Monday, March 20, 2023

Three SaaS Purchasing Mistakes Organizations Are Making

By Vishal Muktewar - May 09, 2022 3 Mins Read

Three SaaS Purchasing Mistakes Organizations Are Making

With more and more SaaS applications being constantly released, it is becoming difficult for organizations to choose the one that meets their needs. This leads them to make mistakes that end up costing them a large amount of money and time.

As per a recent forecast from Gartner, the total public spending on Software-as-a-Service (SaaS) is expected to cross USD 208 billion by the end of 2023. This means that while many SaaS applications will enter the market, the proliferation of applications has made it difficult for organizations to select the right SaaS platform, resulting in mistakes in choosing the correct SaaS application, costing companies big in terms of money and time.

Here are a few mistakes that organizations make when choosing SaaS applications and steps they can take to prevent them:

  • Not pushing for a pre-purchase test

In the past, testing the limits of the software and whether it fits the needs of the organizations was a challenge. But, today’s dynamic marketplace provides an opportunity to test a SaaS solution before making a purchase. This allows buyers to conduct in-depth testing before advancing their purchase decisions. Yet, many organizations often leave out these crucial steps that end up costing them heavily when finally deciding to integrate the platform into their infrastructure. 

Therefore, IT leaders should test SaaS applications. They should enable relevant team members at their organization to participate in testing. This way, they will be assured that the SaaS platform delivers the required features, functions and benefits that the business needs. Also, when testing the SaaS platform, IT leaders should ensure that it does not do more than is required.

  • Not negotiating

Most SaaS platforms do not provide clear pricing when considering enterprise-level software. Instead, they provide an invitation to contact their sales representative to know more about the pricing options. 

Also Read: Three Enterprise SaaS Trends to Watch in 2022

To get the most out value from it, IT leaders should first collaborate with their counterparts to get the organization from the lower pricing tiers and into the enterprise tier since it is the place where organizations get volume-based discounts. If they qualify for the enterprise-level pricing, the second step they should take is to negotiate with the sales team for the largest volume-based discount the firm can receive. 

As the sales team is often eager to close deals, and the first or even second price offered is not always the best deal. Therefore, when negotiating IT leaders should push hard for the best pricing and be unafraid to get out of negotiations if they are not getting what they need. 

  • Not including users early in the process

Implementing any new SaaS software requires widespread adoption of users. Yet many organizations do include users early in the purchasing process, which results in user dissatisfaction. This also leads to a struggle with the adoption of new applications while they find it difficult to extract the full value from the application.

To tackle this situation, IT leaders should build a small team of people who represent all of the functions they are going to be using the software. This provides them new possibilities for implementing SaaS applications. Additionally, it also forces them to put a great emphasis on people in the decision-making process.

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Vishal Muktewar

Vishal Muktewar is a Senior Correspondent at On Dot Media. He reports news that focuses on the latest trends and innovations happening in the B2B industry. An IT engineer by profession, Vishal has worked at Insights Success before joining Ondot. His love for stories has driven him to take up a career in enterprise journalism. He effectively uses his knowledge of technology and flair for writing, for crafting features, articles and interactions for technology enterprise media platforms.

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