Every business faces the same challenge: To generate consistent profits while growing and improving customer satisfaction. This is how businesses have changed in recent years, with software being the key to their success.

Businesses are looking for an experience that is as good as their customers. Businesses want a solution that increases productivity, lowers costs and improves their bottom line. And that’s where software-as-a-service (SaaS) comes in.

Despite the growth of SaaS, many business leaders and companies are still unsure how SaaS can help them. What exactly is SaaS? What are the risks and benefits of SaaS? What are the most recent SaaS trends, particularly in the middle Covid-19?

These are the questions that we will address in our comprehensive guide to SaaS.

Let’s get right in it!

What is SaaS?

We should start with the basics: What is software-as-as-service (SaaS), anyway?

SaaS can be described as a model for software distribution where an external provider hosts and makes applications available to customers via the Internet. SaaS is one of the significant categories of cloud computing, together with infrastructure-as-a-service (IaaS) and platform-as-a-service (PaaS).

SaaS customers usually pay a monthly subscription fee to access the application. Subscriptions can be based on the amount of data that needs to be stored, the level or technical support required, and the number of users who will have access to the application.

In the 1990s, entrepreneurs started to promote SaaS. At least 51% of all companies have a cloud-based process. This number is expected to rise to 73% by 2021. In addition, SaaS industry revenue is expected to exceed $133 billion by 2021.

Types of SaaS Applications

SaaS solutions can be used to cover any business process for all sizes and shapes of companies. While some focus on project management at the enterprise level, others are focused on specific industries and others provide a tool that is tailored to small and medium-sized businesses.

Software for businesses has never been more diverse. SaaS products can be explored by businesses for almost any business area. These are some of the most popular SaaS apps:

• Customer Relationship Management. These applications enable companies to track customer information, automate marketing functions, and track sales through their pipeline.

• E-commerce and web hosting Remote servers can handle everything an online business requires.

• Communication platforms. Instant messaging and file sharing to improve collaboration between teams located in different locations.

• Invoicing and accounting. SaaS companies often focus on billing and invoice services. Other companies offer a complete range of financial tracking, reporting and other services.

• Payment gateways. These applications are based on the SaaS model and include accepting credit cards, processing bank transfer, offering rewards programs, publishing coupons, and tracking them.

• Human resources. SaaS products allow organizations to track employee hours, automate payroll processes and schedule interviews. They also streamline the hiring process.

• Project management. SaaS products provide end-to-end solutions for project management, including the creation of plans, listing requirements, and tracking progress in relation to deadlines and deliverables.

• Enterprise resource planning (ERP). This system is best suited for large organizations and helps to manage all business processes in real-time.

• Data management. SaaS products allow companies to analyze and protect their data.

• Email marketing software. This software helps companies maintain communication with customers, build loyalty and increase brand recognition. It also drives sales.

SaaS benefits and risks

SaaS is believed to offer many benefits over traditional business software installations. Is it really so easy? Let’s examine the pros and cons to SaaS.

SaaS customers have the following benefits, it is undisputed:

• Lower initial costs. SaaS services are typically subscription-based, and there are no initial license fees. This eventually leads to lower upfront costs. SaaS providers manage and maintain the IT infrastructure which lowers costs for software maintenance and hardware.

• Accessibility. Access to SaaS requires only a browser and an Internet connection. SaaS is more accessible than traditional enterprise software because it can be accessed from any device and anywhere in the world.

• Scalability. SaaS providers usually offer many subscription options and the flexibility to change plans as needed. This is useful for expanding your business or adding employees.

• Simple updates. SaaS providers manage software and hardware updates and deploy updates to hosted applications. Customers are freed from this responsibility.

• Flexible payment options. Customers can subscribe to SaaS products on a monthly, yearly or other frequent basis instead of having to pay one lump sum.

SaaS comes with some risks, however:

• Control issues. Software maintenance and upgrades can be left to a service provider, which reduces your responsibility but also means you have less control over the software and apps that you use. These applications can’t be customized to your specific needs, and you will end up dependent on the software offered by your service provider.

