As a digital entrepreneur, you’ve probably come across the terms IaaS, PaaS, and SaaS at some point. But these acronyms can be confusing. Simply put, these are three types of cloud-based computing services. Many popular apps and online platforms are based on SaaS technology so, for online retailers, understanding how this works can be important for making sound business decisions. Of course, understanding how SaaS differs from IaaS and PaaS is also useful. Singaporean merchants especially may want to take note of these technologies.
This guide will explain what SaaS is and how it is useful for online merchants, then discuss how it differs from PaaS and IaaS. It will also offer some IaaS, PaaS, and SaaS examples, and look at SaaS for ecommerce platforms, including Shopify.
What is Saas?
SaaS is an acronym for Software as a Service. Providers deliver cloud-based software through the internet, hosting everything from the application to data on its own servers. This way, users only need an internet connection to use a SaaS, and don't have to do any setup or maintenance. They simply pay a small fee to use the software whenever they want. You probably use SaaS programs every day for work and communication.
SaaS for ecommerce can be a huge benefit to online retailers compared with hosting technology on premises. Not only do these providers offer quick ways to set up online shops, but they can also manage your ecommerce infrastructure, allow easy scaling during peak sales periods, and provide better returns on investments than other ecommerce solutions. Many merchants use Shopify for SaaS because it’s a full-service ecommerce hosting platform that offers everything online retailers need, including custom storefronts, omnichannel options—including for Facebook and Instagram—and an app store full of useful SaaS products.
Pros & Cons of SaaS
SaaS is widely used because it offers a range of benefits to users. These include:
- Low costs: There is usually an affordable subscription payment to use the SaaS offering.
- Accessibility: You just need a phone or computer and the internet.
- Compatibility: SaaS programs work with most operating systems, browsers, or devices.
- Customization: Most SaaS systems can be customized to fit the needs of any business and can be integrated with other business programs.
- Scaleability: You can add or remove features, depending on your needs.
- Automatic updates: Providers usually automatically update their software.
- Easy setup: No need to install anything.
The major disadvantage of SaaS is that you need a stable internet connection. Without this, you won’t be able to use the program or app. Luckily, using SaaS in Singapore isn’t an issue as the country has island-wide internet coverage with 4G and 5G networks.
What is PaaS?
PaaS, or Platform as a Service, allows service providers to offer cloud-based solutions to clients. With these, users pay a monthly or per-use fee to create and maintain their own business applications without investing in the necessary supporting infrastructure. Instead of investing heavily in its IT infrastructure, a company can use a PaaS offering to manage a range of functions, including app design, hosting, testing, web integration, storage, analytics, and information security.
PaaS platforms are hosted on the service provider's servers, which is why PaaS is considered a type of serverless computing service. The easiest way to think about PaaS is as a web-based tool that developers can use to create applications and systems.
What is IaaS?
Another popular cloud-computing solution is IaaS, or Infrastructure as a Service. These are highly flexible solutions where a business "rents" the cloud-computing infrastructure it needs to create its own highly customized platforms and apps. Providers offer a full range of services, including servers, storage, and networking solutions, and clients can use and manage the infrastructure as they need through a dashboard or API.
A key feature of IaaS is that users have to buy whatever hardware they need; otherwise, most IaaS use a pay-as-you-go model for their services. This means that IaaS infrastructure is scalable, allowing a business to change its usage of these programs as their needs evolve.
Examples of IaaS, PaaS, and Saas
To understand the differences between the three types of services, it can be helpful to look at real-world examples. Below, you’ll find some popular examples of Iaas, PaaS, and SaaS.
- SaaS: Shopify, Google Workspace (Suite), Dropbox, GoToMeeting, Zoom
- PaaS: Microsoft, Google, IBM, Oracle
- IaaS: DigitalOcean, RackSpace, Microsoft Azure, Google Computing Engine
What’s the difference between IaaS, PaaS, and SaaS?
From the discussion above, you can see that because they all offer systems based on a cloud, IaaS, PaaS, and SaaS are quite similar. However, there are some key differences, including:
- Management and control: IaaS offers the most control as users manage most of the service; PaaS and SaaS respectively require less management, and therefore, give users less control.
- Service delivery: SaaS is delivered through web browsers; PaaS offers web-based platforms for development and computing; IaaS provides web-based dashboards or API through virtualization technology.
- Costs: SaaS and PaaS often require payment through a subscription model; costs for IaaS are highly variable since it depends on the user’s actual requirements.
When deciding what type of cloud-computing service is best suited to your business needs and online store, these are the three primary considerations you'll need to take into account. For online merchants, though, SaaS for ecommerce, like Shopify, will be the most relevant.
Frequently asked questions about cloud-based computing services
Are there other types of services?
Which service is most commonly used?
SaaS, PaaS, or IaaS: Which is best?
SaaS for ecommerce: What services are available in Singapore?
- Shopify: full-service ecommerce platform
- Wingify: a tool for conversion rate optimization and A/B testing
- TradeGecko: inventory management
- EasyParcel: shipping solutions
- Ematic: email marketing solutions
Getting Started with SaaS in SingaporeUnderstanding the difference between IaaS, PaaS, and SaaS is crucial to picking the right cloud-computing model for your business. For most ecommerce merchants, SaaS Singapore platforms—like Shopify—will be the most useful as they are easy to use and require a low level of maintenance and management by the user. Shopify, in particular, offers a full-service SaaS for ecommerce platform where you can create and host your ecommerce store, add multiple payment options, translate your store, handle shipping, and market your business, amongst other functions. But, whichever model you choose to use, cloud computing is an essential component of ecommerce, and understanding how the different models work can only help your business.
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