Monthly Recurring Revenue in a Cloud World

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Recurring Revenue Management

We’ve seen the transformative power of the cloud in action. With the flexibility, scalability, and cost savings that this computing model offers customers, cloud has proven to be a truly disruptive technology that’s changing the face of business.

However, despite the advantages for customers, VARs and Service Providers offering cloud based services continue to struggle to establish profitable business models. Optimizing the monthly recurring revenue model is the only way to help build a strong, profitable foundation.

“Cloud companies … are all the rage, and rightly so, for they are the future of tech,” wrote J. B. Wood, president and CEO of Technology Services Industry Association (TSIA) in an updated blog post last October. “They regularly enjoy double- or triple-digit growth rates and garner enviable media coverage and razzle-dazzle headlines. But the mostly unspoken truth is that they are underpinned by unproven financial fundamentals that, frankly, wouldn't be allowed to persist in any other industry.”

There certainly isn’t a lack of customer interest in cloud -- Gartner predicts spending in public cloud services will reach US$186.4 billion in 2018. The problem instead lies in the time, effort, and expense of a taking an old school net-new sales approach to each customer.

Profitability in the Cloud

It’s time to start focusing on profitability in the cloud. How? Optimize the monthly recurring revenue model by driving down costs to derive maximum value from each deal.

This approach is beneficial for both you and your customers. Reducing the operational, administrative, and sales-related costs of monthly transactions gives you an opportunity to boost your profitability. At the same time, you’ll free up time and resources so your company can focus more on your customers’ needs – such as monthly service updates and renewals or the option to quickly and easily adopt new technology as it becomes available. This allows you to ensure that customers are getting the most out of your services while also having monthly opportunities to increase the number of users, renew subscriptions, and upsell services.

Automation is the Answer

Service providers in particular need to be freed from the operational burdens that come with efficiently and securely managing customer data. This is particularly true when dealing with multiple channel partners, which only adds to the complexity.

Automation can play a key role. The ability to track and manage your customers’ usage through automated workflows simplifies and lowers the cost of cloud billing, sales retention/renewal, and expansion. By transforming a reactive process that responds to customers’ needs, automation can help you get out in front to build a proactive sales program that introduces new services and options for customers to head off problems before they arise. What’s more, limiting manual input and streamlining repetitive tasks reduces the risk of error and improves your employees’ productivity.

Profitability in the cloud can be achieved by using automation to help you seamlessly bring new customers online, renew subscriptions and even up-sell expanded services. can help you derive more value from recurring revenue by completely automating contract management to increase productivity across your business. When you have a trusted partner to manage usage and billing for your cloud contracts, you’re freed up to focus on customer retention and profitability.



Transitioning to Cloud Consumption? Download this guide for key issues you should address now.



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