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ARR + IT: The IT Guide to Subscriptions and Renewals

Feb 13, 2023 | Media and Communications, Technology

The subscription-based business model is increasingly the future for many companies. For IT leaders, a subscription-based business model means figuring out how to build and maintain the infrastructure necessary to keep subscribers renewing every year. Building this digital infrastructure is easier said than done. More than half of IT leaders—51%—say that siloed business strategies and siloed decision-making are among the top challenges to achieving digital transformation, according to 2021 public-sector industry research by Gartner. Thus, IT leaders need more than just a clear vision and strategy for designing subscriber-friendly infrastructure; they also need to be prepared to overcome internal obstacles and resistance to streamlining and enhancing the customer experience.

The customer experience reigns supreme for subscription-based businesses. To effectively support a subscription model, IT leaders must be able to recognize how modern customers prefer to interact and engage with businesses—everything from when customers make a purchase, to when they reach out for help and support, to when they request customized sales terms and conditions. These make-or-break interactions are what turns a one-time customer into a loyal, satisfied subscriber who renews year after year, generating a reliable source of annual recurring revenue (ARR) for the company.

Fortunately, IT teams don’t need to reinvent the wheel as they build technology infrastructure to optimize the customer experience; they can and should be turning to a subscription management platform. Subscription management technology uses automation, AI, and prebuilt, pre-templated features to help subscription-based businesses expeditiously create consistently high-quality customer experiences.

Let’s explore four key things that every IT leader should be doing with a subscription management platform to develop the digital infrastructure necessary to support optimal subscriber experiences:

1. Build infrastructure that readily scales

Subscription management technology has the potential to rapidly scale to meet the needs of an expanding subscriber base. But this scalability is only possible when IT holds the line on excessive, non-recommended configurations and customizations to the platform. These types of changes are often advocated for by teams that don’t want to adapt their workflows and data management methods to align with subscription management technology; instead, they want to force the technology to align with their legacy ways of doing business. Unfortunately, when these teams get their way, the system tends to start breaking and/or can quickly become difficult to maintain. IT teams can and should be pushing back on any changes or customizations to subscription management technology that don’t adhere to standard, best-practices configurations. That’s the best way to maintain a system that is future-proofed and ready to evolve and expand at a moment’s notice. 

2. Put yourself in the shoes of customers

Subscription management platforms are endlessly customizable, with the option to build out all sorts of capabilities, features, and customizations. To prevent scope creep and stay focused on what really matters (i.e., getting every subscriber to renew), IT teams should be putting themselves in the shoes of their customers and prioritizing the features that enhance the customer experience. One of the most important features that IT should build is a self-service option for subscribers to manage their accounts, pay bills, and put together their own subscription bundles; these self-service features are easy and intuitive to build with modern subscription management technology, and it’s something customers expect.

Digital Process Automation For Claims And Underwriting

IT teams also should prioritize enabling sales teams to offer more customizations when configuring subscription bundles, such as special pricing, nonstandard billing dates, and waivers for a setup charge. Businesses tend to limit customization options that are available to sales because they’re cumbersome to manage and error-prone, even as customers expect to be offered these customizations upon request. Subscription management makes it feasible for IT teams to offer more of these types of customizations, as the system can be configured to automatically take care of applying these customizations correctly when generating orders, creating invoices, and recording payments.

3. Enable data-driven decision-making

The power of subscription management technology lies in its ability to generate actionable intelligence and insights that drive the customer experience. For example, a subscription management platform can help sales teams drill down into subscription data to understand customer behaviors and trends. Similarly, the system can track all sorts of insightful KPIs—everything from deal sizes and deal velocity to product mix and win rates—to help sales teams identify and focus on their biggest sales opportunities, and simultaneously avoid the biggest risks and pitfalls. It’s the job of IT leaders to build and manage these data dashboards and other analytics within the subscription management platform, so that sales leaders can focus on analyzing and taking action based on the data—instead of being consumed with figuring out how to generate it.

4. Build an integrated, interconnected sales ecosystem

In most organizations, relevant sales data must often be manually transferred from a subscription management platform to backend order management and accounting systems. The reason is that different systems typically don’t talk to one another and don’t automatically sync data between systems. The end result is that sales reps waste precious time manually entering sales data into multiple systems, and the potential for mistakes and errors looms large. 

“Subscription management technology is capable of seamlessly integrating with backend systems to create an interconnected sales ecosystem.”

Thus, it’s up to IT to connect and maintain these systems to keep sales data flowing automatically and continuously between systems.

IT leaders have an important role to play in implementing subscription management technology in ways that enhance the customer experience. To build digital infrastructure that fires on all cylinders, IT leaders should focus on just saying no to excessive customizations, building out the high-priority features and capabilities that subscribers expect, enabling the organization to track and make decisions based on data, and connecting the subscription management platform to the broader business ecosystem.

Simplus specializes in helping IT leaders implement Salesforce’s industry-leading Subscription Management platform. To learn more about how we keep IT teams focused on building and maintaining features and capabilities that really matter to subscribers, please reach out to Simplus today. We look forward to helping you to build first-class customer experiences for every subscriber.


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