2022 SaaS buying trend report: Learnings from another year of SaaS savings

SaaS Buying

Another year of SaaS savings means another report looking back on what we've learned, and what trends we think are coming in 2023, in this year's SaaS buying trend report.

Vendr | Streamline with SaaS buying partners
Written by
Emily Regenold
Published on
August 5, 2022
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The full 2022 SaaS buying trend report, out now!

Get a recap of spending and deal flow in 2022, highlights of the changing SaaS buying landscape, and predictions for 2023.

Get the full report here.

To say 2021 and 2022 have been a wild ride for software buying is an understatement. The first half of 2021 saw companies inching out of the active pandemic phase, eager to make up for lost time. By Q3, hesitancy gave way to optimism: Businesses started spending big on innovative software to fuel post-pandemic growth.  

But the first weeks of 2022 became a preview of change on the horizon. Businesses began to turn the taps off as 40-year record inflation, the housing market, and bond yields painted the picture of an impending recession. While gasoline prices are easing, the economic outlook at mid-year continues to signal a downturn. 

Now companies are preparing to tighten their belt and ride out an uncertain second half of the year. While no one has a crystal ball, our buyers are using insights from over 13,000 transactions to help companies build lean, resilient tech stacks for what comes next.

So far this year, we’ve helped customers keep pace with the changing landscape of SaaS buying, helping them save over $240m in savings along the way. 

We’re excited to share some key highlights from the past 12 months and offer insights from our expert buying team.

Buckling up for economic volatility

As recession indicators become more pronounced, companies are preparing to weather the economic changes.

Changes in corporate roadmaps, hiring freezes, and budget reviews have risen across multiple sectors. Layoffs have become more common in major market segments such as technologyautomakers, and B2C services.

Software budget allocations will likely continue to tighten, focusing on the must-have tools that drive value creation and ensure operational efficiency in any scenario. Core products geared toward serving wide-scale needs are in demand, with fringe tools and use cases taking a temporary back seat.

Takeaway: Find ways to reduce costs and free up cash flow. Focus on using software tools that add value or improve cost savings.

“I’m seeing customers in industries that provide a ‘nice to have’ service cutting back on their contracts more than others, as they are likely anticipating a downturn.” - Aubrey Zimmerman, Senior Executive Buyer.

Increasing attention to due diligence

As we predicted in our 2021 report, improvements in approval processes and stakeholder education are leading to better deal outcomes.

Where stakeholders had traditionally taken a passive role in selecting tools, the shift to remote work and a scrappy approach to the pandemic brought a greater awareness of how and why we make software decisions. 

We see this trend continuing in 2022 and beyond. The team approach will prevail, with well-educated stakeholders increasingly kicking off the evaluation process and leading conversations about the best choices for a leaner software stack. 

Takeaway: Keep renewal dates in view. Increasing your lead time by just two weeks can improve savings by 50%.

“As software options have increased, so has the complexity associated with buying it. Stakeholders are learning the importance of having Finance, Procurement, IT, Legal, Security, etc. on their side, and are tapping them in earlier in the process.” - Michael Murray, Enterprise Account Executive.

Tighter budgets, flattening adoption

Companies eager to preserve cash flow are beginning to streamline spending in key areas, including marketing and software.

This trend toward a leaner marketing and SaaS budget is typical for times of economic uncertainty. The slowed pace of software spending also follows other cash-preserving tactics like hiring changes and downsizing mentioned above.

While “budget freezes” are not yet widespread, the once-loosened budget constraints for SaaS buying seen in mid-to-late 2021 are over. Businesses are carefully scrutinizing renewals and net new purchases of software, hoping to align the software portfolio with their expected headcount and hiring cadence.

"Businesses are beginning “realignment of what’s important to them versus initiating a ‘budget freeze." -  John Merklinger, Manager, Executive Buying

Takeaway: SaaS isn’t going away, but it is getting more scrutiny. An iron-clad business case for new tools is vital for securing budget approval.

In 2023, be ready for anything

SaaS may be transforming to fit the economic outlook, but software buying as a whole isn’t going anywhere.

The “calm after the chaos” will lead to a more thoughtful buying approach, with better decision-making as the end result.

Tempering the enthusiasm of late 2021 software buying with a renewed commitment to selecting best-fit tools, businesses will be able to do more with what they have and emerge stronger once the recession recedes.

Get the full report.

Emily Regenold
Chief of Staff
Emily is the Vendr's Chief of Staff, leading the company's brand and external communications.

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