Enabling subscription savings at Zuora
How Robbie Traube Accelerates His Growth By Focusing On Selling In A Way To Create Customer Value
Our team of experts at the Revenue Enablement Institute are studying how large companies are transforming their business models to accelerate revenue growth. We profile growth leaders – CXO – who are at the forefront of defining and implementing the 21st century business model.
Robbie Traube is the Chief Revenue Officer of Zuora (ZUO), a company that provides cloud-based software that enables any business in any industry to launch, manage, and successfully transform into one. subscription business. Zuora’s mission is to help every business earn in the “subscription economy” – where all or part of their income comes from recurring income based on product usage, users, time period, time. use, consumption or other measures of the value received.
Activating the âsubscription economyâ represents an extremely large and growing market. UBS study predicts that this “subscription savings” will double to $ 1.5 trillion by 2025, as people buy everything from software, socks and razors to gyms, entertainment and restaurants to cars and car washes on a recurring basis.
It is likely to continue to grow. Subscription-based businesses have grown almost six times faster than their âproduct-basedâ peers Subscription economy index, an analysis carried out by an institute subscribed to Zuora. Most (53%) of traditional business boards are pushing their CEOs to repackage their products and services into subscription pricing models, usage-based models, or cloud-based offerings, depending on the company. a report from CFO Magazine.
This has made organic revenue growth a top priority at Zuora. âDriving growth is a top priority for us because of the size of the market we drive and investor expectations that we are a growth company,â said Traube. âBut it can’t be growth at all costs. We must remain committed to long-term growth and the success of our customers. We do this by focusing on selling in a way that creates value for the customer.
To realize the potential of this large market, the company has invested in product innovation throughout the subscriber lifecycle – from listing and billing, revenue recognition and collection. âAutomating revenue takes a lot of capabilities,â says Traube. âBilling is important. But finance teams have learned that accounting for revenue and visibility (forecasting) of complex subscription packages is very difficult to do on a spreadsheet. Sellers need tools to cite complex combinations of subscriptions, products, and services across a variety of time frames, conditions, and frequencies. In addition, the shift to recurring revenue changes the cash flow profile of the business, so that recoveries become even greater. “
Presenting these innovations to new and established customers while maintaining high levels of customer success and adoption can be tricky. Traube has worked with his engineering and finance peers to define and enable a âland and expandâ sales movement and go-to-market organization that emphasizes long-term strategic relationships that are unique in the industry. industry.
âWe went through an 18-month transformation in which we put the customer success side and the product innovation side to work together,â Traube reports.
âIt’s really a team sport where my team works closely with engineering and finance to create optimal go-to-market,â he continues. âWe are a product-driven organization because innovation is a critical growth engine for us. So it’s important to have an engineering job with sales. Finance also played an important role in the process, as we need to present accurate forecasts and efficiently allocate our resources in a very dynamic market. “
Over the past two years, Robbie Traube has transformed Zuora’s business model to meet the evolving needs of new subscription businesses and help traditional businesses migrate to subscription selling.
âGrowing your core customer base while adding new business accounts is difficult,â says Traube. âIt requires mixing new business actions (customer acquisition, upselling and cross-selling actions) while maintaining customer satisfaction (like customer education, onboarding and adoption). It’s hard to do. In a way, it’s like rubbing your stomach and patting your head at the same time.
âAll of our customers are undergoing transformations in the way they sell, set prices and invoice,â he continues. âThey are all at different levels of maturity. Some were born and raised in the cloud. Others are traditional businesses that transform all or part of their income into a recurring model. It is important for us to meet our clients where they are in their transformation journey to a subscription model. Sometimes that means helping them walk before they can run.
According to Traube, it’s important to understand where customers are on the maturity curve, as management teams can sometimes be too zealous to move on to recurring revenue until they’ve established an âorder-to-revenue processâ for them. ” ensure their revenue teams can set up, invoice, recognize, and collect recurring revenue without errors, inconsistencies, and cash flow issues.
âThe key for us is to add value at every step of the maturity curve and at every step of the relationship, from implementation to innovation,â he continues. âWe have developed a well-defined and highly optimized workflow throughout the customer lifecycle that ensures we deliver value in all aspects of the implementation – from the time to commissioning, to time required to realize the value of the solution, to the process of continuous improvement in the performance of the customer monetization process. Introducing product innovations that ease the cycle from order to revenue is one of them. You have to keep adding value.
Traube relies heavily on its sales operations team to inform and activate these highly prescriptive sets of sales movements. He sees operations as the heart of the business – because of their role in providing prescriptive information and advice to revenue teams. âWe have well-defined sales movements to develop short-term (quarterly) and longer-term (a one-year chart of accounts) accounts,â says Traube. âThere is a specific point in the customer lifecycle when you can up-sell and cross-sell. You have to know when it is.
To help their revenue team focus on the right actions to add value at the right time, Zuora has become very data-driven in its approach to selling. Traube’s operations and enablement teams enabled data-driven selling with a solid set of customer engagement data from recorded conversations (conversational intelligence), customer success, CRM, and marketing tools based on accounts. Telemetry data from Zuora’s SaaS solutions helps them understand both how to help their customers and how effective their solutions are for their customers’ customers. This gives them a 360-degree view of where they can add value to their accounts and when to introduce new product innovations.
âOur business operations manager, Ted gumerson, does a great job of aggregating customer data from our conversations with our customers, our sales transactions, our CRM and our products to inform those sales decisions, âsays Traube. âWe use this information to lead the account teams – or what we call groups of account managers, marketing and sales engineers – on the next best actions and to execute account-based marketing. It helps our frontline salespeople to think globally, act locally, and respond to the market in real time. “
The results have been solid. By focusing on long term customer value and adding value at every stage of the relationship, Zuora has successfully combined healthy long term relationships, recurring revenue and relationship expansion which is remarkable. Iin the last quarter, Zuora was able to achieve a 110% dollar retention rate, eleven points higher than last year and five points above its goal of exceeding 105% dollar retention rate of here the end of the exercise. It is also the highest level of dollar retention rate over the past 10 quarters. Annual Recurring Revenue (ARR) increased 19% year-on-year, two points higher than Zuora’s ARR target of 17% for the year. Zuora’s ecosystem of global systems integrators and strategic partners also continued to grow in the third quarter. Today, with 200 certified consultants globally, more than 40% of Zuora’s third quarter releases involved a system integration partner.
Robbie Traube is Zuora’s Revenue Director