Innovative Pricing & Packaging Strategies in the Subscription Economy

1. Marke1ng
Panel
–
Innova&ve
Pricing
&
Packaging
Strategies
Brian
Bell
CMO,
Zuora
@brianbell123
1
Zuora confidential, shared under non-disclosure and subject to disclaimer notice

2. In
The
Subscrip1on
Economy,
Focus
Is
On
Rela1onships
BUY NOW
Product
2
SUBSCRIBE
Relationships
Zuora confidential, shared under non-disclosure and subject to disclaimer notice

3. Three
Strategic
Growth
Levers
in
Subscrip1on
Based
Businesses
Acquire
New
Customers
3
Increase
Value
of
Your
Customers
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Reduce
Churn

4. Pricing
and
Packaging
Supports
Your
Key
Growth
Strategies
$
PRICE
4
ITERATE
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5. How
Do
I
Get
My
Arms
Around
My
Pricing
Strategy?
How do I balance
growth & revenue?
How do I improve
Time-To-Market &
operationalize?
How to I think about
choice vs. simplicity?
Do I price for new
accounts or existing?
How do I price
vis-à-vis competition?
CMO
5 5
Zuora confidential, shared under non-disclosure and subject to disclaimer notice
Zuora confidential, shared under non-disclosure and subject to disclaimer notice

6. Pricing
in
the
Product
World
$
Price
PROFIT
Cost
TIME
6
Zuora confidential, shared under non-disclosure and subject to disclaimer notice

7. In
The
Subscrip1on
World,
Pricing
is
Based
on
Recurring
Usage
7
Zuora confidential, shared under non-disclosure and subject to disclaimer notice

8. Consumers
Have
Unique
Needs
8
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9. It’s
a
Compe11ve,
Dynamic
Market
Pricing
&
Packaging
becomes
a
Powerful
New
Strategic
Weapon
9
Zuora confidential, shared under non-disclosure and subject to disclaimer notice

10. The
Challenge:
Where
to
focus
&
start?
C O M P L E X I T Y
MulHple
Currencies
Pricing
Tiers
Add-­‐On
Products
Usage
&
Overage
Product
Upgrade
Product
Bundles
A/B
TesHng
Simple
Monthly
Different
Billing
Recurring
Frequencies
Company
Launch
Revenue
Enhancement
Product
Expansion
Pricing
International
Optimization
Growth
BUSINESS
MATURITY
10
Regional
Pricing
Zuora confidential, shared under non-disclosure and subject to disclaimer notice

11. This
is
Not
Where
to
Start
11
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12. Con1nued…
12
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13. And
Con1nued
Again…
13
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14. Start
Simply
&
Iterate
1
Simple
Recurring
Model
14
2
Basic
Itera&ons
3
Zuora confidential, shared under non-disclosure and subject to disclaimer notice
More
Advanced
Op&ons

15. Four
Basic
Subscrip1on
Price
“Metrics”
1. One-time
Product
Relationships
15
1.
2.
3.
4.
One-time setup
Fixed recurring
Per unit/user
Usage models
Zuora confidential, shared under non-disclosure and subject to disclaimer notice

16. Consider
Fixed
Recurring
Model
to
Start
Focus
on
Core
Value
Prop
for
Target
Customers
16
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17. As
You
Iterate,
Add
More
Basic
Op1ons
1
Simple
Recurring
Model
17
2
Basic
Itera&ons
3
Zuora confidential, shared under non-disclosure and subject to disclaimer notice
More
Advanced
Op&ons

18. Use
a
Promo1onal
Strategy
to
Acquire
Customers
Offer
full
trials
to
drive
adop&on
Offer
Full
Trials
to
Drive
AdopHon
18
Zuora confidential, shared under non-disclosure and subject to disclaimer notice

19. Consider
a
Freemium
Strategy
Give
Away
Base
Product
to
Rapidly
Acquire
Customers
19
Zuora confidential, shared under non-disclosure and subject to disclaimer notice

20. Bundling
Strategy
Offer
Flexibility
&
Cross-­‐Sell
Offerings
20
Zuora confidential, shared under non-disclosure and subject to disclaimer notice

21. Longer-­‐Term
Op1ons
to
Lock
In
Customers
Reduce
Churn
&
Increase
Commitments
(TCV)
21
Zuora confidential, shared under non-disclosure and subject to disclaimer notice

22. More
Advanced
Op1ons
1
Simple
Recurring
Model
22
2
Basic
Itera&ons
3
Zuora confidential, shared under non-disclosure and subject to disclaimer notice
More
Advanced
Op&ons

23. Usage
Based
Pricing
Pay
as
You
Go
&
Limit
Risk
For
Customers
23
Zuora confidential, shared under non-disclosure and subject to disclaimer notice

24. Interna1onal
Pricing
Strategy
A
US
Pricing
B
Asia
Pricing
Address
Different
Market
&
Segment
Requirements
24
Zuora confidential, shared under non-disclosure and subject to disclaimer notice

25. Test
and
Iterate
Pricing
ITERATE
OpHmize
Both
PromoHonal
and
Core
Pricing
Strategies
25
Zuora confidential, shared under non-disclosure and subject to disclaimer notice

26. Be
Mindful
When
Making
Changes
Talk
to
Customers
&
Communicate
Changes
EffecHvely
26
Zuora confidential, shared under non-disclosure and subject to disclaimer notice

27. Lessons
From
Our
Customers
1. Pricing
and
packaging
is
a
new
strategic
weapon
2. Start
simply…then
iterate
with
more
basic
strategies
3. Four
basic
pricing
metrics
for
subscripHon
businesses
4. Leverage
a
free
promoHonal
strategy
5. Test,
test,
test
6. Be
mindful
of
communicaHng
and
deploying
changes
to
your
customers
27
Zuora confidential, shared under non-disclosure and subject to disclaimer notice

28. Meet
The
Panelists
ScoutAnaly&cs
Ma^
Shanahan,
SVP Strategy and Marketing
@ScoutAnalytics
uKnow.com
TeleshuMle
Steve
Woda,
CEO
Richard
Reisman
President
@SteveWoda
@rreisman
Zuora
Brian Bell, CMO
@brianbell123
28
Zuora confidential, shared under non-disclosure and subject to disclaimer notice
SailThru
Dave
Govan
EVP
Sales

29. END
29
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