There are some easy wins that can help you!
Maybe the solution is easier than you think.
Back in the pre-SaaS days when Software was typically purchased upfront with recurring annual support contracts, it wasn’t uncommon for Sales Targets to incorporate the recurring support contract revenue even if the Sales Team was not directly responsible for collections. One particular year we experienced a shortfall as we approached the end of the year even though we were well on top of our Sales targets. After some initial panic and more detailed analysis, it turned out that an entire product group’s support contracts had never been billed due to a system glitch. The problem was resolved, the invoicing was completed, and targets were met. Additionally, as this was high-margin revenue, we had a better-than-expected profit.
It is highly unlikely that a similar situation would occur today – systems, metrics, and analytics are now key to any software company but there are still situations where potential answers to revenue shortfalls are staring us in the face but often are ignored. Firstly, make sure you are getting paid for all usage of your software. Secondly, maximize new revenue opportunities. This may sound obvious, but many companies do not execute well and still lose revenue through the misuse of applications and limiting their range of product offerings.
Software piracy and lack of compliance are still serious issues. Basic Copy Protection will not guarantee compliance but will certainly ensure that casual misuse, e.g., unlicensed devices or users within customer organizations, is controlled. Monitoring locations and frequency of trials through licensing will help detect patterns of potential misuse. With subscriptions, tighter license controls integrated with billing and payments can ensure that only paid-up customers and users are able to use your applications both in the cloud and on-premise. Ensuring customers are compliant will help ensure you get paid for what’s used and avoid the unnecessary disruption of customer audits.
Most Software Vendors offer different packages or editions of their software rather than “one size fits all” to address the widest possible market opportunity. Combining different offerings with various billing options (upfront, recurring, prepay, etc.) can present a headache for Software Vendors in terms of configuring software deliverables. This gets a lot easier to implement if you can simply deliver/install one code base for all customers using Smart Licensing to control Feature Sets, time limitations, and user numbers. This is also a great way to make sure you can maximize upsell opportunities with customers through additional users, features, etc.
The real advantage of this approach is that it’s not just a short-term fix. Investing in a Smart Licensing system to address compliance and maximize revenue opportunities will continue to pay dividends as your business grows and will be appreciated by your customers.