How to Build SaaS Product? Tips and Tricks. Why Do You Need It? How Is It Developed? How To Monetize?
A good businessman always anticipates what their customer needs or wants and no product type fits this principle better than a Software as a Service one. Today, we’ll talk about the process of developing a Software as a Service solution, the challenges presented, and discuss the intricacies of SaaS product development with Incode Group’s CEO Oleh Meleshko.
What Is a SaaS Product?
SaaS stands for Software as a Service, which basically means that you’re delivering a ready piece of software to the user. It’s intended for a certain purpose and doesn’t require installation or configuration. Usually, that part is handled by the entity providing the software. SaaS products are delivered via the browser or a mobile app, depending on the target audience.
The advantage of SaaS solutions, at least for consumers, lies in the fact that they’re easier to work with and don’t require as much input as regular ones. However, on the developer’s side, SaaS products do need substantial maintenance and the efforts of several experts to keep things running smoothly.
Why Do You Need SaaS?
If you want your customers to be happy with the software they’ll be using — Software as a Service is the most logical choice. It takes away the burden of installation and configuration, two of the most annoying processes in software.
After all, user satisfaction is the key factor if you want return customers and a good reputation. By taking on SaaS development and providing your users with its benefits, you’ll be gaining a loyal customer base.
Plus, SaaS applications utilize cloud storage, the most popular method nowadays. If you don’t want to get left behind in the technology race, you have to be using it. SaaS solutions give that incentive and integrate it well.
Cloud storage isn’t just about modernization, of course, they also offer substantial improvements in terms of processing and security. Both of these are essential to good software, especially on a large enterprise scale.
Although SaaS solutions do require substantial maintenance, they make it easy on the devs. For example, any updates and fixes will be deployed simultaneously on all platforms and instantly available to the users. That makes it the perfect choice of software for large companies that need software to be uniform for all of their employees.
Besides, SaaS products can be accessed from any device without being restricted to a single copy installed on a laptop or a PC. This makes them easier to work with for those who travel frequently.
And, don’t forget, SaaS platforms are going to be less costly overall as their development and maintenance is a well-oiled process. You’re not likely to run into many problems, meaning your work will go smoothly.
How Is A SaaS Product Developed?
The nitty-gritty of the development process isn’t much different from developing any application. The post-release cycle is different, sure, as it requires more attention.
As with any project, a SaaS product requires careful planning. You need to analyze your target audience, research your competition, and determine whether SaaS is even the best choice for the case.
SaaS positions software as a service to be sold with the expectation of a lengthy customer-developer interaction rather than a one-time transaction. This means you need to be putting the users first at every step of the way.
This, in part, is why we strongly recommend starting your sketching process with user stories. Consider the variety of customers you’ll have and the different routes they’ll take when interfacing with the software.
Of course, working to please everybody is tough and even the most focused of us can get lost. That is why it’s also important to set your priorities.
Most of the time, SaaS applications will have a base range of features that have to be implemented no matter what. These should be your first step while extras can be put off until you’ve finished the base.
By knowing where to put your efforts first, you can see watch your project blossom and see the bigger picture. This distance helps realize that, perhaps, you don’t need quite as many extra features and can do well with what you have.
That, in and of itself, is a great way to cut costs. Instead of slashing features left and right, you implement the must-haves and then cull the herd. The added perspective will prevent you from making the wrong choices.
Focus on solving the core problems, one that every user has and, only once you’re done, move on to smaller specific issues. They do need to be addressed but don’t lose the sight of your goal while trying to appease a niche audience.
We probably don’t need to stress the importance of wireframes but it’s probably a good idea to reiterate that this will help cut costs in the long term. Development won’t suffer if you take the time to do wireframes but, rather, they will help you see which parts need tweaking before you get in too deep.
In the process of making your SaaS product, you need to understand that, sometimes, your audience won’t be huge. However, even in these cases, you need to be looking for a middle ground as making a full app for a niche audience isn’t a very profitable plan.
In short, keep development agile, know your audience, and don’t get too ambitious. Even these three golden rules will make your SaaS solution development much easier.
SaaS Product Case Study: Embedify
Embedify is a lightweight and effective knowledge base builder, developed following the SaaS principles. It’s one of Incode Group’s recent projects and a good example of an efficient roadmap for SaaS development.
