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A 5 Minute Overview Of


Why the Subscription Model Will Be Your Company's Future -- And What To Do About It

About the Author

Tien Tzuo is CEO and co-founder of Zuora, a billion-dollar cloud-based software provider. He was formerly chief marketing officer and chief strategy officer at Salesforce.Com where he was the eleventh employee hired. Prior to that, he worked for CrossWorlds and as a sales consultant for Oracle. Tien Tzuo is a graduate of Cornell University and the Stanford University Graduate School of Business. He is widely credited with coining the phrase "Subscription Economy".

The Main Idea

For hundreds of years, the formula for success in business has been pretty much always the same : Today, the customer is in the driving seat thanks to digital technologies and networks. To succeed in the marketplace of today, the formula has become: To excel today, it's better to turn your product into a service which delivers the outcomes customers value. Replace one-off product sales with ongoing subscriptions which offer customers access to the outcomes they value the most. That's the essence of the "Subscription Economy".

Everything feels different right now. Why? Because I think we’re in a pivotal moment in business history, one not seen since the Industrial Revolution. Simply put, the world is moving from products to services. Subscriptions are exploding because billions of digital consumers are increasingly favoring access over ownership, but most companies are still built to sell products. They’re not set up correctly for the next hundred years of business. As a result, huge opportunities are up for grabs. If you’re not shifting to this business model now, chances are that in a few years you might not have any business left to shift.
Tien Tzuo

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