Cloud services billing as practiced by many software -as -a -service enterprises is prone to grave mistakes. Few things need to be borne in mind about SaaS enterprises at the outset.

First, they are typical service providers in the non-technical sense.
Second, cloud enterprises deal with services that are agnostic of platforms and products.
Third, they offer products that have many flanker models and gradations.
Fourth, cloud services offer ample scope for customization of client requirements.

In the backdrop of these elements noted above, our business consulting team at Netfunda has analyzed the following mistakes in cloud services billing.

Cloud Services Billing

Looking for the moment of truth in the wrong places

SaaS enterprises are service providers. Their services are installed on cloud. A vital interface between the service provider and the end user takes place on a virtual platform. The vital point on the agenda is to negotiate with the subscriber for subscription renewal. Subscription renewal works with recurring customer interface and recurring billing. This means that subscription billing and customer interface should ideally take place from the same platform. But this does not happen. The mistake here is the usage of distinct software applications for billing and sales. The twain does not meet. The splitting gap between billing and sales restricts revenue growth. To resolve this issue, we at Netfunda have developed a subscription billing software called Netfunda OneClickBill. It is an innovation with the unique offering of  standard  SaaS  subscription billing with a customer ordering interface. Not only does it increase sales, but reduces resource engagement in the billing department.

Using Low Pricing Point As A Traffic Building Measure

A low price point is commonly used by enterprises as a traffic building measure. In this context, it is worthwhile to recall the words of the now UIDAI chief and former Infosys CEO, Nandan Nilekani:

The Industry Is Self Destroying Itself

SaaS enterprises in their overzeal to tap clients readily participate in price warfare. They offer hefty discounts and slash prices aggressively. The end result is that the client becomes price conscious and demanding. The firm that does not respond to threats of price discounts and price cuts is labelled an “inflexible IT vendor.” Responding to price cuts of rivals means price warfare and the industry on a whole ends up with lower levels of revenue and profits. There is a smarter way out of this rut.

Use a recurring billing management system with simple dashboard analytics. Track and analyze the amounts billed against each client. Repeat purchases would symbol customer loyalty. Further filters can be custom fit to fix threshold levels of amounts billed. Now coupons and discounts can be rolled out to reward customer loyalty. This tactic can be incorporated by using  a subscription billing software that executes coupon, billing and discount billing effortlessly.

“First time customer” blues

First time customers can be offered trial plans for a limited period. More than pricing, SaaS enterprises should focus on customization to build traffic. A cafeteria benefits plan can be used to entice the customer with absolutely no standardized features. Let the customer decide the features and end user benefits he wants. Let him choose from the menu of available options. The customer will pay only for what he chooses. Add on billing can be executed using the subscription plan management system. Value based automatic billing system like OneClickBill offers immense functionality for SaaS enterprises to do this. When the customer decides the flavors that go into his mocktail, he is likely to feel more empowered. An empowered customer will not mind paying a premium. Premium pricing and add on billing is a more sensible proposition than  generosity that is “self destroying.”

Taking Up Selling And Cross Selling For Granted

When cash registers keep ringing at regular, sales representatives take prorating for granted. A satisfied customer very often does not have too much to ask for. He does not call the support team of the SaaS enterprise every third day. The sales representatives do not bother to engage with the customer till the day when they discover that he  has shifted loyalty. This comes as a rude shock. Upselling and cross selling does not necessarily mean pushing the gauntlet down the throat of the customer. It’s always advisable to cross sell the customer different upgrades of existing software products. This is where business invoicing software like Netfunda OneClickBill can be very handy.

SaaS firms can grow better and faster. They need to be willing to embrace “stretch targets.” The cut throat competition in the subscription economy requires SaaS enterprises to use software products that deliver value based IT solutions. Netfunda OneClickBill is more than just a hosted billing software. It is a complete subscription plan management  system that overhauls strategy, structure and systems as shown above.