Now software as a service (SaaS) is actively gaining popularity. If you want to implement your project in this area, then you need to know how to start a saas company. Today we will look at a detailed plan, thanks…
Top 12 SaaS Trends to Watch in 2023-2024: Market Overview
The software-as-a-service (SaaS) market is ever-changing and constantly growing. Since 2020, Saas giants like Salesforce, Adobe, and Shopify have demonstrated almost astronomical growth that at times reached 225% in a year and a half.
This year, Saas products are becoming more popular among companies, helping them achieve their business goals. Here are some key stats:
- The total value of the global SaaS market increased from $152.18 billion in 2021 to $176.62 billion in 2022
- By 2025, nearly half of all digital data the world produces will be stored in the cloud, and around 85% of business apps will be SaaS-based
- 73% of corporate representatives use Saas products to meet their business goals.
When evaluating new tools and features of Saas for your business, it’s essential to keep an eye on the trends in the industry to ensure you’re making informed decisions based on the latest data.
This article covers 12 of the most interesting trends in SaaS that Devox Software specialists have identified today — including how they work, how to implement them, and predictions about where they’ll be in the next couple of years.
SaaS Market Overview in 2022
SaaS, or Software-as-a-Service, has been around since the late 2000s and has consistently grown in popularity over time. In fact, 71% of companies worldwide identified SaaS as “quite important” or “very important” for their businesses. Other crucial preferences were AI, Big Data, and machine learning. Even more, 88% of respondents to the O’Reilly survey admitted they use at least one cloud-based SaaS service.
Due to such high demand, the SaaS industry is constantly and rapidly evolving, making it difficult for companies to stay on top of trends. Technology advances and users gain access to more information than ever. So, it’s vital to align with the latest tendencies in the SaaS world and keep tabs on competitors and their strategies to remain on top of trends with the latest market data.
What Factors Influence the SaaS Industry:
- Spending and ROI: As Saas products address the main problems related to corporate profitability this year — including remote work, resilience, scalability, flexibility, and speed — Gartner expects public cloud spending to exceed 45% of all IT spending by 2026.
- Cloud growth and security: Gartner analysts assume companies will be ready to spend around 66% of their software budget on SaaS due to its effectiveness and reliability.
- Tech innovations: Agility is a crucial business objective these days, and the capacity of Saas to meet this need quickly and conveniently convinced around 75% of business leaders to invest in Saas.
- Saas acquisitions and IPOs: Saas market attracts investors and fuels acquisitions, contributing to better positions of scalable cloud solutions in the market.
- Global situation: Black Swan events like the COVID-19 pandemic and Russia’s invasion of Ukraine also impact the growth and state of the SaaS industry. For example, the global lockdown increased the necessity for remote work, which fueled the need for SaaS among companies.
12 SaaS Industry Trends that Will Determine the Market Appearance for 2023-2024
Choosing the right tool for your SaaS company can be challenging if you don’t have an idea of what to look for in the software you need to run your business. Luckily, the industry experts at Devox Software have put together their predictions of the top SaaS trends over the next two years so you can start thinking about how you’ll incorporate these tools into your business practices now.
One trend that is expected to grow over the next few years is marketing technology (MarTech) which includes predictive analytics, machine learning, and artificial intelligence to improve decision accuracy in customer-related areas.
In this regard, predictive analytics helps to foresee what a customer will do based on their past actions and behaviors. At the same time, machine learning provides a system with the ability to learn from past data and adjust its behavior over time. Combined with the power of Saas platforms, the technologies make the tool accessible, clear, and transparent.
Key Martech benefits:
- Better relations with customers through building more personalized communication
- Faster streamlined workflow with automated tools
- More accurate decisions about customers
According to Ascend2 and Third Door Media, the most important tools in this domain include marketing automation, email distribution, and CRM, used for systems integration (46%), real-time processing (40%), and data centralization (24%). With these capabilities, the Martech Saas trend is predicted to be one of the most powerful enhancements in the coming year in terms of increasing sales with more personal and relevant targeted marketing messages.
As a design tool made for non-graphic designers, Canva helps to create marketing materials faster and see them in action instantly. Even more, its pricing transparency is one of the best examples on the market.
#2 Artificial Intelligence
As one of the key Saas trends, AI integration creates new opportunities for users, including greater collaboration and personalization. By combining AI with CRM and customer service solutions, companies can respond more quickly to customers’ needs and better meet their expectations.
AI is also being used to analyze unstructured data such as social media posts, comments, and videos – which can lead to better insights on trends in customer sentiment and market analysis. This way, it assists in building a corporate focus on customer experience and ensuring you make products and services that meet customer needs.
Key benefits of AI as a Saas trend include:
- Creating a high-quality user experience
- Better security of services and accuracy of decisions
- Higher level of customization and personalization
Given the variety of application fields and advantages of AI, this trend has become a game changer in the Saas world. By providing tools for quicker deployment, faster learning, and better security, AI in Saas can become a competitive advantage for your business.
