Software As A Service ( Saas ) Essays

783 Words Nov 15th, 2016 4 Pages
For businesses offering software as a service (SaaS), this will usually mean that your entire business model depends on your website or software. For this reason, the software must be easy-to-use, efficient, simple, and above all: Meet or exceed expectations.

At Intergy, we saw this first-hand when we worked with Car Industry Appraisal Application Pty Ltd (CIAA). CIAA allow car dealers to easily avoid appraisal systems that are paper-based, and instead move into the digital age- completing appraisals from anywhere, with an innovative system. This is the heart of what SaaS businesses aim to do- provide a service that improves the lives of those using it in some way.

For SaaS to make a profit, businesses must offer enough features to entice new customers and keep a competitive advantage, while still maintaining simplicity and ensuring a high Lifetime Value (LTV) and low Customer Acquisition Cost (CAC).

So how much profit should you be aiming for? Consider the 40% rule. Ideally, both your growth rate and your profit should equal 40%- meaning if your business has a growth rate of 20% you should be earning a 20% profit, if you’re growing at 30% you should be earning a profit of 10%, and if you’re growing at 50%, you can even lose 10%.

Here are some tips to ensure you profit from your software as a service:

Offer value
To have customers signing on for a monthly commitment, you need to offer enough value that they can justify adding one more monthly charge to their bank…

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