In a relatively short amount of time, it’s become virtually impossible to picture a functioning workplace without any form of SaaS. It’s hard to even remember a time before we were linked with our coworkers via Slack, managing our accounts via services like Bill.com, or simplifying our communication using services like MailChimp.
And though the last five years have been a boon for SaaS companies, most predictions show that we haven’t seen the half of it yet. According to Blissfully, SaaS spend by companies of all sizes is set to increase 118% by 2020. And as more and more companies adopt new solutions for success, some new trends have emerged in the SaaS landscape. Here’s a look at what to expect in 2019.
1. SaaS adoption isn’t slowing down
According to a recent study by Gartner, the SaaS market will grow 17.3% in 2019, with cloud adoption becoming the fastest-growing sector. Gartner predicts that cloud system infrastructure services will grow as much as 27.6% in the coming year. That growth means a huge boost in revenue–as much as $85 billion, but as companies begin to rely heavily on SaaS, competition for those accounts becomes more steep.
In 2018, SaaS companies reported having, on average, nine competitors. According to Ashley Minogue, director of growth for Openview, that number is probably going to grow in the coming year and investing heavily in your brand is the best way to stand out:
“In 2019, we will see more companies investing in their brand (as opposed to just direct lead generation) to break through the noise and create a groundswell among their user base,” Minogue writes. “Companies recognize they will not win by just having the first spot in the search results or by creating a feature war with competition.”
2. It’s time to tighten up SaaS security
But as SaaS gains widespread adoption, the potential for data breaches grows as well. Data and privacy concerns are widespread, and for good reason. A recent study by Ping Identity found that 27% of IT professionals reported breaches of customer identity data stored in a public cloud, whether it was within their own organizations or in a SaaS application provider’s cloud.
According to Ilan Frank, head of enterprise product at Slack, in 2019, SaaS companies need to make security a priority:
“Organizations will make data privacy and security of sensitive data an even greater priority in 2019. Businesses will demand improved transparency and control over their data,” he says. Because more businesses will prioritize data privacy and security, the SaaS applications those businesses use will need to do the same.”
3. The SaaS AI revolution is here
From Amazon Echo in our homes to chatbots fielding customer queries, AI is everywhere right now, and the trend towards artificial intelligence is set to disrupt many industries. SaaS is no different, but companies that move fast could find themselves ahead of a very important trend. In fact, Dan Scarfe, founder of New Signature, thinks the coming wave of AI technology will spark a “fourth industrial revolution,” wherein SaaS, in combination with AI, will change the way we work:
“AI as a component of the fourth industrial revolution is a means to achieving more, not merely doing the same with fewer resources,” Scarfe writes. “It is a catalyst, which has already sparked a workplace evolution. Over the coming years, we will need fewer hands performing menial tasks, but not fewer staff per se. Instead, AI in the cloud will free the existing workforce to take on more meaningful roles. Fifty per cent of the jobs people will be doing in 2025 haven’t been invented yet, after all.”
4. Customer success is at the forefront of SaaS company success
But no matter how much the SaaS landscape changes, customers should always be at the center of our focus. According to Ashley Minogue, 2019 needs to be the year that SaaS steps up to the plate when it comes to customer success and reducing churn:
“In 2019, we will see more early stage companies recognize that customer success is the backbone of their business and invest in building out their customer success teams proactively,” Minogue writes. “This is imperative in the product led era. More and more companies are adopting PLG strategies such as empowering self-service sign-up and delaboring their sales process.”
Here’s to a happy and successful 2019!