Software as a service

Top 7 Business Benefits of SaaS Versus Traditional Licensed Software

Software as a service is an alternative to traditional licensed software installation in the business environment where the end users create the server, install the applications, and configure all the platforms. SaaS clients do not buy software. Instead, similar to a rental, they are authorized to utilize it for a defined period and pay just for the software they use. Favorable adoption rates: SaaS applications have higher approval rates and lower learning curves because the software is available through standard web browsers. This is significant given the high cost of on-premises software development and implementation versus the low entry cost for SaaS. Businesses don’t want to invest capital in custom developed or off-the-shelf software that users won’t adopt. Pay for usage: IT organizations often overestimate end-user software utilization, such as forecasting an active end-user community growth to 10,000 employees for a particular application when it only grows to 500 employees one year later. Software as a Services enables corporate buyers to pay for active users instead of the forecasted user community. Simpler upgrade process: SaaS vendors manage updates, feature enhancements, and new releases by deploying them to the hosted applications centrally. This process eliminates the need for clients to upgrade applications on end-user desktops. SaaS vendors typically deliver several minor automatic upgrades alongside two to four major updates annually. In this way, SaaS-based applications users can be confident that the software provided by the vendor is always the latest version. Scalability and integration: Some SaaS applications support end-user customization. APIs allow connections to internal applications such as CRMs or ERPs as well as to other SaaS vendors. A notable aspect of integration is automatically sending field written orders to the ERP. It enables salespeople in the field to check inventory, write the order, obtain customer approval, submit it and get confirmation, all in front of the client within minutes. As customers scale with a SaaS vendor, the need for software licenses or investing in server capacity is eliminated. Just modify the subscription. Time-to-market: The Software as a Service vendor provisions the network infrastructure, software, and hardware at the data center narrows customization of the SaaS applications user interface and features. This restriction eliminates delays for internal IT organizations to deploy, enhance, or develop the application. Work anywhere: Users can access software via mobile devices wherever they are connected because it is accessible over the internet and hosted in the cloud. The ability to access the data and software when salespeople in the field need it can mean the difference of a sale. Lower total cost of ownership: The unknown cost to deploy and operate licensed software is a common criticism of licensed software. However, the total cost to run a SaaS application is predetermined. Software as a Service vendors bundle software, hardware, and support services such as business continuity, implementation, help desk, training, upgrades, troubleshooting, and security into a single fee. The result is knowing the overall total cost of ownership in advance. The SaaS software industry is advancing rapidly. In fact, point solutions will continue to fill gaps in the marketing and sales continuum. This blog post was first published on LinkedIN

