Study: 90% of Cloud Providers Cite Integration as Major Obstacle to SaaS Success

Strategic consulting services company THINKStrategies and MuleSoft, a cloud integration provider, announced the top five findings from a recent study focused on the impact of integration on SaaS and cloud vendors in the rapidly growing cloud computing market. One of the key findings of the survey is that integration is the most common hurdle in the sales process for SaaS/Cloud providers, with almost 90% of respondents considering integration to be important or extremely important in winning new customers.

In addition, SaaS/Cloud vendors also identified integration as the most time-consuming element of customer implementation process. Nearly two-thirds of SaaS/Cloud vendors acknowledge that integration needs to be a critical part of their solution, rather than leaving it to the end user.

“The success of the first wave of SaaS/Cloud vendors has sparked a ‘Cloud Rush’ affect which is attracting a proliferation of players to enter the market, ranging from fledgling start-ups to the biggest vendors in the hardware, software and services industry,” Jeffrey M. Kaplan, Managing Director of THINKstrategies and Founder of the Cloud Computing Showplace, said in a press release. “The results clearly show that leading SaaS/Cloud vendors must incorporate integration solutions into their go-to-market strategies in order to succeed in today’s marketplace.”

The research report identified five key findings regarding the impact of integration on SaaS/Cloud vendor success:

1.    Integration is a key to winning new customers: Over eighty-eight percent (88.8%) of SaaS/Cloud vendor respondents view integration as either important or extremely important in winning new customers.

2.    Integration need is widespread:A majority of SaaS/Cloud vendors (52.8%) say that more than half of their customers require integration. Dealing with integration issues is the norm, not the exception, when deploying SaaS/Cloud solutions.

3.    Integration is the top barrier to new SaaS/Cloud sales: Almost eighty-eight percent (87.7%) of SaaS/Cloud companies identified integration as a common or very common sales hurdle.

4.    Impact of integration on time-to-value:Integration is the most time-consuming element of customer implementation, with 79.3% of respondents saying that integration was highly time-consuming or somewhat time-consuming.

5.    Integration is a critical component of SaaS offerings:Nearly two-thirds (62.5%) of the SaaS/Cloud companies believe integration is a critical part of their solution.

As cloud adoption continues to grow, customer expectations have shifted dramatically, requiring SaaS/Cloud vendors to take on many of the integration burdens formerly held by end users. Customers concerns about integration represent both a threat and an opportunity for SaaS/Cloud providers. Failing to offer integration can blunt sales and create customer support issues, while offering integration capabilities can create a competitive advantage.

 “As SaaS adoption rises, and as the number of SaaS providers continues to increase, issues with integrating these applications will remain at the forefront,” Mahau Ma, VP of Marketing for MuleSoft, said in a media statement. “SaaS/Cloud vendors have to understand that the integration responsibility now rests on their shoulders, not the end-user, and will become a significant inhibitor to their business.”

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