Survey: Efficiency Driving SMB SaaS Adoption Not Cost Savings
December 7, 2017 | Contributed by: Greg Sterling
Charles Laughlin lead off with the opening presentation for LSA’s Cloud Adoption Summit today in San Francisco. The title of the session was “SMB Cloud Shift: Why and So What?”
He presented early data from LSA’s second SMB-SaaS adoption survey wave (n=1,000) and set the stage for the remaining sessions throughout the day by raising a number of key questions:
- Can players now selling marketing leads pivot to selling SaaS?
- What channels drive scale in a challenging SMB market?
- Will all-in-one approaches succeed over point solutions?
- Will success require verticalization?
- Will a few large players end up dominating the market?
Efficiency and ease of use (above) top reasons SMBs were adopting cloud solutions. Yet adoption was uneven by industry and product category. Those not adopting cloud-based tools and services most commonly reported being “comfortable” with their existing provider or software.
There was a high correlation between SaaS adoption and the age of the business. Companies that were less than five years old were more likely to use online booking and mobile apps, for example, than established businesses more than 20 years old. Newer businesses were also more likely to buy the solution directly from the vendor or through an online marketplace vs. through an intermediary or third party sales representative.
Asked, “If you were to consider purchasing services outside of the core service offering of a particular provider, from which would you be more likely to do so?” ISPs and technology providers (48%) were strongly preferred to banks or media/marketing service partners (23%). As a practical matter that boils down to something like: would you buy digital marketing services from a bank?
Laughlin’s presentation also offered a number of near-term predictions about the market:
- SMB cloud adoption will accelerate
- All companies selling to SMBs will be in the cloud business
- The SMB sales process will dramatically change
- Virtually all newly formed SMBs will be cloud adopters (in some form)
- CRM platforms will lead the way
These ideas form the core tenets of the Tech Adoption Index.