Leverage data for better business results
Financial services companies are constantly looking for ways to increase their revenue and maximize growth. However, this can be difficult in an increasingly digital landscape where data is often spread across multiple systems with varying levels of accuracy.
There is a wealth of data generated by modern businesses in the financial services industry – 70.3 billion real-time payment transactions took place in 2020 alone. With thousands of daily investment values and transactions that need to be analyzed, reported and shared, it can be difficult to keep track of exactly what has been delivered and to whom.
Current issues
But while providing information of this complexity and scale, financial services SaaS companies must manage their own fragmented data. Without collecting and understanding how their own software is being consumed, it is inherently difficult to bill accurately for the services they have provided a customer, resulting in potential revenue leakage and a degraded customer experience.
These financial SaaS companies struggle to manage data about how their services are used. Not having full control over data or the right processes in place can lead to performance issues, prevent insights from being used to plan and launch new services, and stifle the innovation and growth of a SaaS platform.
Driving the introduction of this type of software is increasingly linked to tailoring services to the customers’ needs. To offer more dynamic pricing and billing, for example, financial services SaaS solutions need a way to set a variable price based on each asset’s unique attributes and summarize the collected data on a customer-specific basis. This means that each customer’s specific invoicing conditions can be calculated correctly by the invoicing system.
Another big problem is the application stack of many SaaS and other businesses. Most have modern CRM and ERP systems, but rely on an older invoicing system and homegrown integrations to customer systems and data sources. It traditionally takes several days to add new customers to the billing system. For each new contact, the billing team must analyze the service agreement to determine if new integrations, software development, or manual processes are required to serve the new customer.
This results in a slow, and ultimately compromised, customer experience. It also puts pressure on the team to get everything ready in time for the next billing run. Although this generally gives good results, they are far from efficient. Companies need integration between business applications and their accounting platforms to avoid unwanted delays and bottlenecks when using different systems.
The solution
Instead, financial services SaaS companies must overcome manual processes and introduce automation in managing their data.
The first step towards reversing revenue leakage is the collection of transaction system usage data using software. By connecting all the different systems used by customers – such as online banking platforms or payment gateways – reporting and analytics software provides an overview of transactions. This ensures that no information is missed that could contribute to income leakage.
Once all data is collected, usage data management software can normalize it into a single format so that it can be easily read by any system or application. This defines how each piece of data should look and ensures that it is structured in a consistent way throughout the company.
This means that financial SaaS companies can integrate all software and data formats, whether it is transactional data or complementary data from CRM or ERP, which are used to enrich the data with valuable customer information.
The benefits of understanding data usage
By having greater control and understanding of usage data, companies can upgrade their old ways of working. This includes high levels of automation in usage data processing and easier integration across business systems, including invoicing.
New customer creation and monthly invoicing will become more streamlined, with more accurate invoicing and fewer miscalculated invoices to deal with, teams can not only save time but also prevent revenue leakage.
With a more flexible back-end business system, the sales team can quickly offer flexible pricing models that can be easily adjusted for each customer. They can even offer multiple pricing plans for different devices within one customer.
Going forward, with a more efficient system in place, companies can respond better to customer demands. By collecting transactional and software usage data, SaaS companies have greater insight into how their platform is being used and thus how best to bill for the services provided. Using software that automatically processes all types of customer usage data, companies can easily collect, format and check customer data so that it can be fed back into valuable reports that are insightful and actionable.
About the author: Stephen Hateley is head of product and partner marketing at DigitalRoute
