Just how big is the SaaS market going to get?
Some believe it might double in the next two years alone, spurned on largely by converting the remaining on-premise software companies to the cloud. (Oracle is being very aggressive in this area, specifically.) In Q2 2017, SaaS represents about $15-17 billion globally, which is a 31% year-over-year increase. Microsoft actually replaced Salesforce as the global SaaS leader last year, and many of Microsoft’s customers are still on-premise — which means its cloud and SaaS offerings will only continue to grow. Overall, the growth in hosting and cloud services is outpacing the growth in overall IT spending.
This year, it looks like the public cloud services market, which includes SaaS but also infrastructure and security pieces, will grow 18%. Small and medium-sized businesses are leading the way, usually in the form of needing a better CRM, business analytics solution, or hosting/storage.
Cloud spending overall is expected to hit $390 billion by 2020, and likely $246 billion by the end of this year.
Also to consider: Oracle’s SaaS offerings were 8% of its revenue in 2016, and are on pace to be about 13% of its revenue this year. That’s almost double as one revenue stream.
Quick take then: the SaaS market is obviously growing. What does that mean on the sales side?
A big pie, and you can get a piece
$390 billion is a lot of money, and while three big names — Microsoft, Oracle, and Salesforce — have a lot of that pie, there’s more to go around and the barriers to entry are fairly low. So many companies (SO MANY) are still on-premise, and that represents a massive opportunity.
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As with anything in sales, capturing a slice of the SaaS market is going to be about showcasing your specific value. What actual problem can you solve for someone? Most of those on-premise companies probably inherently know by now that they should shift to the cloud and have some corresponding software, i.e. a CRM, but there’s a reason (or a series of reasons) they haven’t yet. Those likely have to do with change, process, cost concerns, adoption concerns, etc. CRM adoption rates, for example, have increased greatly in the last five years — but close to half the companies buying into a CRM, SaaS solution are still seeing multiple departments not adopt the technology. These are all the pain points driving the SaaS sales market. If you can specifically clear some of these pain points, you can win some business.
It almost feels as if SaaS will be the market to grow before AI becomes the market to grow, as both Putin and Elon Musk recently alluded to. So hop in and solve those problems for people. It might be your ticket to early retirement, or at least a few nice vacations.
How? Don’t’ know. Do you think you need sales for Saas? Good question — take a look here.