Devox Software team developed Ferretly, a social media background screening SaaS platform, to analyze social media posts. It applies AI, along with several other cutting-edge technologies, to detect risky content and manage it properly.
#3 White-Labeled SaaS
White-labeled Saas is a concept referring to software products made without branding, letting companies purchase them, put their own branding, and then resell them to their customers. This is especially useful for companies that lack the technical skills to build software but have a robust business model for selling software and a clear understanding of a digital product their need.
What advantages can you expect from white-labeled SaaS?
- A carefully made, rigorously tested, and well-designed software you can use for your business needs
- Faster time-to-market with a ready-made digital product
- Ability to focus on value proposition, concise branding plan, and marketing efforts while working with a digital product
A well-made while-labeled Saas will easily integrate into your existing business ecosystem, IT infrastructure, and embedded BI tools.
Low-code platforms are becoming more popular as they allow businesses of all sizes the flexibility to create custom applications without needing programming skills while working on their digital transformation initiatives. In other words, it lets developers focus on the business logic and user experience of the solution instead of solving complex coding tasks.
The main benefits of low-code development include the following:
- Presence of pre-made modules for easier designing
- Easier access to complex software development projects and higher input value for junior developers
- Open API to access the repository of easy-to-use tools for faster software development
- Useful for developing desktop and mobile applications alike.
All in all, low code is among Saas industry trends that make the development process easier, faster, and more customer-centered.
Example: Webflow environment
Webflow is one of the most popular no-code environments used to create appealing and effective websites. Also, it’s used as a collaboration tool between various teams that can work together on enhancing a pre-made template.
#5 Cross-Platform Tools
This group of Saas trends unites digital asset management solutions, document management systems, and login management software. All of them help unite scattered data within the enterprise to fuel growth and business evolution.
For example, cross-platform tools can automatically sync customer data between disparate systems within a single platform accessible across any channel or device. This can include various files, documents, and valuable branding assets worth considering during the sales process.
Advantages of cross-platform tools:
- Faster access to the needed documents and assets
- A single dashboard for Big Data
- Better decisions regarding customers
Cross-platform tools are expected to establish a separate Integration Platform as a Service (iPaaS) market with over $10.3 billion worth by 2025. This will lead to widespread usage of innovations, such as visual analytics and big data integration, not available this year.
#6 PaaS (Platform-as-a-Service)
The more complex your software is, the harder it becomes to keep it in your internal storage. In this regard, PaaS is a Saas trend that offers an efficient alternative to switching to public or private clouds.
Before 2022, enterprise customers had been hesitant to move their IT infrastructure out of the data centers and into shared hosting environments for fear of losing control over customer data and service levels. But today, it’s easier to become open to using external platforms with cloud services’ enhanced security, flexibility, and scalability. By being estimated at over $53 billion in market size in 2021, PaaS is projected to reach over $319 billion by 2030.
- Cuts costs on hardware maintenance
- Saves time and increases speed on creating software
- Provides greater flexibility and mobility
With PaaS, companies can focus on developing their core product instead of worrying about system maintenance, hosting, and scalability issues. That’s why we recommend paying attention to this trend to be among the first to enjoy its benefits for your business.
Example: Amazon AWS
AWS is a leader in the PaaS domain, providing a cloud platform for many SaaS products. This is especially useful for startups concentrating on building software instead of solving server-related problems.
#7 Integrated APIs
Integrated API, or a piece of code that connects two software products, is among those trends in Saas that are relevant for companies with global outreach, as the ability for different departments within a company to share data is crucial for successful business scaling.
At the same time, integrated APIs are beneficial for users too. As more and more companies offer their services via apps, customers often need an easy way to integrate data from other sources into these solutions. That’s where integrated APIs come in handy: they allow developers to easily connect their apps with other products so users can use both using a simple interface.
Advantages of integrated API:
- Ability to automate tasks by integrating various programs into one application
- Providing better experiences for customers
- A wider set of capabilities within a single Saas product
In a nutshell, integrated APIs provide an opportunity to increase efficiency and simplify customer experience when it comes to accessing information.
#8 Vertical SaaS
Designed for a particular niche, vertical SaaS is a trend that gets stronger with time. The more customer-focused a business becomes, the more tailored solutions it needs to address every specific need of its target audience segments.
In this regard, micro SaaS products are on the rise. Businesses prefer investing in software specifically designed for their niche — and here, vertical SaaS takes over as the trend of choice, especially for tech startups that appear to provide personalized solutions non-existent in the current market.
Advantages of vertical Saas:
- Better conversion rates and reduced churn
- Ability to make highly personalized digital solutions
- Increased customer trust and loyalty
With time, SaaS trends tend to evolve from general frameworks to highly specialized ones. And vertical Saas is up-to-date in this regard, letting companies decrease the scope and complexity of typical software programs to meet customers with increasingly focused apps that provide personalized solutions.
