More Related Content Similar to Subscribed 2015: The Subscription Maturity Model? Where do you fit? (20) More from Zuora, Inc. (20) Subscribed 2015: The Subscription Maturity Model? Where do you fit?3. What are we trying to enable?
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Align price with experience
Product/Service
Defined by
access
Experience
Defined by
interaction
Outcome
Created
through
interaction
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5. Subscription models can get stuck
•Attrition
•Acquisitions
•Culture of “winging it”
Subscription models evolve rapidly
•Iterate pricing and packaging
•New functionality, new markets
Why a Maturity Model Approach?
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Rising expectations
•Customers
•Investors
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7. And This
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“…messy organic growth, seven customer data stores, three
independent payment collection systems, customers passed
between different contact centers, no centralized view of
the customer.”
“how do we enhance and maintain our customer experience
while changing every fundamental aspect of the technology that
supports our subscription business without damaging our
customer experience?”
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IDC’s Subscription Business Model
MaturityScape Stage Overview
Wild West
Focus on customer
acquisition without any
retention strategy.
Inconsistent customer
experience.
Business Outcome
Churn is excessively high,
outpacing new
subscribers.
Differentiated
Customer experience hinges
on individual perception of
the offering. Systems
support low-touch
subscriber acquisition, but
lack scalability and visibility.
Business Outcome
Recurring revenue is on the
rise, but churn is still high
and/or unpredictable.
Customer Loyalty
Focus on bringing the “right”
customers in, keeping them,
and providing them with
social avenues to express
their loyalty.
Business Outcome
Churn is slowing while
recurring revenue is
increasing.
Time to Value
Acceleration
Structures designed to get
customer to realized value
quickly, and then
demonstrate this back to
customers via usage
reports.
Business Outcome
Focus on profit as well as
revenue growth. Better
visibility into key metrics.
Customer Lifecycle
Optimization
Focus on building and
deepening customer
relationships-- before the
customer even makes a
purchase through renewal.
Business Outcome
Customer lifetime value is
3x-4x the cost of customer
acquisition.
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9. Haphazard
Opportunistic
Inconsistent
Experience
High churn
Low customer lifetime value
Reactive management of the business
Outcome
Monitor customer engagement with the product/service.
Develop strategies to make customers more engaged.
Hone your strategy to be more attractive/valuable to key
segments.
Guidance
Wild, Wild, West
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10. Easy to get on board
Hinges entirely on the individual's perception of how
unique, cool, convenient, cost-effective, or useful the
offering is.
Experience
No focus on customer lifecycle. Customers come in leave
in a linear fashion
Pricing focus is on promotion, not retention, and churn is
still high and unpredictable
Outcome
Develop a forward- versus backward-looking income
statement focused on annual recurring revenue.
Systems must be addressed at this point. Billing frequency,
scalability; holistic view of the customer.
Guidance
Structured and Differentiated
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11. Becoming more social. Outlets are created or supported for
customers that want to engage with one another.
Pricing and packaging are designed to help bring the "right"
customers into the offering
Experience
Churn is slowing; The cost of customer acquisition may still
outpace customer lifetime value.
Recurring revenue measurements and overall retention
rates are more instructive in determining business health.
Outcome
Pricing should be transparent and simple to understand.
Focus on getting the customer into the right plan.
Structure technology and process around governance.
Institute controls over rogue behaviors.
Guidance
Building Loyalty
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12. Continuous engagement
Unified customer experience across product/service lines
Customer feels like an individual, not a segment.
Experience
Systems and processes support continuous engagement,
by providing recommendations and demonstrating value
through elements such as usage reporting.
Up-sell and cross-sell identification.
Outcome
Integrate pricing/packaging with customer experience to
more effectively design offerings that enable customers to
see realized value as quickly as possible.
Guidance
Value Acceleration
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14. Hierarchy of Pricing Flexibility
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Subscription
Metered
Access
Consumption
Outcome
What is a
successful
outcome?
Size= cost
of
equivalent
unit
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15. Clear cadence of contacts and experiences
Delightful
Personal
Experience
A dashboard view across all key subscription metrics
Customer usage data build prospect and customer profiles
The company realizes that sometimes, putting customers
in the "right plan" means putting them in the lower cost
plan.
CLV is 3x-4x cost of customer acquisition.
Outcome
Some of the biggest challenges were are managing scale.
Hone your multi-channel relationship capabilities
While it may be possible to run pricing experiments, setting
a consistent pricing structure is important to building trust.
Guidance
Lifecycle Optimization
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Editor's Notes 1/3rd view 1/3rd view 1/3rd view 1/3rd view 1/3rd view 1/3rd view 1/3rd view 1/3rd view 1/3rd view 1/3rd view 1/3rd view 1/3rd view 1/3rd view 1/3rd view