How your company adopts a usage-based business model such as AWS – TechCrunch

300+ Amazon Web Services (AWS), which has been released for years, does not need to be reimbursed if it is sold at the wrong price.

That is no coincidence.

Utility Price (UPP) provides tremendous revenue growth and product adoption. Any company operating in the cloud can adopt a usage-based pricing model that enhances (and should) provide value to the customer with best practices and frameworks.

I worked for a few years as CEO at AWS, personally overseeing Amazon CloudSearch and some related services raising revenue over $ 1 billion on the back of a cost-based model. Later, when we launched Amazon OpenSearch, the same model contributed to great success and adoption.

The usage-based model is the only one that makes sense in the cloud. Considering the elastic nature of the infrastructure below, anything that is stacked upwards should be just as flexible – and increase in value. Below, I have set out seven steps to launching a usage-based pricing model in your business.

Step 1 ፡ Apply the usage measure

Many companies make mistakes by starting with a pricing model and trying to go back to measure usage.

This is the wrong approach. The first step is to measure all of your technological heritage. If you are a beginner, it is very important to apply the measurement at the beginning.

Knowing who, when, where and how much is being used will help you to open up useful insights into all functional groups and groups, and make pricing easier.

Look for a purpose-built measurement service

Do not fall into the trap of measuring instruments. Measure your stack of technology in a comprehensive way. You have to think about measurement first and then move on to pricing and billing, not going back to pricing and billing.

This is a good way to put this in.

Suppose you know you want to charge for API calls, and start by considering the numerical pricing model for API calls. Going back to this measurement method, you come to the conclusion that you need to measure the number of API calls.

Compare this with the measurement future approach. First you decide whether you need to use Device API calls because it is one of the key features of how your customers interact with your product. Then, you ask yourself, what is the general way to use a device API call?