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Software as a service (SaaS)

If you’re new to the concept of software as a service (SaaS), you’ve come to the right place. We’re going to delve into what SaaS is, what it can do for your business and more.

We’re also going to cover the most common use cases for SaaS, how it works, the main benefits of SaaS-based services, as well as the price.

What is software as a service?

Software as a service (SaaS) is a concept of developing and delivering software applications from independent software vendors over the Internet – as a service. Instead of developing, installing, and maintaining software, this concept allows countless users, residential and commercial, to simply access SaaS via the web.

It completely frees the user from complex hardware and software management. SaaS software applications are also referred to as proprietary, on-demand, or hosted software, as well as web-based applications.

SaaS applications require nothing more than a SaaS provider’s server to run. The provider is also in charge of managing access to the application, including performance, availability, and security. Some of the most common SaaS characteristics include:

  • multitenant architecture
  • easy customization
  • better access
  • customizing with a point-and-click interface

What is SaaS used for?

SaaS can benefit customers especially if it comes to modern, e-commerce businesses that do most of their work via the Internet.

The main purpose of SaaS applications is to offer out-of-the-ordinary, ready-to-use solutions that can easily meet a wide range of business needs such as analysis, calculation, storage, and communication.

Analytics overview feature in Customer service software - LiveAgent

SaaS offers multiple benefits and advantages:

  • SaaS applications are quick to deploy
  • the concept is quite affordable
  • minimum infrastructure
  • SaaS can work anywhere, as long as there’s an Internet connection
  • security and backup
  • high adoption rate
  • accessibility and scalability
  • compatibility

Since the user doesn’t have to install and run SaaS applications on their own devices or data centers, they are free to make other investments. Because of that, SaaS is perfect for businesses that need to improve:

  • customer relationship management (CRM)
  • content management
  • sales management
  • access management
  • database management
  • financial management
  • human resource management (HRM)
  • patch management
  • project management

How does software as a service work?

SaaS services work through cloud delivery. A cloud service provider will host the application and related data using its own resources, networking, databases, servers, and infrastructure services. The independent software vendor (ISV) may also use a cloud application service provider to host the application in its own data center.

One of the biggest benefits of SaaS is that users don’t have to deal with software setup and maintenance, and software licenses are not required.

It provides customers with network-based access to the application. When new functionalities and features are deployed, users get access to them.

Examples of software as a service

The SaaS market is growing and expanding into new territories. It gathers a huge variety of software products and vendors. From small providers with a single product to dominant forces in the cloud landscape such as Google and AWS. One of the best things about SaaS products is that they are so diverse.

They range from IT business analytics tools and helpdesk software solutions to video streaming services. There are also SaaS solutions for monumental business applications such as billing, customer relationship management, sales management, email, etc.

LiveAgent helpdesk page

Some of the most notable examples of SaaS products include:

  • Salesforce
  • LiveAgent
  • Google Workspace apps
  • Microsoft 365
  • HubSpot
  • Trello
  • Netflix
  • Zoom
  • Zendesk
  • DocuSign
  • Slack
  • Adobe Creative Cloud
  • Shopify
  • Mailchimp

What are the main benefits of SaaS-based services?

SaaS has many benefits, but we’ll highlight the most important ones.

  • SaaS allows you to access sophisticated applications – it doesn’t require the user to buy, install, maintain, or update any software, middleware, or hardware. Businesses with limited resources can afford even the most sophisticated enterprise software, such as CRM and ERP.
  • Users can pay only for the features they use – Saas allows users to save resources by automatically scaling according to the level of usage.
  • Access to free client software – users only need a web browser to run most SaaS apps.
  • Easy workforce mobilization – SaaS apps only require an Internet connection and a device to run. Therefore, they are a perfect solution for companies that need to mobilize their workforce frequently without worrying about security issues.
  • App data access anywhere – since SaaS apps store data in the cloud, you can access them from anywhere, any time.

What makes software SaaS?

Among the characteristics of a SaaS are:

  • multi-tenancy model
  • automated provisioning
  • single sign-on
  • subscription-based billing
  • high availability
  • elastic infrastructure
  • data security
  • application security
  • rate limiting/QoS
  • audit
Audit log filter in Help desk ticketing software - LiveAgent

How much does SaaS cost?

Many pricing models work on a subscription basis. Users pay a subscription price or a monthly fee. Here are some pricing models that are based on the subscription model:

  • free or ad-based – free service
  • flat rate – annual or monthly subscription fee
  • per-user – a fixed subscription price for every user
  • per-user tiers – a single subscription model for multiple users
  • usage-based or pay-as-you-go
  • feature-based tiers
  • freemium

Can I create and customize software as a service?

Saas is needed for achieving steady business growth, here is how to create your own SaaS in 4 steps.

1. Research the market

The global SaaS market is swarming with solution providers, which only increases your need to develop out-of-the-box solutions. Start by researching the market to understand your target audience, their main requests, the essential features, as well as your competitors. Also, understand the business models they adopt.

2. Create a plan for your product

Planning your product should include the functionalities and features of your SaaS solution and the customer base that will use it. In addition, you need to understand the recurring need for such a solution.

If you can understand what motivates your target audience to use your product, you’ll be able to create a solution that will address their specific pain points. You also need to plan the pricing strategy and the marketing campaign to properly advertise your product.

Project plan and review

3. Determine your SaaS requirements

These are the features your SaaS product must have:

  • multi-tenant architecture
  • application and data security
  • frontend UI/UX design
  • backend data management
  • third-party integrations
  • user analytics and monitoring

4. Choose a technology stack

Every SaaS solution has two vital aspects – frontend (client-facing) and backend (server-side). For the frontend, you’ll need tools such as CSS, HTML, as well as JavaScript (Vue.js, Angular, and React).

For the backend, you need secure, scalable, and fast frameworks such as Ruby on Rails, .Net, Laravel, or Python. You should also think about the servers. Choose from:

  • external servers
  • physical servers
  • remote servers

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Frequently asked questions

What is software as a service?

SaaS is a solution that allows users to gain access to cloud-based apps over the web. They can use such a solution to connect apps in an online environment.

What is SaaS used for?

It can be used for CRM, content management, sales management, access management, database management, financial management, HR management, patch management, project management, etc.

How does software as a service work?

SaaS service models work through cloud delivery, relieving the user of the need to install and manage the software infrastructure. The provider simply allows the user to gain network-based access to the SaaS application.

What are examples of software as a service?

The best examples of SaaS are solutions such as Salesforce, Microsoft 365, HubSpot, LiveAgent, Zoom, Netflix, Mailchimp, and more.

What are the main business advantages of SaaS-based services?

The main advantages of SaaS include accessibility, operational management, affordability, scalability, analytics, and increased security.

What makes software SaaS?

Multitenancy, automated provisioning, high availability, cloud delivery, data, and application security constitute the main characteristics of SaaS software.

How much do you get from SaaS?

Because SaaS solutions offer multiple subscription models, you can decide the amount of service you want from them based on your specific needs.

How can I create software as a service?

Above, we discussed the steps you need to take. To simplify the process, you need to research the market, plan your product and its features, and select the right technology and servers.

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