5 Common Misconceptions About SaaS

Geri Mileva on

SaaSIn today’s digital era, marketing professionals have innovative technologies at their disposal, which can help them expand their business. While this offers clear advantages, it also comes with the downside of having to scrutinize hundreds to find which ones are worthwhile investments.

Many small and medium business owners ask if they should utilize Software as a Service or SaaS. In this article, we’ll discuss misconceptions surrounding SaaS to help you in deciding whether to make the switch.

What Is SaaS?

SaaS pertains to a subscription-based model and cloud-hosted software that is accessible via the Internet. It offers an alternative method of accessing software.

The terms web-based software, cloud software, on-demand software, and hosted software are interchangeably used to refer to SaaS. Popular examples of SaaS include Google Apps, Dropbox, Netflix, and Cisco WebEx.

SaaS vs. On-Premise Software

The main difference between SaaS and the traditional on-premise software is that it’s not installed in the owner’s device or server. A third-party provider hosts the application and makes it accessible over the Internet.

How Do I Benefit From SaaS?

SaaS eliminates the need to acquire hardware, install applications, and license software. As such, you won’t incur hardware and setup costs.

Since it’s hosted in the cloud, you can readily access it anywhere, boosting your efficiency tenfold. In terms of payment, the subscription fee is generally paid monthly, allowing you better budget planning.

The model also affords flexibility as customers can subscribe or terminate the subscription at any time. In other words, you only pay for what you use.

Additionally, SaaS providers give customers scalable options, enabling them to choose the features they want.

What Are Common Misconceptions About SaaS?

Despite the benefits, some people remain hesitant to use SaaS. This is probably because of misconceptions surrounding the model.

Here are five common misconceptions people have about SaaS:

  1. The system is unsecured.
  2. Users will lose control over their files.
  3. It is more expensive than the on-premise model.
  4. It is not customizable to the user’s needs.
  5. SaaS is only for small and medium companies.

Let’s discuss each common misconception and get the facts straight to help you make an informed choice about whether to invest in SaaS or stick to the traditional model.

Is SaaS Unsecured?

Data security is the fundamental concern of business owners. It is also the primary argument that SaaS critics often raise.

The concern is both valid and understandable. After all, someone accessing your data is the last thing you want.

The structure of on-premise software gives the illusion of better security. Since you are accustomed to having your files in your hardware, you feel it’s safer that things stay that way.

However, you must consider that developers of cloud software are data specialists whose role is to safeguard customers’ data. This means they have the resources to invest in sophisticated security systems that average users can’t afford. They are also expected to abide by data security policies and laws.

You can rest assured that your data is safer with SaaS providers than in your own system.

Of course, you should still do your homework and look for reliable SaaS providers. Companies with SSAE, CSAE, and ISAE certifications are your best bet since the certification signifies their adherence to industry standards.

Will I lose Control Over My Files?

Another misconception is that SaaS providers can retain customers’ data even after the subscription is terminated. Others say that nothing can stop these providers from selling confidential information to third parties or use it for something else.

Such claims, however, originate from not understanding the nature of SaaS. These companies are no different from other businesses that rely on reputation and consumer trust.

Stealing your data would be against their best interests. In fact, they have more to lose from mishandling customers’ data.

Think about how you deposit money in the bank and not lose ownership over it. In the same way, you don’t lose control over your data. You merely entrust it to another entity for better management.

You’ll be relieved to know that contracts are precisely set up to protect your rights and interests. For short-term usage, you can choose a pay-per-use model to ensure complete control.

Is SaaS More Expensive than On-premise Software?

Some people argue that the monthly recurring cost of subscription fees is more expensive in the long run than the capital expense of buying on-premise software. This is the biggest misconception of all.

Although you’ll regularly pay a subscription fee, the amount is fixed and relatively low. Bear in mind that these companies are data specialists that cater to a wide market. Because of that, they are able to allocate their expenditures to their clients and offer their services at cheaper prices.

Aside from minimizing your costs, SaaS will shorten your worry list. Since it’s the SaaS provider that processes your data, you don’t have to worry about hiring employees who will manage it. You’ll also be able to eliminate upgrade and maintenance costs that come with on-premise software.

Can I Customize SaaS According to My Needs?

SaaS skeptics think that cloud software is not customizable and difficult to integrate. However, these concerns have already been addressed by many companies.

Numerous applications that are being offered today allow users to customize their systems and choose specific features. It’s just a matter of finding the right SaaS that suits your needs.

Many vendors offer a free trial of their services. You can opt for a free trial so you can assess whether the software matches your business requirements.

Additionally, cloud applications are now designed with an interface that grants easy integration. Companies also have a customer service medium that will help resolve issues faced by customers.

Will Larger Companies Benefit from SaaS?

Yes, any company, regardless of size, can benefit from using cloud software.

SaaS definitely holds numerous advantages for startup companies, such as the reduced overhead. However, the benefit is not limited to them.

Improving productivity and efficiency is the value of SaaS. And companies of all sizes aspire for that, making SaaS a welcome tool for any industry.

In fact, a study sponsored by a US company reported that only 4% of large companies are not utilizing cloud software.

Should I Utilize SaaS for My Business?

Without a doubt, SaaS provides a lot of benefits for users. Some of those benefits become even clearer once you understand why common misconceptions are just that—misconceptions.

The answer to whether you should switch to cloud software depends on you. After all, there are aspects of your business that only you know about. You are the best judge of what your business requires at the moment.

If recent developments are any indication, succeeding in business entails embracing innovations.

There are a lot of features that are yet to be explored in the new cloud platform. But one thing is certain: cloud software is here to stay. And at the rate that it’s growing, only those who can keep up will survive.

So, think about it. Are you ready to take the leap?