A Comprehensive Guide to the SaaS Product Development Process

Various commonly used applications like Slack, Netflix, Shopify, etc. are based on the SaaS model. SaaS applications scale as per the growing business needs, reduce IT infrastructure costs, and can be easily accessed anytime anywhere with an internet connection.

This further boosts productivity and makes it easier for companies to manage remote teams. Implementing the right SaaS product development process and strategies can help you build high-quality products.

What is SaaS?

SaaS is a software deployment model and the abbreviation stands for software as a service. In this model the SaaS product development services provider tailors applications within a cloud infrastructure and launches them over the internet. Users can access SaaS applications over various devices like smartphones, laptops, and others with a stable internet connection.

The Software as a Service (SaaS) market is expected to grow at a compound annual growth rate (CAGR) of 19.28% from 2024 to 2029. This is projected to result in a market volume of US $818.80 billion by 2029.

A brief history of SaaS gaining global popularity:

The Software as a Service (SaaS) business model has been around since the 1960s, but it became popular in the late 1990s and early 2000s: 

1960s- IBM created the first time-sharing system, which allowed multiple users to access the same computer system at once. 

1990s- The dot-com boom made it difficult for hardware to keep up with the growing complexity of software. Companies like Amazon, Salesforce, and Concur began offering internet-based applications on a pay-per-use basis. 

2004- Email services like Gmail became some of the first SaaS products to be mass-marketed to consumers. 

2010s- SaaS became a proven and tested business model, with Salesforce leading the way. 

2023- SaaS is a preferred primary method that companies use to deliver applications. 

SaaS is popular because it offers pay-as-you-go pricing. This means with SaaS product development services; businesses can scale their usage up or down without paying for unused licenses or features.

SaaS eliminates the need to install software to use them and the emergence of advanced broadband technologies along with high speed internet connection promotes greater adoption among the users. 

How can you implement SaaS?

SaaS applications are implemented on:

• Private Cloud
• Public Cloud
• Hybrid Cloud

Why run SaaS on a Private Cloud?

Private clouds are more secure than public clouds because they offer dedicated resources and allow businesses to implement robust security measures. This is especially important for industries that deal with sensitive customer information, such as healthcare, finance, and legal services. 

Some of the key benefits of using a private cloud for SaaS are

• You can tailor the infrastructure to specific needs that help to achieve optimal performance
• It helps businesses adhere to compliance standards and data residency regulations.

Why run SaaS on the Public Cloud?

Public clouds are commonly used for collaboration, project management, and data archiving SaaS applications. Using the Public Cloud helps with cost savings and achieves pay-as-you-go scalability and smooth maintenance via the service provider. 

There are many benefits to running SaaS on a public cloud, including: 

• You don’t need to purchase hardware or software, and you only pay for the service you use. 
• You can easily add or remove users or features as your business grows. 
• It lets you access your applications from any device with an internet connection.
• Your SaaS provider handles updates and security patches, so you always have the latest version. 
• The service provider handles maintenance activities.
• You can customize SaaS applications and integrate them with other business applications. 

Why run SaaS on a Hybrid Cloud?

Using Hybrid Cloud allows You to keep sensitive data on private cloud servers while running applications and analytics on public cloud service providers. This unique approach proves helpful in terms of achieving high scalability without compromising on security and flexibility in the SaaS development process.

Some of the key benefits of Hybrid Cloud for SaaS product development are:

• You can adapt and change to maintain your competitive advantage. 
• You can choose where to deploy cloud-native applications for SaaS solutions. 
• You can use your data and run your analytics applications on any cloud or in any environment. 
• You can integrate with analytics platforms, such as Microsoft Power BI, and cloud data platforms, such as SingleStore and Snowflake in the SaaS development project.

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The SaaS Product Development Process

1. Conduct an In-Depth Market Analysis

Like other software development life cycles, SaaS also begins with research and analysis. The product development team must find key answers to the following:

• How does the product resolve the user’s issues?
• Who will be using the SaaS product?
• Are there other similar products available in the market?
• How will you differentiate your product? 

Good market research helps to validate the product demand. So, you will not end up building a product with zero user demands. 

2. Structuring the Fundamental Requirements

The next big thing in the SaaS product development process is planning privacy protection & security audits. SaaS products are built for a massive user base. Security inconsistencies in planning and design are best identified and eliminated in the early phases of the product development process.

3. Estimating the Budget

Budget estimation for the development process involves analyzing several key areas, such as UI/UX design, coding, business analysis, user support, maintenance, and marketing strategies.

A SaaS product development company can provide you with a guilt-free quote for end-to-end services. This helps to tackle unforeseen issues and convince stakeholders with a realistic view of the project. 

4. Determine a suitable Pricing Strategy

Based on the target audience, geo-location, and marketing strategies, there are several SaaS pricing models for the users. Some of the standard ones are:

• Freemium: Users can access the product with limited features and upgrade to advanced versions to unlock more valuable features.
• Pricing per feature: This revolves around paying for what you use. In simple words users can pick desired features and pay for it.
• Flat rate subscription: Users pay a regular fee monthly or annually.
• Usage-based pricing: Users pay for the period of time they use the product for minutes or hours.

5. Define the Technology Stack

Building a robust technology stack involves decisions on the front end and back end. Different technologies are viable for different kinds of products. For example, if your product idea involves AI usage, you should go with Python and its supported frameworks like Django, Flask, etc.

For front-end development, several advanced UI-building frameworks exist, such as React.js, Angular, Vue.js, and others. Similarly, for the backend, you need to choose compatible programming languages, databases, servers, etc. Technology stack is also crucial for a smooth SaaS product management process.

6. Develop an MVP

Building a minimum viable product with a few core features helps to build a solid foundation for the SaaS software development project. Various successful products, such as Facebook and Uber, began their journey as MVPs.

For example, Uber was launched with just a taxi booking feature. Based on user demand, the app was updated with several complex features, such as scheduling rides, real-time driver tracking, emergency calling services, multiple payment options, etc. 

Building an MVP also helps to prioritize the key features and attract stakeholders for the project.

7. Test, Iterate, and Maintenance

It’s time to launch your MVP to a group of early adopters. This testing phase helps you gain feedback and make necessary changes to the software product. 

However, various companies launch the MVP to the key audience instead of a selected group. This has the advantage of gaining massive user feedback and prioritizing it according to the demands. 

You cannot delay iterative features and need to launch them according to the priority level. Such an approach helps build a loyal customer base. Once the SaaS product is complete with final features based on the customer feedback, it enters the maintenance phase. 

Under these phases, you may need to add more features according to changing user demands, comply with the latest industry compliances, resolve issues, bugs, and errors in the product, and more. 

Conclusion

The SaaS product development process can be overwhelming, but the right steps help build high-quality solutions. It is advisable to follow agile methodologies in building the application code. Agile allows the developers to easily add new iterations to the application code and also promotes CI/CD.

At JS Panther, a SaaS product development company, we can help you turn ideas into viable solutions. We equip software solutions based on your industry vertical with compliance, regulations, and technology trends.