All facets of your business should be tracked to ensure that they’re running with peak efficiency. Whether it’s website performance, social media metrics, your general customer service, etc., you must stay on top of the processes involved.
Otherwise, you’ll miss out on positive trends that can be capitalized upon while small discrepancies go unnoticed. Failing to catch problems before they get out of control could cause significant detriments over the long haul.
Leveraging the technologies of today to monitor and track performance is what keeps business ahead of the curve. It’s an approach that not only improves your overall operations but also drives innovation and industry disruptions. Knowing these intricate details provides a big picture illustration of strategizing on a grander, more successful scale.
Your business’s most integral component would be its ability to earn money. Of course, everything referenced above impacts your proficiency with profits.
However, none of the elements discussed previously deal directly with money—which is where revenue monitoring comes into play.
Why Are Subscriptions Ideal for Your Business Model?
Market fluctuations can be an emotional rollercoaster for any business. This issue tends to rear its ugly head when your business model is based on a one-off payment structure.
In this instance, during your “busy” times, you’re bound to push yourself too far trying to maximize your profits, so the “down” periods do less damage. The stress and anxiety caused by this unpredictability can fray even the steadiest nerves.
Moreover, those fluctuations are unpredictable, making it more challenging to plan around consumer behaviors. You’re continually chasing your tail, trying to stay ahead of the curve.
Whereas subscription-based modeling for organizations provides a steadier revenue stream that offers stability. Planning around your clients’ interactions with your product or service becomes much more seamless since you’re following a straight line instead of an erratic wavelength.
Currently, people stay home more than ever, and their abodes are becoming more ubiquitously connected to technology. This shift in lifestyle seems to mesh with subscription-based businesses, which are growing 5-times more rapidly than S&P 500 revenues and U.S. retail sales.
What Kind of Problems Can You Run into With a Subscription-Based Model?
There are plenty of reasons why subscription-based services or products will do wonders for your business.
However, we’d be remiss to ignore that running your organization this way comes with complications. More specifically, the previous section’s stats prove how the market is growing and getting competitive.
Consumers have heightened expectations, and your competitors have finetuned their operations to near perfection. Merely offering subscriptions isn’t enough anymore, despite consumers leaning in that direction.
Moreover, you can run into the following two issues that take significant chunks out of your revenue totals:
- Payment failures lead to users no longer using your service/product.
- These are often caused by expired payment information.
- People decide not to renew.
Sometimes, lapsed renewals come down to forgetfulness. Still, people being unaware that their subscription ended is frequently because your brand hasn’t become an integral part of the former client’s life.
In some instances, there’s an error with the service. An “urban legend” of sorts that comes to mind is one company with a sign-up process glitch. It broke the SMS verification for customers in Russia on Androids. Anybody who fit that description was blocked from subscribing or payment processing for 3 weeks.
Anecdotes aside, there must be a method that rectifies these revenue-related obstacles.
Without some kind of tracking, these types of issues will spiral. This leads to some severe damage to your earnings AND your reputation.
As such, revenue monitoring has become crucial in recent years:
Defining Revenue Monitoring
The very framework of revenue monitoring for subscription-based businesses is tracking the key performance indicators (KPI).
Revenue monitoring involves all the KPIs that impact your ability to earn, which would be the following:
- Conversion rate
- Subscriber growth
- Subscribers per location
- And much more
Generally, you’re dealing with vast revenue data that can be intimidating to manage. Sure, it’s one thing to have the information—it’s entirely different from knowing how to leverage it. Human behaviors play such a pivotal role in how the data should be interpreted, making it even further confusing.
The three below concepts will illustrate precisely why revenue data is challenging to handle:
- As a rule, there are no absolute terms and minimum or maximum thresholds for revenue metrics. How the data is evaluated should be based on in-flux conditions. In other words, context plays a pivotal role in the insightful interpretation of your numbers.
- Metrics often clash with one another. While many do correlate and play off one another, others don’t necessarily mesh. These topological relationships can be either dynamic or volatile.
- Algorithmic functionality and data storage are impacted by the frequency with which business metric sampling rates are irregular. This issue presents significant volatility and requires a wealth of adaptivity.
Realistically, it’s not possible to handle these challenges and the overall dynamism of this revenue data through manual means. Nor is it wise to apply static thresholds. Utilizing incorrect monitoring methods generates false positives – and false negatives – that won’t be recognized.
What you need for your business is monitoring technology that tracks your data 24/7, providing root-cause analysis. This leads to lightning-quick resolutions for promptly flagged problems.
Applying Revenue Monitoring Technology to Your Subscription-Based Business
At Avora, we provide revenue monitoring that learns the typical behavior of individual performance metrics. There doesn’t even need to be a static threshold.
We extract valuable insights, correlations, and patterns by dynamically processing massive amounts of data. With this approach comes the type of scalability, customization, and specificity that you require for your business to monitor its revenue.
Moreover, our technology flags discrepancies in real-time, so you can spring into action and handle the issue immediately.
Advantages to Avora’s Solution
The chances are that you don’t only have one revenue stream. Even if you don’t, diversity often opens you up to a sea of earning opportunities.
With more diverse revenue streams, you require a system that can monitor each one individually. Our solution provides this level of specificity and doesn’t treat revenue as one mass metric.
Furthermore, when there’s a data discrepancy (e.g., a substantial revenue decrease), monitoring top-line and previous events (e.g., conversion rates) will pay massive dividends. Namely, you can pinpoint the root of the problem right away instead of flailing in the wind for answers.
Here’s one last consideration for this section:
Imagine how utterly impossible it would be to manually connect metrics and events without taking a few weeks.
Avora monitors an array of metrics simultaneously and can connect them to various events or discrepancies. This also helps you almost instantaneously get to the root cause and solution to any issue rearing its ugly head.
Getting the Most Out of Your Revenue Monitoring
You must monitor the KPIs that most impact your revenue. Otherwise, you’re not going to achieve anything close to your ideal ROI.
Here’s a breakdown of what you should monitor and why it’ll make a positive difference:
- Keeping Track of Churn Rates:
- Maintaining a continual grasp on churn rates means you’ll be fully aware of how many customers you’re losing in real-time. As the weeks or months pass, you’ll also have a bigger picture view of those canceling or not renewing your subscriptions.
- A higher churn rate indicates that you aren’t providing users with enough value. Or, customers are unaware of how to use the product. In both scenarios, it now becomes possible to rectify the issue.
- Keeping Count of New Subscribers:
- Avora uses 24/7 monitoring to track registration spikes or drops.
- Our technology tracks billions of events before filtering them and calculating a single score.
- We also send alerts when an issue arises, so you’ll be notified right away.
- Keeping Tabs on Conversions
- No conversions generally mean an absence of revenue, making it one of your most essential metrics.
- Drastic drops out of nowhere could be caused by issues with the website or a translation error, for instance.
- The quicker these issues are solved, the better—because it stops you from losing money. With Avora, these issues are flagged as they happen, so you can rectify them with little hassle.
- Keeping in Touch with User Habits
- Avora is also aware of how your customers are using your product or service, tracking their actions from the moment they log in to when they log out.
- Potential discrepancies might indicate that users aren’t interacting in a manner that adds value. We notify you when this happens so you can take the appropriate action.
Revenue Monitoring Technology is Any Subscription-Based Business’s Direct Path to Success.
Subscriptions-based businesses are feverishly multiplying. As the years go by and people continue to see the light, expect this trend to intensify. The only way to thrive in this highly competitive market is by staying on top of your data to help hone and finetune your offerings.
Thus, Revenue Monitoring technology, such as what’s offered by Avora, is the sure-fire path to your long-term success.