May 2023 SaaS Demand Index

Read our interactive PDF report:

We’re excited to update the SaaS Demand Index with data through May 2023.

For our new readers: the Demand Index is derived from high-intent (aka “okta pricing”) Google Search volume data.

Reminder: this is a directional, free, and ever-evolving analysis → always do your own due diligence.

Moreover, the data captured here is best characterized as top-of-funnel or dark funnel → factoring in sales cycle length, do NOT use this Demand Index as a predictor of near-term financial results and/or financial guidance.

Industry-Wide Data

High-intent search volumes are up 16% year over year.

On a sequential basis versus April (a seasonally weak month), the Demand Index was up 9%.

To frame these results, Gartner’s April 2023 forecast has SaaS spending to grow +18% in 2023 and +18% in 2024

Demand by customer type continues to be highly correlated with diversified* performing best. (*i.e. not predominantly Enterprise or SMB)

Trends By Product Category

While some consensus narratives yet again hold – “Security = strong” and “E-Commerce + Marketing = weak” like past reports (April 2023, March 2023, Feb 2023, Jan 2023, Dec 2022), one new call-out:

Communications: Strong past 4 months, *perhaps* due to AI leverage for the contact center constituents

All of the category drill-downs – like this Communications example – are available in the slide PDF:

State of The Market – G2 + Sapphire + RepVue

G2 and Sapphire each released strong State of SaaS Buying reports – the most common themes were ROI, ROI, and ROI (seriously).

For More ROI Reading – See our research studies (n = 234) on “Drivers of Software ROI” and “The ROI Of IT + Software

Sapphire “2023 SaaS Buyers Outlook”Report | My Excerpts


G2 “2023 G2 Software Buyer Behavior Report”Report | My Excerpts


Lastly, RepVue’s May 2023 Quota Attainment Data is threaded here. TL, DR – mixed results, with some weakness in forward-looking Sales Engineering and SDR quota attainment.

Curated SaaS Content

Tom Tunguz – “How Much More Efficient Should a SaaS Startup Be When Using AI?

Dave Kellogg – “Interpreting The Insight 2023 Sales KPI Report

Gerry Chen from Greylock – “The New New Moats: Why Systems of Intelligence are still the next defensible business model

Cloud Ratings Content

We released our recent episode with CJ Gustafson (CFO of PartsTech – a Series C vertical SaaS – and author of Mostly Metrics):


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