The excitement that comes with watching an industry grow brings about all sorts of new ideas and practices, increasing efficiency in even the smallest of companies. There seems to be no other industry expanding at quite the same rate that the SaaS market is.
As more companies look to get into the SaaS game, a number of software-as-a-service conferences have emerged throughout the country, providing inspiration, networking, and a host of additional opportunities. With businesses continuing to shift into hybrid or fully-remote working environments following the pandemic, the future of SaaS industry applications and the market as a whole looks brighter than ever.
Let’s delve deeper into the various segments, services, and trends shaping the SaaS industry’s future.
What Is the SaaS Industry?
The SaaS Industry is made up of companies who provide software-as-a-service (SaaS) offerings–these are typically cloud-based services that make essential business processes more efficient. Whether virtually (with some form of software) or manually (with a team of experts), SaaS is used to provide a specific kind of app or operating system that completes a set of tasks on behalf of a company. While the earliest form of SaaS has technically been around since the sixties, it’s had a serious revamp over the last twenty years that has transformed the tech world.
From the evolution of the internet down to our daily use of mobile devices, the SaaS industry not only continues to expand but has become something difficult to ignore in this increasingly digital era.
As we stand firm in the foreground of a new decade, the industry continues to make significant noise internationally as well. In 2022 alone, the global SaaS market size held a value of over 260 billion USD and, by the looks of it, there’s nowhere to go but up from here. According to McKinsey, the global market’s worth sits at about 3 trillion USD and could jump up to 10 trillion USD by 2030.
How Fast Is the SaaS Industry Growing?
The SaaS market size was valued well over 200 billion USD and the speed of deployment is only going to get faster. From 2023 through to 2030, the industry displays a 13.7% compound annual growth rate (CAGR).
With that being said, what is the SaaS Market Size for 2030?
An impressive 197 billion USD is the SaaS market size Gartner currently forecasts for 2023. According to Statista, this value is expected to increase to about 232 billion USD by the end of 2024. Given this current SaaS industry growth rate, Gartner projects it to increase to over 400 billion USD before the decade’s end.
In other words, the industry is growing faster and faster as more niche micro-SaaS applications increase. Micro-SaaS, in novice-friendly terms, is a SaaS business that is much smaller in scale and works within a specific domain or niche!
What Is the Fastest Growing Segment of SaaS?
It comes as no surprise with the rise of technology that artificial intelligence (AI) and machine learning (ML) would be the fastest-growing segment of the global SaaS market. Companies, no matter the size, are constantly searching for ways to accelerate and enhance their processes. This common goal allows segments like ML and AI to steal the spotlight as automation continues to impress.
Where there are various segments, there are specific industries to benefit from those segments. Some of the most prominent industries currently profiting from SaaS implementations include:
- Banking, Financial Services, and Insurance (BFSI)
- Information Technology (IT)
- Retail and Consumer Goods
- Telecommunications (Telecom)
Industries like IT/Telecom, BFSI, and healthcare hold the largest market shares for SaaS as of 2021. Although AI and ML are growing at exponential rates in each industry, there are several other segments that follow closely behind. Here are some of the various SaaS market segments that many companies within each industry utilize:
- Content Management
- Customer Relationship Management (CRM)
- Enterprise Resource Planning (ERP)
- Human Resources (HR)
- Machine Learning and Artificial Intelligence
- Marketing Automation
- Project Management
What Are the Vertical SaaS Trends in 2023?
Vertical SaaS refers to a cloud computing solution designed for one specific industry’s use, like manufacturing, insurance, and retail.
SaaS is here to stay, so it’s a smart idea to keep an eye on what’s going on in the industry—horizontally, vertically, and otherwise. You’ll want to be at the forefront of innovation. If it’s setting trends through each industry and segmentation it exists within, then it’s worth taking a look at. Here’s a quick list of vertical SaaS trends drawing the most attention in 2023:
- Integration models
- AI products
- The overall future of careers and employment
- Billing platforms
Make Your Mark In the SaaS Industry at Rally
As the future of SaaS continues to dazzle, its desirability increases with each passing year. SaaS services are taking up significant space in most business models because they allow companies to do more in a shorter period of time.
If you’re ready to begin your SaaS journey, a conference that highlights all the ins and outs of the industry should be your first stop! Visit our website to get all the juicy details for this year’s Rally conference and register before it’s too late!