As part of the ongoing process of examining local commerce and SMB Saas strategies, Localogy goes straight to the source: SMBs themselves. How do they feel about marketing and operational software? What features do they want? And how has their hunger changed over time? This is all a moving target.
Localogy’s Modern Commerce Monitor (MCM) Wave 6.1 answers these and other questions related to SMB SaaS adoption, which we preview in this Benchmark Bytes series. After examining how many SMBs adopt SaaS last week, we shift gears to zero in on the types of services seeing the greatest demand.
In other words, what are the greatest operational needs of SMBs today, and how is that reflected in their explicit demand for SaaS products? We’re talking functions like supply-chain logistics, fintech, CRM, marketing & advertising and payroll. These are all central functions, but where is demand trending?
Localogy members can access full charts and SMB survey reports. Non-members can purchase reports.
Data Dive
Going deeper, a few other insights jump out from these figures.
– The leading category for SMB SaaS adoption is finance and operational solutions with 67 percent of respondents adopting.
– That’s followed by marketing and advertising solutions (54 percent) CRM (53 percent), payroll and HR (51 percent), and supply chain services (46 percent).
– Fintech’s’ lead in SMB adoption is logical, given the category’s overall growth and democratization over the past few years.
– Giving fintech additional scalability, it addresses a universal need. The same goes for operatoional solutions.
– Beyond broad applicability, these are core SMB needs, as opposed to relatively less-critical functions like marketing (though marketing is important).
– Marketing came in second place in these rankings, not only showing prevalence but also growth. It grew signifigantly in SMB responses from the previous survey wave.
– CRM follows behind marketing in SMB responses… which relates to marketing in that it enables customer management and communications/outreach.
– Among all areas of SMB spending in this survey, supply chain services have grown the most over the past two survey waves.
– This stands to reason as supply chain services have grown in demand in the shortages and challenges of the past 24 months.
– Similarly, payroll and HR software is a priority for many businesses, as macro factors (in this case the great resignation) have elevated demand.
Long-Tail Play
Stepping back, SMB online marketing – website-based or otherwise – continues to grow rapidly. SMB SaaS startups and online services providers are correspondingly thriving as it continues to grow as a leading subsector of the broader SaaS universe. There’s a long-tail opportunity at play.
Meanwhile, new SMB SaaS users could represent permanent adopters – a concept that was accelerated in the Covid era as SMBs were forced to boost their digital transformation. This sends them into the arms of SaaS providers to accomplish a range of marketing and operational functions.
We’ll return in the next installment to go deeper into Localogy original survey research. That will include SMB goals and success factors. Let us know what additional insights jump out at you from the above data, and stay tuned for more breakdowns in our Benchmark Bytes series.
Meanwhile, stay tuned for the newest wave of Mobile Commerce Monitor, which will be unveiled and previewed at next week’s L23 conference…
