SaaS 102 (1) What is SaaS?
SaaS 102 Chapter 1: What is SaaS?
By Teddy (CEO)
By writing 102 articles, I would like To share my views on SaaS, talk about the development history of SaaS, the difference between To B and To C, what is the difference between SaaS in China and overseas services, and share the characteristics from the perspective of technology, products, marketing, regulations, and recruitment.
Those opinions are based on my experience in e-commerce and SaaS in the past ten years, plus some summaries from my observations, so there may be deviations. I hope to get more immediate feedback through text publication, so that my message cost and error correction cost will be lower.
Today, I would like to talk about the following:
1. What is SaaS?
2. Why use SaaS?
What is a SaaS?
Ten years ago, many people could not answer this question. Even today, there are still some things that are not clear, so I would like to talk about the name of SaaS and its history.
Software as a Service — “Software” means “Service”.
Twenty years ago, it would have been Software as a Product.
Software is a product, even now do the Internet, obviously in software, but on the post, but only called “product” manager, rather than emphasizing the “software” product manager, even though it is clearly do SaaS company, also will not call “product” manager for “software services” manager, more have not seen “service” manager.
Why does Software as a Product become Software as a Service?
Software, products, services
In the 1990s, the way of selling software was very special (if I look back at 😅 now). The software itself was invisible, but a media must be used as the carrier. At that time, Floppy Drive and CD-ROM were used as the carrier to spread and sell.
In the past, when buying software, they had to queue up at the store and buy boxes one by one and install them at home. However, with the development of science and technology, especially the improvement of Internet speed, I believe that now many post-00s do not know what is CD at all, let alone what Floppy Drive 😅, because all things just need to download.
At that time, the “software” was really a product, but in fact, it was not completely correct. What we bought was just a software license. I will not elaborate on it today, but I will talk about it later.
Why can software go from product to service?
To be “software” is a “service.” Software itself is made up of a lot of code, but unlike many other products, it has a few key qualities that make it a particularly good service.
* Low replication cost
* Energy standardization
* Can be on the cloud
* the intangible
In fact, similar to “software”, there are “music” and “film”.
The iPod used to be the best product for listening to Music, everyone knew how to use it, but less than 20 years later (launched in 2001), the millennials were using Spotify, Apple Music, they didn’t know how to use the iPod to listen to Music! Here is a very interesting video:
www.youtube.com/watch?v=0lv…
Have you ever wondered if you could replace “software” with anything, such as “car” as a service, “house” as a service, “office” as a service, etc.?
But with those products, it’s hard to do
* Low replication cost
* Energy standardization
* Can be on the cloud
* the intangible
You can rent an apartment online through Airbnb, but the “home” itself is not replicable, it’s cheap to replicate, and it’s hard to standardize.
It’s important to be able to standardize services. If SaaS makes too many customized features that only fit a subset of customers, it’s not a good SaaS at all. It’s not even SaaS, because basically you can’t replicate indefinitely at low cost. Develop 20% of the functionality to meet 80% of customer needs. Yes, it’s hard to do something that 100% of your customers will use, but 80% is a big enough market, right?
Software can be made into a product that can be used in 80% of scenarios, solve some common problems, and be quickly deployed in the cloud for immediate use. For the companies that produce this “product”, the cost of replication is very low, at most paying more for servers and broadband.
Take the iPod. In the old days, even if I wanted to make music as a service, you still had to figure out a way to get the music into different hands at a low cost, and that was a big shipping cost.
Software (and music, too) has the quality of being “invisible” and can be distributed cheaply over the web.
So why didn’t SaaS come about 25 years ago, with Windows 95?
Because at that time, the Internet just up ah, at that time, the Internet is only 14.4 KBPS, can not achieve real meaningful distribution, at that time, you want to listen to a song, download 1 hour, you still want to use?
But with THE advent of 4G, broadband (100Mbps+), as long as it’s available online, you can basically pay a fee and listen to it right away, even if the movie isn’t a problem.
In fact, there is also some objective reasons to speed up and strengthen the development of SaaS. The problem of piracy before, whether it is music (MP3), or software, movies, etc., can be solved after Service, because you have to connect, Software firms’ revenues have soared as vendors can tell by IP address, number of machines and so on whether someone is using piracy.
The development of online payment system can also greatly encourage SaaS, you can make a software to sell ten thousand yuan is not a problem, but if you only charge 200 yuan per month, as a software company you, how to guarantee, and low cost to each customer to charge the 200 yuan per month, as a software company you, how to guarantee, How can you, as a software company, guarantee that you can charge each customer 200 dollars a month at a very low cost?
Why use SaaS?
Low construction cost
I don’t mean that you’ll end up paying very little or very little, I can’t guarantee that, but the “build” usage costs of SaaS are much lower than traditional software because customers don’t have to pay a one-time fee or spend three months developing a system.
There are many factors to calculate the cost of using a software. If a SaaS company provides the same functions and services, the SaaS company will achieve lower cost effectiveness than the customer’s own implementation. Otherwise, there is no reason for customers to use SaaS for a long time.
Low barriers to application
Because SaaS software company to make a success, we must to solve a problem, is to be suitable for most companies use function, and must to do more than the traditional software easy to use, such as the installation of a key, the interface simple and easy to use, therefore, the most good SaaS, will be on a vertical field do well, use simple words to describe: Small and beautiful, simple and fine.
Low maintenance cost
Reliability and flexibility are requirements of all systems, but these Scalability features are difficult to develop and maintain at a low cost because they are used solely by the customer. However, SaaS has Economies of scale. The more customers there are, on average, the lower the maintenance cost to achieve high reliability and flexibility.
Low input risk
When calculating the cost, many people only pay the cost of calculation, both money and time, manpower, etc., but not consider “error correction cost”, using SaaS error correction cost is very low, in most cases, a free trial, payment can only pay for a month, or even metering, don’t share can immediately compare Google again another again, Compared to self-development, error correction costs are often much lower.
conclusion
To summarize, SaaS works because of three characteristics:
* Low replication cost
* Energy standardization
* Can be on the cloud
* the intangible
There are four main reasons why customers want to use SaaS:
* Low construction costs
* Low maintenance costs
* Low barriers to adoption
* Low investment risk
When you do SaaS, do you develop for the above characteristics and reasons?
【 About AfterShip】
AfterShip is an international company founded in 2012 and headquartered in Hong Kong. With product development centers in Shenzhen and Hong Kong, AfterShip provides over 100,000 b-end customers worldwide with a range of e-commerce SaaS services including marketing promotion services, face printing, logistics tracking and return management. It is a leading enterprise in the field of international logistics inquiry, and currently has launched two Mobile App products for C-terminal users.
The company has been continuously profitable since 2014 and has grown by 100% every year. Our business covers all over the world, and we have cooperated with over 700 logistics companies in over 30 major languages. Our customers include Amazon, Wish, eBay, Paypal, Groupon, Etsy, etc.
We are product-driven and technology-centered. Since the establishment of the company, we have made extensive use of excellent open source software and embraced innovative technologies. The company has a good SaaS payment habit and a strong instrumentalization and engineer culture.
At the same time pay attention to personnel training, work here, everyone can attend from the user communication, needs to discuss, online product development to deployment, team internationalization, rapid development of business, we need a large number of talents to join us, we can provide for future international compound talents oriented growth space and opportunities.
“Click the link to welcome to join us, work hard together, grow together ~”
hr.aftership.com/
