In 2023 cloud wastage continued to challenge large enterprises, with 82% struggling with efficient cloud spend management. This inefficiency often stems from a mismatch between allocated resources and actual usage, enhanced by uncertain budget forecasting. Despite the availability of AWS discount plans that can offer cost savings up to 72% if optimized properly, almost all organizations struggle to fully capitalize on them.

 

We will explore how a large enterprise was facing similar challenges because of their large and dynamic workloads that made it difficult to apply discount plans that require long-term commitments. However, by shifting their strategy to include a blend of AWS discount plans that was managed by Zesty, they significantly improved their utilization and cost savings. Read on!

 

Dynamic and Hyper-Scale Workloads Increasing Uncertainty in Forecasting

 

The core challenge lies in the difficulty of selecting an optimum discount plan that will suit your workload’s requirements. Let’s take an example of a North American company in the marketing and e-commerce sector. As a leader in e-commerce marketing with a wide consumer base, they were facing the challenge of managing thousands of AWS EC2 instances for their constantly changing applications. The management was complex, time-consuming, and not cost-efficient.

 

Initially, they strategized to invest in AWS discount plans to leverage stable discounts. However, planning for commitments three years in advance becomes nearly impossible when even a three-week forecast is uncertain. The uncertain forecast coupled with dynamic workloads, created a persistent challenge where they were only able to cover 70% of their provisioned resources.

 

The organization chose AWS Savings Plans for its relative flexibility, however, it still posed a financial risk of overcharges during low usage periods due to its fixed dollar-per-hour commitment. And, in case of high application demands, the company resorted to using On-Demand instances which became prohibitively expensive over an extended period of time.

 

This led to discount wastage on days of low usage and exorbitant expense on days of higher demands. Their variable workloads demanded the flexibility of discount programs that are able to adapt to changing usage rates. As a result, the company couldn’t adjust to the fluctuations, leading to significantly lower savings than potentially possible.

 

Using a Perfect Blend of Discount Plans: Zesty’s Way

 

Zesty’s blended approach of discount plans for larger and dynamic workloads focuses on finely tuning AWS discount plans to match the variable need. After considerable evaluation of the workloads, the following suggestions were implemented:

 

• For the consistent part of the workload, AWS Savings Plans were utilized which benefited the organization with stable discounts. This caters to the predictable, steady needs of the business, like maintaining a core set of EC2 instances. Additionally, a relatively small portion of Standard Reserved Instances (SRIs), which tend to offer the deepest discounts (as much as 72%) is utilized for stable workloads to get more aggressive savings.

 

 

• The versatile workloads were managed with Convertible Reserved Instances (CRIs) as they allow adjustments in daily consumption to align with actual usage. For example, for a daily $10 CRI commitment, it is possible to utilize $8 one day and $12 the next day. This flexibility lets businesses scale resources up or down efficiently without underutilizing or paying extra in cases of unpredictable workloads. With an intelligent evaluation of the dynamic requirements, Zesty allocates the more variable portion of the workload to CRIs, which typically yields 40-60% to 3-year CRIs and 20-40% to 1-year CRIs, adding more adaptability and enabling par utilization.

 

This blended approach to AWS discounts brings flexibility back to your cloud infrastructure, allowing an increase or decrease as needed. This approach helps manage risk with the CRIs and elevate the savings ratio with SRIs and Savings Plans.

 

Zesty’s intelligent allocation strategy helped the organization to efficiently cover its varying operational demands, and balance cost savings with operational flexibility.

 

 

Screenshot 1: 3-month coverage after implementing Zesty’s intelligent allocation

 

 

As depicted in the above graphs, Zesty adeptly managed to prevent the overprovisioning of resources and avoided cloud wastage. There were instances where the demanded and reserved instances almost converged, but Zesty intelligently ensured that usage did not fall below the reserved line, thus preventing underutilization.

 

Zesty’s Commitment Manager: Adding Flexibility to Discount Plans

 

After successfully implementing a customized blend of AWS discount plans, Zesty notably achieved better cloud savings. This success was not just about reducing costs but also about managing the commitment risk through optimum utilization.

 

The below graphs demonstrate coverage of 99.99% and a running tab of $32,000 in savings month-to-date. After Zesty tailored their cloud commitments to actual usage, it prevented over-investment in underused resources while ensuring availability for peak demands. This led to a more streamlined cloud infrastructure, where cost savings and operational efficiency went hand in hand.

 

 

At Zesty, we strive to help organizations explore the right blend of AWS discounts that would work best for their workload environment. We enable businesses to leverage adaptability in their management of AWS discount plans while avoiding long-term financial lock-ins. We make savings easier and faster by adding flexibility back to discount plans.

 

 

Explore more details about Zesty’s Commitment Manager or Book a demo now!

 
Use a blend of AWS discount plans to significantly improve savings