Zuora Launches Dedicated Billing and Revenue Recognition Business Models for Consumer Models
Zuora Inc. (NYSE: ZUO), a leading provider of monetization platforms for fixed income businesses, Zuora, Inc. (NYSE:ZUO), today announced new specialized solutions for consumption-based billing and consumption-based income accounting. With these new offerings, Zuora’s market-leading solution now provides end-to-end billing and revenue recognition for consumption-based pricing, providing businesses with a complete solution to quickly move from quotes to cash and record revenue. By combining billing and revenue recognition capabilities, Zuora® offers companies a unique opportunity to go to market quickly with flexible consumption patterns while maintaining revenue recognition, helping companies meet ASC 606 and IFRS 15 standards.
As uncertain economic conditions continue, it is imperative for companies to use flexible monetization strategies to offer value-added services. Zuora currently uses consumption-based pricing for over 40% of its customers, which has 22% higher net dollar retention (NDR) and 11% higher year-on-year (YoY) subscriber growth compared to their peers .[1] . With consumption-based billing experience for hundreds of companies over the past decade, such as Zoom and Siemens, Zuora offers many sophisticated models to help companies overcome the operational challenges that can come with consumption-based pricing.
“Across industries, subscribers still require pricing flexibility to change their subscriptions frequently and pay for what they consume,” said Matangi Ramanathan, vice president of product management and general manager of Zuora. “Companies need the flexibility to experiment quickly and frequently, track and report consumption, and keep their entire ecosystem running smoothly. Over the past few years, many companies have adopted consumption models that go beyond simple pay-as-you-go, such as the prepaid drawdown model or the multi-attribute consumption model, which creates additional risk and complexity for financial groups.”
Because consumption is unpredictable and can change from day to day or even minute to minute, it can be difficult for finance teams to get complete consumption information across their entire customer base and accurately predict future consumption. This lack of predictability creates risk and complexity for revenue recognition. By adding a purpose-built solution for consumption-based revenue recognition, Zuora now also helps companies better prepare and mitigate the risks associated with variances that can occur with consumption-based pricing.
With this launch, Zuora adds:
- Ready-made monetization models such as prepaid drawdown, minimum and maximum commitment, and aggregate per-use pricing allow businesses to quickly respond and adapt to their customers’ needs.
- Consumption analytics, near real-time processing, and threshold notifications enable customers to see their consumption in near real time and limit their spending. The same capabilities allow companies to monitor and predict expansion opportunities for high consumption customers.
- Consumption-based reports, dashboards, and analytics that enable companies to implement and automate consumption revenue accounting policies. This enables revenue teams to better predict, predict, and mitigate the financial risks associated with consumption-based pricing models.
“With Zuora, we have realized consumption in a variety of ways that provide immediate value, increasing flexibility for our customers and making revenue more predictable,” said Moshe Sarousi, director of financial operations and global invoicing at Yotpo. “By leveraging these models, Zuora is an important partner in helping us achieve greater retention and faster growth.”
The Zuora post launches specialized billing and revenue recognition business models for consumption first appeared on Fintech Finance.
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