The state of the software as a service (SaaS) industry is well-established with a bright future ahead. The US SaaS market size in 2023 is $135.10 billion (Statista). What is the future growth of SaaS? Reports forecast that the US SaaS market size will experience a CAGR of 5.49% between 2023 and 2027, resulting in a market size of $167.30 billion.
While the numbers look promising, SaaS industry news and trends (which we’ll cover later) reflect that the future of the SaaS industry is full of change and disruption. As new technologies and capabilities emerge, the current methods become obsolete. That’s why it’s so critical to attend the SaaS conference that looks beyond what’s happening today in any single industry—Rally. This conference brings together movers and shakers from Software, Ag & Food, Healthcare, Hardtech and Sportstech, and Entrepreneurship. But before we get into that, let’s see what’s on the horizon for the SaaS industry in 2023 and beyond!
What Are SaaS in Industry Use Cases?
The role of SaaS across numerous industries is that of providing on-demand software programs. These programs grant businesses access to key features, such as:
- Customer relationship management
- Cloud data storage
- Inbound and outbound call management
- Graphic design
- Word processing
- Marketing analytics
These are just a few of the uses for SaaS. If you can do something with a computer, there’s likely a SaaS application for that.
What Are the Benefits of SaaS?
The reason why SaaS is so popular from a customer standpoint is that this subscription model offers a lower barrier to entry for software access. Rather than investing a significant amount up front, businesses can pay smaller amounts on a monthly basis for software. This often allows users to test out a new program before committing to lengthy contracts or paying the full cost. The as a service portion of SaaS also includes—you guessed it—ongoing service through customer support, program updates, and cloud data storage. By working with a SaaS provider, companies can count on assistance when their software has bugs, becomes outdated, or is challenging to use to its full potential.
From a SaaS company standpoint, the subscription model offers more consistent revenue streams. Instead of receiving larger one-time payments at inconsistent intervals, providers can benefit from receiving smaller payments on a consistent schedule. The SaaS model reduces extreme feast-or-famine periods and helps teams forecast their future revenue more reliably. Better forecasting appeals to investors, who will feel more confident investing in businesses that show consistent growth instead of sporadic periods of success.
What Is the Future of the SaaS Industry?
When analyzing IT and SaaS trends for 2023, Gartner reports the top 10 trends to watch out for, which are:
- Digital immune systems
- Applied observability
- AI trust, risk, and security management (AI TRISM)
- Industry cloud platforms
- Platform engineering
- Wireless-value realization
- Adaptive AI
- Sustainable technology
Gartner further categorizes these trends into four themes:
- Optimization: These trends push SaaS offerings to the limits of reliability, value, and integrity. Digital immune systems layer multiple programs and best practices to optimize cybersecurity and reliability. Applied observability programs make the most out of available data to detect patterns and inform decisions. AI TRISM works to regulate artificial intelligence so that businesses can trust the technology’s data and ethical applications.
- Scaling: These trends increase the size of offerings while improving delivery speed. Industry cloud platforms, which are accessible through SaaS offerings, allow businesses to adapt to rapid changes in their industry so they can keep growing. Platform engineering seeks to improve the end-user experience for SaaS programs, resulting in easier usage and increased productivity. Wireless-value realization involves finding new applications for wireless technology, such as vehicle-to-vehicle communication, which expands the uses for SaaS platforms even further.
- Pioneering: These trends transform business models and reach new and exciting markets. Superapps allow SaaS providers to offer entire ecosystems filled with helpful apps and features that are already integrated with each other. Adaptive AI capabilities enable decision makers to think on their feet with real-time data. The metaverse is a virtual space that adds on to the physical world, and SaaS programs can facilitate the interaction between physical and virtual activities.
- Sustainable Technology: This category includes all of the previous categories. As technology continues to develop, it must do so in a way that is environmentally, economically, and ethically sustainable. Advancements in the SaaS industry should improve energy efficiency (for end users or server farms), enhance productivity and economic opportunity, and respect privacy and intellectual property rights.
SaaS offerings that incorporate these themes and trends will shape the future. Will your organization be a part of it? Secure your position in the future of SaaS by registering for Rally!
What Is the Future of SaaS Companies? See For Yourself at Rally!
The future of the SaaS industry is connected to every other industry that uses software to function. Advances in healthcare, agriculture, manufacturing, and other industries create new challenges for SaaS offerings to overcome.
At Rally, we recognize the value of cross-sector collaboration, especially when it comes to innovation in SaaS. That’s why we’re gathering leading minds from:
- Ag & Food
The future comes quickly. Reserve your spot to help shape what’s next.