What SaaS Trends Are Leading the Market in 2024?

Speaking about general tendencies in the software development industry, it is impossible not to mention the growing number of cloud solutions. More and more businesses opt for modern cloud platforms instead of on-premises servers. The reasons for such changes are related mainly to cloud computing: it ensures the desired mobility, scalability, data security, and cost optimization. That’s precisely what businesses across many industries are looking for today.

SaaS (Software as a Service) is the most popular cloud software delivery model. SaaS products come in different formats and types and can help users solve various business and individual tasks. But what is the future of SaaS industry? Are SaaS solutions here to stay? And what should you bear in mind if you are interested in SaaS development? In this article, we will talk about major SaaS trends 2024 that will help you find answers to the questions mentioned above.

SaaS Market Overview

The demand for SaaS products is relatively high, and it is expected that the number of such apps and their users will continue to grow soon. To ensure that it is so, let’s look at the figures revealed by market research.

According to the analysts at Fortune Business Insights, the global SaaS market volume will reach $908.21 billion by 2030, while in 2023, this figure was at $273.55.

Today, many different types of SaaS solutions are on the market. The most popular of them are the following ones:

• CRM (Customer Relationship Management) systems;
• ERP (Enterprise Resource Planning) solutions;
• Content, collaboration, and communication tools;
• Business Intelligence and analytics tools;
• Human capital management.

According to the data published by Statista, the strongest SaaS market players are globally known companies such as Microsoft, Salesforce, Oracle, SAP, and Google. Though these prominent firms are potent rivals, the increasing demand for SaaS products opens enough space for newcomers in the industry.

Various studies and surveys have shown that today, around 70% of all the software products built for businesses are SaaS solutions. It is predicted that by 2025, their share will be close to  85%, which proves a significant high interest from companies in using such applications in their work.

Advantages of Using SaaS Solutions for Businesses

Today SaaS products are among the most important drivers of digital transformation. But how did SaaS solutions manage to win such a role? It can be explained with the key characteristics of this software delivery model and benefits that SaaS users can leverage.

As this model presupposes using the internet to access the apps their vendors manage, it provides users with a lot of freedom and flexibility. The majority of SaaS products can be downloaded and installed without downloading. Users can view and interact with them directly through a web browser on their PCs, laptops, or mobile devices.

These peculiarities create an excellent context for the following benefits:

• You can get access to SaaS apps from anywhere. The main pre-condition that should be met is having an internet connection. Previously, to gain access to some data, employees had to be at their desks and get access to their PCs. Now, it doesn’t matter what device you are using. You can view and share data and work with different files and tools. All this is extremely valuable in the epoch of remote and hybrid work models.
• You can enjoy lower upfront costs and predictable subscription pricing. SaaS doesn’t require installing specific equipment like servers, which allows companies to save a significant amount of money. Moreover, there won’t be any investment related to the support and maintenance of this equipment. You do not need to buy a license to implement a SaaS solution in your business processes. As a rule, vendors offer various subscription plans for their solutions, and you can just choose the most appropriate one based on the range of services (or working places) you need.
• SaaS solutions are highly scalable. You can easily adjust the services or the computing and storage resources you need. It means that in the case of SaaS solutions, you are not required to buy additional resources in reserve just in case. You can adjust your subscription plan or add extra services, resources, or users when necessary.
• SaaS products are updated automatically. When you have traditional software, its maintenance and support can become a real challenge. Updates should be introduced manually, which can be a very time-consuming process. When you rely on SaaS, there is nothing to worry about. All the updates are initiated in a centralized manner by a vendor without any user participation or effort. It is essential to mention that all users typically get access to an updated version simultaneously.
• With SaaS, you can significantly enhance collaboration within your team. The SaaS model makes organizing real-time data-sharing between all team members simple. Now, there is no need to push employees to work on their versions of files and then send them to each other. Collaboration can be easily optimized. Cloud solutions are a perfect option even for distributed teams. All team members can be provided with access to the required files. Thanks to this, they can edit and update them simultaneously.
• You won’t need to bear any IT infrastructure and management responsibilities. A third-party vendor offering SaaS solutions will handle all the related processes. As a result, you can save money and time that are usually allocated for such tasks.

Namely, these advantages are usually used as the main arguments for companies that need to decide whether to start using SaaS solutions in their business processes. However, to leverage them, you must ensure that the solution you are considering now corresponds to the SaaS tech trends and meets the ongoing market demands. 

