Do you want to build a SaaS product? SaaS, or software as a service, is a growing industry with tremendous potential. There is no better time to take the plunge in this fast-growing market than now, even though it is still in its infancy in some countries. However, it is important to know how to handle SaaS sales.
As compared to the last two years, businesses are spending 50% more on cloud technologies today. Clearly, the cloud technology industry has enormous potential.
It is certainly a challenge to break into the SaaS world. The following SaaS sales guide will show you how to get started with SaaS sales and what it is all about, whether you are new to sales or just looking for ways to improve your skills.
How does a SaaS product work?
In a SaaS model, suppliers build and maintain software on a subscription basis via the Internet.
Any device with an Internet connection and a web browser can run the software. SaaS users don’t have to worry about updates, compliance, or security issues since data and applications are stored on remote servers.
Benefits of SaaS
SaaS applications offer many advantages over on-premises solutions due to their cloud-based nature. These advantages include:
- Easy accessibility – software is available at anytime and only requires an Internet connection. Data is immediately available across multiple devices.
- Reduced costs – SaaS solutions reduce the costs of purchasing and maintaining expensive hardware. The implementation process is quick and painless.
- Data security – SaaS providers make secure copies of customer data.
- Availability – servers can be located anywhere in the world, and can continue to work even if one goes down.
- Scalability – systems can be easily upgraded and downgraded as needed.
- Integration – SaaS products can be integrated with a variety of other tools to create a whole software ecosystem.
The step-by-step guide to build a SaaS product
What is the best way to build a SaaS product from scratch? You should follow these steps to ensure that you do not overlook any critical points of developing a SaaS solution.
1. Come up with an idea
You can skip this step if you already have an idea for a SaaS product. In that case, we have a solution for you. Let creativity go and take a more task-oriented approach. Which options are available?
- Transform traditional software into a SaaS. Sometimes looking for something new is pointless. Utilise existing ideas – find software that works under an on-premises model, simplify it, and turn it into a SaaS.
- Transform your service into a SaaS. You can also convert an existing service into a SaaS product.
- Adapt to your own needs. That’s the key to success. You cannot find the solution you need, so you decide to develop your own product to solve the issue.
- Identify your niche. Easier said than done. By conducting interviews, you can learn about the needs and problems of people. Using software, you can solve the problems.
2. Conduct market research and identify your competitors
A crucial element to remember before creating a new product is market research. How will your product differ from what’s already available? Knowing your competitors well will help you identify all the things you will change or improve. Listening to their customers will also help you a lot. Check out what your competitors say, what they like, and what they don’t like. Make sure not to repeat them.
3. Describe your SaaS requirements
Now is the time to analyze aspects such as features and integrations. Knowing your customers’ needs and the most important things for them is possible with a previous market analysis. Customize your SaaS solution to meet your customers’ needs and maximize the security of your customers.
Always keep in mind that the needs of your consumers will change constantly, so you need to be able to adapt quickly.
4. Identify the MVP
A minimum viable product (MVP) is a low-cost prototype used by SaaS developers to validate their ideas and get feedback, ensuring they are moving in the right direction. In order to provide your customers with maximum value at minimal cost, you need to figure out what your core features should be.
In reality, what does it mean? Building, launching, and scaling up a new product is how you find the right version. It is not uncommon for the first product to be the right one. Dropbox is one example of an MVP that has been successful.
5. Select a technology stack and SaaS developers
Making a SaaS product is similar to selecting the materials from which it will be built. These materials need to match well with the product and be of high quality. All these elements – frontend, backend, cloud provider, database – contribute to success. Your decision will impact the product’s future work and possibilities, as well as the costs and effort you’ll incur. Make sure the software is prepared for growth to prevent it from becoming overloaded.
Next, we need to find a team of developers. The company will develop your product and stay on top of technological developments so that they can adapt your product to these changes. Software as a service companies often outsource software development (Slack does), and this can reduce costs and speed up development.
6. Decide on a pricing strategy
There is no hard and fast rule regarding which pricing strategies work best in the SaaS industry, although some have proven more successful over time.
- Pay-as-you-go – when customers use the service more, they pay more; when they use it less, their bills are reduced.
- Pricing per feature or user provides a value measure based on features or users.
- The freemium model offers a free product combined with additional paid features.
- Another thing to keep in mind when it comes to SaaS pricing. Customers want to test out the product for free first. Almost half of SaaS companies offer free trials. Getting potential customers to try out your product is an excellent way to make them a loyal customer.
7. Developing, launching, and scaling
A SaaS product is now in its final stages of development. In spite of appearing here previously, these three words should be repeated once more at the end. Since technology is always evolving, you must keep your product up to date and make sure that it is always a step ahead of the competition.
Challenges faced while you build a SaaS product
Creating a SaaS product now involves the less pleasant part of assuming risks. Can you anticipate any challenges after launching a SaaS product? Most SaaS solutions face certain challenges.
- Customer churn rate: The percentage of customers who leave after a specific period of time. Depending on the size and maturity of the business, churn rates vary consistently. Offer a higher plan or more options, etc., to reduce the churn rate.
- Onboarding: Do you teach your clients how to effectively use your product? Free to paid conversions will tell you this. Then your free version may be adequate, or your solution may not be understood by customers.
- Lifecycle: To avoid becoming outdated, you should make a long-term plan. In this field, longevity is a challenge. Several years ago, we did not have all the SaaS solutions that we have today. Make sure you don’t miss out on the new wave of SaaS.
Also Read: The Ultimate Guide to Sell your Art Online