5 Essential Elements of Software as a Service (SaaS)

Every business has its challenges and including in-depth research, business plan development, and meticulous execution. Working towards your vision every day leads to success. Software as a Service (SaaS) business is no exception, with its own particular rules, regulations, and best practices. Because there are so many elements to implement, you can manage these tasks most effectively by tackling one at a time. Cost Per Acquisition What does it cost to acquire one customer? When you take into account all of the related marketing expenditures, it quickly becomes clear that marketing can be an expensive affair, especially when done through the wrong channels. Begin by writing down and accounting for every expense in your marketing campaigns, no matter how small or insignificant they look. To calculate your cost per acquisition, divide the total marketing investment by the total number of customers you acquired in that month. If you are a start up the figure might be higher than what you are receiving at the end of the month, however, it should begin decreasing with more subscriptions, but f you continue to spend more money per customer than your revenues, you will ultimately be unsuccessful. Tip: Use customer analytics to determinine which segment results in the highest returns. Churn Rate How many customers do you lose per month? The customers that keep coming back determine your company’s growth rate. Churn gives you the average number of people that leave your site. A high churn rate could mean your product is not meeting the customers’ needs as they expected or as you anticipated. There may be a possibility that marketing is the issue, but you must determine the problem and fix it as soon as possible for business to remain healthy. Tip: Gather feedback from customers before they unsubscribe for you understand the root cause of the churn problem and address it. Monthly Recurring Revenue Closely related to the churn rate, you also need to calculate your monthly recurring revenue. The higher the churn rate is, the less consistent the recurring revenue will be. By the time you place your product online, you have spent a significant amount of money in developing and marketing it. When sales revenues start coming in, you need to understand not just the total but also what portion of it is recurrent. The recurring cash flow you receive each month shows you the sustainability of the business. If the amount is sufficient to run and grow the business, then you are heading in the right direction. However, if the amount keeps fluctuating, you need to re-strategize. Tip: Invest more time in the recurrent customers, and give them great customer service to retain them. Revenue Per customer Once you know your monthly recurring revenue, you know your key customers. Crunch the numbers to understand how much each customer is worth and explore how to grow their portfolio. It is easier and more cost effective to market to an existing client than to acquire a new one, so focus on leveraging those existing relationships. You can up-sell an upgrade of the product or cross-sell a sub-product that will improve the customer experience. Robust leveraging can bring amazing results to your revenues and margins. Tip: Develop systems that increase the revenue you receive from a customer. The systems should add value for the customer so they want to continue using them. Lifetime value And for long term forecasting, understand the lifetime value of each customer. This is a prediction of how much you will be making in the future and the above metrics will inform these predictions. For example, if your current churn rate is low, your average revenue per customer is increasing, then the lifetime value will be high. The lifetime value indicates the most profitable customers to invest in for the best returns in the future. Tip: Let your finance team help you with these detailed calculations. SaaS business is a matter of numbers. If the numbers do not make, then figure out why and make improvements or move on to a more profitable segment. The above metrics are all closely related and they represent how well your product is doing in the market, and what you need to change. If these metrics are aligned with your vision, dedicate your time and expertise to make your SaaS business profitable.

Scroll to Top

Contact Us

Thank you for sharing your details. Your Brochure is ready to Download.

*Please check your Download folder for the downloaded file

Download E-Book

Download E-Book

Download E-Book

Free Download Presentation

Free Download Presentation

Free Download Presentation

Free Download Presentation

Free Download Presentation

Free Download Presentation

Free Download Presentation

Free Download Presentation

Free Download Presentation

Download Presentation

Free Download Presentation

Free Download Presentation

Download Brochure

Download Brochure

Download Brochure

Download Brochure

Download Brochure

Download Brochure

Download Case Study

Download Case Study

Download Case Study

Read our Privacy Policy for details on how your information may be used.

Download Case Study

Download Case Study

Free Download Presentation

Download Brochure

Thank you for sharing your details. Click below link to watch.

Thank you for sharing your details. Your Ebook is ready for Download.

Thank you for sharing your details. Your Ebook is ready for Download.

Thank you for sharing your details. Your Ebook is ready for Download.

Thank you for sharing your details. Your Presentation is ready for Download.

Thank you for sharing your details. Your Presentation is ready for Download.

Thank you for sharing your details. Your Presentation is ready for Download.

Thank you for sharing your details. Your Presentation is ready for Download.

Thank you for sharing your details. Your Presentation is ready for Download.

Thank you for sharing your details. Your Presentation is ready for Download.

Thank you for sharing your details. Your Presentation is ready for Download.

Thank you for sharing your details. Your Presentation is ready for Download.

Thank you for sharing your details. Your Presentation is ready for Download.

Thank you for sharing your details. Your Presentation is ready to Download.

*Please check your Download folder for the downloaded file

Thank you for sharing your details. Your Presentation is ready for Download.

Thank you for sharing your details. Your Presentation is ready for Download.

Thank you for sharing your details. Your Brochure is ready for Download.

Thank you for sharing your details. Your Brochure is ready for Download.

Thank you for sharing your details. Your Brochure is ready for Download.

Thank you for sharing your details. Your Brochure is ready for Download.

Thank you for sharing your details. Your Brochure is ready for Downloads.

Thank you for sharing your details. Your brochure is ready for Download.

Thank you for sharing your details. Your Case study is ready for Download.

Thank you for sharing your details. Your Case study is ready for Download.

Thank you for sharing your details. Your Case study is ready for Download.

Thank you for sharing your details. Your Case study is ready to Download.

*Please check your Download folder for the downloaded file

Thank you for sharing your details. Your Case study is ready to Download.