The history of SaaS products began at the end of the 20th century, and since then, they have changed a lot. Though the analysis of the first products of this type introduced several decades ago can bring you many valuable insights, we recommend you focus more on the future of SaaS and take into account the latest market tendencies.

Implementation of AI and ML as One of the Key SaaS Industry Trends

Today, Artificial Intelligence is a technology that significantly impacts the development of numerous markets and industries. And SaaS is not an exception. AI is gradually changing how we work with data and organize the process of fulfilling different tasks. Today, we can delegate many routine tasks to AI-powered tools, and it is reasonable to expect that the range of available opportunities will grow.

One of AI SaaS products' most widely discussed functionality is content creation. Generative AI can facilitate many processes for specialists working in different spheres.

Today, it is too early to discuss replacing creative jobs with AI. Generated text content should still be edited by a human. Moreover, issues can be related to the need for proper fact-checking procedures. However, we expect AI-powered solutions to be a reliable, supportive tool for many professionals. Such solutions can reduce the time traditionally required for looking for information or elaborating and formulating ideas.

Though the range of AI use cases in SaaS is wide, and it is impossible to enumerate all of them in the framework of our article, let us focus on at least the most widely spread ones. To make our list of the latest trends in SaaS more structured, we will classify them based on the AI technologies used.

Machine Learning (ML)

Machine learning algorithms are sets of different processes and rules that Artificial Intelligence software uses to perform tasks. The list of these tasks can often include identifying patterns in processes, discovering new data insights, predictions based on a given input, etc. What else can ML functionality ensure?

• Advanced business intelligence and analytics. AI can process vast volumes of data much faster than any individual. Moreover, thanks to the application of AI, it is possible to avoid many mistakes that appear due to human factors. As a result, thanks to AI, businesses can access valuable insights and accurate analytics practically in real time.
• Market research. This use case is based on the capacities of AI and ML to work with different sources simultaneously, combine and compare insights, detect patterns, and make logical conclusions.
• Task automation. AI can be applied to automating a lot of tasks of different complexity. Such a solution can evaluate the ongoing conditions to choose the correct pattern of behavior. Today, there are AI products for automating email campaigns, scheduling appointments, summarizing content, managing inventory, qualifying leads, etc.
• Service personalization. Nowadays we can observe a trend toward hyper-personalization. However, it is impossible to ensure it if you do not have reliable software that can do a significant part of the work. ML-powered systems can deeply study customers' preferences, interests, and needs to give them the most valuable offers. As a result, you can achieve growth in sales and a significant increase in customer satisfaction.
• Customer behavior insights. For every company, it is crucially important to understand what its customers expect to get, what they think about the offered services, and what they want to improve. To get this knowledge, seeing how people interact with your products, content, and website pages is vital. And that’s exactly what can be analyzed by AI. Such tools can define patterns in user behavior and provide conclusions based on them. These insights are often taken as a foundation for strategic planning.
• Predictive analytics. AI can offer insights into ongoing trends or processes and predictions on future updates. Tools powered by Artificial Intelligence are often enriched with functionality that can analyze historical patterns and their consequences and provide business forecasts. These predictions allow managers to make more efficient and better-informed strategic decisions.
• Risk mitigation and security improvement. ML and AI tools are expected to play a leading role in the data protection and system security sector shortly. These innovative technologies can continuously track the performance of systems and identify any vulnerabilities and potential threats in real-time. Moreover, they can be applied to increase access control efficiency and user authentication features. ML algorithms can recognize patterns in user behavior and immediately close access to data in case any anomalies are detected. We will further turn to the questions of SaaS cybersecurity in more detail in our article.
• Software scalability. Scalability is one of the key benefits of cloud-based solutions. And AI can take this feature to an entirely new level. It can ensure auto-scaling which can become a solid competitive advantage for SaaS platforms. AI can help optimize system performance and resource usage during user demand fluctuations. As a result, businesses won’t be obliged to overpay for unused resources during low-demand phases. At the same time, when many people will be using a platform, it will demonstrate a stable performance.

Natural Language Processing (NLP)

NLP relies on deep learning algorithms. Thanks to this, it makes it possible for apps to interact with users with the help of a human language. In other words, this technology can understand inputs made in different natural languages and provide an output. What can it be?

