SaaS Market Trends in Indonesia

SaaS (System as a Service) is software with the cloud system that has begun to be popular nowadays. SaaS business and delivery models are still new to the Indonesian consumers. SaaS can be seen as a software delivery model that utilizes the internet to provide its services. SaaS is commonly used by companies for business methods by sharing information. SaaS is liquid (it can be developed—the model can vary according to the needs of the user or the target market). In recent years the development of SaaS in Indonesia has to be progressive, according to a research by the Boston Consulting Group, the market of SaaS is expected to growth at an annualised rate of 31.9% in the following five years to reach US$ 400 million in 2023 from US$ 100 million in 2018. 

The increase of SaaS business is related with market demand for SaaS service. As we already know, most of the business sectors in Indonesia need human labor to complete operational tasks (finance, HR, etc). SaaS has become more interesting for people because it is felt more efficient—cheaper  than others cost for labor and infrastructure, and easy to use by using the internet. A dramatic change within people’s behavior using SaaS because of easy access to the internet and devices, this is the importance of digital transformation among businessmen. There is a few points business growth that everyone should know:

The Internet Penetration in The Country is Rapidly Increasing

SaaS business in Indonesia have a potential for developing or increasing popularity because internet users in Indonesia are still growing every year and almost everyone are start becoming internet user. The level of internet users in Indonesia increased two times 34.9% in 2014 and in 2018 increased to 2018. Along the business at having a good internet access, solution cloud such as SaaS become available and operated better than before. Sustainable growth at internet infrastructure in Indonesia will push the growth of SaaS in this country.

Affordability of Cloud Services

Cloud options are often cheaper than traditional solutions, it only takes an internet to use it by providing easy access, this could make it easier and more effective for the user. Although cloud services have shorter time to deployment, and can be scaled quickly. 

More SMEs are going Digital

At this time many small business entrepreneurs (SME) already integrated, they tend to have an interest in using digital cloud methods, because the rent for building cost a lot. Other than that, SaaS user are using digital cloud method because they can cut a lot of money for rented a building and making an office. SaaS user could save a lot of money from spending it for paying an employee making them arranging company finance. They don’t need to pay lot of people for doing stuff at the office because SaaS are doing the work for them. This is why SaaS are much more popular nowadays among small business entrepreneurs. 

SaaS Awareness has been Growing

Survey by Cloud Indonesia and MARS in early 2012 only 3% of people in Indonesia understood the capability of SaaS. Early SaaS movers have invested heavily in awareness building and education paving the way for new players to sell into business that are already open towards the potential of technology. As long as people’s awareness for SaaS are increasing, this could make the SaaS developer introduce their peoples social potential product for changes at era digital.

More Spending on Software

Company costs for software in Indonesia have increased an estimated 33% reaching 900 million USD. Most companies in Indonesia have a lot of budget for software spending, the SaaS players are expected to continue growing on the back of this trend.

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