Master Consumption Billing as a Microsoft CSP Partner
In today’s competitive market, B2Bs face the challenge of maintaining margins on their services. This difficulty arises due to the need to provide value to customers while remaining profitable. As a result, pricing and packaging services to meet customer demands and increase revenue is essential. The global pandemic has forced many companies to pivot and find a new business model, with CEOs and CFOs realizing the importance of having a product that suits unique needs and can be adapted as the business grows.
To satisfy customers’ demands and survive, many businesses have adopted subscription-driven pricing models. However, B2Bs looking to scale their operations increasingly turn to consumption-based models. This pricing model enables companies to only pay for what they use, offering increased flexibility, cost-effectiveness, and the ability to scale up or down quickly. The interests of the vendor and customer are further aligned with a consumption-based model.
Many CSP Partners initially purchased a platform to automate Microsoft CSP licenses but are now facing challenges scaling their business due to their current automation platform not supporting offerings entering the consumption era. The benefits of a consumption-based model include the supply being in tune with demand, allowing customers to choose what products and services they need and consume them as they go. This approach reduces overhead and resource wastage and provides a better return on product investment.
Enabling enterprises to transform their business models is vital to accelerate their journey into the new age of recurring and consumption revenue. By adopting a consumption-based model, B2Bs can better meet customer needs, improve their margins, and enhance their growth potential.
“Realization that a CSP Platform can be more than a billing application, but a fully flexible commerce automation system for cloud and non-cloud services that could be integrated into any customers tech stack for digital transformation is a game changer.”
To successfully implement a consumption-based pricing strategy, B2Bs need robust operational business processes combined with a powerful billing automation platform. This will unlock new business models, offerings, and distribution opportunities and enable businesses to differentiate themselves by delivering secure and resilient delivery with speed and agility. Cloudmore, as a platform provider, understands that consumption of products or services peaks in specific months and declines in others. Therefore, having a deeper understanding of customer usage patterns will provide valuable insights into future product development and ultimately lead to data intelligence.
The consumption-based pricing model allows enterprises to understand how their customers consume their products, leading to better products that meet changing needs. Customers avoid resource waste by paying as they use each month, and B2Bs can reap as much profit as possible during peak sales cycles. Cloudmore also offers hybrid pricing models that combine subscription-based pricing with consumption-based pricing to capture additional usage, making it ideal for companies with fluctuating customer usage.