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SaaS Development – What You Need to Know

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Building an SaaS Solution Pt. 2 – Why You Need it and Where to Start
There has been a revolution in software product development. Only 38% of companies relied on SaaS (Software as a Service) in 2016. That number spiked to 43% in 2017 and 51% in 2018. According to the study, 786 technical professionals from small and large organizations, 94% in total use cloud SaaS solutions.

By 2020, 83% of most companies’ work was done in the cloud. An average of 34 SaaS applications is used by firms today. 48% of companies have SaaS development or product contracts for one year on average.

Now, there is no need to buy software on media, install it, and update it regularly. Software as a service has revolutionized.

Why Opt for Building SaaS?
There are a number of undeniable benefits of using both readymade and custom-made SaaS solutions:


You don’t need a lot of preparation time to start using SaaS – such solutions are most easily installed and don’t require any configurations. Just install and use. Save time for more pressing tasks.


Hardware and software licenses are cheaper than the traditional model, and maintenance costs are also reduced. There is no need to buy expensive equipment. Upgrade costs are also lower compared to traditional models.


SaaS enables small and medium-sized businesses to use software without huge costs. This, in turn, allows you to increase the flow of customers.

Third-party integrations

SaaS providers usually offer flexible systems. You can easily integrate third-party plugins, services, tools, and solutions.


All data is reliably stored in a safe place. You don’t have to worry that important data will be lost or fall into unwanted hands without your permission.


SaaS solutions are accessible at any time. All that is required is Internet access. This is extremely important for solving urgent tasks timely and staying mobile while working.

Factors to Consider Before Building a SaaS Product
There are a number of factors that should be analyzed before introducing a SaaS product into your existing workflow. It is important to choose the right contractor to save time, money. A few general tips – consider ordering a custom product to best fit your specific business needs and pay attention to Eastern Europe-based providers that offer a reasonable price-quality ratio. Before purchasing a readymade or ordering a custom product, make sure to also study the following aspects.


The reasons why a SaaS project might fail should be investigated. This will help identify pain points and eliminate possible problems at the development stage (or avoid a low-potential product).

Non-compliance with market requirements

You need to clearly understand the needs of your target audience and study the market. Forums, developer meetings, marketers, focus groups with prospective users – all this will help you choose the best solution. Brainstorm is a great way to generate ideas.

Lack of a marketing strategy

Many companies make a common mistake. They just design the product, test it, release it to the market, maybe make adjustments. But only then do they start advertising the product – through social networks, a website, etc. This is a huge mistake. Success doesn’t come on its own. It is necessary to come up with the entire marketing strategy in advance. Also, take care of providing a free promo version.

No flexibility

Consult leading analysts, find out what the forecast in the market is. After the product is released, listen carefully to your audience. Of course, it is advisable to find out the opinion of future users even before the product goes to market. Lack of flexibility will ruin your success. In the product itself, it is necessary to make the possibility of changes – quick and safe for the project as a whole.

Pro tips for reaching success in the SaaS market

What steps should be taken to ensure the product is as successful as possible?

Plan out pricing

You have to be flexible in calculating the price. Include the potential extra costs due to unexpected circumstances while formulating pricing.

Make sure there is customer support

Dedicated customer support should carry out updates, reply to user feedback, and help solve issues.

Organize partnership opportunities

Integration with other tools and services will help you offer a product that best meets the user needs. Unite with business partners and achieve success together.

SaaS – How to Develop and Become the Best
If you are looking to develop an SaaS product of your own (either to release it in the market or for in-house purposes), you need to approach the whole process with specifics in mind. Start with figuring out the main formats of SaaS solutions.

Types of SaaS Solutions
The major formats of SaaS software include: 

  • eCommerce software – for products and commercial activity management.
  • Vertical SaaS – niche-oriented solutions focused on business optimization.
  • Collaboration software – used for communication and collaborative workflows.
  • CRM – helps boost the efficiency of sales and marketing efforts (like HubSpot).
  • ERP – solutions for thorough management of business processes.
  • Project management software – platforms for convenient project management (like Jira).
  • Accounting solutions – solutions focused on financial operations and payments (like Tipalti).

Steps to Building a SaaS Product
How to properly approach building a SaaS product from scratch? Make sure to pay an equal share of attention to all the following aspects.

Market analysis

It is crucial to analyze the market where you are going to deploy the product. This is where you should bring in the most knowledgeable experts. The correct analysis will help avoid many pitfalls in the future.

Software requirements

When it comes to the SaaS model, it is important to ensure security, think over all the details of the product. Hire the best outsourcing team you trust. conduct competent preparation. Experts must understand all the specifics of the software you are looking to build.

Create an MVP if you must

Minimum viable product will help you see how the basic capabilities of your future full-fledged product satisfy the relevant market standards and user requirements. It can be a great “trial project” to clarify your real prospects in the market.

SaaS pricing strategy

The SaaS financial model must be tailored to the needs of your target users. Thus, users can pay for using your product in a number of ways:

  • For functionality;
  • For the time of use (subscription model;
  • Fixed price;
  • Freemium – a free version of software with limited features and paid full functionality.

Remember also that sometimes it may be necessary to transfer a project to new technology or rewrite the backend or interface, so take this into account when estimating costs.

Developers team

SaaS development is a responsible task that affects the success of the entire project. You can use your own programmers for this purpose. But it’s better to resort to outsourcing. This is a time- and cost-saving method, very popular in today’s business environment.

Budget planning

Write down the budget, taking into account the approximate time it will take to complete a project, the possibility of making changes, and the pricing policy for the client. You should always calculate your budget for a possible force majeure.

Transferring to the SaaS Model

In order to transform an existing application into a SaaS product, you need to take a bunch of similar steps:


Study the competitive environment. Analyze the actions of your competitors. Conduct an assessment of what is currently on the market, what product your potential customer expects.

Gather a team

Find the best talents. If you’re going for outsourcing, check out the projects that the outsourcing team created previously. Shed the light on the specifics of your business. And make sure to communicate with the people working on your project a lot.

Pick a cloud provider

Explore the offers of different suppliers, consult with experts. Take care of the technological side – it must be up to par.


The time it takes to convert to SaaS can be reduced by hiring a team of experienced professionals.

Adobe is a great example of moving from on-premises software to the SaaS business model. Previously, you could buy a copy of Photoshop. Now, it’s a whole suite of products that’s used based on the monthly subscription.

Key Metrics
What key SaaS metrics will you need to track? Most SaaS businesses focus on KPIs – key performance indicators such as:

  • monthly or annual income;
  • CAC (Customer Acquisition Cost);
  • LTV (Customer Lifetime Value) – the profit a customer brings during their total time of subscription.
  • churn rate – a percentage of customers that ceased the subscription;
  • NPS (Net Promoter Score) – the total value of your product for customers.

There are low-engagement SaaS products (subscription via website, mail, and so on) and high-engagement ones (a huge contribution of the sales force to customer acquisition and service). Keep that in mind as well.

The use of SaaS is extremely important to business success. Reducing material and time costs, an individual approach, as well as greater customer engagement are the key parameters of such a success. But you need experienced specialists with profiled knowledge to help you implement a new SaaS solution most properly.

Axisbits is a custom software development company with extensive experience in developing web applications of any complexity, including SaaS application development. We create top-notch ERP solutions, eCommerce websites, and startup applications based on sophisticated technology. Contact us to get an SaaS solution built on the most innovative technologies that will surely boost your business potential.

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