SaaS, which stands for Software as a Service, stands amongst the fastest growing industries of the current era, with Gartner reporting a 2021 forecast of almost $121 billion for the industry. More and more companies are showing interest in cloud technologies and there’s no doubt that it has a bright future ahead.
However, the vendors are also advancing at a very fast pace and new SaaS products are improved than ever. So, how do you step into the world of providing SaaS? What does it take to make a SaaS product that stands out from the rest? Well, we’ll be looking at all about it in this article. Make sure you give it a thorough read. Let’s start!
What is SaaS?
SaaS is a software licensing and delivery model which essentially means that the user gets to enjoy the services of a specific software over the internet, without hosting it locally. SaaS products are offered on a subscription basis and are hosted on the cloud so whoever is paying for them, can use them no matter where they are located.
So, the vendors host everything that comes with software such as the database, the source code, server, and so on. All the customers have to do is subscribe to the product and start using it right away, without worrying about anything else.
Let’s take an example to make things clearer; You probably heard of Dropbox, right? Well, for those who don’t, it’s a cloud-based storage management system. Just like a hard drive, it can store all the data you need to store, without physically being present with you. All you need is a subscription!
As soon as you sign up and get your credentials, you can sign in to your account and start putting your files there just like you would on your regular hard drive. And guess what? You can use it from literally anywhere, as long as you’re connected to the internet.
One of the best things about SaaS is the ease of integration it provides. As Greg Evans, VP Strategic Partnership, PageCloud said:
“We believe with an enabled SaaS future we have better access to funding which will allow for greater integration.”
As a result, bigger companies will start investing in smaller teams which will eventually lead to new and highly flexible products in the tech market.
Highly Recommended Article: Different Types of SaaS Products
What Makes a Good SaaS Product?
There are certain things that separate a good SaaS product from an average one. From solving customers’ problems as effectively as possible to being cost-effective, there’s more than one thing that makes a SaaS product stand out. Below, we’ll see a list of all the major factors that contribute to a top-notch SaaS product.
1. Be Specific
To be able to kick in your new product, one of the most important things is to keep your scope as narrow as possible. If you’re solving a certain problem for a large group of problems, not only will you be able to acquire more customers, but you will also put all your strengths into that one specific problem, making the end product better.
On the other hand, if you fail to narrow down your scope, you’ll be solving more problems but won’t be able to concentrate on anything fully. So, not only will better solutions be being offered by competitors, but your focus will also be scattered, and the end product won’t be up to the standards.
2. Flexibility
Nobody likes to use something that cannot be adjusted according to their needs. For a business to thrive, tending to the customer needs is of utmost essence. However, customer needs are not something you can generalize and so it’s quite hard to develop something that fits everyone’s needs. But customers still require tailor-made software.
So, the only way to take care of this is to make something that offers a whole lot of options for customization. Always have room for different sorts of customers and never leave any customer segment out of the equation. Failing to achieve this could have a disastrous effect on your customer base.
3. Value Proposition
Providing a good value proposition to the customers is important in any business but it has a special place when it comes to SaaS products. Since the customers here are looking to avoid software costs and using it on a subscription basis instead, you need to make sure you provide them the value for the money they need. Otherwise, there will be nothing stopping them from buying software once and for all.
So, always think from the perspective of the customer and take into account the reasons why they’re opting for SaaS instead of on-premise software. Make them the offer which is justifiable and provides them good value.
4. Branding
Branding is a major pillar upon which SaaS products stand. A lot of SaaS products fail not because they are not useful, but because they are not branded and eventually die due to little to no awareness. Branding lets you create value in the eyes of a customer and it’s how you climb the steps of success.
Make sure you start branding your SaaS products from the very start and as it starts to make progress, your brand starts getting recognition as well. Moving on, if your services are good enough, your brand will start becoming state-of-the-art. This lets you introduce any new service and instantly make it a huge talk in the market, thanks to the credibility the branding has built you.
5. Effective Marketing
Marketing is one of the foremost steps that your team needs to take care of upon the launch of your SaaS product. No matter what service you’re providing or what problem you’re solving for your customer base, if the customers don’t know about your product, they’re never going to be interested in it.
Now I know that marketing is crucial in any product, let alone SaaS, but marketing a SaaS product isn’t the same as everything else. Customers need to know the difference before buying it, and there’s no way they can fully experience the product before a small hands-on demo.
So, the marketing team needs to make sure that they either include videos of the functionalities or provide demo accounts for the people interested. Once the customers get to know what the product is capable of, it’ll become hard for them to resist.
6. Robustness
Robustness is something that doesn’t help you acquire customers, rather help them stay. The quality of software being robust is highly underrated and is amongst the most essential things that customers look for. Switching to different services from time to time is quite annoying and wastes resources, so customers always prefer something which they could stick to.
So, to retain as many customers as possible, a SaaS product needs to be highly robust and reliable for the customers in the long run. The thought of switching to a different vendor should be the last in the mind of a consumer.
7. Be Creative
Creativity is welcome above all. Succeeding to provide something your competitors can’t is the art. Once you master this, you’ll be sailing in the ocean all alone. If you’re starting a new SaaS product, chances are someone out there might already be providing the same product. So, the only way to reserve your spot and attract customers is to be creative. Otherwise, there’s no reason why someone settled with another vendor will come to you.
So, always make sure you put in enough hours while designing your product. Don’t merely follow what everyone is doing and try to think outside the box. The more you stand out and solve customers’’ problems efficiently and effectively, the more you reap.
Why Are SaaS Valuations So High?
SaaS products are taking the corporate world by storm, and even huge enterprises are starting to prefer it over traditional software nowadays. As studies suggest, midsize companies will be spending a staggering sum of $2.8 million.
People often end up thinking, why are SaaS valuations so high? Why is it outnumbering traditional software so quickly? Well, let’s see.
First off, one reason is abundantly clear: The recurring revenue; Since SaaS products are subscription-based, their turnover is easy to predict. Moreover, when coupled with booming growth, it contributes the most to a high valuation.
Secondly, SaaS provides services over the cloud so, it’s accessible from any corner of the globe, as long it has an internet connection. SaaS companies are scalable, and this pandemic situation has added fuel to the fire, resulting in an overall increase in valuations of SaaS products.
Conclusion
SaaS products are what the future holds. They’re subscription-based software that is provided to customers using cloud technology. Companies providing SaaS products are rapidly increasing and there are more SaaS products out there than ever.
However, since the competition is already quite hard and getting even harder with every passing day, there are certain things one should look out for while developing a SaaS product. Throughout the article, we have seen the 7 most important factors that contribute to a good SaaS product.
