Cloud cost optimization best practices:
reach your company’s cloud nine

Whether you host with AWS, GCP, Azure, or another cloud provider, you’re looking toward a future of endless growth. Unless your cloud budget ends too soon.

Cloud service pricing plans can quickly become confusing. A couple of months, and you’re no longer sure your cloud usage is sustainable. 

Your cloud spend can get out of control with several key factors getting into play. 

Why do cloud costs spiral?

It’s estimated that at least 30% of global cloud spend is entirely unnecessary. To begin to understand, we must explore the ‘why’. Let’s examine the elements that contribute to this troubling issue.

Accessibility issues

Are you an SME? Unfortunately, this means you could miss out on some serious discounts. Because the quantity of storage or instances that you require is lower than that of big corporations, you are not offered bulk discounts. Having a smaller team can also mean that staying on top of offers, discounts, and cloud credits is difficult, so potential savings are lost. 

Complex pricing models 

Tiered, subscription, usage-based, the list goes on. With this many options, it’s no wonder financial decisions become blurry. As analysis paralysis sets in, it’s tempting to go with a vendor’s suggestion rather than question if it is the best fit for your business. 

Lack of transparency

Multiple spreadsheets and scattered information result in a worrying lack of visibility. There may be unused resources that are still being billed for. It may also be the case that you are paying for a lot more storage than you need or extortionate data transfer fees.

Fast moving innovation

It’s true that when things are busy in business, we are less likely to keep up to date with news and developments. But that can be costly. New technical developments often come with cost-saving attributes and efficiency boosters. Likewise, when your business priorities shift, attention should be allocated to cloud architecture to ensure that opportunities to scale up or down are not missed.

Just one of these areas can lead to significant cloud waste. Businesses suffer financially without cloud cost optimization.

Now that the scope of the problem is evident, we can move to a more positive outlook. Here’s a breakdown of your potential business gains when cost optimization practices are implemented. 

How can cloud cost optimization help?

High cost savings 

Imagine what you could do with almost 60% more budget. 

It’s almost unbelievable, but optimizing cloud costs has helped many businesses make such significant savings. These savings are achievable. Group buying to achieve bulk discounts is just one of the best practices outlined later in the article that will facilitate high savings.

No more unnecessary costs

I’m sure we can agree that paying for unused cloud resources doesn’t make sense. Whether it’s idle servers or over-provisioned storage, this waste can be avoided. 

A bonus? When you trim the waste, you reduce costs and boost your profit margins. That’s money you can invest straight into company growth. 

Intelligent budget forecasting

Surprise bills and blown budgets become a thing of the past with optimized cloud costs. No more ‘guesstimates’—now, you can predict your expenses with financial clarity. Optimization gives you the tools to plan budgets with confidence and keep investors happy in the process. 

Efficient scaling

With cost optimization, you’re only paying for what you use, right when you need it. Because your cloud should scale when you do—automatically. No more bloated bills for underutilized resources. A responsive model gives you the efficiency that grows with you. 

Cash for growth, not waste

Discover more growth opportunities as you unlock previously wasted capital. The money that you save on cloud expenses will contribute to company growth in the areas that matter – hiring top talent, new product development, and expansion into new markets. You can spend smart and invest big with your savings gains. 

Agile and responsive development

A fast-moving market can leave businesses behind, but optimized cloud costs give you the flexibility to respond quickly and proactively. You can pivot, scale, or launch without a hefty overhead. 

Maintaining your speed does not always mean purchasing more expensive infrastructure. Our best practices explain how optimization of your costs equals agility in the market. 

Sustainable growth

Long-term outlooks are sunnier with cost optimization. Lean and efficient infrastructure reaps significant financial rewards from quarter to quarter. It’s not just about cutting bills today – it’s about sustainable growth. Less waste means reducing your company’s carbon footprint, too. 

Outpacing Competitors

Want the edge over the competition? Of course, you do. 

