In the digital era, where customers can select virtually anything with a click of a button, they are demanding more choice; not only in products, but in how and when they pay for them. They expect flawless service and require instant gratification. Yet, CIOs in every industry are struggling to keep pace with IT demands to bring new products and services to market and offer the complexity needed for modern commerce. In fact, MGI Research forecasts that go-to-market speeds will increase substantially by 2020. The stakes are high. Customers simply move on. For those who take on the Cloud metamorphosis, costs are low relative to the long-term profitability provided by the “makeover.”
Technology professionals who are charged with managing recurring relationships often must do so with outdated technology and systems that are ill-equipped to handle sophisticated cloud billing, invoicing, geographies and taxing bodies. Technology implementation expenditures now must revolve around customer expectations instead of traditional development cycles. The two could not be more out of sync. And many companies are living with traditional business models and legacy back-office systems built for a world focused on customer acquisition instead of customer retention.
The Altimeter 2016 State of Digital Transformation study reports that 55 percent of those responsible for digital transformation cite “evolving customer behaviors and preferences” as their primary catalyst for transformation. Yet only approximately half of those respondents (54 percent) have completely mapped out the customer journey within the last year or are in the process of doing so.
Modernizing processes and systems can now be done without ripping and replacing outdated legacy systems. Companies are overcoming legacy constriction by adding an agility layer that is not only easy on the IT budget but can also offer a new generation of consumers the dynamic purchasing and payment methods they demand.
Successful companies are flipping their business models to better serve their customers by enabling options with the customer in mind. It’s the Burger King “Have it Your Way” of pricing. From AWS’ recent per-second billing strategy to subscription poster child Netflix, companies are innovating and differentiating by giving consumers more flexibility and choice in the way they purchase services and goods.
Companies like Amazon, for Instance, offer an a la carte menu of subscriptions and usage-based models with flexible payment options and timing. The notion is that more people will buy if you can offer the options that matter to them. Recently, Amazon announced that key services will be sold on a per-second basis providing customers with the ultimate in pay-as-you-go pricing. Amazon’s agility has impressed the market. Other companies are noticing and developing more flexible pricing options as well.
Success in the age of the customer demands enterprises to shift their mindset and technology toward highly-tailored product offerings that are at the core of a customer-centric business strategy. In short, companies need to up the ante with the goal to solve people’s procurement challenges instead of simply focusing on delivery issues. User-friendly billing solutions offer customer choice around payment providers, pricing, promotions, consumption options, payment methods, dunning processes and split billing.
For example, contemporary, state-of-the-art systems can aggregate bills for multiple locations and make services portable for customers as they change locations, devices or usage patterns. A customer can also select split-billing where some services are paid for directly while others are redirected to another account for payment.
A great example of split-billing is between personal and business accounts. If Jane E. customer wants to purchase an internet plan and a Gaming plan under one account, and bill the internet to her business MasterCard, and the gaming plan to her personal VISA card, she can. Even if the VISA card expires and rejects payment, a company-specified dunning process can address the offering on the expired card without affecting the other offering.
Until recently, the previous standard required two accounts for each purchase and manual lookups for a complete view of the account, making for a time-consuming and error-prone process.
Ideally, bills can be parsed to any entity. Products can also be rolled up for specific charging all along the hierarchy. For example, parent-child hierarchies can parse an account to map to its own currency and taxation: a global multinational can pay in dollars, a regional entity can pay in euros, and a national entity can pay in British pounds.
The bottom line is to look for a cloud billing solution that empowers pricing, packaging, invoicing, recording and reporting that is “always on” with 24/7 availability and can expand and contract as needed. One that optimizes a company’s line of business and leverages each revenue moment – from the initial sale, each upselling and cross-selling opportunity, and all invoicing and payment events to include every customer touchpoint.
Today, customers have greater choice and lower switching costs, but if they are provided quick and accurate service they will often stay and buy more over longer periods of time. The ultimate payoff is greater and longer customer lifetime value with increased revenue growth.
The complexity and customization of cloud billing empowers your business to offer multidimensional customer choice in order to retain your loyal and recurring customers.
With all of its advantages, there’s never been a better time for you to head for the Cloud. You’ll be glad you did.
By Brendan O’Brien