Understanding and creating price plan components.docx
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Transcript of Understanding and creating price plan components.docx
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Understanding and Creating Price Plan Components
Donna McPhee– Customer Success Manager
March, 2013
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Speaker Introduction
Donna McPhee, Customer Success Manager
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E: [email protected]: 888.519.1425 x415
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Agenda
1. What’s a price component?2. Popular Price Components3. Component Reports4. What about the Why?5. Summary6. Questions
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What’s a price plan component?
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A price component is really just: what (cost) and how (frequency+when) you charge your customers for your products and/or services.
There are 2 main categories:• Those charged on a one time basis.• Those charged on a recurring basis that you define.
Recurring price component types:
• Core Plan Components• Recurring Add-ons• Metered Components
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Example – Skype Price Components
All of the menu items under Prices are Skye’s price plan components.
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Core Plan Components
Monthly recurring charge Customer chooses the core plan
that suites their needs.
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Creating core plan component in Fusebill
Fill in the details of your core plan and click create.
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Addon Components
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Creating Addon components in Fusebill
• Creating an add on component is very similar to creating a core plan component.
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One-Time Components
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Skype sells apps as one time components and hardware.
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Creating one time components in Fusebill
Both of these one time components have now been created in Fusebill.
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Coupons
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Creating coupons components in Fusebill
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Metered Components
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Metered components are used when customers are charged on usage/volume, etc. (in this example a price per minute) this can be:• Standard• Tiered• Volume• Stairstep
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How to create metered components in Fusebill
The metered charge components popup is the most detailed of all the price components.
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Component Reporting
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Stats! Stats! Stats!
Being able to create components doesn’t mean very much if you can’t easily track or report on them.
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Component Reporting
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The Components Section of the Reports tab
Here you’ll find more detailed report options for your components.
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The Why?
• The one time transaction is a thing of the past.• You have to give customers what they want.• Empower your sales and marketing people• Free up your IT team• Keep accounting happy
Flat pricing is usually only used because it’s easy!
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Knowing what price components are, how to create them, and how to track them is great but why is this important for your subscription business?
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The Why?Build Relationships
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• At the center of a subscription business is the vendor-customer relationship.
• Subscription relationships have 3 key attributes:• Faster turns – customers change their subscription
at will to adjust to their needs. • Lower margins – Customers buy just what they
need. • Cancel anytime – Customers don’t want a
commitment, they want to be able to walk away at anytime.
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The Why?Empower Sales and Marketing
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The inability to easily introduce new price plans and test pricing is often one of the hardest obstacles for sales and marketing.
Sales are more often than not are the front line talking to customers and closing deals, they need the flexibility tailor the offering to the customer and once the deal is closed keep the customer happy and paying monthly.
Both groups need to be able to access information vital to their success:- Are price plans working?- Are customers happy i.e. churn- Are some price components working better than
others?- Is per customer profitability being measured and
measured accurately?
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The Why?Keep IT Happy
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The inability to easily introduce new price plans and test pricing is often one of the hardest obstacles for sales and marketing.
Sales are more often than not are the front line talking to customers and closing deals, they need the flexibility tailor the offering to the customer and once the deal is closed keep the customer happy and paying monthly.
Both groups need to be able to access information vital to their success:- Are price plans working?- Are customers happy i.e. churn- Are some price components working better than
others?- Is per customer profitability being measured and
measured accurately?
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The Why?Happy Accountants
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Eliminate manual billing processes and reduce errors.
Track revenue and deferred revenue.
Taxes
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Summary
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Being able to easily create price components and move away from flat pricing is an important key to subscription success.
• A price component is really just: what (cost) and how (frequency+when) you charge your customers for your products and/or services.
• There are 2 main categories:• Those charged on a one time basis.• Those charged on a recurring basis that you define.
• Not only do price plan components need to be easy to create, they have to be trackable and reportable.
• A billing system that give you price plan components that are flexible and robust, not only makes customers happy but your entire organization as well.