“Can’t we have both?”

In the final scene of the movie “Trading Places,” our triumphant heroes stand on the beach of some exotic locale, reveling in their victory from having cornered the orange juice commodities market.  One character asks “What shall we have for lunch, the lobster or the cracked crab?”  Another character, glass of champagne in hand, answers with her own question: “Can’t we have both?”

The point is: not all choices are mutually exclusive; not everything is a zero-sum game. That’s a fact that we here at Aria, more times than not, find ourselves pointing out to the many businesses that find themselves embarking for the first time on some recurring revenue offering. “How do we manage and price our service or product? Should I offer an all-you-can-handle open bar, or would a pay-per-drink model serve me better?”

Phrased that way, it would appear that the choice between a subscription model and a consumption model is mutually exclusive. And the reality is that one certainly can choose a “pure” flat-rate buffet or a “pure” metered offering if one really wants to go either of those routes. But my recommendation, when posed with this seemingly clear question is, almost always, “You can have both.” Furthermore, I’d assert that any vendor purporting to offer a billing solution with entitlement management capabilities isn’t worth their salt if they don’t guide their customers down the path of “having it all.”

Why? Two reasons. First and foremost, while service providers can’t be blamed for focusing on the immediate problems, a properly consultative monetization partner/vendor’s primary job is to force those providers to also consider all future possibilities and not preclude their implementation through short-sighted solution design.

Secondly, and more to the point of this essay, the subscription model and the usage/consumption model can and do “feed” off of one another, even when billing and pricing are centered completely on one side of the fence or the other. What if I want to perform ROI metrics on a pure-subscription, all-you-can-drink model?  Isn’t it reasonable to imagine that the same system performing that static, rhythmic billing of my end users will also tell me what they consumed, even if it’s just for reporting purposes? What if my marketing team informs me that they will get more traction if they can offer a lower monthly commitment plan with overage costs to complement my existing single-fee-focused product catalog?

So sure, if you want to do a pure play with one or the other model, Aria’s solution is ready to get you there. But be prepared; if you don’t come to the table asking the question already, Aria will have you ask, “Can I have both?” The answer will always be “Yes, you can and you should!”

Brendan O’Brien, Aria Systems

The Right Recurring Revenue Model for Success

About the Author

Brendan O'Brien

Brendan O’Brien has been in the subscription services business for over 20 years, and is recognized as a pioneer and thought-leader. It’s fair to say that he introduced the world to cloud billing, and innovated database-driven, enterprise-grade web applications for companies ranging from Medical Manager, to Wright Express, and LaserLink. All this before the concept of “cloud” was even on the horizon. Brendan is trained as a professional stage actor and classical tenor.

The Forrester Wave: Subscription Billing Platforms, Q4 2015

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