Zuora announced its first acquisition and a new product, Z-Insights, two weeks ago. The acquired company, FrontLife, will form the basis of Z-Insights. This is an important moment for both Zuora and is called the “membership economy”.
I have always been a fan of the membership economy and feel that it has given rise to a culture in which people are conditioned to expect membership-like performances from all their vendors – even traditional Too.
In my view, it places more emphasis on collecting and interpreting customer data to understand how well a business is performing against the expectations of its customers.
Hybrid companies – such as traditional businesses that are dipping toes into the subscription ocean – will find the membership economy open. The membership economy requires a different business model, and it makes complete sense.
If your customers pay you only a small amount every month and they can leave at any time, then you need to find ways to attract and hold them. The old model that accepted full payment no longer works.
The basic philosophy behind Z-Insights is, a product designed to capture and analyze data that is required in any membership company. Z-Insights will start appearing in the market as pre-Dreamforce, but here is my rough cut of the announced modules and what they do.
The customer identification module will be used to provide a real-time view of the customer by combining and analyzing critical customer data, such as account balances, company data, demographics, recurring revenue, social data, and some usage data.
This is a type of data that will help inform a subscription company about serving customers. For example, metrics based on things like data and recurring revenue provide an understanding of the footprint of a vendor in the account as it nears the time of renewal.
However, this is the old school thinking. The purpose of using these information should be to remove problems throughout the year, not just during the renewal season. In this way, it can lead to what we all say we want: better customer relationships through better experiences.
The Zuora literature describes the moments module of customers as a window into what customers are doing, but I think something is missing. I am a big believer in the idea of moments of truth – those times when a salesperson has to offer something, such as help, advice or information.
This module will be most useful for observing moments of truth and telling actors what to do. Also, I hope no one tries to use this module in Big Brother mode.
The customer segment module can be used in two very important ways: to drive sales; And for better supporting moments of truth.
In fact, one purchase is another moment of truth, so it can merge all into one, but here is the point. Instead of dealing with the small number of segments achieved through a static analytics report, what the segments are doing dynamically to customers – such as presenting a business idea in the onboarding process to new customers or customers at risk of churning Can.
In addition, segments can easily include customers with older versions of a product that are targets for an upgrade program.
If you can segment, you really need to be able to communicate with the appropriate messages through the appropriate channels, and that is what the customer trigger module does.
Since you can define the segments you want to focus on, you can be very specific in targeting – and thus very precise about the message you deliver. This module will also enable you to select the correct channel, or will also help deliver messages to your app.
Finally there is the subscriber dashboard. Any self-respecting platform provider can provide such major functionality without a dashboard, and no one should. This dashboard will contain metrics about the information that a membership vendor cares about the most.
Some other apps, such as CRM, tell you how close you are to creating your number. This dashboard should focus on the truth and early warning signs.
The most interesting thing about Z-Insights is how much ERP-oriented data it collects and then redirects to front-office processes. This is an idea that has been talked about for a long time – ever since CRM was previously called “ERP for the front office”.
We have seen many people hold a stake in the ground to say that ERP is the necessary suite, that CRM is somehow derivative. Over time, however, CRM has only grown larger, while ERP is showing signs of evaporation as individual modules move from the rear office to engage in the front office.