Virtualization has made it possible for people from different parts of the world to collaborate on projects using various tools residing on a remote server. The software is hosted at a central point and users are given access keys so they can perform required tasks from their end.
This model is popularly referred to as Software as a Service (SaaS). You can also create SaaS business from scratch using WordPress and plugins or scripts purchased from Codecanyon.
Incentives for a SaaS Business
With a SAAS product, users may not need to install any software on their computer (except for highly specialized software that may not work optimally on a web browser). The vendor does not need to keep track of software distribution and also lowers development and maintenance costs, hence keeping low the cost of accessing the tools.
Furthermore, all the maintenance activities are managed from a central point. Clients may not even be aware of maintenance downtime as updates are automatically pushed to the users without affecting their productivity. They also do not have to worry about their license expiring provided they keep their subscription up to date.
Advantages of SaaS Business
- Users do not need to install complicated software on their devices. This means that even low-end gadgets can perform complex tasks provided they are connected to the internet. The processing power resides in a remote server.
- Security is guaranteed since data is stored in a remote server under layers of security walls. Data transfer is hashed so that is is practically useless to anyone who may intercept it.
- Highly reliable because the servers have >99.99% uptime. They also have redundancies incase of a disaster. This also means that the product is highly accessible to a wider pool of users than would be the case if licensing model were to be used.
- SaaS is easy to scale because upgrades and downgrades are managed from a single point. Just a single click and the entire system is updated without affecting any user.
- Reduced costs since distribution and customer care overheads are marginally reduced. It is also cheaper to provide trials to users without additional costs involved.
Deciding the Type of SaaS Application to Run
Virtually any type of cloud-based business can run as a SaaS business. When you create a free blog on WordPress.com, you are subscribing to a SaaS application. You only need to create a free account on the website and start creating your website/blog without having to install WordPress on your PC.
SaaS applications bring different parties together to accomplish a particular task. Here are some businesses that can run as SaaS.
- Online marketplaces with different sellers/shops, third party service providers (like fulfilment agencies/couriers) and the customers. All these stakeholders are able to accomplish everything they need to do on a single software hosted in a remote server.
- Communication and video conferencing software like Zoom. Everyone is able to hold simultaneous virtual meetings from wherever they are without causing any interference to the other users.
- Billing software that enables a national power company to consolidate all customer bills simultaneously and send each consumer their own bills. Consumers can also get their usage history and generate their own bills at will without having to wait until the billing period is due.
- Customer Relationship Management (CRM) software like most email marketing tools e.g. Get Response, Mail Chimp, etc. They automate processes for millions of email marketers who work at their own time and are still able to schedule and automate most of their marketing campaigns, generate reports and optimize actions.
- Enterprise Resource Planning (ERP) software like most software chain stores use to automate their inventory management and reporting tasks.
- Project management software.
SaaS Product Development Process
To create your own SaaS product, there are two ways you could go about it:
- Create one from scratch.
- Convert your existing app into a SaaS product.
Whichever way you choose to go, you must have sufficient budget to cover the costs involved. Costs can vary form minimal to astronomical proportions. Here, we are going to see how to create yours from scratch without selling your kidney.
First, you must decide what service you want to provide. You must know if there is a need for the product you want to create because this will help you map out the components of the SaaS product you will create. Next, you must decide whether you are going to use a standalone script or extend the functionality of WordPress using plugins to achieve the effect you want.
After making that decision, you must go out and assemble all the tools you will need to create the service you want. We are going to cover both in this article.
How to Build SaaS Business From Scratch Using WordPress
You can do so many things with WordPress. Let’s see how to build a multi-vendor marketplace using WordPress.
- Having purchased your preferred domain and bought a hosting package, you will need to install WordPress and configure it as you would any normal WordPress site. You can check out this guide if you are new to WordPress.
- Install and configure Woocommerce on your website (including payment gateways). The configuration wizard will guide you through the process if you have never done this before.
- While still on the plugins section, search for WooCommerce Multivendor Marketplace and install in your website. You can also download and install it manually if you prefer that. Use the configuration wizard to set it to meet the needs of your website.
- You have created a multi-vendor marketplace where different merchants can sign up, list their inventory and start selling. You will not need to do the fulfilments of the orders because each merchant manages their own store and fulfils their own orders. Your work is to ensure that the platform runs smoothly and also help with technical aspects should a shop owner/customer run into a challenge.
- You can allocate quotas to the vendors beyond which a fee applies. You can also set a fixed recurring fee for the vendors or charge a small commission per sale made through the platform. The choice on how to monetize is yours.
