Tips to Help You Navigate SaaS Marketing Regulatory Compliance

In software-as-a-service (SaaS) marketing, specific regulations ensure fair and ethical practices within the industry, safeguarding consumer interests and promoting healthy competition. Compliance fosters trust among consumers, develops long-term relationships, and enhances brand credibility.

This guide covers each category and the challenges of SaaS marketing success to help SaaS companies with the following:

• Financial compliance
• Security compliance
• Data security compliance

The SaaS platform and company's integrity, security, and trustworthiness depend on these certifications and regulations. This is why most companies hire an industry-specific SaaS marketing agency. Learn more about the basics below.

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Three SaaS Compliance Categories Explained

Before discussing the different compliance tips and techniques, let us briefly discuss each regulation.

   1. SaaS Financial Compliance

Compliance with key financial services laws ensures businesses adhere to regulatory requirements. Here are the crucial regulations for SaaS companies: 

ASC 606

Created collaboratively by the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB), ASC 606 offers a structured five-step procedure for efficiently acknowledging revenue. 

ASC 606 is a comprehensive and adaptable system that considers various revenue recognition situations commonly faced by SaaS solutions. It incorporates the expenses of SaaS customers throughout their entire lifecycle, providing businesses with a blueprint for recognizing revenue from all streams, including recurring, expansion, and consulting services.

Generally Accepted Accounting Principles (GAAP or US GAAP)

The Financial Accounting Standards Board (FASB) established Generally Accepted Accounting Principles (GAAP, or US GAAP), which are a set of widely used accounting rules and practices. 

It covers the intricacies and specifics of business, corporate, and SaaS accounting practices. US regulations require that businesses issuing public financial statements or those publicly traded on the stock market adhere to GAAP protocols. Compliance guarantees that financial disclosures are clear and stick to standardized terminology and practices.

International Financial Reporting Standards (IFRS)

The International Financial Reporting Standards (IFRS) are a universally acknowledged set of accounting principles for the financial statements of public corporations. It aims to uphold clear, uniform, and globally comparable reporting standards.

IFRS guidelines are compulsory in over 140 regions and authorized in numerous global territories, including South Korea, Brazil, India, and the European Union.

   2. SaaS Security Compliance 

Security compliance regulations ensure the adherence of SaaS providers to industry-specific security standards and regulations. It protects user data, privacy, and the overall integrity of the platform.

International Organization for Standardization (ISO/IEC 27001)

The International Organization for Standardization (ISO) offers a range of standards for information security management systems (ISMS). ISMS creates a structure that recognizes, assesses, and minimizes security vulnerabilities. 

ISO 27001 is a reference point for SaaS enterprises to handle risk evaluation and security protocols. The ISO describes ISO 27001 as a system that helps organizations of various types manage the security of assets such as financial data, intellectual property, employee information, or data entrusted by third parties.

Service Organization Control 2 (SOC 2)

Created by the American Institute of CPAs (AICPA), Security Organization Control 2 (SOC 2) represents an elective regulatory benchmark for service providers. This compliance standard outlines the various standards and expectations for handling customer data. 

SOC 2 standards cover the routine management of customer data, which means the business has rigorous information security procedures to ensure comprehensive supervision.

Payment Card Industry and Data Security Standard (PCI DSS)

SaaS companies that manage payments should comply with payment security regulations. The Payment Card Industry (PCI) and Data Security Standard (DSS) establish security measures for businesses that process, transfer, or store card data. 

If a SaaS company follows the PCI DSS, it will always be safe and secure when dealing with payments, card information, or authentication, no matter where they are, what payment methods they use, or how many transactions they handle.

   3. SaaS Data Protection Laws

The SaaS compliance checklist is not complete without data protection laws. SaaS companies collect and analyze customer data to determine the success of their marketing efforts. Data protection laws ensure SaaS customers can choose whether to share their data and understand the use, management, and storage of their private, health, and financial information.

General Data Protection Regulation (GDPR)

The General Data Protection Regulation (GDPR) concerns safeguarding personal data for individuals residing in the European Union (EU). It imposes responsibility on businesses managing customer data and empowers EU residents with authority over their data. 

With GDPR, EU residents can access, delete, contest the processing of, or export their data. This regulation applies to all organizations handling the personal information of EU residents, no matter where they are. Non-compliance with the GDPR results in substantial penalties.

Health Insurance Portability and Accountability Act of 1996 (HIPAA)

HIPAA is a federal regulation that prevents the unauthorized sharing of protected health information (PHI) without explicit consent or awareness. 

The US Department of Health and Human Services enforces HIPAA, which gives patients control over their private information such as medical records, and establishes safeguards that healthcare providers must put in place to protect the privacy of patient data.

SaaS healthcare companies and providers that collect patient data for marketing, such as SaaS search engine optimization (SEO) marketing, must comply with HIPAA. 

California Consumer Privacy Act (CCPA)

The California Consumer Privacy Act (CCPA) is a state regulation designed to promote data security and safeguard the privacy of consumers living in California. 

CCPA empowers California residents to view the personal data gathered by businesses, the option to have that data erased, the choice to opt out of selling of their personal information, and protection from discrimination when exercising their CCPA rights.

SaaS companies' thorough compliance list depends on the markets they are involved in and the kind of data that they handle. Working with a SaaS marketing agency helps businesses ensure thorough, prompt compliance and avoid critical penalties.

SaaS Marketing Compliance Tips

Here are a few best practices to help SaaS companies comply with the latest regulations.

     1. Implement SaaS Regulations

Carry out policies and procedures uniformly throughout the entire organization. Designate a chief compliance officer (CCO) to spearhead the company’s adherence to regulations. A CCO can prevent regulatory compliance issues and supervise all internal operations.

     2. Supervise Employees Regarding Compliance

Establish regular intervals for ensuring adherence to security and compliance. Managers must assess the effectiveness of controls by creating internal and external audits. This proactive approach identifies vulnerabilities. Conducting risk assessments at least once a year or after significant policy alterations is ideal.

     3. Integrate Compliance into the Software Development Processes

Ensure that security and compliance controls are integrated seamlessly into the software development lifecycle. Developers must manage the code from its initial development stages to the final production phase.

     4. Manage Incidents Diligently

Establish a robust incident management system following the regulatory and compliance structure to respond to security breaches. Let us look at an example: 

A SaaS company's incident management system detects a data breach. This incident swiftly alerts the designated compliance team and initiates a predefined response plan. It includes halting data access, prompting an internal investigation, and promptly notifying the affected users, all while keeping a detailed audit trail. 

The system automatically generates a comprehensive incident report documenting the breach, the company's response, and measures to prevent future occurrences. Having this system in place ensures full compliance with regulatory requirements.

     5. Train All Stakeholders

Inform the organization and all essential stakeholders about the most recent compliance and security requirements and what measures they need to take to remain compliant. Continuous security includes the commitment of every individual within the organization.

     6. Evaluate Compliance Regularly

Conduct an annual review of all established policies. The compliance department must stay informed about the latest changes in regulations and guidelines. They must also continuously examine the current compliance status within the existing tech stack. 

Summing Up

Marketing regulatory compliance should be a priority of every SaaS company, no matter what industry they are in. Ensuring adherence to financial, security, and data security regulations helps SaaS firms remain competitive, effective, and trustworthy. 

Find out more about how your SaaS company can comply with various marketing regulations in your specific industry. Ask an expert. Contact Digital Authority Partners (DAP) today.