Making Best Use Of Iot Usage Data
Over the last years, IoT data has become common in business. IoT has enabled businesses to optimize their existing processes and to create new business models around the constant flow of IoT-created data, taking advantage of the accurate and actual usage data. How is it done best?
In this blog, we will discuss the best practices we see at our clients when implementing IoT data from a billing perspective.
From Data To Optimized Business Models
The key benefit of IoT data is the insight it gives to actual events provided by sensors e.g. the use of IoT devices. Being able to predict events, and also track them in real-time can offer major benefits for the optimization of processes.
Today, most IoT applications are optimizing internal processes on a tactical level. However, we also see the rise of new business models that leverage IoT data to bring new competitive offerings to the market. In those new business models, strategic use of IoT provides flexibility in usage and optimizes alignment with the client’s business.
The common elements of these new business models are:
- IoT creates even real-time usage data
- Services are based on this real data
- Processes in the offering are based on usage transparency
- The clients pay for what they use.
Using Data As The Strategic Driver For Business Change
The beauty of real-time data-driven by IoT sensors is that usage becomes measurable and predictable. For goods and services, in technology and logistics, all aspects become much more agile, and this can be used to drive down costs for both supplier and client. In the cases we have worked with, we see our clients actively discuss how to leverage these benefits in their client relationship.
Here are some key findings:
Be clear on data accessibility and data ownership upfront
- Propositions based on real-time data need to be based on a common understanding of the process, the data generated, the way data is transferred and the ownership of the data upfront. Only then alignment can be met.
Balance the benefit of IoT-based services for both parties
- The best offerings provide monetary benefits to the clients and efficiencies or flexibilities in the client’s business operations.
Offer agile monetization that matches your agile proposition
- Hybrid models, where usage-based pricing is combined with some fixed (subscription) cost seem to be the most liked models.
Provide real-time data insight for your clients
- Providing real-time data insights allows your client to use the data for its business purposes, makes the related cost predictable, and gives trust in the relationship.
Agile Billing Helps You Optimize Your New Business Model
New business models require different set-ups in billing to meet the client’s expectations. Your clients will demand insight in their monthly cost structure as the usage evolves.
They will also want to be able to steer or take action if the cost becomes dis-aligned with their business situations, so early warnings for overruns or underruns against the normal cost are expected when the data is available. An agile billing system can support this.
As a result, you will see a better client relationship where you will be a trusted advisor, and fewer invoice disputes leading to a quicker cash inflow.
If you want to learn more about building new business models in recurring revenue billing, have a look at our Quick Guide to Recurring Revenue Business Models, click here to download it.
Take Us To The Test!
If you feel your billing needs will outgrow your current recurring revenue billing solution, or if you are just curious to learn how Good Sign does things differently, feel free to take us to the test! We will gladly take on your challenge and prove to you it can be done, and that the new world lies beyond just subscriptions.
Good Sign Software helps businesses solve existing pain points in monetizing service contracts and managing subscriptions and pay-per-use services. We help companies freely grow scalable services.
Feel free to contact us and let’s have a chat on how we can support your company.