According to Gartner research, user spending on SaaS rises yearly. Such rapid demand has made the SaaS model a leader among other models. SaaS demand was estimated at $121 billion in 2020 and has grown to $145 billion in 2021. By the end of 2022, Gartner predicts that this number will rise to $171 billion.
The phenomenal possibilities of SaaS are driving more and more businesses to develop software as a service. Therefore, we have prepared an article that will tell you about the entire process of SaaS apps development. We will also look at the main benefits of SaaS and the pitfalls so that you can make an informed decision about using SaaS.
What is SaaS?
Experts of this site, who are leaders in the development of the NFT marketplace and software development, put forward their views on the concept of SaaS. This definition is easy to understand and remember. SaaS (Software as a Service) is a software deployment and implementation business model in which a vendor develops an application, licenses it, manages it, and makes the software available to consumers over the Internet.
In other words, SaaS is software+service, software as a service, and on demand. The software as a service provider provides the client with the implementation of business functions and the functionality of business applications, solves the issues of integrating its service into the consumer’s IT system, and assumes all the functions of developing and supporting solutions and ensuring their scaling.
Benefits of SaaS
By deciding to create a SaaS platform, you get the following benefits:
- Use of the corresponding licensed software.
- No installation, updating, or maintenance of hardware and software is required.
- Small recurring costs instead of high one-time costs.
- No need for server hosting, administration, and data security protection.
- Payments are predictable.
- Programs are updated from time to time.
- Reduced deployment and implementation costs.
- Reduced costs for support systems, configuration, and expensive skilled system administrators.
- Reduced overall IT costs, expensive software, hardware platform, servers, and network equipment.
- Security of working capital.
- Increasing the speed of deployment of solutions, ensuring operability in the shortest possible time.
- Global availability.
- Guaranteed quality and high level of reliability.
Obstacles When Implementing SaaS
Before you move on to SaaS development instructions, take a close look at the issues you may encounter:
- Data security. In the healthcare or legal sectors, sensitive information goes beyond the company’s server, compromising access control, privacy, and security.
- Limited choice. There is more software choice in the traditional model than in the SaaS model. Although the situation is changing over time, a few players are still left in the SaaS segment.
- The need for the Internet. The user must be connected to the Internet to use the SaaS application.
- Slow work. Depending on the speed of your internet connection and other required resources, the SaaS offering may be slower than if the software runs locally.
- Lack of integration. With SaaS, there are fewer opportunities to integrate the software with other programs.
How to Create a SaaS App: 5 Steps
Developing a SaaS App takes a lot of time, effort and is cumbersome. For your convenience, Jatapp has compiled a step-by-step guide on how to create software as a service. Understanding the basic steps will allow you to implement bolder ideas.
Define a Business Idea
The first step towards creating your own SaaS app is setting a goal: What exactly do you want to do? What problem do you want to solve with the help of cloud technologies? The simplest example is Google Docs or Microsoft Office 365. Previously, the document management platform had to be installed on a computer. Still, thanks to technological development, the developers managed to transfer the program to the cloud, which made it available to millions of users. Similarly, it would help if you defined the main idea of your project – this will allow you not to be scattered on unnecessary tasks.
The next step after you understand what kind of SaaS platform you want to launch is competitor analysis: design, features, marketing and advertising, pricing, and more. This will help you understand how other startups implemented an idea similar to yours, what the target audience expects, and which ideas are successful and which losers.
If some companies have managed to conquer the market by becoming world-famous brands, such as Amazon, Spotify, or Uber, then when launching your SaaS, it is wiser to focus on such large-scale projects. Also, you can bet on a narrower niche or implement everything at a higher level. Launching a niche SaaS project is faster, cheaper, and less risky. Creating an improved analog of an existing project is more prolonged, expensive, and challenging, but you can get much more profit if successful.
