SaaS is a cloud computing technology that allows users to access vendor cloud-based software. The software or applications need not be saved in the user machine; they can access them through a subscription model, web, and API, used to get the services. Several examples of SaaS are Netflix, Amazon, Uber, and many more. SaaS products nowadays entirely change the aspects of the business as software services can satisfy the needs and requirements of customers significantly. G-Suite is a imminent example of SaaS software offering a more seamless experience to customers regarding productivity and updates.
The SaaS market is enormous, and several B2B and C2C companies are using this business format for capturing the market. It is hard to establish a new business in the SaaS market as it is already saturated. For example, if any organizations want to provide similar services like Uber, it will be difficult as the customers’ must be convinced about their services. Many platforms such as emails, CRM (Customer Relationship Management), or Project Management options are already providing software solutions that are similar to each other with very little difference. The ways through which new SaaS business can be established is difficult to find.
A competitive edge can only be achieved through pricing strategies or providing innovative products to capture the market. The methods through which any business can succeed in the saturated market are as follows:
1. Identify the competitors
The competition is stiff, and it is difficult for a SaaS start-up to enter a market that does not need them. The market is already filled with competitors, and to succeed in such environment, one needs to understand the customers’ nerves. It can be achieved by finding out the customer’s pain points. The best way to understand the current market is to visit the competitor’s websites to understand their marketing methods. By going through their successes and failures, one can build a clear idea about the ways to capture the market. Using tools like SEMrush will help understand the ad content and business strategy of the competitors, and it will be beneficial in evaluating them. Filling the market gap by identifying the issues of the customers that are not yet addressed by the existing SaaS business organizations can help attract more customers. By identifying the competitors’ facilities, it will be easy to identify the areas where they are lacking. The extent of dissatisfaction will give an idea about the requirements of the customers.
2. Build a brand
A brand image is essential in the online business where the SaaS is the new method of capturing the market. Every organization may provide almost similar quality of the product, but success lies in creating a better brand. For example, Nike is preferred by most of the customers due to its impaccable brand image, which it has created. Their profit margin is nearly 45 percent, which is the result of branding. As SaaS business is purely dependent on trust, a strong brand image is necessary. If an organization is planning to enter the SaaS market, it must make endorsements by hiring influential people from society. When two products A and B have similar qualities, the decision making of the customers become difficult. It is where the brand image comes into play. The customers will look after different offers they make, their brand reputation, their leadership thoughts, the product, platform, and services to help them make the brand image.
3. Create a niche market
Whenever targeting the already Saturated Market, building a new fan base for the product is necessary. Product differentiation is the only way through which the marketer can create a different target audience. For making a new set of customers, it is important to offer something different that is not available in the existing market. The SaaS market is already bursting and only provides new services that can grab the customers’ attention. Large business houses often target a large number of customers. For SaaS start-ups, it will be more tactful to address a small niche market. Even if the market is saturated, the start-up companies can still build their niche market by providing services where enough software is still not available. HubSpot and New Relic are examples of the SaaS market, which took advantage of being early in the market.
4. Enhance the customer experience
Improving customer experience is necessary to enhance consumer satisfaction. Every SaaS start-up must capture customer attention, which is essential to establish the business in the Saturated Market. Using feedback is the most effective method to increase customer satisfaction. For offering a more seamless experience, taking inputs from the customers will help understand their requirements, and the business can build upon those factors. The branding, product differentiation, and niche market creation are dependent on the feedback of the consumers. Asking for their viewpoints will help in building a strong relationship based on trust and respect. Customers are often interested in buying products from organizations that are customer-centric and provide personalized services. According to a survey, 80 percent of customers have said that they are interested in organizations that provide customized services, and 52 percent believed that feedback mechanism gives them more satisfaction. It is also necessary to buy your products to understand the customer’s journey. By doing so, a seamless experience can be offered to the customers. The AWS Marketplace has launched several SaaS and APIs by taking subscriptions from a single platform. The payment input in the AWS marketplace is through SaaS subscriptions and SaaS contracts.
5. Work on pricing strategies
The price of a product is essential for any organization to launch a new business in a Saturated Market. The organizations must analyze the existing SaaS market and find out the proper pricing strategy, which can help them penetrate such a saturated market. Cost leadership can be the most effective means for a start-up when aspiring to achieve their new business market goals. If the price offered is less than the competitors for a similar quality of services, the new organization can establish its business in the saturated market. Offering free services as trials and discounts with their products can help build an effective business for SaaS business. It is necessary to convince any customer what extra will be offered by a brand. Often low processes with similar products can be helpful in successfully establishing a new SaaS business.
6. Capitalize on changing trends
The market constantly changes with time, which is even true for a saturated market. The requirement of the customers’ changes and the market trend differs with time. When the new SaaS company wants to capture the market, they identify the current trends and build on the requirements. The market trend shows that building on customer success is the most useful aspect of achieving success. A large amount of revenue is invested in capturing a new customer base, and if expected retention is not achieved, huge losses will be incurred. Also, market trend must be analyzed to work on existing customer retention for more revenue generation. SaaS Radar is used to identify the extent of customer success in the SaaS business. It analyzes the growth rate of 2200 SaaS-based businesses that earn within the range of $10 million to $200 million.
SaaS is the most acceptable business form in the present context as technological up-gradation and people’s dependency on remote services have created a lucrative market for SaaS. But it can be difficult for new business houses to penetrate the already saturated market. Ways to Succeed in the saturated market have been discussed and analyzed, which gives the impression that it is not impossible. However, the existing small start-up business can also evaluate the strategies to make a significant growth movement. The main idea is customer satisfaction. Identifying the current insufficiencies in the market can be the best method for establishing a new business through value-added services. Building on the existing services with more innovation can help engage and retain many customers.
The road to success in saturated market is creating different products and engaging customers with the offered services.