Across industries, leading businesses are increasingly shifting their business models from selling products as a single transaction to selling everything as-a-Service (XaaS). Who wouldn’t want to trade lumpy revenues in for recurring and predicable revenue streams with the added benefit of much deeper customer relationships and the data to continue to improve offerings?
In fact, 75% of monetization decision-makers see launching a subscription-based service as a priority, recognizing that to compete in the digital economy they must move away from product-centric, transactional relationships toward more sustained and meaningful relationships with customers. But competing today requires much more than a simple subscription that lacks personalization, flexibility, incentives and a way to stand out in the marketplace. In fact, companies who are leading the pack are moving beyond product sales and simple subscriptions and now offering creative packages with bundled services, intuitive pricing measurements and flexibility in subscription account setup.
Business leaders who want to move toward those capabilities need to take a fresh look at their business models and the systems and solutions they use for monetization. Yesterday’s ERP-based solutions can provide stop-gap capabilities, but savvy business leaders understand that to truly scale their XaaS business — with the flexibility to imagine any business model — they need purpose-built monetization solutions that tightly integrate with front- and back-office applications.
That is not easy to achieve, as most companies that are operating in a product-centric world lack the pricing, billing, monitoring, revenue management and other monetization capabilities necessary to complete the shift from selling physical products to digital services. That means that companies moving toward XaaS must seriously evaluate whether their existing solutions can support unique services and bundles by enabling flexible pricing based on custom attributes, or advanced cross-product discounting and charging based on events, downloads or other measurements that relate to consumption.
The companies that are winning in XaaS today strive for some common capabilities that help them stand out, including:
Accelerated launch of creative subscriptions and usage-based offers that no longer hinder the evolution of business models;
Increased subscriber control through online tools and the ability to personalize everything from threshold notifications to payment methods by account owner;
Advanced capabilities like AI for product recommendations, bots for intelligent customer interaction, and analytics to monitor subscription KPIs;
Opportunity to take advantage of REST APIs and best practices based on standards that foster integration among commerce, point-of-sale, engagement and ERP applications.
And of course no one wants to risk security breaches, limits to business growth or stalled innovation, so the most robust monetization solutions must be delivered on high-security, high-performance cloud infrastructure with the ability to instantly scale up and down.
To learn more about how Oracle is bringing the power of communications-grade billing to the cloud for all industries, read our latest major Oracle Monetization Cloud release.
Additionally, check out a recent OVUM report about XaaS and requirements for software-driven strategic approaches to monetizing digital services .