REPORT – ZUORA

SUBSCRIPTION-ECONOMY-INDEX™

The Latest Edition of the Subscription Economy Index™ Shows Continued Growth

About This Report

The latest edition of the annual Subscription Economy Index™ (SEI), Zuora’s Subscribed Institute’s landmark index, tracks the rapid ascent of the Subscription Economy. The report reflects the growth metrics of companies around the world in sectors including SaaS, Media, Manufacturing, Internet of Things (IoT), Business Services, and Communications/Video Conferencing.

This edition of the SEI (as of February 2022) features new data from the 12 months ending December 31, 2021.

Highlights include:

  • Up-to-date subscription company growth versus the S&P 500 and other global indices
  • Sector- and region-specific Subscription Economy growth trends, including compound annual growth rates (CAGR), churn, and more
  • Sector-specific analysis, commentary, and recommendations businesses around the world should consider to be successful in the Subscription Economy

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The Subscription Economy Index™ vs S&P 500 & U.S. Retail Sales

Subscriptions have provided resilience at key moments of uncertainty, and enthusiasm for these services continues to grow, as seen by the companies that comprise the Subscription Economy Index™(SEI) report.

Over the past decade, the Subscription Economy Index has grown 4.6x faster than the S&P 500, which represents more traditional, product-based businesses (compound annual growth rates, or CAGR, for the 10-year period were 17.5% vs. 3.8%, respectively).

 

SaaS Sector Growth

SaaS continues to be the fastest-growing sector in the SEI, with both business-to-consumer (B2C) and business-to-business (B2B) SaaS driving growth.

 

Media Sector Growth

In the past year, media subscription momentum (both in the SEI and beyond) suggests that even after 2020 shelter-in-place orders were lifted, many consumers maintained their new media subscriptions.

 

Manufacturing Sector Growth

Connected services are continuing to fuel the growth of the manufacturing sector as companies look to complement physical products with innovative offerings. Traditional manufacturers in the S&P 500 Industrials Sector experienced increased demand in 2021 after the 2020 pandemic dip, but SEI Manufacturing businesses also continued to grow.

 

“Over the past few years, there’s been a lot of talk about subscription companies. Today, Zuora, a company that powers subscription-based businesses, which we wrote about in the magazine last year, launched an index to track what its CEO Tien Tzuo calls ‘the Subscription Economy.’”

“The breadth and depth of the data analyzed in this study speak to the rapid ascent of the Subscription Economy.” 

“Because Zuora is a company that collects a great deal of data, Tzuo is able to say with confidence that 70 percent of customer growth was attributable to expanding footprints (upsells, cross-sells, renewals) rather than to the addition of net new customers. Zuora anonymizes customer data to derive such insights, which it publishes as the Subscription Economy Index, or SEI.”

“Over the past few years, there’s been a lot of talk about subscription companies. Today, Zuora, a company that powers subscription-based businesses, which we wrote about in the magazine last year, launched an index to track what its CEO Tien Tzuo calls ‘the Subscription Economy.’”

“The breadth and depth of the data analyzed in this study speak to the rapid ascent of the Subscription Economy.” 

“Because Zuora is a company that collects a great deal of data, Tzuo is able to say with confidence that 70 percent of customer growth was attributable to expanding footprints (upsells, cross-sells, renewals) rather than to the addition of net new customers. Zuora anonymizes customer data to derive such insights, which it publishes as the Subscription Economy Index, or SEI.”