Here at Gotransverse, we’ve watched as company after company — in SaaS, marketing, ad tech and countless other industries — have adopted usage-based models to maximize revenue and improve client relationships. We wanted to know: Is it working? Will this trend continue? So last month, we commissioned Forrester Consulting to evaluate the current adoption, challenges and benefits of usage-based billing models.

Our driving question was this: As more firms incorporate digital products and services into their product portfolios, will usage- and consumption-based business models become their preferred models?

Forrester surveyed 170 Director+ decision-makers responsible for billing platforms and heard from a wide-range of subject matter experts on the current state of usage and consumption-based billing. They got deep in the weeds to uncover the motivations, benefits and challenges of implementing a usage-based billing model.

Here’s a preview of what we learned.

Usage-Based Billing Models Will Continue to Spread

With technological advancements from data analytics to IoT to cloud computing, companies have more opportunities than ever to fine tune their business models to better meet customers’ growing expectations and evolving demands. As a result, nearly three quarters of respondents who are not yet using a usage-based model plan to adopt one in the next two years.

Adopting Usage-Based Billing Takes More than the Flip of a Switch

From alignment with value proposition to predictability of revenue to the question of what to monetize and how, our study uncovered the most common questions and concerns businesses have about usage-based models. But firms that have already made the transition overwhelmingly offered one piece of advice to those that haven’t yet:

“Flexibility and configurability of billing technology is crucial to success. Billing solutions designed to allow frequent and easy updates enable firms to monetize flexibly as they evolve their products and services.”

There will be trial and error involved in the shift to usage-based models. That’s to be expected, and it’s okay. The key is to build these models on a technological foundation that’s flexible enough to support that evolution.

The Advantages Are Worth the Investment

Of the survey respondents that have adopted usage-based models, the vast majority are satisfied that this is the right business model for them. We’ve written before on the advantages of usage-based billing models, and this survey validates the anecdotal evidence we’ve gathered from clients over the years. Some of the most frequent benefits are the lowered barrier to product and service adoption, the opportunity to expand product offerings and the ability to use customer insights for better relationship management.

All in all, our survey found that, though adopting a usage-based business model can be a daunting task, the payoff is more than worth the effort — especially for business that partner with trusted, consultative technology partners to solidify plans and establish the right technological foundation to make the most of the new business models.

Learn how Gotransverse can help your business make the transition, schedule a complimentary demo today.