From dethroning established enterprise products to enabling new revenue streams from pure digital services, the world has seen numerous SaaS success stories. From lowering costs to enabling seamless scalability and reliability, the benefits are now accepted. But SaaS is not just limited to re-engineering large business models and making the world of enterprise technology a more agile ecosystem. You do not always need a large challenge or technology need to build the case for a SaaS way of working. The beauty of SaaS is that it can be adapted to solve challenges for a very small problem or a group of users as well.
The scaled-down dimension of SaaS making an impact now is Micro SaaS.
From the labeling itself, it can be easily understood that Micro SaaS focuses on a smaller use case and a smaller ecosystem of SaaS technology adoption. Let’s make it a little more understandable.
Micro SaaS-based businesses or service providers are those who usually have a relatively small development team (in most cases a single person) that develops a SaaS offering to support a very niche use case within a larger ecosystem. It operates with lower costs and focuses on a more targeted revenue stream. These teams are often self-funded and profitable.
A simple example could be a SaaS service that allows brands to allow customers to find the nearest store that is authorized to sell the brand’s products. With minimal or no coding expertise, a brand can incorporate a small set of code in their website to perform this specific function. It could take a visitor’s geographic information captured from the brand website to a SaaS service that maps the nearest stores from the list of all stores provided to it by the brand. All the business needs is an additional page on its website to portray the data shared by the Micro SaaS app. In such cases, while the Micro SaaS application caters to a very small use case within the website, it serves as a key marketing channel for the brand. While other major SaaS solutions like CRM or CSM platforms may be deployed by enterprises to cater to a larger need of personalized customer experience, this store locator service is a small yet highly useful service. Going the Micro-SaaS way means it doesn’t cost much for the brand but at the same time is a success for the developer of the service who could run the service on any popular cloud service.
This is just a small example of how the Micro SaaS-based approach delivers pinpoint value and enables the faster realization of ROI. Adoption is growing and so are the number of Micro-SaaS providers. This approach works for businesses or entrepreneurs that want to target a niche problem or challenge or want to offer a smaller sub-service that can complement a larger SaaS application.
So, why is there a steady movement of businesses towards Micro SaaS? Let us examine the 4 key advantages that make Micro SaaS a lucrative option for app and product development in the right niche:
SaaS is a lower-cost option to traditional software development methodologies. Micro SaaS takes it to a whole new level. An app or business that caters to a very niche use case or consumer segment doesn’t require extensive development, management, and maintenance as with larger SaaS applications. Hence Micro-SaaS is more cost-effective.
Predictable Revenue Stream
This is perhaps the biggest attraction for Micro SaaS. Businesses or entrepreneurs that leverage the Micro SaaS model have a clear idea of the small challenge or use case they cater to and how to monetize their service easily. This puts them in a better position to predict revenues based on the number of recurring subscribers they can generate.
Lower Management Overhead
Because a Micro SaaS-based business is limited to a particular niche challenge or use case, it doesn’t need a complicated and large workflow or business process management associated with large SaaS applications like for example a SaaS-based CRM or ERP platform. In most cases, a Micro SaaS app can be run with a very small team and with minimal managerial overheads.
Narrower Business Focus
A Micro SaaS platform focuses on a very niche problem or a very small use case and is often built as a complementary feature addition to a larger SaaS application. Hence from all efforts ranging from requirement gathering to design, coding, revenue modeling, and staffing, the app or service only needs to have a very narrow business focus. This eliminates complexity in operations and simplifies usage policies for end customers as well which ultimately results in more customer interest.
Micro SaaS opens a new door of possibilities for small businesses or entrepreneurs to create a lucrative and self-sustained business in the digital economy. Once a clear market base is identified, then building, deploying, and monetizing the service is not hard. That said, it’s also true that these solutions tend to fit in best as a piece of the puzzle rather than the puzzle itself. For software product and application companies, this is an opportunity to find such solutions and partner with them. Those solutions can be incorporated into their overall framework and architecture to deliver more value to the end-users. Being complementary, this becomes a win-win for both parties. Get in touch with us to know how your app or product could leverage the Micro-Saas trend to deliver more complete offerings faster.