We Asked 7 Experts How to Save $1M on Software. Here’s What They Said

Every year, organizations spend millions of dollars on SaaS but much of that investment is wasted, often on unused licenses or redundant tools. To eliminate that unnecessary spending, we often see teams jump straight to tactics like license reclamation or app rationalization. If you have a savings goal in mind, these tactics work but may only get you so far without a consistent, repeatable process. 

That process centers on the software renewal. Why? Renewal is the only time you can change your contract—thus the only time to realize savings on software. When you treat cost optimization as an ongoing discipline, that’s when you’ll begin to see results.

To give you an inside look at how this works, we asked Zylo’s in-house SaaS Management experts for their advice. In this article, you’ll learn:

• Why saving money on SaaS is harder than it looks
• How to build a software savings pipeline—and what not to do
• Underrated cost-savings approaches
• Ways real-life organizations are driving results

Why Saving Money on SaaS Is Harder Than It Looks

While the concept of saving money on software is relatively straightforward, it’s harder than it looks. The following challenges can make it more difficult to hit your cost-savings goals:

• Having poor visibility into software spending—including long tail apps and shadow IT
• Being understaffed and/or underresourced
• Not following a formal renewal process
• Lacking accountability to business outcomes
• Failing to obtain executive buy-in

Poor Visibility into Software Spending, Renewals, and Ownership

According to Zylo’s 2025 SaaS Management Index, companies spend $49M on average annually on SaaS. Yet, we’ve found that many underestimate how much they spend by 3X. Without a clear understanding of what apps you’ve purchased, when renewals occur, and who’s accountable, savings opportunities disappear quickly.

Poor visibility makes its difficult to:

• Know the full potential of your savings opportunities
• Prioritize the applications that will deliver the greatest impact
• Keep the right stakeholders informed and engaged in the renewal process
• Prevent rogue spending (shadow IT)
• Stay within budget
• Forecast future spending

Understaffed and Underresourced

Many organizations run lean IT or procurement teams, which can make SaaS cost optimization feel challenging. That’s why having a clear process, and the right tools, matters. To further extend their capabilities, some organizations choose to partner with a SaaS operations resource to accelerate results and scale their savings engine faster.

No Formal Renewal Process

Each year, organizations experience an average of 247 renewals. Without a process in place, you’ll miss out on savings opportunities because:

• Applications automatically renew under your nose
• The window to negotiate better pricing is missed
• Renewal decisions get made in a silo and without data
• Stakeholders or app owners are not engaged early enough

Lack of Accountability to Business Outcomes

Achieving cost savings requires accountability across the organization. Poor accountability occurs as a result of:

• Misalignment to business outcomes
• Failure to drive results
• Poor visibility into KPI tracking
• Working in a silo—without cross-functional engagement

Failure to Obtain Executive Buy-In

Top-down directives are often the most effective way to get the support you need for an initiative and ensure accountability across the organization. Without executive buy-in, your results are likely to fall flat. For example, your initiative may:

• Get deprioritized
• Stall or fall to the wayside
• Struggle to obtain buy-in from departmental leaders across the company

Advice for Building a SaaS Savings Pipeline

In 2025, Zylo’s SaaS Management Index found that nine in ten IT leaders recognize the cost-saving potential of software optimization. To generate a SaaS savings pipeline—your prioritized list of actionable savings opportunities—it requires having the right structure in place. When all the pieces click together, saving money becomes a steady, predictable motion.

The Zylo experts who contributed to the following advice include:

What Advice Do You Give Clients When They Ask, “How Can I Save $1M on Software This Year?”

Saving $1M in software costs doesn’t happen overnight or by slashing spend ad hoc. It’s the result of continuous, data-driven decisions. Our team emphasizes starting with the basics: 

• Visibility
• Ownership
• A clear process

“Savings are a great goal to have, but we should take a step back and make sure that the process is in place to drive toward that goal. Who is owning each step? Are we asking the right questions? How are we tracking the savings when these actions are completed?”

