7 benefits of a subscription management solution

Give your SaaS businesses access to the full picture with a next-gen single source of truth. Read more about benefits of a subscription management solution.
Erinc Karatoprak
By Erinc Karatoprak on June 24, 2022
 

Data lives in different systems. And if they are not integrated seamlessly into one centralized location then the data quality suffers. And when you use subpar subscription data to garner insights, you end up making subpar decisions.

In our blog Single source of truth: Why spreadsheets won't cut it anymore, we explored why do SaaS businesses need to start with transformation into solutions that will enable them to grow revenue and streamline operations in a more efficient way.  This blog will cover how good subscription management can support your growth and revenue.

Apart from offering a holistic view of customers' needs and the impact of business activities, here is how a subscription management solution offers a better single source of truth: 

1. Builds greater trust in data: Do you find yourself faced with incomplete or inaccurate sales data? Or accidentally added duplicate subscription data points? A subscription management solution does away with such instances of human error by offering a central resource for accurate and up-to-date data. And because the AI-powered system does all the work, you don't need to keep checking with different sources to see which is the most accurate and authoritative data set.

And such an SSoT also standardizes the data fields (definition and version) so that everyone is on the same page. Thus, whenever any stakeholder tries to extract a particular metric, they get the same data as everyone else in the organization would. 

2. Helps avoid revenue leakages: By tracking renewal and payment dates, and sharing reminders regularly, an automated SSoT will ensure that you never forget to share invoices with your clients. Also, by helping you gain access to the right data points, around subscription billing and pricing, you will never again underbill or underquote a client.

For example, if you are a company that makes EUR 25M revenue a year, even a 1% of revenue leakage means that you lose close to EUR 250,000. To steer clear of such heavy financial losses, you must implement a subscription management tool.

According to, Wolter Rebergen, Commercial Director, Younium “In a spreadsheet everything is manual, which increases the chances of data error. On the other hand, a subscription management solution offers an automated and trustworthy source of truth. If you have it integrated with your CRM, the data pulled from the contracts is going to be most reliable since it's signed off by the customer. Also, because the data is built from the agreement, there are no typing errors or data lost in translation.”

“And since it's also integrated with your finance backend, the invoices are directly and automatically sent to the client,” he added.

3. Improves data accessibility and transparency: A good subscription management solution removes data silos so that different stakeholders get easy and role-appropriate access to updated data whenever they need it. 

4. Enables bias-free decision-making: By offering a 360 degree view of the company data, a subscription management tool eliminates the bias caused by being too close to a problem. 

Let’s take the analogy of people standing blindfolded around an elephant, each touching one part of it. The one who was touching the pachydemr’s hide thought that it's a leathery and rough creature. The other who was in contact with its tusk, categorized it to be a being of smooth and dense texture. And so on. Only when the blindfolds are removed do they recognize the animal. 

Similarly, it is when data becomes more accessible across teams that the business leaders uncover insights about your SaaS business that helps you gain a competitive advantage or prepare for risks. Subscription management systems (such as Younium) also offer dashboards and visualizations to help understand the data better.

5. Meets compliance requirements: SaaS subscriptions tend to change throughout a customer life-cycle. And SSoT enables proper versioning and maintenance of repositories of legal contracts, from at least the last 5 years, that is important to ensure audits are successful. It also ensures the smooth-sailing of certifications for business processes such as ISO.

6. Grows organization-wide productivity: A subscription management tool enables much faster exchange of subscription data without too much administrative effort. There is no need to manually try to match all data and check for errors or debate the interpretation of the data. It automatically extracts data from multiple sources so that you can spend more time on the analysis.

7. Improves NPS score: When all the teams collaborate better and faster via a subscription management tool – there is more informed decision making, less confusion between cross-functional teams, smart prioritization of tasks. This means, the right communication and solutions are delivered to the client with minimal delays, which helps improve your brand’s Net Promoter Score (NPS). 

Examples of how a subscription management tool trumps spreadsheets

Data is akin to gold. But when it's spread across systems or spreadsheets, it becomes difficult to monitor your SaaS business’s finance performance and growth.

A single source of truth in an integrated subscription management system is key to enable all your teams to be on the same page and create a good foundation for better SaaS business growth and control.

Sr No.

Business run on spreadsheets

Business run on an integrated subscription management system

1.

Your SaaS sales team bags a new client on a monthly retainer, by offering a 20% discount on the rack rate. While the sales team updated this pricing detail in their CRM, the finance team didn't get the memo. 

Naturally, with the limited information available to them, the finance team ends up invoicing the client for the full amount. And you are left with a disgruntled client.

With an integrated subscription management, subscription details are automatically pulled from the contract and are accessible to the finance team. 

It also automates and streamline the customer invoicing process and reporting.

Hence, there are no errors, confusion or delays when it comes to billing the client every month.

2.

A new salesperson was added to your team, and tasked with discussing a product upsell with an existing client. But there were just too many versions of pricing in the spreadsheet, owing to frequent subscription changes and dynamic pricing. 

