Why IBM repriced it’s Cloud Pak for Data as-a-Service
On May 2nd, 2022, IBM restructured the prices for one of its most successful suite of AI-powered solutions — IBM Cloud Pak for Data-as-a-Service (CPDaaS). This effort lowered the barrier-to-entry to deploy our game-changing solutions in their workflow. As the Platform Product Manager (PM) that launched this initiative, here is a summary of the process.
What is IBM Cloud Pak for Data-as-a-Service?
IBM CPDaaS is an end-to-end platform for advanced analytics suite of cloud-native on-demand solutions built on RedHat Openshift that help clients put their data to work and to infuse AI into their workflow; it is an offshoot of our award-winning — Cloud Pak for Data. These on-demand services help users gain efficiency and optimizations in these 4 use cases:
- MLOPs and Trustworthy AI: Infuse IBM’s powerful AI and MLOps portfolio into your workflow, data, and models with transparency, accountability, and trust.
- Multicloud Data Integration: Leverage IBM’s DataFabric to connect, access, transform, and deliver enterprise data across multi-cloud environments, users, and roles.
- Customer 360: Build smarter relationships with your customers using a 360-degree view of your customers and personalized insights extracted from your enterprise data, with IBM’s data discovery, cataloging, and visualization.
- Governance and privacy: Automate robust data protection policies and governance enforcement across multi-cloud environments to ensure holistic data trust, security, and privacy.
Why IBM decided to do this?
Because at IBM, everything we do revolves around the customer, a 2021 user research we perform showed that the following pricing concerns were limiting adoption:
- Too many pricing metrics: After users have used our lite plans/ free trials, they often fell off the funnel due to some of our services having as many as five (5) different metrics that left them overwhelmed or confused. In response, our pricing redesign work switched all our services to a new metric — Capacity Unit Hours, introducing consistency. Also, we ensured all services have a maximum of 2 metrics (3 in the rare case).
- High entry cost: A common metric CPDaaS services had prior to May 2022 was Instance Charge (this charged clients for provisioning a service instance and often includes predefined allotments). After thorough analysis, we noticed that some users do not use a large chunk of this allotment. And given our SaaS positioning, we decided to offer a Pay-as-you-go pricing (CUH) that effectively reduced the average price for most of the services and lowered the entry price.
- Lowering the time-to-value: The simplicity of our new metrics and tiers ensures customers can quickly get to value, instead of spending valuable time poring through resources and on support calls just to understand our pricing.
What does this mean to our customers?
Given the reasons above and true to our Clients-First culture, our efforts successfully provided the following business values to our clients:
- Clients save money: This redesign helps clients save direct and indirect costs of using our services by removing esoteric metrics (e.g. authorized user), metrics that introduce unused entitlements (e.g. Instance charge), and hard barrier charges between plans.
- Simplified UX via improved pricing transparency: Our new pricing reduces confusion and helps customers buy into the platform more seamlessly by ensuring clients readily know what service tier and pricing they should pay for.
- Lowering the time-to-value: The simplicity of our new metrics and tiers ensures customers can quickly get to value, instead of spending valuable time poring through resources and on support calls just to understand our pricing.
CPDaaS’s new pricing strategy was introduced to ensure clients have a more delightful experience using, provisioning and paying for our cutting edge services. I am honored to be have worked with the team of outstanding PMs and leadership that launched such impactful and thoughtful change within IBM.
