This content is part of the Essential Guide: How to implement a successful SaaS business model

Vertical SaaS (Software as a Service)

Contributor(s): Karen Goulart

Vertical SaaS (Software as a Service) describes a type of Software as a Service cloud computing solution created for a specific industry such as retail, insurance or auto manufacturing.

Many longstanding technology companies are now offering vertical SaaS solutions. SAP AG, for example, is offering its third iteration of Business ByDesign, billed as an "end-to-end" SaaS business process solution. IBM's Genelco SaaS offering is aimed at the insurance industry and can be used to handle life- and health-policy processing as well as annuity-product portfolios.

A large number of the companies in this space are start-ups focused solely on vertical SaaS offerings. These companies include Philadelphia-based Internet Pipeline Inc., which focuses solely on insurance industry customer relationship management (CRM), sales and business processes; and Kenandy Inc., which focuses on manufacturing enterprise resource planning (ERP).

In 2011, consultancy Forrester Research Inc. predicted major growth in this area of the SaaS market, calling it one of the "five trends that will change cloud sourcing." Vertical SaaS may also be referred to as vertical cloud.

This was last updated in May 2012

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