Discover the Top 15 Most Expensed SaaS Applications

In today’s fast-paced business landscape, the use of Software-as-a-Service (SaaS) applications has become increasingly prevalent. Employees are increasingly expensing SaaS applications, with 7% of employees doing so in 2024. While that’s a 53% decrease from 2022, it’s still significant and poses problems for an organization. 

Shadow IT is not only a source of uncontrolled spend and SaaS sprawl but also a source of risk, with 65% of expensed apps having “Poor” or “Low” security ratings via Netskope’s Cloud Confidence Index™. Expensed apps also result in $1.5M per year on average per company. This spending makes up only 3.4% of total expenses but still accounts for more than one-third of the SaaS portfolio.

These applications offer convenience, flexibility, and cost-effectiveness, making them an attractive choice for employees. However, the rise of shadow IT – the use of unauthorized or unmanaged SaaS applications – has become a significant concern for organizations, leading to uncontrolled spend and security risks. 

Top 15 Most Expensed Apps for 2023

(by transaction volume)

This data is based on Zylo’s 2024 SaaS Management Index report. By examining these apps, we aim to shed light on the hidden costs of shadow IT and provide insights into how companies can better manage their SaaS stack. 

Data shows that AI increasingly fuels employee app preferences. For the first time since Zylo started tracking this data, AI apps appear on the list of the most expensed apps. 

In fact, ChatGPT’s appearance in the top 15 most expensed apps points to the growing appetite of employees for generative AI. The popularity of many of these apps (such as LinkedIn, Grammarly, Canva, Adobe, Kahoot, and SurveyMonkey) also coincide with the recent integration of AI functionalities. 

1. Udemy
2. LinkedIn
3. CliftonStrengths
4. Canva
5. Kudoboard
6. Grammarly
7. Adobe Acrobat
8. Kahoot
9. Coursera
10. SurveyMonkey
11. OpenAI API
12. Calendly
13. Adobe Creative Cloud
14. ChatGPT
15. MasterClass

Breaking Down the Top 5 Most Expensed SaaS Apps

Employee software preferences continue to change. The only app returning to the Top 5 is Kudoboard, while Adobe Acrobat fell from #2 to #7. And then there are apps that completely fell off the Top 5 list – Twilio, Mailchimp, and GoDaddy. Here’s a  breakdown of the five most expensed apps in 2023.

1. Udemy: A popular online learning platform offering various courses and training materials for individuals and businesses. Users can access thousands of courses in multiple categories, such as business, technology, and personal development. The platform allows learners to acquire new skills or enhance existing ones at their own pace. With more people working remotely or in a hybrid work environment, it’s no wonder online learning has grown in popularity.
2. LinkedIn: A professional networking platform that connects individuals with potential employers, colleagues, and business partners. In addition to its networking features, LinkedIn offers learning resources, job search tools, and analytics to help users build their careers and stay updated on industry trends.
3. CliftonStrengths: An assessment tool that helps individuals and teams identify their strengths and improve performance. Based on the Gallup organization’s research, the tool provides users with personalized insights into their talents and helps them develop strategies to maximize their potential.
4. Canva: A graphic design platform allowing users to create professional-looking designs for various purposes, such as social media posts, presentations, and marketing materials. The platform offers a range of images, templates, and design elements, making it easy for users to create visually appealing content without prior design experience. Democratizing design has made it easier to scale creative work and is attractive to those without a design background.
5. Kudoboard: Falling from last year’s #3 slot, Kudoboard is a tool for creating virtual “boards” to recognize and appreciate colleagues, team members, or employees. Users can add text, images, or videos to their boards, which can then be shared via email or social media. Kudoboards remain a fun and engaging way to celebrate successes, build team morale, and promote a positive work culture.

Honorable Mentions: OpenAI API and ChatGPT

As we mentioned, we’re seeing AI tools for the first time on our most-expensed apps list – specifically OpenAI API and ChatGPT. 

Employees might pay for OpenAI APIs to access its advanced language processing capabilities and gain a competitive edge. On the other hand, ChatGPT is helpful for a broad spectrum of tasks. It’s being used for everything from generating creative ideas, writing social media posts, or crafting responses for customer support – among thousands of other possibilities.

While helpful for productivity and innovation, the unauthorized use of AI apps can lead to hidden costs and potential security risks for the organization. The unmanaged use of AI tools can lead to hidden costs, such as subscription fees or API usage charges. Additionally, using ChatGPT may introduce security risks, as employees may inadvertently share sensitive information with the tool or expose the company to potential data breaches.

