One of the primary challenges for SaaS companies is SaaS product success. Many SaaS companies are looking for ways to ensure the success of their SaaS product. As the world turns to cloud-supported work, the founders of new SaaS companies must embrace change, think big, and target what’s missing in the market. There are a few things you can evaluate to determine the success of your SaaS product. In this blog, we will discuss the trends to follow to stay relevant in the industry and the top SaaS companies to watch in 2023.
What are SaaS companies?
Software-as-a-service companies use software to provide services to customers. In these businesses, the product is created, developed, hosted, and updated by the company itself. The SaaS model allows businesses to scale without increasing costs and access an unrestricted global market.
In Software as a Service, the software is externally managed, owned, and delivered. You can access most SaaS through your web browser. Almost all customer data is stored in a cloud environment. In this way, customers do not require data center-based or in-house applications. If a customer has a solid internet connection, they can access their data from any device anywhere in the world. There are many SaaS providers who offer mobile apps for their customers.
SaaS company examples: Shopify, Slack, Adobe, HubSpot, Microsoft, MailChimp, etc.
Future of SaaS: Statistics 2023
- SaaS is worth over $195 billion. (Gartner)
- SaaS-based business apps are expected to represent 85% of all business apps by 2025. (Bettercloud)
- Cloud computing spending is predicted to exceed 45% by 2026. (Gartner)
- SaaS companies continue to spend more than 50% of their revenues on marketing and sales. (McKinsey)
- China, India, and Brazil are expected to experience double-digit growth in SaaS between 2020 and 2025. (Reply)
SaaS Business Model
A SaaS business model involves selling cloud-based software for a subscription fee. A subscription fee usually applies to monthly or annual cloud-based software, which can be accessed via mobile, desktop, and web apps. There are three phases in the development of SaaS businesses: setup, growth, and stabilization. Listed below is an overview of each stage.
Setting up
In this phase, the SaaS company’s foundation is built. As the founders develop products, they identify their target market and research consumer needs. They will also plan the campaign to launch the products. It is also common at this stage to develop a marketing and sales strategy, consider options for customer support, and organize finances.
Growth
As soon as the products reach the market, the business is likely to experience rapid growth. Due to the large market reach of SaaS companies, they can expect new customers to adopt their products, resulting in a need for marketing, sales, and customer support. This is an ideal opportunity for the business to secure a loyal customer base by acting quickly.
Fortunately, this growth will generate additional revenue. Companies can meet customer demands, such as IT support and customer service, by reinvesting their capital into products and services. As the company acquires and retains more customers, it will likely start making more money.
Stabilization
In this situation, the business continues to gain new customers without increasing overhead costs. As a result, they have wisely invested in marketing automation, customer service software, and product updates. SaaS companies can use these tools to stay on top of customer demand, create a delightful user experience, and plan for exits in the future.
Now that we’ve discussed the SaaS model, let’s explore what makes a SaaS company successful and what trends to watch.
What makes a SaaS company thrive in 2023?
Keeping up with trends and changing over time is an important characteristic of successful SaaS companies, along with innovating and thinking big. During the digital age, product cycles and technological advancements have continually accelerated. It can be challenging to stay ahead of the curve, even for established companies – but it is absolutely essential to thrive and build sustainable momentum.
Take a look at the SaaS trends in 2023 to make your SaaS product a success.
- White labeling, APIs, and flexibility
If SaaS companies want to survive and grow, they need to make their solutions available via APIs, allow companies to get branded versions, and support flexible deployment options.
Providing an easy-to-use, integrated experience is fundamental to solving the business problems of larger organizations. This includes authentication and payment solutions. The companies that provide such solutions are also very concerned and conscious about their brand and will look for ways to white-label them.
- Better connectivity with 5G
Mobile apps will be needed for software providers’ solutions, not just mobile-friendly versions. In the era of a million apps on every phone, the challenge is to create apps that meet consumer needs and work on a wide variety of devices, including 2G and 5G.
