Moving to the Cloud: The Complexities of Managing XaaS Customer Data

Once your business has made the decision to transition your product or service into a cloud-based offering (or a combination of cloud and perpetual offerings), one of the first steps in that transition is to establish a new business model for the cloud.

In addition to defining how you will acquire customers and establishing a strategic revenue model, you'll need to understand and plan for the complexities of managing up to 12 times the renewals data. This massive increase in customer data occurs when a business transitions from annual to monthly subscriptions, regardless of whether your pricing model is fixed or consumption-based. (Consumption pricing can be expected to create even more data as you track individual customer's usage!)

How will your business manage all of this data efficiently and securely? How can you create the most value from this raw data?

Making the Most of Customer Data

XaaS presents businesses with the opportunity to collect information about how their customers use their products or services, not to mention when, how often, from where, and for how long. And those are just the basic metrics. If a customer hasn't logged in for a period of time (either a few days or a few weeks), your system can automatically flag that account for customer service follow-up to address any issues that may have come up to try to retain that customer.

The potential for collecting valuable insight and automating customer success management are vast and valuable, but this depends on having a strong foundation for gathering and storing data. And for businesses that are transitioning from perpetual or on-premises offerings, the undertaking of transitioning data from spreadsheets or other outdated methods to a data management system may seem overwhelming.

However, the long term benefit of this effort is well-worth the upfront investment of time and resources, as accurate and useable data will inform strategic decision-making regarding conversion, adoption, retention, renewals and future offerings.

To make the most out of your XaaS customer data, it is important to:

• Know where your data resides (in what systems, databases, etc.)
• Determine what kinds of data issues exist that need to be resolved
• Identify the optimal data types (fields)
• Define how your data should be formatted
• Document operational procedures for data transfers
• Identify who is responsible for collecting and managing customer data
• Understand the necessary integrations (with other systems such as your ERP or CRM and with your partners)

The process of assessing your existing data and documenting drivers and goals going forward will help you guide a successful transition to a cloud-based offering.

Building a cloud-based business model that addresses the question of how to make the most of your customer data is a critical early step that will establish the strategic base upon which your new business will be built. If your business is ready to move to the cloud, our free eBook, "Transition to Cloud Consumption" can help you make the most strategic move to a cloud subscription or consumption model.