While your competitors are overspending on the cloud, you’re saving. The savings you make with cloud cost optimization go straight into innovation and growth and push you ahead of the field. You become better, faster, stronger, and the number one choice for your customers. 

This may sound like a dream vision, but it’s well within your grasp. Companies of all sizes deserve access to the best cloud cost optimization strategies. Grow and thrive in the market using the key components below. 

Key components of effective cloud cost optimization

The following best practices are ranked with savings and effort in mind, using expert finops recommendations and Google’s Architecture Framework for cost optimization.

Implement technical optimization

Starting at the foundation level, the most efficient way to make cloud savings is by implementing technical optimization.

This involves reviewing and adjusting cloud infrastructure for optimal performance and cost efficiency. The keys to technical optimization are: right-sizing resources, auto-scaling, and using serverless architecture. 

Right-sizing 

Right-sizing is all about matching your infrastructure scale with usage. For example, you may have deployed 50 VMs (virtual machines) but not all of them are utilized. Your system can therefore run with fewer or smaller VMs. Resizing or deleting these can unlock previously wasted budgets. A word of caution – right-sizing requires less effort if completed during the design phase rather than post-deployment of resources. 

Autoscaling 

It allows you to be dynamic and highly responsive to your company’s ever-changing load, meaning real-time savings on resources you aren’t using. 

Common instances can be grouped to form managed instance groups. These groups have the benefit of autoscaling capabilities. Without any extra brain power on your part, autoscaling works by adding more VMs to your managed instance groups when there is more load and deleting VMs when there is less need. 

You can even autoscale capacity based on personalized parameters that matter to your business, such as CPU usage, and also take advantage of schedule-based autoscaling for an anticipated load. 

Serverless Architecture 

Resources that take up space on your server can drain money quickly. Moving to serverless (or cloud-native) services that support scaling to zero can be more cost-effective. For example, rather than maintaining servers to deliver mail, you could use a service that charges on a per-message basis. 

Once you’ve optimized your infrastructure, your next most impactful cost-saving practice is auditing your cloud usage. 

Audit cloud usage efficiency

Since your company goals will evolve, audits must be carried out regularly. Evolutions in your business could include new projects, performance goals, and budgets, and things can easily slip through the net if timely action is not taken. 

Such audits expose inefficiencies and patterns across longer periods. Using this insight will ensure that your infrastructure aligns with your current objectives and earn you significant savings over time.

After completing your internal optimization, it’s then time to look outwards to see what support can be leveraged for more cloud savings. 

Join group buying for lower rates 

Group buying is the cost-optimization strategy that you probably won’t hear much about from AWS, Google or Azure. 

Luckily, there is free help available to companies who wish to take advantage of group buying for cost optimization. Low rates, no upfront commitments, and up to 60% of savings can be gained with this savvy financial strategy.

It works by participating in a group purchasing agreement or program that negotiates lower cloud rates for bulk purchasing, reducing costs through economies of scale. Smaller and start-up companies no longer miss out on such offers and can take full advantage of money saved for essential growth. 

What else can be gained from a bit of external help? 

Leverage cloud resellers’ offers

Cloud providers can only offer you plans and pricing models by their policies. Most of the time, these won’t quite be the best fit for your company, and you can lose small amounts of cost here and there, adding up to huge long-term losses. But there is a way around this. 

Cloud resellers are your answer for tailored solutions that lead to significant savings. 

You can compare offers from cloud resellers for discounted rates, flexible pricing models, and better terms. Just like holiday package comparison sites, you get the best value for your business.

As if that wasn’t enough, there is one more high-save, low-effort method that can make cost savings. The cherry on the cake of cloud cost optimization. 

Get promotional free cloud credits

Everyone loves a freebie—so keep your eyes peeled! 

Cloud providers and resellers often extend free credits, promotional offers, and trial periods that you can take advantage of.

In particular, these can be hugely beneficial to start-ups and smaller businesses to offset initial costs. 

Such offers also allow you to explore new services without extra expense—another win for company-wide cloud cost optimization.