• Translation from one language to another;
• Summarization of texts;
• Content generation;
• Grammar corrections;
• Sentimental analysis, etc.

Companies can use NLP tools for solving many business tasks, but one of the most important is providing round-the-clock customer support. Modern tools can learn volumes of specific information after connecting with unique language data pools. As a result, they can ensure human-like communication with customers, especially in standard situations.

Introducing virtual assistants and chatbots is a widespread use case for NLP technology. The quality of customer support is among the main parameters people consider for shaping their opinion about a business. That’s why companies that care for their reputations should pay enough attention to this aspect. Users expect to get quick and accurate responses to their questions which is quite difficult to ensure when your client base is continuously growing. Agents physically do not have any possibility to process dozens of requests per minute. But AI can do it for them. Thanks to the implementation of AI-powered chatbots and virtual assistants, you can decrease the load on your customer support team and automate your company’s interaction with customers (at least in standard situations when human interference is not required).

Moreover, NLP tools can analyze the request received from a client and redirect it to a manager when they can’t cope with it without human participation. Given this capability of AI-powered SaaS products, it is pretty obvious why these apps are often used for analyzing customer support tickets and feedback. They can help define the most common issues that your customers face and detect what weaknesses and strengths of your business your clients see. That’s why the introduction of NLP functionality today is not a tendency that can be observed in building solutions for customer support teams, it is also one of the SaaS marketing trends.

Computer Vision

Implementing computer vision functionality requires significant investments in the most powerful cameras with high resolution. Nevertheless, these projects are expected to become more affordable and gain broader adoption in the future. We can already name this technology as one of those with the most decisive influence on the SaaS tech trends, especially when creating solutions for manufacturing and retail industries.

Below you can find just a couple of examples of its use case.

• Face recognition. This feature allows brands to provide clients with personalized recommendations and special offers. Today, such functionality boasts popularity among companies focusing on luxury services. For them, it is vital to recognize each client and get access to the history of previous purchases.
• Inventory management. Computer vision tools can evaluate a stock, track inventory status, and send notifications to managers when ordering any items or raw materials is required. Such systems demonstrate higher accuracy in comparison to humans and help to streamline a lot of processes. Moreover, they can be enriched with functionality for locating different items, which is especially helpful in massive warehouses.
• Shelf management. AI-powered solutions of this kind can detect empty shelves at a supermarket and notify employees. Moreover, they can analyze customers' behavior and recommend placing different products to boost sales.
• Defect detection. Computer vision can quickly identify product peculiarities that do not correspond to the set norms. This allows operators to adjust production lines immediately and prevent significant defects-related financial losses.

IoT-Powered SaaS Products

The Internet of Things is another emerging technology with the strongest potential to revolutionize many industries by opening new opportunities for them. This technology makes it possible to unite remote devices such as cameras, sensors, and others into a single network and get real-time data. As a result, users can access the most relevant insights and work with information unavailable before the introduction of IoT systems.

IoT apps are already used in manufacturing, healthcare, agriculture, and logistics. The SaaS model is a perfect option for working with data received from IoT devices. SaaS platforms can accumulate, store, and process the acquired data in different formats. 

But that is only one aspect in which SaaS can be useful. It is also important to highlight that SaaS apps can remotely manage and control IoT devices. As a result, companies can save a lot of time and money that traditionally can be required when device management is unavailable in a remote centralized way. 

This possibility is significant for business users with massive IoT systems. That’s why such features are pretty typical for enterprise SaaS solutions. Given all the benefits of this SaaS and IoT duo and the demand for such tools, it is evident that the creation of IoT-powered tools will be one of the most significant enterprise SaaS trends soon.

VR and AR Functionality

There is a stereotype that AR and VR functionality is mainly integrated into tech products built for the entertainment industry. However, this is not fully true. Of course, AR and VR are greatly transforming the gaming space today. But they are also applied in other industries, such as e-commerce, for example. 

SaaS platforms can ensure the required infrastructure for e-commerce companies that want to revolutionize the online shopping experience by introducing AR and VR functionality. The range of use cases of technologies in e-commerce is rather wide from virtual showrooms and product demonstrations to the most innovative virtual try-on features.

