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How Will AI Impact the SaaS Industry?


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Artificial intelligence (AI) software is literally everywhere. Various industries are rapidly implementing AI use cases in their business operations. It’s like the new kid on the block who’s excited to meet everyone.

Reports suggest that one in sixteen American companies uses AI technologies in their workplace. Moreover, this market is expected to witness a 36.6% CAGR between 2024 and 2030. All these prove its immense popularity.

When it comes to the SaaS marketplace, AI adoption seems slow. Forbes reports that the SaaS market is growing by eighteen percent every year. We’ll definitely need AI to meet the demands of this evolving industry. 

In this blog post, we’ll discuss the ways AI applications can eventually help the SaaS industry grow.

#1. Cybersecurity

According to the ISACA.org website, SaaS faces immense security risks from the perspectives of the customer and provider. For instance, companies might face challenges with attestations and third-party risk management or mitigation. Inefficient security, data loss, and unauthorized access are also concerns. 

Thankfully, AI will solve these issues with its ability to analyze data and detect security threats. Various algorithms will help SaaS providers prevent cybersecurity threats by detecting fraud and potential breaches.

This technology identifies suspicious patterns in transactions and customer behavior. Hence, it’s able to prevent fraudulent activities by assessing user activity and network traffic. In some cases, AI helps automate compliance processes and meet data privacy standards.

All in all, AI offers the data security and threat protection needed for a successful SaaS product operation. It can also help with identity and access management.

#2. Localization

Many SaaS product providers mistake localization for simple translation of their services and payment models. Hence, they don’t understand the target market, leading to bad internationalization. Unfortunately, localization is much more than that. 

Industry leaders report that AI-powered SaaS product localization makes it user-friendly and more accessible across global markets. According to PayPro Global, SaaS providers can make the most of AI by collaborating with an eCommerce partner. These tools can handle global SaaS compliance, taxes, and payments. 

With this type of solution, SaaS business owners will have the expertise and technology to employ AI tools in their best interests. This is possible because the eCommerce partner will have the infrastructure and own the data, making it easy for AI algorithms to function.

#3. Workflow Automation

The global SaaS market will jump from USD 296.93 billion to USD 829.34 billion between 2023 and 2031. What does this mean? It proves the industry’s evolving nature and popularity. 

In such a crowded market, it’s normal to face operational issues. Examples include inefficiency during onboarding processes, human errors while ensuring compliance, and the lack of cost savings. 

That’s why the SaaS industry needs the automation features of AI technology. Industry leaders suggest that workflow automation can help with the following functions:

  • Streamlining identity management processes.
  • Ensuring organizational security.
  • Continuous access management.
  • Automation of user provisioning.
  • Reduction of human errors due to authentication.

As a result, SaaS applications can use proactive maintenance, automated workflows, and resource optimization. It can also help enhance the user experience and resource allocation to ensure smooth operation and cost efficiency.

#4. Customer Support

Reports state that bad customer service can lead to a USD 3.7 trillion loss. Moreover, eighty-eight percent of customers think that support is the most important.

Customer service in the SaaS industry is crucial. For instance, the products can be complex, and clients need clear instructions to understand the technicalities. 

Similarly, customer support is crucial because the SaaS tool will be deeply ingrained in the client’s business. They’ll need assistance to operate it. Thankfully, AI can help with that. 

AI-powered chatbots can provide instant support to anyone with queries at any time. This tool can address questions and resolve simple issues. The use of sentiment analysis can help these AI tools learn from each interaction and offer faster resolution. However, human agents are still required for complex technical issues with the SaaS product.

All in all, Storyboard 18 states that AI is reshaping SaaS applications and the company’s operational capabilities. As a result, it’s transforming user experiences and enabling industry growth. Use cases like workflow automation, customer support, cybersecurity, and localization are here to stay in the SaaS industry. 

Even then, the disadvantages hinder discussions about this technology. In the SaaS industry, AI’s inability to meet data security and privacy concerns weighs down its use cases. Ethical dilemmas and the lack of transparency are also issues.

Thankfully, with the right tools and understanding, the SaaS industry can adopt AI technology without any hiccups.


Wanna become a data scientist within 3 months, and get a job? Then you need to check this out !