SaaS purchasing insights for October 2023

Faced with an unpredictable global economy and slowing revenue growth, companies worldwide have certainly picked up the pace of layoffs this year in a bid to ultimately minimize outgoings.But while there is an optimism that these cuts will slow down in 2024 – a possible result of these organizations having already reduced their headcount by as much as feasibly possible – they still need to be looking to make efficiencies in other areas of the business.One such area is SaaS spend.The problem is, continuous advances in technology, resulting in an influx of new tools on the market, combined with the increasing need to innovate makes this a challenging task.In other words, many simply aren’t willing to compromise on their software stack – and the data shows it.Here are our SaaS purchasing insights for October 2023.,

SaaS purchasing insights

Share of spend for AI software has tripled in the past six months

,

, AI well and truly dominated the headlines following the launch of ChatGPT back in November 2022, and between January and April of this year, the share of spend for these tools had increased by a staggering 500%, accounting for 1% of total SaaS expenditure.What was unclear at the time was how these tools might fare once the initial hype had passed. Would they continue to be procured at such a rapid pace, especially as organizations continued to scrutinize their budgets?According to the data, yes.Over the past six months, we have seen the share of spend for these tools triple, with AI software now accounting for 3% of total SaaS spend on average.What’s interesting though is that while generative AI tools including ChatGPT provider, OpenAI, AI-generated interview notes platform, Metaview.ai, and conversational CRM solution, Haptik.ai have certainly experienced growth, it’s actually the integrated AI tools such as Rulai, People.ai and Headsup.ai that are capturing a higher share of wallet across our user base.,

Average SaaS spend per employee has increased by 27% in the past year

,

, As companies continue to implement the latest technologies – resulting in the average SaaS stack growing by 18% year-on-year – and as software prices rise by an annual average of 12%, it’s inevitable that the amount being spent on each individual employee will increase as well.In the last year alone, this increase has been significant, with SaaS spend per employee rising from $6,220 to $7,900.But while software spending is up across most departments, it is in fact marketing, finance and analytics tools that are driving most of this growth.Here’s the thing though – with software accounting for more than $1 in every $8 of total business expenditure, it’s crucial that the cost of each tool, and therefore the cost per employee, is kept to a minimum. Especially as your headcount grows.This doesn’t necessarily mean having to terminate subscriptions though.While we would certainly recommend that you rationalize your software stack to ensure there are no instances of duplicate software, feature overlap or unutilized tools or licenses, there are other ways you can significantly reduce costs in this area.How?Well, with 90% of companies overpaying for these software tools by an average of 26% – often substantially more – one of the biggest opportunities for driving down costs is to negotiate with leverage.In other words, secure the best possible deal with the help of exclusive vendor pricing data.,

Trending SaaS vendors

Which SaaS tools are trending this month?Looking at the total contract value (TCV) of new transactions across our user base – including both new purchases and renewals – we’ve ranked the ten most popular SaaS vendors and shown their monthly movements.,

, While there has been some movement on the leaderboard over the past month, with vendors such as NetSuite climbing to position four and Snowflake dropping to position seven, many of the top ten remain the same as in September.Emerging as a new entrant, however, is collaboration software platform Atlassian.,

Rising SaaS vendors

,

, In addition to looking at the top ten SaaS vendors by their total contract value (TCV), we’ve also looked at those that have seen the largest month-on-month TCV increase.Climbing the ranks in October are Emarsys, an omnichannel customer engagement platform, Braze, another customer engagement platform, and AI-powered analytics tool, ThoughtSpot.Given that two of these rising vendors operate in the same space, it is indicative that companies are investing heavily in multi-channel marketing.,

Falling SaaS vendors

,

, What goes up must go down. Or so they say.Unfortunately, over the last month the total contract value for the HRIS platform, HiBob, online learning marketplace, Udemy and customer training software, Skilljar decreased the most substantially.,

Vendor of the month: Emarsys

,

, With the highest increase in total contract value across our user base, this month’s vendor spotlight is on omnichannel customer engagement platform, Emarsys.Not only was the SAP company named a leader for the fifth time in the 2023 Gartner® Magic Quadrant™ for Personalization Engines, but it also has an almost five star rating on G2 and it therefore comes as no surprise that the software provider has risen in popularity amongst our customers.,

Category of the month: Mobile Marketing

Despite already being worth a cool $18 billion in 2023, the rise of mobile commerce, advances in mobile technology and the demand for more personalized and targeted communications is set to more than triple the value of the global mobile marketing industry, seeing it reach a staggering $58 billion by the end of the decade.And if our data is anything to go by, this type of software is already becoming a staple within the average company’s software stack, with tools of this kind now accounting for 3.4% of total SaaS spend.Emarsys isn’t the only platform worth talking about though. Other popular platforms used across our customer base include Braze, Attentive, Branch, AppsFlyer and Customer.io.,

, When purchasing or renewing one of these tools, keep in mind that the list prices are rarely set in stone.Our data indicates that the average discount provided by vendors in the mobile marketing space is 18%, which means you could be saving almost a fifth of the price – often substantially more – with the right leverage and negotiation strategy.,

Secure maximum cost savings on any SaaS contract

With access to the pricing and discounting data for more than 16,000 SaaS providers across the globe, Vertice can secure you the very best deal on any software purchase or renewal.What’s more, our experienced team will handle the procurement of these tools on your behalf, saving you a substantial amount of time, while also identifying the cost-saving opportunities that exist within your SaaS stack.For a better understanding of how Vertice can achieve this and ultimately streamline your SaaS procurement process, have a watch of this.Alternatively, search through our vendor database for exclusive pricing intel.,

, , , , , , , , , , , , , , , , , , , , , , , ,