• Connectivity problems. Although storing all your data on the cloud may save you time, it can be difficult to access in case of an outage. If your Internet connection becomes unstable, you may lose your work. This can impact the performance of your company and reduce the productivity of your employees.

• Security concerns. Some SaaS companies aren’t compliant with security standards or aren’t transparent about security. Consider that remote access to any device by users can increase the possibility of unauthorized use.

• Regulations by the government. Many SaaS solutions work with data that falls under state regulations. It is possible that there are technical challenges in meeting state requirements.

SaaS vs. PaaS. vs. IaaS

The three main cloud service models are SaaS (PaaS), PaaS (IaaS) as we have already stated. Many business owners are unaware of the differences and don’t know which one is best for them.

This section will break down the differences between the models, so you can make an informed choice.

First, let’s define them. Let’s take a look at what it means to use software, platform or infrastructure as a service.

Software-as-a-service (SaaS), as mentioned earlier, is a software distribution model in which a service provider hosts an app and makes it available to subscribers over the Internet. As long as the Internet is available, customers can access the software on any device.

Platform-as-a-service (PaaS) provides developers with a complete environment for deployment and development over the Internet. PaaS allows developers to create everything, from simple apps to complex closed-based software.

Infrastructure-as-a-service (IaaS) is fully self-service for accessing and monitoring computers, storage, networking, and other services. IaaS allows businesses to access resources as needed and purchase them on-demand.

The main difference between these three cloud service models is the amount of service they offer out-of-the-box for end users. Let’s take a closer look at their differences:

• Software and data. SaaS customers don’t need to worry about managing their data usage or maintaining their applications. IaaS and PaaS both require customers to manage their data usage and applications.

• Operating systems. SaaS and PaaS providers provide the ability to control the operating system on which the software runs. IaaS customers still have to manage this part of their technology stack.

• Servers and data storage. All three cloud computing models can be accessed via the Internet and all three handle data storage and server management.

The table below shows how each business uses each service. Unchecked means the service provider manages.

Feature	SaaS	PaaS	IaaS
Data		x	x
Software (apps).		x	x
Operating systems			x
Servers
Data storage

Five examples of SaaS-based companies

Do you wonder what makes SaaS companies stand out from the rest?

You can answer this question by reading the following list of five common SaaS examples. It will encourage you to make a move and propel your company forward.

Google

Google is the first to be called, with 137 Internet-oriented products including Survey, Document Creation and Cloud Content Collaboration. Digital Analytics, Video Conferencing and many other services. Google Docs and Google Drive are the most well-known products. It was a small startup that started in 1998. Today, the company has grown to $136 billion in annual revenue.

Adobe

Most people are familiar with Illustrator, Photoshop and Illustrator. Adobe has more than 50 products for digital marketing, photo editing and printing. Their help is what allows users to open over 200 million PDFs each year. Adobe users are a key part of the company’s $11.17 billion revenue in 2019.

MailChimp

MailChimp was founded in 2001 and has grown to be a top-rated marketing platform for businesses. It offers solutions in email marketing, transactional emails, and Marketing Automation. MailChimp is the main product. It allows users to set up automated emails and track the results. We also rate MailChimp among the most inspiring B2B websites around the globe.

Slack

The company began as a huge multiplayer game, but it failed. It eventually evolved into Slack which we all use and love today. Slack currently has three products. Its main product, Slack Messenger, is an internal messaging and video conferencing tool.

Shopify

Shopify has been a well-known platform and application provider. It is used widely by E-commerce shops and retail Point Of Sale (POS). The company offers three products: Shopify Plus, Shopify Plus and Burst by Shopify. It has more than 800,000 entrepreneurs around the world.

To get more ideas for starting your own SaaS company, you should check out our complete list of the top 10 B2B SaaS businesses.

Five SaaS trends you should be following

The SaaS industry has seen an explosion in growth over the last few years. Many of these trends are a result of a wide range of factors. Some of these trends have passed without much impact, but others have remained.

