Attributed to: Michael Misasi, Senior Director, Strategic Partner Management at BlueSnap
Businesses today have to deal with an extremely competitive environment. This means that traditional revenue models such as subscription fees and one-time sales are no longer sustaining profit margins. This new environment is creating knock-on effects on how private equity (PE) firms expect software companies to view revenue sources. Today, PE companies require diversified revenue streams so that enterprises can survive the current market landscape. With that – they have created a new portfolio at the C-suite to manage this expectation – the Chief Monetisation Officer (CMO).
A CMO’s job is to innovate revenue streams and align product development with financial goals so as to identify and/or develop new sources of revenue to help sustain business growth and keep up with rising competition in the market. They spend a significant amount of time evaluating emerging trends and technologies, and judging their profit potential.
Chief Monetisation Officer: The Job Description
The dynamism in today’s market has motivated the rise of many disruptive technologies and helped businesses keep up with changing customer expectations. However, it has also highlighted the limitations of traditional revenue models, like subscription fees and one-time sales. This has made the introduction of a CMO a strategic priority for all growth-focused enterprises. The sentiment is also echoed by private equity investors and software executives, who realise that firms today need a strategic leader who is focused on championing innovative revenue strategies.
A CMO takes on the responsibility of optimising and managing the company’s revenue generation approaches in order to help reach profit goals. To do this, they design and implement revenue models, develop pricing tactics, and foster strategic partnerships and joint ventures to boost sources of revenue. However, they are also liable for ensuring customer satisfaction so the business doesn’t sacrifice long-term goals for short-term gains.
Embedded Payments: An Important Aspect
Within the strategic partnerships domain, one key strategy CMOs have been implementing to achieve their goals is embedded payments, which offer a seamless way to create value for customers whilst significantly boosting margins.
Embedded payments also consistently rank as a top priority for investors and executives because they help businesses reduce churn by offering additional value-added services without asking customers to leave the platform. This makes the customer experience more seamless and improves satisfaction. Embedded payment programs also increase revenue per customer via transaction fees or revenue-share arrangements and allow SaaS businesses to monetise commerce conducted on their platform, which is vital to maximise profits in today’s economic climate.
By giving growing companies the flexibility to enable and disable complementary financial services easily, embedded payments support business growth and expansion plans and set companies up for success.
2025: What’s in Store?
As the importance of a diversified revenue stream continues to increase, embedded payments will act as a cornerstone for corporate strategies. The diversification will help companies mitigate the risks associated with single-revenue-stream models.
The data generated from payments will be used to inform evidence-based decisions around product development, marketing strategies, and customer personalisation, enhancing the organisation’s ability to meet customer needs effectively. Moreover, as the payment processes are embedded, firms will gain more control over them. This will allow businesses to tailor the payment journey to their consumers’ specific needs and ensure a consistent brand experience.
All this will act as proof of a scalable and diversified growth model, which will enhance growth opportunities and make the enterprise more attractive to investors. This will contribute to an increase in the importance of the CMO and the role that they play in determining the overall direction of the company.
Can a Chief Monetisation Officer add value to a business? Definitely.
This is especially true if the business goal is to diversify revenue streams and keep up with emerging trends in payments. A CMO will leverage embedded payments and seamlessly integrate novel, high-margin, and scalable solutions into the customer journey, consequently helping meet investor and market demands.