What is SaaS in 2022?
If you’re just starting to explore the concept of SaaS, this is the place to find out what SaaS can do for you, see how SaaS is different, identify questions about SaaS, and lean more about developing SaaS applications.
Since the term Software as a service (SaaS) was first used in 2005, much has changed about the concept and its meaning. Understanding it is essential in ensuring business growth, especially at a time when cloud computing is growing faster than ever before.
What is a SaaS solution and how does it differ from traditional licensed software?
SaaS is a delivery model in which software is licensed to customers using a cloud-based system. End users are able to access selected applications via a web browser or mobile application.
SaaS apps largely rely on subscription models for provisioning software licenses. Unlike a perpetual license, this software delivery model ties each account to a subscription that grants SaaS access for a period of time—usually on an annual or monthly basis.
That subscription fee generally grants access to product documentation and ongoing support govened by a service level agreement (SLA), but some SaaS providers charge additional support fees to make custom code changes at the source code level.
SaaS platforms involve software that is available via third-party over the Intenet.
Examples of popular SaaS providers include:
- Google Workspace, Salesforce
Benefits for companies
Here are the main benefits of the SaaS model:
- No additional expenses for software installation and maintenance
- Fast time-to-market with no expenses for launching the product
- Single product for all devices
- You get all the improvements and updates as soon as they are released
- Software stability and scalability
- More secure and usable data
- No additional costs for license and tech support
- High levels of data security in comparison to on-premise solutions
- Ability to implement the remote work model
With the release of SaaS upgrades, the capacity of services has expanded, the speed of information processing has increased, the volume of storage, the complexity, and the expansion of tools all also grew. It enhanced the performance efficiency, enabling us to get better business insights.
What are the benefits of Software as a Service for resellers?
Resellers offering SaaS solutions in their portfolio can observe an increase in revenue over time as more and more companies opt for this approach.
Additionally, with the traditional software model, resellers spend large amounts of money on customer acquisition and for perpetual licensing. With the SaaS solution, when new customers come on board, resellers continue to ean revenues from initial customers without having to reinvest in customer acquisition.
Software as a Service allows for a steady revenue stream with much more business planning ability. In addition, with SaaS, the role of resellers is transformed from an extenal supplier to an intenal partner and consultant, which also makes them more difficult to replace.
In the traditional software model, customers pay a large price for the perpetual license. The percentage that resellers get from this large licensing fee leads to the higher initial revenues.
On the other hand, the SaaS customer pays a smaller cycle fee after a regular cycle, thus the lower initial revenue numbers of the SaaS reseller.
Lifetime value of customers
The lifetime value of the SaaS customer can average between 3 to 7 years depending on the service. Resellers can generate commissions over the time that the customer stays subscribed to the service.
As new subscribers are brought into the revenue fold, resellers still ean revenues from the initial customers without having to invest in customer acquisition.
But it’s not only on subscriptions that resellers can generate revenues. One of the features of SaaS services upgrades. Apart from the initial subscription, resellers can also generate more revenues from upgrades of their customers.
Therefore, assuming an average 3 percent chun of a good SaaS service, reseller revenues will still be positive when upgrades are factored in. This explains the upward trend of reseller revenue in the below graph.
How understanding the benefits of SaaS can improve your business performance
SaaS custom development allows your organization to quickly launch an application with minimal release costs.
This means that you do not need to purchase and install special software for your users.
You don’t have to worry about developing applications to run on different types of computers and devices, because the service provider has already taken care of all of that for you.
In addition, there is no need to hire qualified professionals to solve security problems that may arise when using mobile devices.
A properly selected service provider ensures the security of your data, regardless of the type of device that uses the data.
Redmonkey SaaS Application Development plans
Redmonkey Development plans include:
The software package:
This is the actual product that will be deployed to your customers, built from the ground up to handle your exact specifications. The final product will be thoroughly tested, optimized, and monitored for any operational issues before delivering the source code via GitHub.
Sales Platform and Front-end Informational Site:
While often overlooked, the front-end website used to market and sell the software is a crucial part of any SaaS project. To make sure the marketing site has the right impact, our team will ensure that it contains the right targeted content designed to capture leads and convert them into sales.
Subscription Suite and Account Management:
Ultimately, you’ll need an account management system to sign up the new users and process payment securely. Our SaaS development company will provide the necessary multitenancy user management tools to ensure your SaaS product is a success, with a role-based system allowing users to edit and update account information, track sales, handle customer service, and more.
How long does it usually take to develop a cloud-based SaaS application?
It could take 2-18 months from the early stages of planning to product launch. But this depends on multiple factors such as the complexity of your app, the scale, the tech stack, and the number of developers on your team.
How much does it cost to develop a SaaS application?
The SaaS development cost for a Minimum Viable product varies from $60,000 to $300,000.
The exact amount depends on a host of factors, primarily determined by the developers’ location, the complexity of the application, and the type of team helping with the development.
For example, hiring from the US could cost you $120,000 per app, while moving the process to Ukraine could lower the costs to anywhere from $65,000.
Getting to this spot in the article shows that you’re keen on creating your SaaS business solution. And here’s where we can help.
At Redmonkey, we’ll create a SaaS solution for your startup in just 3 months.
Our team has more than 25 professionals and over 15 years of experience creating tech solutions.
Looking for an expert development team that knows how to build a SaaS application?
we always interested in hearing about projects & opportunities
Redmonkey team will take care of SaaS development needs and help to realize your vision.
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