Tech Marketing Zone is brought to you in partnership with:

The SaasAddcit Blog is centered around the idea that Saas (Software as a Service) is fast becoming the most important advancement and future of the software and computing industry and will continue to reign supreme for a long time. As technology creates the opportunity to have less material possessions and use physical space, its fast changing the way we all experience life. Saas addict covers the latest news and updates every business owner and technology fanatic should be aware of. “Omri is a Marketing fanatic and recovering Saas Addict dedicated to find new and innovative ways to enrich and empower software provides and emerging Startups on their way to online stardom. His rich experience as a marketing director for walkme.com providers a breath of fresh air to the ever changing Saasosphere.” Omri is a DZone MVB and is not an employee of DZone and has posted 59 posts at DZone. You can read more from them at their website. View Full User Profile

Getting The Best Monthly Recurring Revenue Possible

03.22.2013
| 2286 views |
  • submit to reddit

Monthly recurring revenue is a great thing to plan for and work to maintain in SaaS. With the new and kind of non-standardized SaaS marketing world, there should always be something put into place to bring on some stability and predictability for a company. SaaS by its unique nature allows for this quite well, with its blend of software and internet making for so many strategies that are very easy to implement.

So, how can you get the best out of your monthly recurring revenue? We propose blending the following in the ratio and methods described. This should also calculate for slack, given modifications to meet corporate cultures and SaaS applications and industries.

First, assign yourself a set of points, that being 50. Each of the following, you may dedicate points to using more or less heavily.

#1 – Free Advertising Model (Minimum 40 Points)

Take one point for using advertising. For each three small image banners per page, deduct two points. For each five text ads, deduct one. For any flash banner ad, deduct five. Interstitials, deduct 10.

You should not spend more than 20 points on advertising.

Advertising is a steady and reliable way to gain some recurring revenue. All who visit the site will generate it, and free users with an ad heavy version will use it perpetually. Light usage on all free access levels works less effectively.

It’s important to be tasteful with your mixture and how prolific you make ads in even a dedicated ad-grinding version of the platform. For this, the more obnoxious ones are more costly in points, to offset annoyance with sparseness.

Gimp this version, but only marginally. No points for gimping here.

#2 – Gimped Cheap Version (Minimum 20 Points)

A next step up model can a considerably less capable version, but for cheap and with minimal ads. In this model, you give a dedicated 10, but may spend 1 point on text ads in the ratio of the advertising model.

This version will be less annoying but considerably less capable in how permission or features are available versus the paid version. Minimal text ads are permissible as well, and this will be one that people will pay a per-access cost of a couple dollars to use uninterrupted, where heavy users unwilling to pay will grind the ads for you.

#3 – Remaining Points (Minimum 9 Points)

You may have 9 points remaining, or more. These can be used for incentivizing conversion along the three channels, to make this formula also work as a way for customer gain.

For each successive three days of free discounted access you provide for an upgrade, deduct half a point. For each partner-endorsed incentive, deduct a point.

This allows you to tap into some additional promotions, one of which may cost you but ensures conversion and draw of customers.

With this formula, you should be able to create a good strategy for strong monthly recurring revenue. Notice how gamification kind of helps make this an easy little puzzle to solve, rather than a conundrum of migraine proportions. In the future, try this model, and share with the world your success or failure in getting it to work.

Published at DZone with permission of Omri Erel, author and DZone MVB.

(Note: Opinions expressed in this article and its replies are the opinions of their respective authors and not those of DZone, Inc.)