If you have a challenge and you need help installing your multi-vendor WP store, click the button below to order our service.
How to Build SaaS Business From Scratch Using Codecanyon Script
A script eliminates the reliance on third-party tools like WordPress and plugins. Scripts also helps you speed up the process of developing your application because you are taking a complete code and you only do minimal modifications and it starts running.
Some technical knowledge is required here because you will be going into the source code and making changes by yourself. You could hire someone to help if your budget allows. We offer these services at the Chirpsuite store. We can help you create a SaaS application like this free app we created to help website owners audit their websites to improve performance and ranking.
Assuming you have already purchased and configured your domain to your hosting account, here is how you go about it:
- Go to Codecanyon and search for Turbo Website Reviewer.
- Make a purchase (it will not work without a purchase code) and download the files and the purchase code.
- Go to your Cpanel and open the “public_html” folder.
- Upload the files you downloaded from Codecanyon into the root folder (public_html folder). Use the Cpanel unzip tool to extract the contents of the zip archive into the root folder.
- Visit your website url in a new browser tab and the set up wizard will be automatically executed to help you finalize the settings. Set your user name and password and apply the application license to validate the script.
- Go to the admin panel and finish configuring your app by adding content to pages and setting up website identity.
One limitation with scripts is that they require technical know-how to make substantial modifications. Even if you manage to do, you may still end up losing the modifications when a new update is available and you have to repeat the process all over again.
However, if you have the technical expertise, this is a piece of cake. Plus, you will not have to spend many months trying to create your own app. It is like forking a script from Github and modifying it to suit your purpose, only that you have dedicated support for the duration of the license.
If you need help setting up your own script, you can order our script installation service from the Chirpsuite store. Click the button below to place your order if you need help.
Marketing Your SaaS Service
After developing your product, it is time to start marketing it if you are going to make money off of it. Since you have created a tool, you can ask a few people to try it for free for a limited period and provide feedback and testimonials. You can use these testimonials to market your product to a wider audience.
You can also sell your application as a gig on any of these freelance marketplaces. Once there, you can sell “Website SEO Review” service. Many people own websites and majority of them do not know how to make their websites perform optimally. You can review their websites and generate a report to help them know what they should do to improve performance.
You can help people create accounts on the platform and let them use the functionalities of the tool to automate their processes. For instance, you can help people create accounts on Mochaseo.com so that they can review their websites for insights on how to improve their SEO.
Do not forget that you can also allow affiliates help you sell your service. What happens here is that, you qualify people based on certain criteria and give them a tracking code which they can use to market your service. Every time someone clicks on their tracking code and purchases your service, a sale is registered on their account. You can choose to make instant payments or consolidate and send out payments periodically. The choice is yours.
Choose Your Pricing Model
You can use different pricing models for a SaaS business. Some of the most common pricing models you can use include:
- Flat rate – users can access full functionalities of the service after paying a certain fee. It can be once for life, yearly, monthly or even weekly plan.
- Pay-as-you-go – users only pay for what they consume
- Feature-based – users pay different fees based on the features they choose
- Number of active users – users subscribe to use the software based on how many people will be accessing it simultaneously during an active subscription period
- Freemium – users can access certain features for free forever but they can also upgrade at a later date should they need extra features. This model is preferred by many companies because it boosts the life time value (LTV) of a customer
- Trials – you can give users promotional prices, including free trials for a limited number of days. When the trial ends, they are charged the full price. You could also set low entry fees for the first month then bump it up in subsequent cycles when the user has tested the features of your service and made a decision whether they will be upgrading or not.
Monitor the KPIs of Your SaaS Business
You must stay on top of things. Always keep tabs of the performance of your SaaS business by monitoring the following indices:
- Customer churn – the proportion of your customers who fail to renew their subscription. Take note of this index because it is the most overlooked in most cases, especially if your business is at the exponential growth stage.
- Monthly Recurring Revenue (MRR) – total revenue the business generates month over month.
- Customer Lifetime Value (LTV) – total revenue a customer generates for the business before they completely stop using the service.
- Cost of Acquiring a Customer (CAC) – the amount of money spent to get a customer to subscribe to the service.
- Net Promoter Score (NPS) – how much value the customer derives from using your service. You can decide on the parameters to measure e.g. how many new followers did they get by using your service, did their rankings improve, how much money did they save by using your service as compared to when they were not using it, etc. All these are customer gains.
Starting your own SaaS business can be a viable business with healthy passive income in the long run. It is not a get-rich-quick type of business. It may take you several months (especially if you have a limited budget) to start seeing tangible results. You must consistently work on the project and promote it to see traction within a reasonable duration.