Why this is a good time to be a SaaS
This year’s Covid pandemic induced some quite extreme changes in the global economic climate. Ones with consequences we are yet to witness. How extreme these outcomes could be? Well, that depends on where you are in the industry spectrum.
If you’re a SaaS – kudos! Chances are, this was a year to demonstrate resilience and grasp new opportunities, as this business model takes the lead in positive predictions when it comes to growth and ROI.
SaaS sovereigns the IT revenue list
Numerous surveys – from small-sampled ones like a survey from Timia to Gartner’s research – imply that SaaS is the business model of 2020. Despite the global IT spending which is to decline by 8% due to Covid-19, these solutions will exceed last year’s expectations. And by 20 billion dollars!
The future is bright and stable for SaaS; expectations are pointing towards a steady 12% of annual growth, with 75% of businesses using all or mostly SaaS applications by next year. IaaS and PaaS are growing faster, but it’s the specificities of the software-as-a-service model and all of its benefits that changed the IT map in this unprecedented year.
Needles to say, this is not going undetected by the major players; 2020. SaaS acquisitions are happening big and have companies like Apple or Visa involved.
The beauty of the subscription model
It’s no rocket science to identify key factors which created so many favourable circumstances for a SaaS business. The sudden and significant change in the working model – aka work from home – caused a surge in demand and supply of various necessary and not so necessary tools and platforms. All those means with a mission to simplify (or even make possible) remote work boast agility, simplicity of usage and a subscription-based pricing model.
The latter, turns out, is very popular among user-companies who find the predictable digital subscription services very appealing. Many software as service companies adapted quickly to the circumstances, creating bundles, freebies and other perks for new and existing users. No wonder why the Zuora research showed subscription companies to be more resilient to the global crisis.
But, not just that. If you analyse the way Covid-19 changed the SaaS landscape, you must also notice the switch from sales-focused modus operandi to customer-focused one. With a goal to boost retention and minimize the churn, software as service companies are setting new standards in filling their customers’ rising expectations.
The beauty of cloud-based SaaS
Ah yes, there are numerous thumbs-up for cloud-based SaaS owners too. With customers demanding ease of access, security, and innovation, it is becoming clear that such a service is best when cloud-based.
What stands out among the major benefits of cloud-based software are the cost savings made possible by scalability. Let’s not forget the storage. Companies can transition to cloud storage without the need to manage, monitor and secure it separately from their data protection service.
Creating your opportunities despite Covid
To wrap up this story, we would like to refer to the beginning of it and the link between the Covid-19 effect based on industry. Travelling is among the sections who took the hardest punch, however, resilient SaaS solutions are making their way into new win-win ventures. A business trip startup TravelPerk has launched an API product which provides the latest data on worldwide travel opportunities and risks. Their product FlexiPerk is enabling users to cancel their reservations and get at least 90% money back. This much-needed possibility is resonating with the users, explains CEO and founder Avi Meir.
Such examples are well-grounded in agility and flexibility provided by cloud technologies, necessary for a modern SaaS to survive and thrive.