In short, AI apps requires the same diligence as you would vetting any new software.

What Can You Do About Frequently Expensed SaaS Applications?

At Zylo, we believe effective SaaS Management requires continual discovery, active monitoring, and identification of all new SaaS expense purchases. Check out some ways to create a cloud governance framework and prevent expensed SaaS applications from costing your organization.

Start with Complete and Ongoing Visibility of Your SaaS Stack

To mitigate these risks and better manage your SaaS stack, you must start with SaaS discovery. That means getting visibility into all the applications in your environment.:

• Complete and ongoing visibility of your SaaS stack: You can’t manage what you can’t see – and that includes shadow IT. Companies frequently underestimate the number of SaaS in their environment. For instance, the Sr. Software Asset Manager at Genesys, Samantha Griffin, shared that they initially thought they had 100 apps in their environment. After going through the discovery process, they uncovered 600 – 500% more.
• Discovery drives visibility into shadow IT: By uncovering hidden SaaS applications, you can better understand your organization’s SaaS landscape and identify potential risks. This information can then be used to implement appropriate security measures and control spending.
• Streamline SaaS management and reduce costs: With a clear view of your SaaS stack, you can identify redundant or underutilized applications and consolidate licenses to save money. Additionally, you can negotiate better deals with vendors by leveraging your consolidated purchasing power.

Practice Freedom within a Framework

Today’s workers increasingly value flexibility. Allowing them to easily discover and select their preferred tools raises awareness of what software is available, increases utilization, and reduces shadow IT. Freedom within a Framework is a popular SaaS governance strategy that puts guardrails in place without hindering employee productivity. It sits between centralized and decentralized governance.

It starts by creating policies to curb rogue software purchases. Often that involves putting restrictions on expense purchases – either setting a dollar threshold for what may be expensed or banning them altogether. The route you choose depends on what makes sense for your business.

While policies get you off to a strong start, the key is in enforcing them. Visibility and education are key to making sure your policies work. 

Offering employees an enterprise software store or application catalog helps them see what apps are available to them. Typically, the apps in your catalog are vetted and standardized software titles. If a tool is not listed, you can then provide guidance on how to properly request new purchases.

Education is also critical to enforcing governance. For instance, employees need to understand why you’ve taken this stance on software purchasing and usage. Help them understand the potential risks and costs associated with unauthorized app usage, and encourage the use of approved tools and platforms. 

By addressing the underlying causes of shadow IT, businesses can ensure better control over their SaaS portfolio and maintain a secure and efficient IT environment.

Create a Software Review and Approval Process

For many organizations, introducing more rigid governance around SaaS acquisition can keep expense spending in check. Your software approval process can be as simple as a quick form submission to request a new application. 

Or, it can be as comprehensive as a software review board, involving a cross-collaborative team to review each new application request (e.g., Procurement, IT, Legal, and Accounting). While a review board may slow down the acquisition process and restrict who can acquire software, many Zylo customers say it effectively reduces shadow IT and expense spending.

Take Action on Unapproved Software

Once you have governance in place, you can begin to eliminate shadow IT. 

Start by identifying which apps you already have an enterprise agreement for. Then, check if licenses are available and migrate the user or users under that contract. Before canceling the other subscription, understand the terms and when you’re able to pull the plug.

If you don’t already have an enterprise agreement, notify end users they’ve purchased outside of policy and request they cancel the subscriptions. Next, direct them to your application catalog to select an already approved tool. If they’re unable to find a tool they need, provide direction on how to request the purchase of a new tool if that fits their needs better. 

At this point, you’ve done all this hard work, the last thing you want is for shadow IT to creep back into your environment. Make sure you have proper monitoring in place so you’re alerted when a new app or payment comes in that is against your policies. Then you can take quick action, whether asking to cancel the subscription or not reimbursing them on future payments.

Reduce the Risks of Shadow IT Today

The rise of shadow IT and the increasing use of expensed SaaS applications highlight the need for organizations to gain a comprehensive understanding of their SaaS landscape. Your organization can better manage its SaaS stack, control spending, and improve overall security by addressing the hidden costs and risks associated with these applications. You can start achieving these goals by following the steps outlined in this article.

Do you know your organization’s most expensed SaaS applications? Employees expensing SaaS leads to shadow IT. Luckily, Zylo’s AI- and Machine Learning-powered Discovery Engine is unmatched at finding 100% of your SaaS — even those expensed apps hiding in the shadows. Schedule a demo and see how Zylo can go to work for you!