Advertising agencies and web designers have realized that using workflow management software is imperative to succeed in today’s competitive landscape. Now, the main question is whether or not use the Software as a Service (SaaS) model as opposed to a self-hosted solution.
According to the research firm IDC, by 2014,“approximately 34% of all new business software purchases will be procured via SaaS and SaaS delivery will constitute about 14.5% of worldwide software spending across all primary markets.”
After hearing so many ad agencies asking about the benefits of adopting the SaaS model, I would like to review the advantages of deploying this type of technology. Thus, next time you are evaluating a new solution, you will have the necessary tools in hand to determine what the right software is for you.
Advantages of SaaS
Reduce Total Cost of Ownership (TCO)
Choosing the SaaS model, you can avoid high upfront costs at your creative agency since you won’t need to spend capital on additional hardware, such as servers and storage. Everything will be taken care of by your service provider. Additionally, there is no internal IT personnel required, which will not only reduce overhead costs, but also working capital.
At Function Point we speak with creative directors and project managers on a daily basis and they can’t afford to waste time on items that are not directly related to their core business. It is much more cost effective to focus on client related items, like creating a new marketing campaign, than spending time dealing with software upgrades and hardware issues.
Capital Expenditure (CapEx)
The pay as you go model will reduce your CapEx considerably since traditional in-house solutions, also known as on-premise software, comes with a high price tag.
Quite often we hear “I have spent many, many hours trying to develop our internal solution and we still don’t have the right tool in place!” Especially with small and middle sized ad agencies, they do not have the resources nor the time to develop and maintain a workflow management software.
The SaaS model will help your cashflow as you will not have to spend a large amount of cash to buy the software. You will have the flexibility to pay monthly for the service. This is what I call a shift from CapEx (capital expenditures) to OpEx (operational expenses).
Due to some of the advantages of the SaaS model, the creative industry is changing the way they do business so they can stay competitive. How your agency is dealing with this new trend?
Read Part 2 of our take on the benefits of adopting a SaaS model software.
As an Account Executive, Marc knows the deepest nooks and crannies of Function Point like the back of his hand. He's a happily transplanted Torontonian who claims to be able to snowboard and play hockey at the same time.