Global SaaS Growth Summary Part 2: Top Trends for 2019
October 23, 2018
In the first part of our Global SaaS Growth Summary, we examined the most popular forecasts as well as the most top countries and companies leading the way.
Now, let's take a look at the top SaaS trends we'll be seeing in 2019.
A Shift from SaaS to PaaS
After a certain point, it's normal for SaaS providers to pivot their efforts from customer acquisition to customer retention. And creating a Platform-as-a-Service (PaaS) is one of the best ways to do this.
By letting clients create and choose add-on apps and services for the original product, PaaS allows them to expand capabilities while forgoing usual hassles like the need for more hardware or software infrastructure. This simplicity and scalability are what SaaS providers are hoping will cement their presence in their niche.
One prime example of this is the Lightning platform from Salesforce. Here's how they describe the advantages of PaaS:
"PaaS provides a huge benefit for companies adopting a microservices architecture since PaaS allows for each microservice to be deployed and managed faster. PaaS is especially helpful when microservices are built using several different language and frameworks."
Unbundling Is In
Instead of offering a full-featured product, many startups are opting to package their core services as an API with a suite of tools. This lets clients stay lean by customizing their user experiences while discarding any extra bloat.
This ability to swiftly tailor SaaS solutions depending on particular demands allows SaaS providers to give rich, niched-down services that stand out from the increasingly-overcrowded market of similar products.
Vertical vs Horizontal
The debate of horizontal and vertical models has raged on between developers for years. Previously, SaaS providers have focused on a horizontal approach, offering services tailored towards operations, sales, accounting, and HR.
Today, many players in the industry are realizing that a "one size fits all" approach to all industries often isn't what "fits best." So in lieu of broad business functions, they're focusing on building vertical-specific applications for target niches like telecommunications.
Callbox, a B2B lead generation company, argues that neither approach is absolutely correct. Just as the needs are circumstantial, so should the solutions be. Because SaaS applications can combine with third-party software, Callbox believes the future lies in custom integrations to meet needs across all industries.
A Mobile-First Approach
In a recent survey, financial software company Intuit found that 43% of small business owners primarily use their smartphone to run their business. Adoption of smartphone use is also increasing among bigger companies and senior executives as well.
This one was easy to see coming; we already use communication platforms like Skype and Slack during transit. And we already check tasks off our favorite productivity apps while on the move. Many SaaS providers began as web or native apps. So the challenge to deliver a mobile experience on par with their other counterparts is substantial.
But to be first in their market, they'll have to take a mobile-first approach for the future. Here's how app performance company Neumob describes the shift towards mobile in a recent white paper:
"The continued trend toward the mobilization of virtually everything is fast converging with a profound surge in the adoption of software-as-a-service (SaaS) applications. The impact of Mobile-SaaS convergence is that organizations of all sizes are leveraging new, critical mobile applications that maximize employee productivity and spur business growth."
Rise of the Machines
Just like every other industry, SaaS is set to experience an artificial intelligence (AI) and machine learning renaissance. With immense promise to cut costs, AI is already being used by providers for chatbots and A/B testing.
Among the top players making big investments in AI to improve their offerings are Amazon and Oracle. Amazon has begun trying to leverage the many advantages of AI and machine learning for its SaaS-based Amazon Web Services. Oracle recently announced it would be making significant investments into "AI-infused apps," with many spectators assuming this move to be an attempt to take the top spot from Salesforce.
It's expected for AI to be commonplace in SaaS applications in just five to ten years.
What Are You Waiting For?
Now that you've gotten a sneak peek at what the future holds for SaaS, which trends will you adopt? By adapting early, you can stay ahead of the curve and set yourself up for a brighter future.