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Why Aren’t More Businesses Using SaaS Components?

Auth0 report reveals that despite budget barrier removal, adoption remains immature

October 20, 2020

The ease of use, deployment, and management offered by SaaS applications has transformed how companies do business. This explosion of SaaS usage over the last ten years has also attracted billions in venture funding while inspiring thousands of entrepreneurs to launch new products that propel them to cloud stardom. Cloud has even become a mainstream term that non-technical consumers use in day-to-day conversations. And yet there is one area of SaaS adoption that remains relatively immature: SaaS components.

A SaaS component is a cloud tool that replaces a specific function within an application. Historically, as organizations have built custom software, their software development teams would code these functions into the application. But as software development has moved from monolithic codesets to agile microservices models, companies have made the shift to using SaaS components for non-differentiating functions.

For example, Stripe is a commonly used SaaS component for payment processing. Companies no longer need to spend valuable developer time coding and managing a custom built payment system. Instead, they can simply purchase Stripe and integrate it into their application, saving development and maintenance time and risk. Easy, right?

Given these undeniable benefits, most companies must have already completed this shift to SaaS components?

Our research says: actually... no.

“SaaS component adoption is still relatively immature.”
-Auth0 Report: How Development Teams Purchase SaaS

According to the research, the majority of technical teams believe in the value of SaaS component usage; however, adoption rates vary greatly from company to company, and overall usage is relatively low.

Build vs. Buy Percentage

Why SaaS Component Adoption is Low

The research report also surveyed respondents on the issues that have prevented their team from using third-party SaaS components. The top five reasons in ranked order are:

  1. Cost Issues/Lack of Budget
  2. Security Issues/Concerns
  3. Missing Features/Functionality
  4. Timing/Speed
  5. Management Doesn’t Approve or “Get it.”

But this low adoption rate will not remain for long. According to the Covid-19 Digital Engagement Study, produced by Twilio, COVID-19 has sped up digital transformation by 5.3 years. This acceleration has given development teams the budget and permission to innovate.

“Obstacles have been cleared, barriers have been broken down, and budgets have been freed up.”
-Twilio: COVID-19 Digital Engagement Report

2021 is the time to build, but how companies approach their innovation will be the critical aspect of how they succeed. Given the current low usage rate of SaaS components, early adopters will benefit the most in productivity gains. But with a wide spectrum of SaaS tools in the market, where does a development team look to start? Given that each company has their own unique business requirements, it’s best to do an internal audit of the application components that take the most time and effort to build and maintain.

According to the How Development Teams Purchase SaaS report, the top five components in ranked order are:

Most Time and Work

And for companies that are currently building authentication systems internally, the research also showed that moving to a SaaS component can help companies reduce their time to market.

SaaS Platform

Developers Influence SaaS Purchase Decisions

As companies move to integrate these SaaS components into their applications, it is critical that they put as much effort into HOW they buy as WHAT they buy. Research shows that developers care greatly about being consulted in SaaS component purchase decisions.

"Getting to choose SaaS components matters to 91% of developers."
-Auth0 Report: How Development Teams Purchase SaaS


These results clearly demonstrate how developers will be on the front-lines of the digital revolution, driving software selection decisions across organizations. And these teams will need SaaS components that are simple to use out of the box (and easy to customize). So while SaaS component adoption might still be immature in 2020, it is looking to be a top priority for many companies in 2021.

To learn more about how companies can take a developer inclusive approach to SaaS component purchases, read the complete How Development Teams Purchase SaaS report.

About Auth0

Auth0 by Okta takes a modern approach to customer identity and enables organizations to provide secure access to any application, for any user. Auth0 is a highly customizable platform that is as simple as development teams want, and as flexible as they need. Safeguarding billions of login transactions each month, Auth0 delivers convenience, privacy, and security so customers can focus on innovation. For more information, visit

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