Top 10 strategies for reducing your Azure spend


In this article I’m going to give you 10 strategies you can adopt to reduce your Azure spend. Remember, behind every Azure service there is a virtual machine working away. This is what costs – compute: CPU, memory and storage. In that order.

At the moment we see a lot of customers wanting to reduce their cloud spend. The more workloads we move into the cloud, the more important it becomes to be more efficient. The good news is that most people can reduce their cloud spend, sometimes by large amounts.

So, top 10 strategies – here we go:


1.Autoscale: Autoscaling allows you to automatically adjust the number of instances or resources based on predefined rules or metrics. By setting scaling rules based on factors like CPU usage, memory consumption, or request volume, you can dynamically increase or decrease resource capacity. This ensures optimal resource utilization during peak demand and avoids overprovisioning during low-traffic periods, resulting in cost savings and improved performance. A word of caution: it takes time to scale up and down, so if you have very spiky workloads you may have to run spare capacity, although I can give you through some tips to help there as well.


2. Right-sizing: Right-sizing involves analysing and adjusting the size of your Azure resources to match their actual workload requirements. By monitoring resource utilization metrics like CPU usage, memory utilization, and storage capacity, you can identify overprovisioned resources. Right-sizing them to the appropriate size, such as choosing a smaller virtual machine or reducing storage capacity, helps eliminate wasteful spending on unused capacity and improves cost-efficiency. When you have done a large migration project, very often the VMs that you have provisioned will have been based on guesses! Pareto principle always applies, 80% of the work is being done by 20% of your applications. Some of them will hardly be doing anything! Once you have monitored them for a while and collected some data you usually find you can move quite a few of your VMs to cheaper instances.


3. Scheduled service hours: Some services or resources in Azure may not need to operate 24/7. By scheduling specific hours of operation, you can automate the start and stop times for virtual machines, databases, or other services. For example, you can schedule them to run only during business hours or during peak usage times. This approach reduces costs by limiting resource consumption to the necessary hours, minimizing idle time, and optimizing cost efficiency. Let’s say your business runs 8-8 5 days a week. That’s 60 hours out of 192 – meaning you have the potential to save over two thirds of your running costs simply by turning machines off when you’re not using them. The good news? This can easily be automated.


4. Reserved instances: Azure offers the option to purchase reserved instances, which provide significant cost savings compared to on-demand pricing. By committing to a one- or three-year term and paying upfront or on a monthly basis, you can reserve capacity for specific Azure resources, such as virtual machines or databases, at a lower hourly rate. Reserved instances are ideal for long-term workloads with predictable usage, offering substantial cost reductions compared to pay-as-you-go pricing. If you can’t reduce your service hours, this might be a great next step because you don’t even have to change your applications – you just change the way you purchase.


5. Remove duplication: Analyse your Azure environment and identify any duplicated or redundant resources. Duplicated resources may occur due to manual provisioning errors, changes in requirements, or unused test environments. By eliminating duplication, you can reduce costs associated with unnecessary resource consumption, simplify resource management, and ensure optimal resource utilization. We often see this in estates that have grown organically, or when businesses have merged. I can give you some great tips on which resources can be shared, so you can go through your estate.


6. Deploy only when needed then tear down: Adopting a “deploy on demand” approach helps optimize cost efficiency. Instead of keeping resources provisioned and running continuously, you provision them only when they are needed and tear them down after use. This practice is particularly beneficial for development and testing environments or for batch processing workloads. By paying only for resources during their active usage, you can avoid unnecessary costs for idle or underutilized resources. We do a lot of integration, and we often have overnight jobs that move data around. Look for this type of workload and assess whether they need to be running all the time. Once you get your head around it, you can literally deploy your application for a matter of minutes to do the work and then delete it! You’ll need some maturity in DevOps, but the savings can be huge. 


7. Move to SaaS: Consider migrating your applications to Software-as-a-Service (SaaS) offerings available on Azure. You no doubt have Office 365 now – and if you haven’t WHY NOT?????? SaaS solutions, such as customer relationship management (CRM) platforms, enterprise resource planning (ERP), financials and other lines of business systems, eliminate the need for infrastructure management and maintenance. By leveraging SaaS, you can reduce costs associated with provisioning, managing, and updating the underlying infrastructure, allowing your organization to focus more on core business activities. SaaS licensing models are also favourable, usually monthly/annual costs based on usage rather than the capital costs of up-front license fees. When you go to SaaS there are huge advantages, but you also need to look at how you integrate and how you consolidate your data. I can help you with some strategies there as well.


8. Move to cloud-native: You can’t go SaaS on everything – with your applications developed in-house or built for you, you need to host them yourself. If you’ve done a lift-and-shift to cloud, these might now be running on Windows VMs. Modernize your applications by leveraging Azure’s cloud-native services, such as Azure App Service, Azure Functions or Azure Logic Apps. Cloud-native architectures enable greater scalability, flexibility, and cost efficiency compared to traditional infrastructure approaches. By adopting serverless architectures and leveraging platform-as-a-service (PaaS) offerings, you can benefit from automatic scaling, pay-per-use pricing models, and reduced operational overhead, resulting in cost savings and improved agility. No more patching operating systems! Most custom applications are built with a combination of database and web UI/API. These are so easy to migrate to cloud native, you’ll be kicking yourself for not doing this sooner.


9. Increase hosting density: Remember, behind everything in the cloud is a bunch of virtual machines. Increasing hosting density means sharing your virtual machines to run multiple workloads. Utilize containerization platforms like Azure Kubernetes Service (AKS) to increase hosting density and resource utilization. Containers enable running multiple services or applications on a single virtual machine, optimizing resource consumption. By consolidating workloads onto fewer virtual machines, you can reduce costs associated with provisioning and managing individual instances while maximizing resource efficiency. You can also achieve the same result – at a fraction of the complexity – when you port your applications to Azure App Service. Which way is best for you will depend on application complexity. 


10. Rationalize your environments: Evaluate your Azure environments and identify opportunities for consolidation or reorganization. This process involves assessing your resources, subscriptions, and deployments to optimize efficiency. By combining workloads, consolidating multiple subscriptions, or rearchitecting your applications, you can streamline your infrastructure, reduce management complexity, and achieve cost savings through better resource utilization and more effective management practices. One area for quick wins can be test environments. We often see a proliferation of test environments, but do you really need them? And do you need them all the time (see above). Also, mergers and acquisitions (M&A) lead to opportunities here.

Bonus: Azure Advisor: Azure Advisor provides ongoing recommendations for optimizing your Azure resources. It offers suggestions to improve performance, security, reliability, and cost efficiency. Regarding cost savings, Azure Advisor can identify opportunities to optimize your resource usage, such as identifying idle or underutilized resources, recommending rightsizing options, and suggesting the use of reserved instances. By following Azure Advisor’s recommendations, you can continuously optimize your Azure environment, reduce unnecessary costs, and ensure efficient resource allocation.

If you’re struggling to get started, why not book in an Azure Discovery Workshop with me and my team? In this we can discuss your own Azure estate and your workloads, and decide which strategies work best for you.

happy holidays

we want to hear from you