The Q2 SaaS Trends Report: How companies are doing more with less
Read the latest SaaS Trends Report and discover how companies achieve more with less. Discover popular software, contract price trends, and the impact of AI on B2B SaaS. Learn cost-saving strategies and buy SaaS with efficiency.
Today, we introduce our latest quarterly SaaS Trends Report.
Over the past three months, we noticed one prevalent trend: every company is trying to do more with less. Even with lofty revenue goals, companies are working with fewer people, smaller budgets, and limited software.
Our report looks at what types of software remain popular, and which products have the highest annualized contract values. We also introduce our new SaaS AI index, comparing B2B SaaS companies' investment in AI tools with the value they provide to users.
We also look at how much SaaS costs. This quarter, the average price per contract has decreased by 45%. Discounts are harder to find, but prices are becoming more transparent. We also share our community insights on how to get a good deal when buying SaaS in the changing market.
Key insights revealed in the SaaS Trends Buying Report
Spoiler alert: here are some of the report’s key insights and trends.
- The value of annual contracts fell by 45% between the first and second quarters. In Q2, the average software contract cost $62,000. Significant drops were seen in Customer Relationship Management (CRM), Accounting & Finance, and IT Service Management.
- This year, prices rise – especially within leading CRM, project management, and marketing automation providers. This trend could respond to reductions in user count and service levels. As contract values dwindle, we predict an increase in price hikes from SaaS companies in the upcoming months.
- However, discounts are becoming less common. This might hint towards a straightforward, transparent pricing trend rather than initial high quotes that need to be negotiated down.
- High-volume, high-value solutions like Netsuite, Salesforce, ZoomInfo, and LinkedIn top our charts. Their popularity and crucial role are undeniable in a time when companies focus on mission-critical operations. Sales Intelligence tools saw over a 20% jump in their average contract value in the second quarter, highlighting their role in boosting sales prospects and pipelines in the face of layoffs.
- When it comes to new SaaS investments, buyers prefer the tried-and-true. Established leaders like 1Password – our top net new purchase – are favored over start-ups as budgets shift towards reliable products.
- In B2B AI, tech giants like Google, Microsoft, Salesforce, and Adobe lead the pack. Their B2B SaaS products come with deeply integrated AI solutions, offering immediate benefits to users.
- While Sales intelligence, CRM, and marketing/sales automation tools have adopted AI more wholeheartedly than other SaaS sectors, there's still some road to travel in proving the real value of AI to customers.
This quarter, Vendr customers completed almost 3,000 transactions. We examined each contract in detail, looking at product type, duration, and final agreed price. Our report also draws on Vendr's past analysis of billions spent across many thousands of deals and suppliers. To form our AI index, we evaluated the AI products each company offers and the buying trends of these products among Vendr customers.
Efficient SaaS buying is a competitive advantage
As companies race to achieve their goals with limited staff and tight budgets, efficient SaaS buying is more than a convenience—it's a competitive differentiator.
Companies that harness procurement can optimize resources, boost productivity, and propel their bottom lines. This efficiency isn't simply about buying SaaS at the lowest cost; it's about building a software stack that provides the highest level of value at the best price.
With our SaaS Trends Report, we're thrilled to highlight the benefits of transparent transactions, the significance of avoiding unnecessary software purchases, and the need to future-proof your business with the finest technology. In today's age of doing more with less, firms that excel at efficient SaaS procurement stand out not just as survivors, but also as industry leaders.
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