- Vertical specialization, modular designs
SaaS providers specialize in specific industries, especially when it comes to software solutions. Organizations are shifting from on-premises to SaaS, which means their needs are becoming more business and function-specific. To address such needs, SaaS providers will have to build their own specialization layers or integrate with third-party solutions.
To accomplish this, solution providers need to be modular and open to becoming part of an ecosystem rather than remaining closed and standalone.
- Security
Security is the key to SaaS success. In recent years, cyberattacks, ransomware, malware, and IT outages have steadily increased as hackers become more sophisticated. The cloud hosts all business data and is accessed through SaaS. SaaS security will start getting a lot more attention once Infrastructure as a Service (IaaS) becomes mainstream.
Any IT security professional finds it much more difficult to secure every piece of software with remote working and other modern work trends. SaaS is the way businesses can achieve simplicity, scalability, and security. You can reach out to a top SaaS development company for SaaS solutions that are scalable and secure.
Here is the SaaS company list you should look out for in the coming year.
Top SaaS companies to watch in 2023
- Meistertask
It is an intuitive platform that allows you to manage tasks online. This web-based solution can be accessed from mobile devices such as iPads and iPhones. It comes with kanban-style project boards that can be used to manage tasks in a flexible manner.
- Grammarly
Grammarly is a San Francisco-based platform that helps users improve their grammar and communication skills. A popular tool for professional and student use, Grammarly analyzes customer text to help clarify their meaning.
- Rapid7
A Rapid7 IT security solution gathers data across a company’s users, services, assets, and networks. Using the tool, you can make security decisions instantly on-premises, via mobile devices, and through the cloud. The market capitalization of Rapid7 is $6.39 billion as of March 2022.
- Aurea
Aurea, one of the world’s leading sales acceleration platforms, is based on a predictive and prescriptive self-learning engine developed to help companies close sales from the first point of contact to the end of the sale. By using machine learning, it anticipates and recommends optimal sales activities, improves performance and motivation, and enhances live, high-quality conversations.
- Spendesk
It can be challenging to manage employee expenses and reimbursements. With Spendesk, employees can manage their expenses end-to-end through a SaaS platform. Among the tasks include approvals, limit automation on credit cards, accounting automation, and invoicing. Additionally, Spendesk helps create interactive and intuitive expense and reimbursement reports.
- Xero
The Xero cloud accounting software is designed for small businesses and accounting professionals. Its key features include invoicing, automatic bank and credit card account feeds, expense claims, accounts payable, fixed asset depreciation, standard reporting capabilities, and purchase orders.
- Tableau
As a giant in its own right, Tableau has exponentially grown since being acquired by Salesforce. Among Tableau Online’s offerings are interactive data visualizations and data analytics tools for business intelligence.
- Anaplan
The Anaplan platform is used for business planning practices and SaaS metrics in a wide range of departments. Using a variety of databases, it generates models using business rules, which can be altered instantly for changes. The company is in the process of being acquired by Thoma Bravo.
- Pipeliner CRM
As its name implies, Pipeliner CRM offers sales enhancement CRM solutions. Using its app marketplace, it automates sales processes through a range of applications. You can manage contacts and accounts, integrate emails, and even create offline applications. It automates the sales process, which helps achieve stretch goals.
- Cvent
Vista Equity Partners acquired the cloud-based event management and planning platform Cvent. Planners can organize events online, select venues, manage events, and create mobile apps, email marketing, and web surveys using the software.
Wrapping up
SaaS businesses such as these should be viewed as examples of successful SaaS businesses. It is important for service professionals and entrepreneurs to understand the SaaS business model, the trends to follow, and the type of products that the SaaS industry needs to succeed. If you set specific goals like improving customer satisfaction and earning customer loyalty in your business, you’ll hopefully experience similar growth in 2023 and beyond.
If you are looking for top-notch SaaS product development to build your next SaaS product, reach out to OpenXcell. We offer SaaS products that have proven track records of success, enabling you to thrive in the SaaS industry.