It was also confusing to track the pricing changes over the years. This made it difficult for them to build a good argument to support the upsell.

An integrated subscription management  solution would be able to help the salesperson gain quick access to the most reliable and accurate view of the current and historic pricing and features enjoyed by the client.   

To make your sales pitch more convincing, the SMS also tends to offer details of competitors pricing, new modules or monetized features, and indexation.

3.

Deciding subscription pricing is a very complex job. It's so difficult to analyze all the data, and manage the many moving pieces, on spreadsheets. Thus, your business devices offer a flat fee option to all clients. 

This means, you end up depriving your customers of choice for admin reasons.

With an subscription management solution, as you have access to so much rich and detailed data and customizable dashboards, it's possible to accurately calculate and build flexible pricing models.

This allows your B2B SaaS business to give customers more tailored options.

4.

Your finance personnel heard on the unofficial grapevine about a particular client having downgraded their subscription to the SaaS tool. 

They wish to confirm this piece of news, but the sales team is away on an offsite and are just not reachable. And the subscription updates are only available on the sales team’s spreadsheets.

This unnecessarily delays the invoicing process.

By offering a hub for your subscription data, an subscription management eliminates the need for the finance, sales, or customer care team to chase after each other for updates.

5.

As a B2B SaaS business founder, you wanted to take a call on whether to scale the business to a new territory or not. 

But you didn't have a holistic view of the sales and revenue projections in the new geography, since the data was fragmented across different spreadsheets - controlled by different stakeholders. 

Even after following up and sourcing these spreadsheets from different teams, you noticed that some of the subscription data was not updated for the last 2 months.

An subscription management tracks real-time KPIs and bookings data, to calculate realistic sales and revenue projections, the right price corrections, personalize communication, or arrive at pending payment amounts. 

It would also offer out-of-the-box reports, such as tax summary reports, financial account analysis reports, and journal summary reports.

Such updated data scoreboards and customized summaries help leaders work with their team to make the most of opportunities like adding a new sales channel, cross-selling or upselling.

6.

During audits, every year, your team of CAs struggle to collect the data from multiple spreadsheets and offer the most authentic version of truth to the auditors. 

Meanwhile, the auditors struggle to match all transactions with the bookkeeping ledger.

If any accidental discrepancies arise, your business may be deemed non-compliant or worse, your license could be revoked on the grounds of illegal financial activity.

An subscription management carefully tracks the entire customer lifecycle from old quotes and contracts to downsells, payments, invoices, payments and churn

It even forges a seamless connection between each detailed revenue recognition line, all the way back to the subscription line item (for plans that may have been sold many years ago).

Thus, an subscription management  makes the audit stress-free by offering a chronological and secure audit trail of what event led to what for each subscription client. 

 

For all these reasons and more, once your SaaS business begins to use an subscription management solution, they seldom look back. 

Here is what Nicholas Johansson, Co-Founder of leading Ed-tech company Kognity, had to say about their experience with using a powerful subscription management for managing their subscription data: “Younium enables us to keep both subscriptions and invoicing effectively in the same system. Changes and alterations on subscriptions were a tedious process in our ERP system and are now much smoother and it saves us a lot of time and reduces the risk for errors.”

How to implement the best-in-class Single Source of Truth

You could try to create a central repository within your organization for subscription data on your own. But during the unification of data, you will face issues like missing metadata, misrepresented data relationships, and different data formats.  

The good news is, there are subscription management platforms that can help you easily keep all of your records in one place.

Here are some of the basic steps that go into adopting such a subscription hub:

  • Identify source systems: Where does all your data exist currently? Is it in spreadsheets? Or in different legacy systems like financial backend (eg: Accounts receivable), CRM, customer success platforms and service? To start off with, identify which set of  disparate source systems you would want to extract data from. 
  • Connect with a subscription management tool: Use connectors and APIs to sync your subscription management to shortlisted source systems and services, from quotes, contracts and invoices to cash. And, then, deploy the solution to clean the data and create a master record.

And what, you may ask, happens if your data currently lives in different spreadsheets? In response, Wolter’s confirmed that when you implement an SaaS subscription management solution like Younium, it's possible to just upload the spreadsheets into the new system.

“And this makes the journey to embracing an automated single source of truth very smooth indeed - even if your business has worked on spreadsheets for years,” he added.

  • Build a governance model: Define roles, responsibilities and processes so that the right people get access to edit, view and delete the data. This helps build accountability when managing data assets.
  • Run a change management program: The transition from your spreadsheets to an SMS can be made a lot more seamless with a detailed change management campaign. To this end, you could communicate about the benefits of the change via videos, emails, and change agents, offer training in the new way of doing things, and set-up organization-wide forums to users to gain access to expert and peer support.  
Still have queries about how a Subscription Management Solution will fit into your existing business workflows? Watch Younium in action to understand what we do and how connecting to our platform can help you take control of your subscriptions.
Published by Erinc Karatoprak June 24, 2022
Erinc Karatoprak

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