As part of the ritual of examining local commerce and SMB Saas strategies, Localogy goes right 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 in a pandemic? This is all a moving target.
Localogy’s Modern Commerce Monitor (MCM) answers these and other questions across the SMB SaaS product set, which we preview in this Benchmark Bytes series. And we recently entered a new chapter of this series, with highlights from the latest wave (8.0) of Modern Commerce Monitor.
After examining the biggest benefits SMBs realize from SaaS tools, last week, we switch gears to examine the share of overall SMBs that are utilizing the full capacity of the SaaS tools that they pay for. Are they getting the most bang for their buck, or are they leaving features on the table?
Data Dive
– Diving in, a slim majority of SMBs (51 percent) aren’t using the full capabilities of their SaaS tools.
– This should be concerning for SMB SaaS vendors because those who aren’t using their software’s full capacity aren’t getting its full value, and therefore could perceive less ROI.
– The above sequence could lead to customer churn in some cases.
– Six percent of SMB respondents said that they weren’t sure if they were using the full range of capabilities in their SaaS tools.
– There are likely others beyond this six percent that aren’t aware of the full range of features in their SaaS tools (you don’t know what you don’t know…).
– Practically speaking, these unaware SMBs are the equivalent of those who answered that they do not utilize SaaS to its potential.
– That leaves 43 percent who claim that they do utilize the full set of features in the SaaS tools they’ve adopted.
– In a glass-half-full mindset, this is a fairly strong figure, given the low technical proficiency of SMBs as a whole. If almost half of SMBs are getting everything they can out of the software, that can be argued as a small win…
– But there’s also much work to do on the other half of the population.
– All the above speaks to the need for more SMB education. Those who aren’t using the full range of SaaS capabilities could be educated on both how and why they should be using more features.
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Long-Tail Opportunity
Stepping back, SMB online marketing – as well as operational and fintech tools – continues to grow rapidly. SMB SaaS startups and online service 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 accelerated in the Covid era as SMBs were forced into digital transformation. This sent them into the arms of SaaS providers (where many have stayed) 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.