BioIQ is a micro Saas product for the medical sphere that offers consumer-centered health testing. With its help, you can get a personalized diagnosis that accumulates all the relevant health data and convenient e-health tools.
Data vulnerability has been the main obstacle to Saas industry trends development. Adaptive Shield discovered that over 85% of companies in 2021 identified cybersecurity as the main risk they face today. But with broader access to AI, this problem is not that sharp, with 63% of respondents pointing at SaaS misconfiguration as the main security-related problem.
For example, AI can help organizations with data breach notifications as they risk facing lawsuits and fines if their customers’ personal information is compromised. Similarly, new regulations can be put in place to let enterprises know they are required to report any security incidents, either externally or internally.
Security-related problems a well-designed Saas can overcome:
- Staying up-to-date with legal regulations and updates
- Having all the settings of internal Saas configured
- Coping with internal and external cyber threats
Using AI and machine learning models with predictive analytics, you get a powerful toolkit for cybersecurity standards improvement. Since these technologies can help organizations detect and automatically respond to security threats, companies in 2023-2024 are expected to become less hesitant to introduce tech innovations into their business processes.
#10 Demand for Collaboration Software
According to SWZD, in 2020, 64% of businesses implemented remote work models, and around 25% of people prefer to keep working from home after their companies will come back to offices. The need for collaborative tools has increased to maintain the effectiveness of teamwork and enhance productivity.
During the last few years, collaborative platforms have evolved into programs offering various team options, including video conferencing, screen sharing, task management, and collaborative sales processes. With time, the demand for HR tools, productivity control, and remote delivery is expected to increase.
Key capabilities of collaboration software:
- Enhanced communication tools, including notes sharing, video conferencing, and screen recording
- The ability for several departments to work together on a business-critical task
- Productivity control and an integrated reporting system
As a Saas trend, the rise of collaboration software is not surprising, considering the increasing demand for flexible work opportunities as well as scalability. And given the popularity of hybrid work models, the market for such tools is expected to grow even more.
#11 Centralized Analytics
Predictive analytics is a powerful tool in several SaaS trends we’ve identified above — among all, as it provides a better understanding of the entire customer journey for companies. In this regard, this trend is about centralized, streamlined data analysis with less work, as you can create a more efficient workflow for analysts with less routine work.
The rapid expansion of data sources, including mobile and IoT, means that it is no longer possible for businesses to analyze data on an individual silo basis; instead, companies need to be able to look at the overall customer experience. Here, analytics can provide deep insights into user behavior, informing crucial business decisions and making more profitable marketing campaigns.
For example, social media data like what people tweet and post on Facebook could give you some clues about their preferences — but without a central system tracking these trends, it would be impossible to get such an overview. Even if you have access to all these data sources in separate databases or spreadsheets, looking at each is time-consuming and complicated; doing it as a whole is much easier.
Key benefits of centralized analytics:
- Easier access and management of data
- Ability to make informed decisions fast and with improved accuracy
- Less routine work and human error risks for data analysts
Centralized analytics is critical for gathering all the information critical for decision-making in one place. Even if you have everything you need in different spreadsheets and databases, automated analytical tools make data processing less time-consuming and complicated.
Example: Aera Technology
Aera is a decision intelligence tool that combines AI, machine learning, and predictive analytics to enhance decision-making. It collects data from different departments and offers solutions in the form of actionable recommendations.
#12 Focus on Customer Experience
Last but not least, customer experience is the top trend to watch in the SaaS world. With an increasing number of companies focusing on customer experience, it has quickly become a core competency for any business striving to succeed in 2023-2024.
Among key tools to improve customer experience, companies invest in mobile-first SaaS, accessible Martech technologies, and tools that fight churn. Given the exact problem that is sharp for your company and niche, you can choose the Saas software that addresses your key concerns.
Why it’s worth focusing on customers with Saas:
- Maintain profitability of a business model
- Stand out in the competition within your market
- Invest in those innovative tools that make your business grow
Even though the Saas market is growing by itself, customers are the ones who make a final choice about which companies they support with their money. So, to succeed in this market, you should create highly personalized and easy-to-use software for them.
Do You Need Help with Implementing a Needed SaaS Trend?
Devox Software specialists are constantly checking the latest trends in Saas to recommend tools and solutions that address the current market needs. We hope our tips helped you better understand in which direction to move in the next couple of years.
If you need help implementing any of these Saas trends, we’ll be glad to provide our software development outsourcing services for your project.
As a SaaS development company, we offer a full cycle of SaaS-related activities, including development consulting, architecture design, UX and UI design, product development, testing and QA, and cloud migration.
Come to us for easy adoption and domain expertise, or request our consultation!