— Taylor Cox, Strategic Account Executive

“When clients ask how they can save $1M on software this year, I tell them it starts with visibility and ownership. You can’t save on what you don’t fully understand or manage. The $1M savings doesn’t come from one big cut; it’ll come from continuous, data-driven decisions across your portfolio. With the right visibility, process, and accountability in place, those savings compound—fast.”

— Delainey Trost, Manager of Services

“I recommend clients start by understanding which applications are up for renewal, and the budget and spend for each application. This gives you the ability to establish a foundation for cost savings. By partnering with a SaaS Management Platform like Zylo, you have trusted data for decision making and expert guidance and support to help you accomplish your $1M savings goal.”

— Jonny Mosquera, Sr. Manager of Services

“Depending on the client, they may view ‘savings’ differently. First, I try to understand where they are getting that number and what it means to them. Then, I work with them on prioritizing the applications that can actually get them moving toward their goal.”

— Sean Gallas, Strategic Account Executive

“When it comes to renewals, prioritize, prioritize, prioritize! Focus your procurement expertise on renewals with the highest savings opportunities so you aren’t spreading your team too thin. And where you aren’t owning the purchases, educate your application owners to manage them with best practices, FAQs, and a standard process.”

— Amber Thompson, Enterprise Project Manager

“Understand where you can save and give yourself time to execute. First, determine what savings levers you want to pull. For example, can you remove license waste or negotiate better pricing? Then I would suggest focusing on the tools with the greatest potential for savings. Last but not least, get executive backing, which will set the stage from the onset and give you air cover when friction arises.”

— Thom McCorkle, Sr. Strategic Account Executive

Discover 10 Ways Zylo Helps You Save Money on Software 👉

What’s One Thing Companies Can Do Today to Begin Building Their Savings Pipeline?

Building a savings pipeline starts with small steps that, over time, evolve into everyday habits. At Zylo, our team recommends these steps to get started:

• Know what’s coming up for renewal
• Prioritize your top apps by spend
• Map out your savings pipeline
• Set renewal alerts to stay proactive

“If you do one thing today, pull your top 10 apps by spend and compare what you’re paying for versus what’s actually being used. That simple exercise almost always uncovers your first $100K–$500K in potential savings and forms the foundation for a repeatable optimization process.”

— Delainey Trost, Manager of Services

“Set up a renewal alert for 120 days ahead of renewal, and then map out the savings opportunity. That could be app rationalization, license optimization, or price benchmarking.”

— Rina Steinberg, Sr. Strategic Account Executive

“Building visibility of what’s coming up for renewal. Once you have that visibility, work with the respective app and/or business owners to understand where you can rationalize applications, reduce licenses, and align on the overall strategy for the department and organization.”

— Jonny Mosquera, Sr. Manager of Services

“Prioritize your applications and follow a proven approach that mixes a proactive renewal strategy with spend, contract, and usage data to make sure your licenses are in line with what you are using.”

— Sean Gallas, Strategic Account Executive

“Do the pre-work to build your renewal calendar and fill gaps in data. Remember, these are pre-renewal activities to ensure you realize savings. The renew/don’t-renew decision and license management, all need to happen well before the renewal / negotiation.”

— Thom McCorkle, Sr. Strategic Account Executive

What’s the Biggest Mistake You See Companies Make When Trying to Reduce SaaS Costs?

When it comes to reducing SaaS costs, the biggest mistakes we often see organizations make is:

• Not having a process in place 
• Tackling the entire software portfolio at once
• Reactively managing renewals instead of being proactive
• Underestimating the importance of cost avoidance

“The biggest mistake I see companies make is trying to do everything at once without getting a firm foothold on the process that leads to value. We want to be proactive—not reactive—in the SaaS lifecycle management process.”

— Taylor Cox, Strategic Account Executive

“The biggest mistake I see companies make is trying to tackle their entire portfolio at once. Then, teams get confused when they don’t see results right away. That’s because they’re working on apps that might not even have a renewal approaching. You end up doing all that front-end work just for usage, pricing, and negotiation tactics to change when the actual renewal comes around.”

— Delainey Trost, Manager of Services

“A common pitfall I see is companies not focusing on cost avoidance. When you tightly manage licenses on a regular basis, it leads to savings down the road, helps you stay on budget, and makes renewals easier to execute.”