Moreover, speaking about SaaS future trends and VR/AR features in such solutions, it will be interesting to mention the healthcare industry. AR and VR SaaS telemedicine solutions for remote consultations are already available. Some projects seek the most feasible ways to use such technologies to enhance medical training and patient education.

Another promising sphere that can place AR and VR among the top SaaS trends is education. And in this case, we are talking not only about school education but also professional training. Various simulations and even full-scale virtual classrooms can provide learners unique immersive and interactive experiences.

Vertical and Micro SaaS

Some years ago providers tried to offer software solutions that could cover the needs of different target groups. There was a trend for universal products that are also dubbed horizontal. Typically they had the functionality that could solve the tasks of companies across various markets. Though such solutions may seem to be a good idea at first glance, in reality, they have a lot of drawbacks. 

They were designed for everyone, so they couldn’t precisely address some particular tasks. As a result, businesses had to look for additional tools and often were obliged to overpay for the features that didn’t represent any value.

However, today among b2b SaaS trends, we can mention the increasing popularity of vertical solutions. This term is used to describe those software products that are built for a particular industry with a special focus on its demands. For example, there can be SaaS products for IT firms, healthcare providers, insurance companies, financial organizations, or manufacturing enterprises.

We should admit that it is a comparatively new market significantly smaller than the horizontal SaaS segment. Nevertheless, today experts are quite optimistic about its future. Businesses want to get tools designed to solve their specific issues, which is exactly what vertical SaaS products can ensure.

What are the key benefits of vertical SaaS for users and vendors?

• Seamless integration. As such solutions are created specifically for a chosen industry, their developers often analyze the range of other tools typically implemented by companies. Thanks to this, vertical SaaS products are better integrated with other popular products that a company may have already used.
• Higher ROI. Let’s admit that vertical solutions are typically more expensive than horizontal ones. However, they demonstrate better efficiency and can ensure higher returns on investment. When businesses have tools that perfectly correspond to their specific business processes, they can save a lot of time and money that used to be required for fulfilling their routine tasks.
• Lower competition. The competition among vertical SaaS tools is currently much lower than among horizontal SaaS products. It is explained by the fact that a smaller number of specialized solutions allows each tool to stand out from the row and attract the attention of potential users. The audience of horizontal solutions is less targeted, making it more complicated for such products to win their market share, especially today, when there are a lot of well-established players in the industry.
• Lower customer acquisition costs. This benefit on our list is directly related to the previous one. Products built to deal with specific needs and bring real value have better chances of winning new users. This peculiarity allows vertical SaaS vendors to invest less effort and money in expanding their client bases.

Examples of vertical SaaS solutions:

• Buildium. It is a cloud-based solution for the real estate industry. Its users can get access to a wide range of tools for analyzing and approving lease applications, processing payments, dealing with possible maintenance issues, and performing other business tasks.
• Riskalyze. This SaaS platform is designed for US-based financial advisors. It offers advanced functionality for creating investment portfolios, analyzing investment risks, evaluating the feasibility of investment decisions, etc.
• Service Titan. This vertical SaaS solution is intended for home and commercial service businesses. It provides users with tools for managing their schedules, preparing invoices, automating recurring services, and creating proposals.

While vertical SaaS solutions are created for particular industries, micro SaaS products provide even a deeper dive into the needs and demands of businesses as they deal with micro-markets (specific niches or segments).

Such solutions have even smaller target audiences and tools that cover only one specific service, which may surprise those accustomed to feature-rich solutions.

For example, it can be a platform that allows users to create one-page websites (like Carrd) or a tool for converting HTML pages into different formats (like PDFShift).

While users can leverage the advantages of solutions built to solve their specific tasks, vendors can also enjoy a row of benefits. Quite often specific products are not very cheap. It means that revenues for vendors will be very attractive. At the same time, the development of small tools usually doesn't take long and doesn’t require huge initial investments that are usually needed for large platforms.

As this product is gaining popularity, it’s worth paying attention to micro saas trends. Even though these are small solutions, they are gradually becoming more and more advanced as emerging technologies like blockchain, AI, and ML often power them. Another interesting point on the list of micro-SaaS trends is related to businesses' increasing interest in non-fungible tokens (NFTs) and tokenization. Already today, some solutions provide all the necessary features for issuing NFTs, purchasing, and selling them.

Low-Code and No-Code SaaS Platforms

Platforms of this kind are gradually gaining popularity among different companies, especially among small and mid-sized businesses that typically do not use too complex systems in their work.