Choose a Monetization Model
If you want to launch a commercial platform, you need to determine the monetization model in advance to implement the appropriate functions in your SaaS product immediately. This is how most cloud projects make money:
- Freemium. The essence of the model is to provide users with free access to the main functionality of their application. But at the same time, it encourages users to buy access to additional features. This usually means blocking ads, accessing analytics and marketing tools, or a helpdesk.
- Subscription. This model implies access to content only after paying for an hourly, daily, monthly, or yearly subscription.
- Advertising on the platform. Selling your app screen space to another brand is the most popular way to monetize SaaS products. You can publish banners, announcements, videos, and animations.
- Pay-as-you-go. This model directly links the cost of a SaaS solution to its use: the more you use, the more you pay.
- Hybrid. A model that combines several monetization methods, such as Freemium and advertising. Most end-user applications use this scheme.
Create a Platform Design
Design is the essential element that determines the success of a platform. How well you develop the design will determine the user experience and, ultimately, the platform’s profitability. When developing SaaS applications, use the following principles:
- Make registration easy. Request only the most essential user information: an email and contact phone number will suffice. If your niche requires more information, divide the registration into several simple steps.
- Make it easy to adapt. Think over the process of introducing the user to your service. A lack of instructions for user adaptation may confuse the user.
- Optimize navigation. Proper information architecture and navigation implementation will help the user quickly find what he needs on your platform.
- Optimize dashboards. If your SaaS application involves working with large arrays of various data, you must ensure that the user receives information in the most expanded form. In other words, ensure that the user understands the current state, what has changed recently, what tasks need to be taken on first, and what problems to solve.
Build an MVP SaaS Solution
After completing all the above steps, you can proceed to the last stage – developing a minimum viable product (MVP). The goal of an MVP is to spend as little time and money as possible to test the concept and see if users are willing to pay cash for it. You can perform this process on your own or with the help of an outsourcing company.
To create a small SaaS solution on your own, you will need a product manager and two software engineers who will work on the project 40 hours a month for six months. Hiring a development company with experience in developing SaaS projects and understanding the chosen niche’s specifics is better for more complex projects.
Examples of Successful SaaS Apps
Below we have compiled a list of the best SaaS landing page examples. Companies have established a powerful connection with customers through conventional solutions and generating regular revenue. Take as an example the success of these platforms, and perhaps shortly, you will join this list:
- Zoom. In its early days, Zoom was positioned as a SaaS-based video conferencing tool that could host up to 25 participants. Since then, the company has increased and offers various communication options.
- Zoho. Zoho is a SaaS set of business and productivity tools. The company provides several independent solutions that can be deployed as standalone devices or as a unified digital operating system based on SaaS Zoho One.
- Microsoft. Known as the developer of the Windows operating system and the Office software suite, Microsoft has made rapid inroads into SaaS over the past few years. Perpetual license-based productivity programs are now available in Microsoft 365 Suite, including familiar desktop tools like Word, Excel, Outlook, and PowerPoint and native SaaS web products like SharePoint and Teams.
- Google. While Google is not a SaaS-only provider, its SaaS products have gained incredible popularity over the past few years. The company recently renamed its G-suite product Google Workspace, giving it a different SaaS status instead of a collection of disparate, unrelated tools. Google is predominantly known for its SaaS-based productivity tools and marketing and ad management platform.
- Adobe. Adobe is known for its perpetual license software products, but since 2012 the company has moved to the first SaaS business model. The same year, she turned Creative Suite into a subscription cloud service called Adobe Creative Cloud, including all the software tools a designer could need. According to NASDAQ, Adobe’s SaaS revenue is $11.6 billion. Adobe has been the market leader since before the SaaS revolution and continues to hold its position.
Now you have a complete understanding of the strengths and weaknesses of SaaS. By deciding to develop a SaaS app, you are opening the door to a new technological breakthrough that will take your business to the top. However, remember the risks, namely the high costs and unprofitability of the idea. Carefully consider every detail of the project to get right on target. If you want to expand your knowledge, visit saasindustry.com and thesaasnews.com. Platforms regularly share advice on implementing SaaS and publish the most relevant changes in this area.