— Rina Steinberg, Sr. Strategic Account Executive

“One of the biggest mistakes is not planning your software reviews (RFPs) and renewal decisions well ahead of renewals. At minimum, you should start the renewal process around 120 days out. When you make last-minute decisions, you are voluntarily letting savings leverage slip through your fingers.”

— Amber Thompson, Enterprise Project Manager

“Not giving yourself time ahead of renewals is the biggest mistake you can make. I’ve seen real-life $200k license savings opportunities get missed because the renewal date was too close. This caused the app owner and procurement team to just push to renew with what they had.”

— Thom McCorkle, Sr. Strategic Account Executive

What’s an Underrated But Highly Effective Tactic for Saving Money on SaaS?

The tactics you use to reduce costs is where the rubber meets the road. Most often, we see organizations jump straight to license rightsizing and app rationalization. But there are other tactics that can be just as effective.

Commonly underrated cost-savings tactics include:

• Automatically pull licenses from inactive users
• Engage early with app owners and suppliers
• Stay within budget or keep budgets flat
• Use the negotiation tactic of “walking away”

Together, these habits turn reactive software management into a proactive savings strategy—one that continuously compounds value over time.

“Pull licenses now, get requests later. Oftentimes, when you draw attention to a license being inactive, the response will be ‘Yes, I need it.’ If there has been no activity over the last 120 days, come up with a policy to automatically pull these licenses so you can rightsize the app before renewal.”

— Taylor Cox, Strategic Account Executive

“Engaging early with app owners and suppliers. The more time you start a renewal, the more negotiation leverage you have. Coming in hot to that first outreach, be aware of your contractual language. Do you have an auto-renewal? Is there uplift language? What’s the term length we want to renew for? What are the net payment terms we’re willing to make?

Heading into that first conversation with a ‘remove our auto-renewal, we do not have budget for an uplift, and we’d like net 45 payment terms.’ This shows the supplier you are aware of your contract, and they cannot use their typical sales tactics to undermine you.”

— Delainey Trost, Manager of Services

“Many people underrate the importance of staying within their budget or keeping budgets flat. This is where cost avoidance measures, like I mentioned before, become incredibly effective.”

— Rina Steinberg, Sr. Strategic Account Executive

“If the application has significant competition in the market, where others have similar features and functionality, use the negotiation tactic of ‘walking away.’ In my experience, this tactic has resulted in many cost-savings wins.”

— Jonny Mosquera, Sr. Manager of Services

Tell Us About a Time a Client Achieved Major Software Savings Through a Renewal Strategy You Helped With

Zylo clients have seen major savings wins just by following this renewal “savings pipeline” approach. The common thread across each success: visibility, preparation, and clear communication well before renewal.

“A software company saved $1.6M in app rationalization by using custom fields and renewal alerts asking app owners if the app is still needed or reviewing what better technology could take its place for less of an investment.”

— Taylor Cox, Strategic Account Executive

“One of my clients had several Adobe contracts. By consolidating into one contract and moving to the ELA tier (which they needed anyways), they saved just over $150k. That’s in just one contract motion. Beyond savings, it also resulted in less paperwork.”

— Delainey Trost, Manager of Services

“A conglomerate client of mine started reclaiming licenses across its entities for PagerDuty 120 days in advance. As that got underway, they identified a significant downgrade opportunity. By downgrading users to a Viewer SKU, they saved $85K at renewal”.

— Rina Steinberg, Sr. Strategic Account Executive

Turn Software Renewals into a Repeatable Savings Pipeline with Zylo

While the SaaS Management Platform space continues to grow and evolve, one thing remains clear. No other provider has more examples of saving companies millions of dollars on SaaS spend than Zylo.

Saving money requires visibility into spend data. That’s why Zylo starts with spend discovery, then uses an AI-powered model to identify your applications based on trillions of dollars of payment data. Not the other way around.

Zylo is more than software. It’s a savings engine with a team of experts behind it. Learn how our SaaS Spend Management solution and SaaS Operations services help organizations reduce costs and build a repeatable savings pipeline. Or connect with our team of experts for a personalized demo.