features and technologies;
- Lack of tailoring/customization to the business needs of your customers;
- Neglecting the customers’ feedback;
- Sales-centric approach only.
SaaS largest companies
AdobeAdobe is now the most successful and the biggest licensed SaaS-based product development company in the world with revenue of $95 billion and a market cap of the north of $300 billion as of the time of writing of this article. Before 2021, Adobe was selling their product as one time purchase but they have made a savvy decision to migrate to the SaaS model where they charge monthly/annual subscription fees. Migration to the SaaS model lightened the process of constant updates of the product for customers and made it easier to use. Adobe offers an extended range of products and services, and to mention a couple of the most popular ones:
- Photoshop – used by numerous companies and freelancers of different specializations, which aren’t only design or architecture-related;
- Postscript – a programming language for reading documents correctly;
SalesforceAs of the time of writing of this article, Salesforce is, in terms of revenue and market cap, the second-largest company worldwide that provides customers with SaaS products that help enhance sales automation through cloud-based business apps, and ready-made Customer Relationships Management (CRM) software implementation. The variety of Salesforce solutions is surely wide as it includes: Salesforce Sales Cloud, Salesforce Essentials, Salesforce IQ, Salesforce SPQ, Salesforce Data Management, and others.
ShopifyFor creating and managing an online store, there is no need to initially build a custom corporate website to place your products as you can use the services of established e-commerce platforms. Shopify is considered to be the most well-known e-commerce platform used by businesses all over the world, boasting revenues of $185 billion as per the latest financials. It provides a vast range of features for online stores among which are:
- Adding unlimited number of products;
- Point of sale;
- Staff management;
- Customer support;
- Discount codes;
- Online sales channel;
- Manual order creation.
Concerns in SaaS product developmentAlong with clearly defining and understanding the goals of your SaaS product development, you should also deeply analyze your target audience and define the main concerns they struggle with when choosing SaaS products for their businesses.
Your SaaS product is not problem-solvingBefore starting SaaS product development, you should conduct research in the area to know the main challenges and problems your potential customers face and how your SaaS product can help resolve those hurdles. Not knowing the demands of your customers leads to your SaaS product not being capable of solving the issues related to the industry and not necessary to use by your potential users. It mostly happens because of an irresponsible approach to development, choosing freelance or unreliable SaaS product development companies. Being customer-centric and knowing your ICP is the key to making your SaaS product successful. MVP development would be a good idea to test your SaaS product functionality and to get a sense of how it is in practice and gauge its demand among customers. Then you tweak functions based on feedback from beta testing users; additionally, you also need to think about who these users will be.
Low customer acquisitionThe cost of acquiring customers (CAC) surely has to be lower than the lifetime value (LTV) of your SaaS product. It means that if your company spends more money on finding potential customers and selling them the product than that product actually costs or if those two combined will exceed the money it will bring, your profits will be decreasing with no potential to recover or grow.
Customer turnover is higher than customer growthCustomer churn is inevitable for all kinds of business caused by various reasons like:
- Your SaaS product and customer experience are of poor quality
- Customers are out of the game and do not need your SaaS product anymore
- Competitors offer better SaaS products at similar or cheaper prices
- The business specifics of your customer can vary
Keeping up with the market developmentSaaS product development is a rapidly growing industry so it is practically impossible to find or create a really unique solution on the market. Although uniqueness doesn’t necessarily matter in SaaS product development as the success of your solution depends on the customer experience it provides, the ability to quickly react to customer requests and needs, and constantly improve the SaaS product considering the market trends and requirements of your customers.
Tough integration of your SaaS productSmooth integration of software solutions is the number one most important thing for most businesses as new products should not influence the productivity of internal processes in a negative way and should not take much time and effort to implement and train staff on how to use it. In the case of SaaS product development, besides easy integration and usage, customers should also have easy access to the subscription payment and getting the invoices. The available pricing plans for your SaaS product must be well described with all ongoing features for each service option.
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Things to consider before developing a SaaS product
Research prevalent user pains and concernsWorking out the main problems and requirements of your future customers is a must before defining the product specifications. It is quite a sizable task as your customers have different business needs and requirements which you have to cover with your SaaS product development. Generally, the success of your solution mostly depends on the awareness of your target audience and researching what the main reason they are looking for a SaaS product is and your job is to address them. At GBKSOFT, we never miss the discovery stage and consider it pivotal for the product functionality and performance on the market. Before defining the project specification, our Business Analysts conduct deep market research on the latest trends, target audience and their needs, competitors, and so on to analyze this information and find the perfect formula for your SaaS product.
Consider the scope of your SaaS product developmentCovering all demands of your target audience is vital but it also means that your SaaS product risks having a vague scope of functionality that is too broad. Don’t try to consider all possible problems in general but take a closer look at each concern of your potential customers within the area and think of what overarching themes unite them. Multitasking and spreading thin won’t bring you quick success in SaaS product development so you should focus on targeting specific problems and pains in the industry when you develop your SaaS app.
Hire experienced developers to build your SaaS productThe idea and goal of your SaaS product can be brilliant but with an inexperienced software partner with a lack of domain and technology expertise, your idea is unlikely to take off. If you are not a tech person and are not aware of all vital peculiarities that SaaS product development services include, then you should hire a reliable SaaS-based product development company with the relevant experience in building successful SaaS products or facilitating migration from on-premise business apps to cloud-based SaaS solutions.
Have a reserve pool of capital available to tap into if neededThe first year after the launch of your SaaS product, your revenue will be hard to predict for sure. Initially, you need to spend your capital for qualitative customer acquisitions; showing them the value and benefits of using your SaaS product, and your key differentiators from competitors. As your customer base will start growing, you will be able to put a finger on your potential revenue and adjust your strategy on increasing it based on customer feedback and satisfaction with your SaaS solution.
Best practices of SaaS development
How long does it take to build a SaaS product?The duration and cost of SaaS product development from scratch depending on various factors like project complexity meaning the range of functions required, technologies used, and developers employed:
- The scope of your project;
- The list of functions and their complexity in performance;
- API integration (if needed);
How to choose a SaaS development company?As a logical roundup of all the above-mentioned points, the first and pivotal aspect you need to pay attention to when choosing a SaaS product development company is the relevant experience they have in building out SaaS products. Having relevant experience means that they will understand the concept of your SaaS solution, develop your idea well, be proficient in the design and technology trends to develop functionality specifics for your SaaS product, provide continuous support after the product release, and promote the services as well. SaaS development requires a specific approach to the pains, concerns, and needs of your target customers in order to correctly define the project specifications and develop a successful solution that will retain customers and remain in demand. The GBKSOFT development team demonstrates a strong technical background in building SaaS products of different types like the migration of on-premise apps to SaaS models, Point of Sale SaaS solutions, SaaS business management tools, SaaS ERP real estate software, SaaS development consulting for various domains among which are retail, gambling & betting, real estate, and others. GBKSOFT provides full-cycle SaaS product development from research of the demands for your solution concept to maintenance of the solution after release including marketing promotion packages. Let’s schedule a consultation with our Business Analyst to discuss the idea for your SaaS development and build a precise plan of our cooperation and ultimately enjoy the result of the fruitful cooperation being a successful SaaS product.
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