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Usage Billing

Welcome to the Usage Economy™, where customers expect to only pay for what they use. This can be a significant benefit for companies with heavy users who traditionally are being under-billed. That's why essential industries, from software as a service to payment processors, have already made the move.

The right choice of billing strategy can pay dividends to any business and be a key differentiator. If you are considering usage billing as a go-to-market strategy, here are some opportunities and challenges you'll encounter.

Usage Billing Opportunities

Recover Revenue

Recovering revenue is a balancing act for any business; you want to make sure you are providing both a positive customer experience and invoicing customers accordingly. You also want to make sure you are not encouraging churn by making it difficult for customers to make payments or renew a subscription.

Instead, efficiency in the customer lifecycle should be top of mind. By implementing one solution rather than multiple solutions, you reduce error and conflict with numerous solutions and thus reduce churn.


New Usage-Based Products

Today, there is an increasing number of companies that are now offering usage-based pricing on everything from furniture, to cars to technology.

This new model has given companies the added benefit of customer knowledge on how, when and where customers are using products.

By aligning your product pricing model with "usage," you can reduce the up-front costs typically found with physical products. This has also opened up the market to serve lower-use customers, so they can afford to use the products being offered, resulting in driving demand for low-risk alternatives versus having to commit to traditional ownership.

Enterprise Usage Pools

An Enterprise data pool means that corporations can have one phone bill and pay for a certain amount of data which is shared between multiple employee mobile devices. Sharing monthly data between numerous devices means those who are using less data, don't get charged for wasted data that isn't used.

However, there are risks to pooling data because if one person goes over the pooled data limit, everyone could become subject to overage charges. Or even worse, the internet speed could be significantly reduced and impact the business productivity. Managing your share plan rules is critical in this environment.

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The Devil is in the Details. Make Sure to Consider the Following

Mediation Engine

To invoice your customers correctly, you need to implement mediation so you can consolidate and correlate customers data accurately. Using micro-moments as triggers, mediation receives data from switches and converts that information to manageable formats for billing, and reporting purposes.

All irrelevant data is filtered out and organizes itself so bills can be easily reconciled and any disputes around billing can be settled instantly.

Mediation can also report on vital details around customer usage so you can accurately track and analysis your customers' data.


Hybrid Subscription

Aligning price allows your customers to dynamically right-size their usage to fit their current and future needs. Aligning price has opened a world of opportunity for customers who previously would not have been able to afford the full cost of service.

This dynamic pricing structure by usage can be challenging for companies to respond to because it eliminates up-front revenue streams and preconceived assumptions of the value and cost behind their full package service offerings.

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Challenges to Complete Usage Based Billing & Monetization

Digest and Consolidate Data

Driven by increased and varied data usage, mediation has evolved to collecting system and usage data across a wide range of networks to be used as the primary source of customer usage for business intelligence as well as including charging, billing, and audits.

Mediate your usage feed data easily with multiple different file formats with LogiSense's powerful data transformation engine. Now you can receive usage file export formats in real time from your communications switch and run reports to analyze your customers' usage data.


Real-Time Pricing

Real-time pricing is a market strategy whereby product prices continuously change, sometimes in a matter of minutes, in response to supply and demand.

With LogiSense whether you have location specific rates, on-net, off-net or conditional rates based on time of day, custom logic or specific rounding rules; our conditional rating engine allows for classification and charging of any usage.

Customized Billing

Bill on first use scenarios are gaining more prominence, particularly in IoT. Service is not billed to a customer until a certain usage threshold is reached or a configurable period has expired. Once either of these conditions is met, subscription and usage billing is triggered, and the state of the service is transitioned (e.g., pre-active to active).

As part of this workflow, Logisense provides a facility to optionally add a time window for when the usage needs to come in. If no usage comes in within that timeframe, then the state change is triggered and any applicable one time and recurring charges due to the state change will be charged to the account.