How To Monetize SaaS Product?
Now, once you’ve made the best SaaS app in the world, it’s time to reap the benefits. In order to recoup the cost of development, you need to monetize your solution somehow.
One of the more popular options is to put advertisements right into the app. But popular doesn’t always mean good and Incode Group prefers to do things differently.
Why? Well, because a lesser-known product will have problems with attracting advertisers and ads have been proven to discourage users from returning to the software. These aren’t the kind of risks that a startup should be taking.
Instead, consider two other great SaaS monetization options — subscription and freemium models.
The subscription-based model is great for solutions that offer long-term services: file storage, finance management, etc. It works best if you allow new users a free month to try out the app though, so be prepared for that.
As for the freemium model, it’s a way to spread your app far and wide while still getting some profit. You simply need to have some desirable extra features locked behind a paywall — the premium version of the app.
There’s also the option to make your SaaS app a “buy to own” type but it’s rare that an app sees enough use to really become profitable on this model.
To sum up, the core monetization options are:
- subscription fees
- buy to own
Interview With Incode Group’s CEO Oleh Meleshko: Running A SaaS Project Like An Expert
This is a brief interview with Incode Group’s Oleh Meleshko, a collection of his thoughts about SaaS projects, the best way to handle SaaS development, and what factors matter most when you’re at work on a SaaS solution.
Q: What are the main challenges in running an outsourced SaaS project?
A: I think anyone’s answer to that question will be somewhat similar to others but there’s a bit of personal experience for sure. In my case, I’d say the development model is a big one. Many companies are chasing “hands-off” clients that don’t involve themselves in the process much. They don’t do it because they want creative control though, it’s done so that they can boost the price beyond all reason. And it’s one of the reasons why I’m not a big fan of the fixed price model.
Personally, I prefer to see any development contract not as a deal between a client and a developer but as more of a partnership. It’s simply a more effective model as well as a more respectful one. The stigma around clients and their interaction with developers is ruining professionalism in the industry.
Instead of joking about “nagging clients” and ridiculous demands, I suggest developers choose to communicate with the companies and actually listen to them. Quite often, all you need to do is talk through the development process to make it more fruitful and headache-free.
We’ve all been conditioned to have this playful rivalry with our clients, always viewing them as an obstacle more than a helpful partner or a source of inspiration. I’m not saying that all clients are picture perfect but having some basic respect for them is the right thing to do. Sadly, all too many outsourcing companies seem to lack that.
It’s also key to have detailed tech specs. Don’t rush in or cut corners as that’s a recipe for disaster. Instead, spend time determining the necessary features and creating a solid vision for the MVP (or EVP!) version. In this case, you’re both making the work easier on yourself and saving money in the long run.
Also, remember to be transparent even if it’s not always pretty. Own up to your mistakes, tell the client the not-so-shiny parts of the development process, and disclose your ideas and progress. I’m not suggesting you spend every day drowning your client in every little detail but giving them the available information establishes trust.
I know I’ve had my fair share of hiccups on my way and I didn’t always feel good about confessing my mistakes to the client. But once the problem is out there and everyone is aware of it working on a solution is much easier and not as stressful.
Q: What kind of tips and tricks can you mention that might be missed by inexperienced devs? Something that helps lower expenses, speed up the development process, and optimize the project itself.
A: That’s a pretty big ask but I’m used to it. Everybody wants to do things with minimal effort and cost while still getting the highest profit. I do have a few suggestions that aren’t rocket science but still get overlooked.
Use the right tools for the job. Before you start the project, you should take a critical look at the technology you’ve picked and assess whether it’s actually optimal. Instead of letting hype or personal preference cloud your judgment, rely first and foremost on the desired functionality and the target industry. Sure, you won’t always find the absolute perfect tool but that doesn’t mean you should immediately settle for the first idea you have.
To add onto the first tip, try to stick to one hyped-up tech per project. Don’t try to add bells and whistles to every single aspect of your product when a simple and time-tested option will be just as good. Too often I see inexperienced devs going “We’ll add blockchain to this” without having any justification for using it.
And my concern here isn’t just with the unnecessary usage of complicated tech. It’s also about the fact that these new hyped technologies tend to cost more and have more potential issues and roadblocks associated with them. Just think of how blockchain projects failed left and right a few years back.
