December 12, 2019
How to fix data-related problems for SaaS companies
From big data to smart data, the market size and growth of cloud services is at nearly 3 times that of overall IT services. And according to Gartner, SaaS is now the largest segment of the cloud market. The global research and advisory company also predicted that the fastest growth in end-user spending on SaaS applications through to 2022 will be on business intelligence, supply chain management, project and portfolio management, and enterprise resource planning.
With this exponential growth comes more and more data that SaaS businesses are processing for their customers second-by-second. Data volume is increasing exponentially — and this mountain of data must be proactively monitored and managed. Failure to do so can lead to mounting costs over time in terms of inefficiency, resource load, and profit.
In this article, we discuss the key data challenges that today’s SaaS operators must be ahead of the game on. We also provide practical tips on how they can then overcome these issues.
Be a smooth operator and a control freak.
From maintenance and network issues to outages and cyber-attacks, back-up and crisis management procedures are critical for SaaS businesses. For all of the benefits of playing in the cloud, there are plenty of examples of SaaS businesses getting hacked or simply just losing data – and it can happen to even the biggest of operators.
One of the most publicized cases involved Dropbox, a popular cloud storage firm with millions of customers worldwide. In 2012, Dropbox experienced a security “incident,” however the true scale and severity of that hack only came to light in 2016 when it was discovered that 68 million users had their passwords leaked on the Internet. Even solid encryption practices did not prevent entry into its company network.
The consequences of a data breach can severely affect a SaaS company’s reputation, share value, and customer loyalty. Customers rightly demand best-practice standards when it comes to experience, service and especially security as the end-users of these ‘always-on’ services. And as customers become more protective over their security and privacy, gaining their trust will become more critical when it comes to managing the customer experience.
Does one size really fit all?
Ease-of-integration is a fundamental service for SaaS providers. While all-in-one solutions are slowing saturating the market, the providers that will win the long-term race are those that consider deep and best practice integrations with other solutions. Think best-of-breed solutions like Autopilot.
It’s true. If you limit yourself to a single provider, you’re not only tied to lesser developed solutions that make up your entire SaaS stack, you’re also faced with the possibility of having nowhere to go should your relationship with that vendor goes sour — or if someone goes very wrong with your data.
According to the experts at SaaS Mag, “One of the most powerful ways of ensuring your customers can easily integrate your SaaS app with other solutions is to make your Application Programming Interface (API) public. You can then provide users with best practices, code examples, and extensive documentation. Access to your API will allow your customer’s development team to customize your SaaS stack and better integrate it with all the other apps they employ.”
The cloud is everywhere but so is GDPR
To put consumers back in control of their data, Europe’s General Data Protection Rules (GDPR) came into force in May 2018 — and these changes created an immediate impact on the SaaS world.
Any business with any customer base in Europe was forced to reconsider the way they communicate with clients and handle their data — or face fines up to 4% of their annual global revenue. And no matter how big or small your SaaS business is, no-one is immune to non-compliance. To put it into perspective, Google was slapped with a huge $57 million fine by CNIL, France’s data-protection watchdog group (Tech Crunch).
If you haven’t yet considered GDPR, at a minimum, it’s important to review your existing compliance processes in the context of GDPR and evaluate the visibility of your current tech stack, especially security software, compliance tools, and vendor management – basically, anything data related. And if you’re using email marketing in your customer journeys, you need to make sure you’re GDPR-compliant. In addition to obtaining your contacts’ consent before emailing them, you must also respect their personal data.
Our article on best practices for email opt-ins in the age of the GDPR takes you to a journey that ensures your email sends are GDPR-compliant. Bonus: you’ll also see improved email engagement and deliverability rates.
Customer data doesn’t require a passport
Cloud-based operations are borderless. This is wonderful for SaaS enterprises connecting with the increasing numbers of SMEs across the globe, however, data security still remains a key issue.
Recent studies across the US and UK reveal that there are low levels of literacy among businesses outside the EU when it comes to GDPR. Almost 60% of full-time employees in both markets handle sensitive information daily. Yet, only 52% of American employees are even aware of laws dictating how sensitive information is handled compared to just 17% in the UK (ObserveIT).
It’s critical to be proactive to futureproof security blind spots. You may think that your systems are secure, yet the interconnectivity of technology can leave serious gaps when it comes to sensitive data. At a minimum, have basic data control and governance standards employed and utilize two-factor authentication. Your customers may also need to consider redefining their data security and governance models to fit the features and functionality of your SaaS solution.
Proactive planning is the basis of future-proofing your business
While SaaS development is racing ahead at lightning speed, being proactive with data security and client control is imperative. Businesses are demanding improved transparency and control over their data as well as smooth integration for more effective productivity. And as you compete for their business, you must make their data as important to you as your own.