The way we do business has been drastically changed by the Covid-19 pandemic. SaaS companies are experiencing a significant shift in their business models due to forced digitalization and remote work cultures. How can they handle the crisis and what are the current SaaS trends?

Continue reading and exploring our article!

Trend 1. Telehealth is on the Rise

Experts predict that telehealth apps will continue to be a popular trend, even after the pandemic. It is simple. SaaS medical applications make it easier to shift to remote healthcare, which is what we’ve been longing for. They reduce the risk of spreading infection during visits to the physical clinic, lower operating costs, and can handle a lot of requests. It is much easier to schedule an initial consultation than with traditional methods.

A telemedicine application Livi Connect is one example of this trend. With a growth of 80% in consultations, the application is now the most downloaded European app. The company created a new product that checks for Covid-19 symptoms to give it a competitive edge. The company anticipates seeing positive changes in the months ahead, as it responds to the worldwide need for remote medical assistance.

Does this mean that the telehealth SaaS startup companies will emerge “winners” in the wake of the pandemic? Even though there aren’t any winners, it is possible that they may be in a better position than other businesses.

Trend 2. Practically every aspect of an enterprise requires technical knowledge.

A survey by Globant, a digitally-native tech services company, found that while most companies were working towards digital strategies, less than 10% of employees actually participated in digital transformation.

Many companies have had to adopt digital initiatives as a result of the move to “all distant” and many will be asking themselves if digital transformation is an ongoing priority or a temporary one.

Forrester’s 2021 software prediction identifies one method of achieving ongoing digital transformation within a company. It is called “dev diaspora”. Forrester believes developers will continue to move beyond the IT department and into business operations. Software is too important to be left to the IT org.

Trend 3. Remote tools for managing work and collaboration are in vogue

Another significant change is the complete transition to remote work. Companies that aren’t prepared for this change now recognize the importance of project management and remote communication tools.

Klaxoon has seen a 90% rise in traffic to its French virtual meeting platform Klaxoon since the pandemic. To simplify team onboarding, the company provided a free 3-month trial and free guidance. Klaxoon can attract more customers and increase its reach by doing this.

Some SaaS providers aren’t prepared for such drastic changes. Zoom is one example. Zoom received over 200 million visitors per day in March 2021. This led to serious privacy concerns. Some bugs have been discovered that allow hackers to steal passwords and gain access to chat rooms.

Remote collaboration is becoming the norm. Many things need to be taken into consideration. Secure and feature-rich SaaS software plays an important role in this. After companies have established remote access and secured VPN access to their work, they will search for reliable and affordable software to support their operations.

Trend 4. Low and no-code platforms are “red hot”

Low-code platforms are platforms that can be customized completely with minimal programming. Users don’t have to spend weeks or months developing a custom app. Instead, they can complete the task in just a few hours or days. No code software, on the other hand, allows anyone to customize an application to meet their specific needs without programming knowledge.

According to Forrester, developers are increasingly adopting low-code tools. Half of those surveyed said they had adopted or plan to adopt low-code tools.

Non-technical staff are now increasingly able to access low- or no-code tools with the ultimate goal to bring businesses and products closer together, enabling faster communication.

Trend 5. The usage is growing, but a cash decline

SaaS is simple to use and maintain so many businesses prefer it to on-premise products. Covid-19 doesn’t always result in a revenue increase. Tech investments are reduced across the board, which means SaaS products need to adapt quickly.

Adobe, Dropbox, Salesforce and other companies are offering free trials and upgrading discounts. Cisco web conferencing has eliminated time limits and increased the number of participants to 100 per call.

Companies try to support their clients during the Covid-19 crisis and offer their services. We’re all in this together, and the best thing we can do is support each other.

The bottom line

Experts believe that cloud infrastructure services, specialized software and other IT spending are the only positive factors. The SaaS market is expected to continue evolving.

This comprehensive guide will help you to increase your knowledge and adapt to current SaaS trends. Please feel free to leave your feedback, questions and opinions in the comments box below.