Commerce Talk

Software as a Service: What is SaaS?

Jeff Schaffner digs into software as a service, or SaaS, solutions. He talks about some of the benefits for small businesses and the limitations businesses can face when they need to customize.

Subscription-based software is increasingly popular, especially for ecommerce businesses. Giants like Shopify and BigCommerce have made it simple and efficient to sell most products online. But is a SaaS product right for your business? Listen to what Jeff has to say, and then you decide.

Transcript

Hey everybody, Jeff Schaffner here with another episode of Commerce Talk. 

Today, let's get into the nitty-gritty of software as a service, also known as the acronym SaaS. 

Getting into it, let's start out with an analogy: SaaS is going to be very similar to the streaming services that we use when we come home in the evening. In this case, I'll just use Netflix. 

So, instead of buying a DVD, you're going to be streaming your services online. In the case of SaaS, you're not owning your own website; you're essentially going to be renting it online. The analogy is going to have the same pros and cons to it as well. 

For example, if a movie you want to watch isn't going to be on Netflix, you'll be out of luck. When renting your website in a SaaS model, you will be locked into the list of features other users will also be using. This is often offset by amazing convenience and ease of use in both cases (so easy installations and updates). SaaS providers are going to be handling everything you need to get going online.

As far as the actual pros, one of the big wins is going to be cost-effectiveness. You'll usually be looking for or looking to lock into a subscription model, which can be easier on the wallet, of course, than a startup purchase. Plus, it's going to be super convenient, with the provider offering themes and integration options while handling security and compliance issues. This is a game changer for small businesses, especially in ecommerce.

With that said, features roll out every year from industry leaders like Shopify, BigCommerce, and Salesforce Commerce Cloud; these companies are always pushing to make it easier and easier. Some are even going up to the mid-market level and even into Enterprise and business-to-business sales.

As to the cons, it's not all sunshine and rainbows. Customization is often going to be rigid and inflexible. The feature set and integrations offered with SaaS models are going to limit you in some cases (depending on your business, of course). Also, in regards to pricing, let's not forget that pricing is typically associated with volume, so costs will rise as the business continues to grow.

That's pretty much it for today. We're starting off with,  of course, a simple overview. Let us know if you have any questions. 

Thanks for taking the time to discuss SaaS with me today. I'm Jeff Schaffner, and this has been Commerce Talk.

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