DigitalRoute

What's your take on AI monetization? With the proliferation of AI products/features being launched by software companies, how to monetize AI is the talk of the town. While there are a lot more ways, we've highlighted the pros and cons of three of them: traditional subscription(seat-based) ; usage-based; and outcome-based. We'd love to get hear your thoughts on which one you thing will become the dominant model in 2025. SUBSCRIPTION MODEL ✅ Pros: - Predictable Revenue: Ensures a steady and predictable revenue stream, making financial planning easier. - Lower Barrier to Entry: By spreading costs over time, customers may find it easier to start using your AI product. ❌ Cons: AI Adoption: Because the AI features are only a part of an all-you-can-eat buffet, it can be tricky to understand the real value and usage of AI. Ongoing Value Demand: Requires continuous product updates and support to maintain customer satisfaction. USAGE BASED MODEL ✅ Pros: - Alignment with Usage: Customers pay only for what they use, which can be an attractive proposition. Scalability: Easily scales with customer needs, catering to both small businesses and large enterprises. ❌ Cons: Revenue Uncertainty: Fluctuating usage patterns can lead to unpredictable revenue streams. Tracking Complexity: Implementing and maintaining accurate usage tracking systems can be both complex and costly. OUTCOME BASED MODEL ✅ Pros: Customer Alignment: Strongly aligns your interests with those of your customers, as they pay for achieved outcomes. High Perceived Value: Clear ROI can justify higher prices, potentially boosting revenue. ❌ Cons: Outcome Attribution: Quantifying and attributing outcomes directly to the AI product can be challenging. Revenue Delay: Payments are often delayed until outcomes are realized, impacting cash flow. Additional resources: If you want a more in-depth list of additional models, Kyle Poyar posted about it a few days ago: https://lnkd.in/dzXrz2x5 And if you want a more in-depth understanding of how a leading SaaS company is tackling AI monetization, we recently released a podcast episode about Freshworks' approach to it with Tapish K., available here: https://lnkd.in/dMXiZVxZ #AImonetization #usagebasedmodel #outcomebasedmodel #subscriptionmodel

On the latest episode of the Data for Subscriptions, we talk with Jeff MacMillan about Autodesk's Pricing Transformation over the years from perpetual licenses to their hybrid subscription approach, that includes a PAYG model, Autodesk Flex. One of the topics we tackled was what's next for Autodesk, and how their approach to the hot topic of the moment: AI monetization. If you want to listen to the full conversation, you can find the episode on your favorite podcast platforms like Apple Podcast or Spotify, or go to the link below. #dataforsubscriptions #aimonetization #hybridsubscriptions #payg #podcast

Transitioning to a consumption-based model brings challenges in revenue forecasting. But by analyzing usage patterns, leveraging AI for anomaly detection, and building predictive models, businesses can better manage these complexities and reduce churn. 📊 Tune in to our latest podcast with Karthik Kirubakaran, Director of Financial Services at 8X8, for insights on overcoming these hurdles. Link in comments. #RevenueForecasting #AI #ConsumptionBasedBusiness

Last week, DigitalRouters came together for our Company Kick-Off—high energy, big ideas 💡, and great conversations! We celebrated 2024 wins, welcomed new Management Team members, and tackled our must-win battles for the year ahead. Huge thanks to everyone who contributed! Now, we carry that momentum into 2025—exciting things ahead!  🚀 Ari Vänttinen Demed L'Her Andreas Zartmann Per-Erik Johansson Hanne Engberg Emil Eriksson Kristine Andersen Richard Matti Shirley Johansson Mattias Nyblaeus #companyculture #kickoff #teamwork

🎧 “We process close to a billion usage events every month. And they’re not just one type—they’re multiple types.” Managing high volumes of usage data isn’t just about scale—it’s about flexibility. In our latest Data for Subscriptions podcast episode, we dive into the challenges of handling diverse usage events, ensuring accurate mediation, and feeding clean data into billing systems. If you’re dealing with complex usage data, this one’s for you. Tune in now! https://lnkd.in/dHn2ngaU

Your customers’ usage data holds the key to smarter pricing and predictions. Are you leveraging it? Too many businesses react to data instead of using it to drive strategy. What if you could: ✅ Spot churn risks before they happen? ✅ Use historical usage patterns to predict future demand? ✅ Build dynamic pricing models based on real usage trends? In our latest episode of Data for Subscriptions, we dive into how companies are turning raw usage data into revenue opportunities. Check out the full conversation with Karthik Kirubakaran, Director of Financial Systems at 8×8: https://lnkd.in/dHn2ngaU

January newsletter is here! 🌟 How will AI transform Order-to-Cash (O2C) processes? What is its role in driving revenue? We’re exploring these questions and more, with subject matter experts. Check it out and let us know what you think! 👇 #O2C #usage #AI

Do you have a sophisticated financial revenue model and want to explore the intricate process of consolidating financial systems? In our latest ebook, we delve into into the challenges faced when integrating disparate financial systems, particularly those handling usage-based billing and large data volumes. We examine the limitations of traditional integration solutions and highlight the advantage of specialized usage data management to provide a comprehensive guide for finance leaders. You can grab the ebook here 👉 https://lnkd.in/dsVcXfJD #usagedata #financialconsolidation #financeleaders

Do you know what metrics to track for a successful CPQ implementation? Here are three key ones to watch: 1️⃣ Billing Details: Are you seeing a decrease in the gap between closing and invoice creation? 2️⃣ Billing Cycle Alignment: Is your billing cycle becoming more in sync with your booking cycle? The closer it is, the better. 3️⃣ Sales Cycle Length: Has it increased due to changes in CPQ or go-to-market strategies? Listen to the latest Data for Subscriptions episode with Kayvan Dastgheib-Beheshti, Global Head of Revenue Operations and Enablement at Tegus, for CPQ implementation tips and insights on how to optimize your processes. Link in comments! 👇

We asked DigitalRoute experts which AI-driven trends will shape the future of Order-to-Cash in 2025. Now it’s your turn—what do you think will have the biggest impact? 🌟 Vote below! 👉 Check out our latest blog for more insights—link in comments!