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    20 2017

    How ISVs Can Overcome the Challenges of Software Monetization

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    ISVs Software Monetization - Cygnet Infotech

    New business models have pushed ISVs to innovate in terms of flexible payment models, managing entitlements, control usage, and tracking and aggregating product usage data.

    For ISVs that address these challenges, it is a game changer. They are now better able to inform business decisions and continue innovation.

    By equipping themselves with the right strategy and tools, ISVs increase their opportunities for growth.

    According to IDC FutureScape: Worldwide Software Business Models and Monetization 2017 Predictions, ISVs across diverse sectors are likely to adopt flexible, digitally centric business models like subscription-based pricing, consumption-based pricing and outcome-based pricing.

    ISVs are also exploring freemium and feature-based software models. Yet, the biggest opportunity and current challenge isn’t how you choose to distribute your software services.

    It’s something else:

    How to Best Monetize Your Software Solutions

    Besides having great software, an ISV needs to have a thorough understanding of their potential buyers and their consumption behavior. This will inform your monetization strategy and software delivery method.

    You also have to remain flexible. Consumer preferences can change on a dime. You need to be able to adapt to enterprise user demands across multiple devices.

    Then, you can overcome the challenges of licensing and monetization, and generate more revenue opportunities.

    Putting Together a Comprehensive Software Monetization Strategy

    Your strategy needs to include software pricing, packaging and licensing. Consider monetization not just as a means of collecting revenue by selling the rights to use intellectual property.

    It should be viewed as an enabler to further revenue growth by developing software in the ways that customers want to use it.

    Effective software monetization has four cornerstones:

    • Packaging
    • Control
    • Tracking
    • Management

    One size never fits all. ISVs need to offer flexible pricing and licensing models if they want their software to reach its full potential. They also need a cohesive licensing team to future-proof the software application.

    By understanding the what, how and how much, ISVs can deliver product versatility and a flexible licensing model. This also gives the ISV the business agility to quickly adapt to changing consumer needs.

    Software Usage Tracking

    It is essential to track consumption and usage so you can change with the market. When the delivery of your software product is in line with consumers’ needs, you build trust within the marketplace. You have now set yourself apart from your competitors.

    Tracking usage also helps you make better investment decisions. You’ll learn where to target your engineering and development efforts.

    By tracking real-time use, you can create a flexible pricing model based on user experience. This, in turn, helps you tap into new markets and expand your base.

    Monetize Individual Features of Your Software Solution

    Apart from addressing their pain points, consumers have a definite preference when choosing your service. If you are unable to offer a flexible monetization model that gels with their business, they will choose a competitor.

    By monetizing individual features, you are more likely to cover all your bases.

    Package Goods According to Consumers’ Preferences

    Customers expect quick deployment, low up-front cost and predictable ongoing expenses. Your software also has to be easy to install and must provide the most up-to-date version.

    In a connected ecosystem, ISVs differentiate themselves by catering to the user demands of “anytime, anywhere and any device.”

    When you put the user in control of how they want to access your software, you have just delivered your unique value proposition.

    Partnering with Cygnet Infotech

    With our Product Engineering Services, Cygnet ensures effective packaging, provisioning, control, monitoring and in-order management of your software solution.

    See how we can boost your software revenue. Contact Cygnet if you want to offer a better customer experience or simply email us at

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