No-code/low-code approaches to building software let programmers quickly create and deploy apps. When we are talking about people who do not have professional coding skills, they still can implement changes in such software solutions. In the case with no-code platforms, for doing that no coding is required at all.

It will be interesting to have a look at statistics. The revenue of the low-code platform market is expected to achieve the level of $32 billion in 2024, indicating a rather impressive growth over the past years. Just compare: in 2018, the market revenue was around $7.8 billion.

Using low-code and no-code platforms can ensure the following benefits:

• faster time-to-market;
• lower development costs;
• lower costs of experimenting and introducing new processes.

Nevertheless, it would be incorrect to insist that such platforms are perfect for everyone. They have a row of limitations regarding the complexity and functionality of products that can be delivered with their help. For example, we recommend not turning to low-code for building an enterprise solution.

Some other points that you should bear in mind are limitations related to the customization options as well as a low level of scalability. It can also be rather challenging (if possible at all) to integrate such software with other tools that you use in your business processes. Moreover, there can be some performance concerns explained by the fact that low-code solutions can’t be optimized well enough compared to those built with hand-written code.

Increased Attention to Cybersecurity

On the one hand we should admit that software products today are becoming more and more powerful and advanced which is a good tendency. On the other hand, we need to understand that the tools, programs, and approaches that hackers and cybercriminals use are becoming increasingly sophisticated.

It means that despite progress, software solutions and stored data are still under threat. Security and data protection remain very hot topics in the SaaS industry. Moreover, as the data is available over the internet without any dependence on the device that can be used, there is another serious concern related to access to it.

Speaking about cybersecurity in the context of SaaS trends, it would be incorrect to say that developers and vendors started to take this aspect into account only now. 

There is a row of well-established traditional measures to make SaaS products better protected, such as:

• Two-factor (or multi-factor) authentication;
• Continuous monitoring of user activity aimed at identification of suspicious behavioral patterns and preventing unauthorized access;
• Role-based control;
• Introduction of recovery plans and backup.

Nevertheless, these methods cannot always ensure the desired level of protection, resulting in a necessity to introduce new ones. And here we can define the following trends:

• Introduction of AI and ML functionality for protecting cloud platforms. Such tools demonstrate better efficiency in detecting behaviors that deviate from normal patterns and identifying signs of malicious activities that may stay unnoticed due to routine activities and noise. 
• SSPM (SaaS security posture management) implementation. The SSPM category unites automated security tools that can monitor security threats in cloud apps. They can detect various types of issues including but not limited to compliance hazards, inactive user accounts, misconfigurations, and overuse of permissions and user rights. Depending on the exact type of the detected issues, SSPM tools can perform different actions. For example, they can send alerts to a security team or automatically implement the required measures like terminating user accounts or closing access to particular data.

Final Word

To cut a long story short and summarize the trends in SaaS industry, first of all, it’s worth mentioning the continuous expansion of the market. Businesses are actively adopting cloud solutions and implementing SaaS products in their processes which drives the growth in the number of SaaS companies.

However, to stay afloat and to win their market share SaaS projects must ensure that their offerings fully meet the market expectations and currently existing standards. Users want to have powerful but at the same time light and not overcomplicated solutions with cool interfaces and simple navigation.

Some may claim that today's SaaS market is overcrowded and that competition for newcomers may be too tough. However, based on our market research, we strongly believe that the industry in 2024 is still open to new SaaS solutions and fresh ideas that can address the needs of potential users.

FAQ

What is the SaaS trend?

The SaaS trend is the general direction in which the sector is developing. Today the market is mainly shifting from universal solutions to micro and vertical SaaS products that are tailored to the needs of a particular niche or industry.

Is SaaS still relevant in 2024?

Cloud solutions in general and SaaS products in particular are still highly demanded in 2024. Many companies introduce their new custom SaaS apps and migrate their existing solutions to the cloud.

What is the future of SaaS companies?

The SaaS market is exponentially expanding which can be a good sign for the companies that provide related solutions. With the growing demand for cloud products, we expect to see more SaaS projects in the market.

What is the future of SaaS?

SaaS solutions are projected to become more feature-rich and efficient as more emerging technologies enter the game. Another important update is the introduction of low-code and no-code platforms that allow users to implement the required changes even without programming skills.