Another big issue is establishing an overly complicated architecture right away. When you’re at ground zero, you need to keep things simple. Present a concise (and working, obviously) demo version of your best product and, once it’s approved, go bigger.
I’m not talking about sticking all code into 1 file and doing as little as possible, just encouraging people to curb their ambitions and understand the project requirements. Sometimes less is more and that definitely applies to early development stages.
It’s also important to focus on communication. I know, I know, everybody says that but, judging by how poorly some devs communicate, it’s still a key piece of advice.
Remember that a daily bug fix/task tracking report might not reflect the hard work you did completely but it does give your clients a kind of progress bar they can rely on. Having these numerical descriptors of your performance makes it easier to show just how well you’re doing.
However, don’t stop there as meetings and calls are just as important. The cold hard numbers are great but nothing beats human contact if you want to get more out of your partnership. Talk to your clients, to your team, and to each member of the team individually.
This not only shows that you’re engaged in the project but also keeps you in the loop on any issues that might go past you otherwise. So don’t think that meetings are unnecessary, they’re actually absolutely vital.
Just make sure you’re keeping a balance and not gathering the whole team every single day just to say “How are we doing?”. Prepare a list of issues, have a point and get to it fast, and let others express their point of view. That’s the mark of successful communication.
Lastly, we all know what it feels like to finish a big project with the deadline right around the corner. And while many of us faced it when doing papers in college, it’s an effective tool in development as well.
I’m not in favor of being overly strict with time management but it’s good to let the devs know you’ve got the end-date set in stone. This motivates people and doesn’t leave time for slacking.
Q: Have you personally faced any unusual challenges during SaaS projects?
A: I’ve had the frequent issue of partners listening to the experts, paying attention and still deciding to go a different way. The challenge lies in navigating this situation and not immediately agreeing to your partner’s suggestions just because they want it that way.
You need to use your experience and an expert’s knowledge to offer up a more profitable solution and back it up with facts. My task as a tech consultant is to listen to the client’s wishes, assess the technical requirements and still find a way to mix them into an optimal solution. It should not only help automate the business but also make it more profitable.
Q: Why do SaaS projects fail?
A: That’s a pretty broad question but, most of the time, the fault isn’t with the technical aspects but, rather, with the direction of the project, the ideas, or the level of execution. Let me clarify what I mean with the latter.
There’s this relatively recent debate of what’s better — MVP or EVP. EVP is “Exceptional Viable Product”, pretty much what you get when you make an MVP and then make it much better. People argue that EVPs are more effective than MVPs because, even though they’re more expensive, they show a better representation of your project. They come with all the cool features and impressive design, which is what you need to get investors and first users on board.
I’m not suggesting we go overboard and develop a full product without having the budget for it. But I, for one, believe that paying more attention to your EVP can result in a higher success rate with your projects.
After all, if you look back at a failed project after a year or two, you likely won’t lay any blame on your developers. SaaS projects fail because of marketing, because they’re not fully realized, or because they’re just… not interesting.
Nowadays, you can’t just make what you think is useful. Instead, you can make an app that you find useless but that the market loves. Demand creates supply, you know?
Q: Any general thoughts on why SaaS matters? Like, why SaaS and not some other route?
A: I’ll say this first: it’s not SaaS only. Sure, there’s no harm in only making SaaS products, especially if you’re good at it. However, I like to keep my hands on the pulse and dabble in different industries and areas.
Still, I do think SaaS is vital because it’s simultaneously customer-oriented and yet relatively easy to monetize. This makes it viable for a company and a good fit in terms of service quality. SaaS, as a format, weeds out the weaker projects all on its own, leaving little room for janky software.
And with SaaS relying heavily on cloud storage, it’s certainly the choice you want to go with for the future. Right now, many other formats are falling behind while SaaS is advancing.
SaaS Product Case Study: CleverSource
If you’d like to see a more detailed example of a successful SaaS product and read about the development cycle, come on over and take a look at CleverSource, a content management system developed by Incode Group.
With the wise words of our CEO and our extensive guide to SaaS product development, you are now well-informed about SaaS projects and can start your journey with confidence. But, to make sure the result is as amazing as you imagine it, we suggest you come get a free consultation from Incode Group. We’ll discuss your vision, help you choose the direction you want to lead the project, and the way to deliver above your customers’ expectations.