Archive | December, 2012

How Usage Data Drives Revenue Growth in the Subscription Economy

The “Use It or Lose It” dynamic in the Subscription Economy means that if your customers don’t use your service, you’ll lose the customer, the renewal and the revenue. The relationship between subscriptions and usage illustrates this dynamic well. If a customer’s usage meets specific thresholds, the subscription revenues are retained at renewal. If usage climbs enough, subscription revenue growth can be generated by a new subscription tier or more seats. Similarly, customers with the most usage tend to expand their subscriptions to more complementary products. On the other hand, if a customer’s usage drops below certain thresholds, the first thing that occurs is tier or seat churn, which reduces subscription revenue. Ultimately, continued drops in usage lead to product churn […]