Applications that integrate and scale will
enable enterprises to meet customer expectations while ensuring
financial integrity and compliance, new research
finds
Subscription pricing must go beyond traditional flat-fee models
to include consumption-based pricing supported by technology for
subscription-based businesses to continue growing, a new research
report from leading global technology research and advisory firm
Information Services Group (ISG) (Nasdaq: III) says.
The ISG Subscription Management Buyers Guides, produced by ISG
Software Research (formerly Ventana Research), note effective
subscription management systems must support a variety of business
models and use cases, either with functional capabilities of their
own or with the ability to integrate with existing systems or
third-party providers. The report states that by 2026, increased
adoption of the subscription business model will lead to more
complex pricing, rating and billing, and if not successfully
addressed with software solutions, will diminish the customer
experience and restrict growth.
“Though subscription models are no longer new, the rate at which
more traditional subscription sales channels are adopting new
pricing and monetization methods continues to grow,” says Stephen
Hurrell, director of Office of Revenue Research, ISG Software
Research. “As a complement to one-time sales, the adoption of
subscriptions and, increasingly, usage-based models, is putting a
strain on existing systems.”
Rather than rip and replace existing applications, enterprises
are looking for ways to leverage their existing ERP and CRM systems
with applications that enable them to add and manage new sources of
revenue without interrupting or complicating the customer
experience, Hurrell noted.
Overall, the research finds software providers recognize that
non-digitally native companies want to supplement their core
one-time sales business with additional pricing and revenue models,
such as subscription and usage, that offer complementary products
and services.
Software providers in the subscription management market now
support better subscriber experiences that require advanced
analytic and predictive capabilities utilizing artificial
intelligence techniques such as machine learning. The report notes
most software providers have been slow to roll out value-added
offerings that can recommend additional monetization opportunities,
such as pricing optimization or plan and bundle options, but some
are leading the way with new digital innovations.
The report highlights one technology area many providers are
actively investigating: how predictive and generative AI can
enhance internal operations to support a better customer
experience. Enterprises need applications that support not just
early forays into new revenue models but also scale with an
enterprise’s ambitions, the report notes. Such scalable
applications will enable enterprises to continually meet customer
expectations while ensuring financial integrity and compliance and
sustained profitable growth.
For its 2024 Subscription Management Buyers Guides, ISG
evaluated software providers across four platform categories –
Subscription Management, Subscription Management Platforms, B2B
Subscription Management and B2C Subscription Management – and
produced a separate Buyers Guide for each. A total of 24 providers
were assessed: Aria Systems, BillingPlatform, Certinia, Chargebee,
Cleverbridge, Conga, FastSpring, Gotransverse, Kibo, LogiSense,
Maxio, OneBill, Oracle, Ordergroove, Paddle, PayPro Global,
Recurly, Salesforce, SOFTRAX, sticky.io, Stripe, VeriFone, Zoho and
Zuora.
ISG Software Research designates the top three software
providers as Leaders in each category. For the 2024 study, the
leading providers in ranked order are:
Subscription Management: Zuora, Oracle and Salesforce
Subscription Management Platforms: Zuora, Oracle and
BillingPlatform
B2B Subscription Management: Zuora, BillingPlatform and
Oracle
B2C Subscription Management: Zuora, Oracle and
Salesforce
“The need to engage subscribers with experiences that motivate
the purchase of subscriptions is increasing demand for
purpose-built software that can interoperate with consumers across
commerce channels,” said Mark Smith, partner of Software Research
at ISG.
The ISG Subscription Management Buyers Guides are the
distillation of more than a year of market and product research
efforts. The research is not sponsored nor influenced by software
providers and is conducted solely to help enterprises optimize
their business and IT software investments.
Visit this webpage to learn more about the ISG Subscription
Management Buyers Guides and read executive summaries of each of
the four reports. The complete reports, including provider rankings
across seven product and customer experience dimensions and
detailed research findings on each provider, are available by
contacting ISG Software Research.
About ISG Software Research
ISG Software Research, previously Ventana Research, provides
authoritative market research and coverage of the business and IT
software industry. It distributes research and insights daily
through its user community, and provides a portfolio of consulting,
advisory, research and education services for enterprises, software
and service providers, and investment firms. Its on-demand service
provides structured education and advisory support through
subject-matter experts. ISG Buyers Guides support the RFI/RFP
process and help enterprises evaluate and select software providers
through tailored assessment services and the ISG Software Research
Value Index methodology. Visit www.ventanaresearch.com for more
information and to sign up for free community membership.
About ISG
ISG (Information Services Group) (Nasdaq: III) is a leading
global technology research and advisory firm. A trusted business
partner to more than 900 clients, including more than 75 of the
world’s top 100 enterprises, ISG is committed to helping
corporations, public sector organizations, and service and
technology providers achieve operational excellence and faster
growth. The firm specializes in digital transformation services,
including AI and automation, cloud and data analytics; sourcing
advisory; managed governance and risk services; network carrier
services; strategy and operations design; change management; market
intelligence and technology research and analysis. Founded in 2006,
and based in Stamford, Conn., ISG employs 1,600 digital-ready
professionals operating in more than 20 countries—a global team
known for its innovative thinking, market influence, deep industry
and technology expertise, and world-class research and analytical
capabilities based on the industry’s most comprehensive marketplace
data. For more information, visit www.isg-one.com.
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version on businesswire.com: https://www.businesswire.com/news/home/20240626410348/en/
Will Thoretz, ISG +1 203 517 3119 will.thoretz@isg-one.com
Julianna Sheridan, Matter Communications for ISG +1 978-518-4520
isg@matternow.com
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