2024年订阅和收入增长报告

Stateof

Subscriptions

&RevenueGrowth

2024

STATEOFINDUSTRY2024

2

Tableof

Contents

03Introduction

04Methodology

06ExecutiveSummary/KeyFindings

13StrategicGoals&Priorities

20Investment&FinancialManagement

28Customer-CentricGrowth&MarketExpansion

37OperationalChallenges&Risks

45Technology&Innovation

53TheFuture

54AboutChargebee

3

STATEOFINDUSTRY2024

INTRODUCTION

ThechangingsubscriptionlandscapeintheYearof

EfficientGrowth

96%expect

subscriptionrevenuetogrowin2024

Backin2020,wewitnesseda

technologyboomdrivenbythe

pandemicandfurtherpropelledbya$2trillionstimulus,resultinginawhirlwindofunprecedented

funding,exits,andvaluationsthroughout2020-2021.

Capitalflowedabundantly,leadingto

companieswithminimalornorevenueraisingfunding.Thenthemusicstopped:theUS

FederalReserveraisedbenchmarkinterest

ratesfromnear-zeroto5.5%between2022andlate2023,triggeringasubstantialcorrectioninpublicmarkets,particularlyimpactingsoftware,internet,andfintechstocks.

Thesurgeininterestratesalsomadecapital

acquisitionmorechallenging,posingdifficultiesforstartupstosustaintheirrapidgrowthpace.

Thedaysofbeingrewardedforhypergrowthatanycosthadcometoanabruptend,andaneweraofefficientgrowthdawned.

Wemovedfromagrowth-at-all-costsintheyearsleadingupto2021,toyearsofabruptcostreductions,tools,and

technicalconsolidation,andsector-widerestructuring,withastrongfocuson

efficiency.

Thisreportpresentsnewdata,basedonsurveying318subscriptionleaders,thattheindustryisshiftinggearsagain,backintogrowthmode,butnowwithastrong

focusonefficiencyandenhancedproductivity.

Thedriveforefficiencyispropelledbyinvestmentsinstrategiesandtoolsthat

usetechnologytoamplifyoperationaleffectivenessandthecustomer

experiencethroughouttheentirelifecycle.

Thisfocusedapproachpositions

subscriptioncompaniestonotonlysurviveinatumultuousbusiness

landscapebuttothriveinanenvironmentthatvaluesefficientgrowth.

STATEOFINDUSTRY2024

Report

methodology

ForChargebee’s2024StateofSubscriptionsandRevenueGrowth,wepartneredwith

Centiment

tosurvey318subscriptionleadersinNorthAmericawhoworkatsubscription-basedcompanieswith50+employeesandhaveAnnualRecurringRevenueofmorethan$5million.70%ofrespondentsrepresentsubscriptioncompanies

Industriesinclude

B2BSaaSorEnterpriseSoftware

52%

thatservetobusinessandconsumers,while15%targetbusinesses(B2B),and15%targetconsumers(B2C).

Thefindingswerecompiledinthefirstquarterof2024.

ConsumerApporServices

27%

●DigitalandProductManagement

●StrategyandOperations

●CustomerRelationshipsandGrowth

●SubscriptionServices

●IncentivePrograms

Titlesandrolesinthestudyinclude

Director,VP,

andC-Levelroles

inthefollowingcategories

eCommerce/PhysicalGoods

21%

4

STATEOFINDUSTRY2024

COHORTANALYSIS

Comparing

Skyrocketers

vsClimbers

Cohortanalysiseditor’snote

Throughoutthisreport,wecompared

responsesofthefastestgrowingcompaniesvs.everyoneelse,andtheirinvestment

priorities,strategies,andtactics.

Skyrocketers

Skyrocketersinclude

businessesexpectingarevenueincreaseofover50%intheyearahead.

Skyrocketershaveaproactiveapproachtomaximizingrevenue

potentialandimplementing

growthstrategieswith

afocusoncustomer

retentionandexpansion.

Climbers

Climbersinclude

businessesanticipatingarevenueincreaseof

1-20%.Climbers

prioritizecustomeracquisitionand

retention.

NOTE:THESEICONSTHROUGHOUTTHEREPORT,ILLUSTRATEHOWEACHSEGMENTWITHDIFFERENTREVENUEOUTLOOKSCONDUCTSANDSTRATEGIZESDURINGTHEYEAROFEFFICIENTGROWTH.5

STATEOFINDUSTRY2024

6

ExecutiveSummary&KeyFindings

01

96%expectsubscriptionrevenuetogrowin2024

04

60%expectchurnratestoincrease

02

86%agreecustomerretentionisasimportantas,ormore

importantthanacquisition

05

Nearlythree-quarters(73%)plan

toincreasepricesin2024(anover10percentagepoint

increasefrom62%in2023)

03

Keepingup-to-datewith

technology,growth,and

profitabilityaretopconcerns

06

Almosthalf(46%)areinvestinginAI

technologytoimproveoperationalefficiencyandautomation(30%),formarketanalysis

andexpansionstrategies(24%),andtoenhanceproductfeaturesandtheuserexperience(20%)

STATEOFINDUSTRY2024

96%expect

KeyFinding01

96%ofsubscriptionleadersanticipatesubscription

revenuetogrow–anotableincreasefrom75%in2023reflectingatemperedsenseofoptimism.

subscription

revenuegrowth

Actionableinsights

Nearlyallsubscriptioncompaniesexpecttogrowin2024.It'sagreattimetostrengthenyourpositioninthemarketandfindnewwaystogeneraterevenue.Remember,keepingcustomershappyiskey.In

today'scompetitivemarket,givingthemrealvalueisn'tjusta

bonus—it'samust.Byfocusingonkeepingcustomerssatisfiedandalwaysimprovingwhatyouoffer,youbuildloyaltyandsetyourselfupforlong-termsuccessandgrowth.

STATEOFINDUSTRY2024

KeyFinding02

86%agreecustomer

Subscriptionleadershavespokenandretentionisa

commonthemetoward

efficientgrowth.We’llseeincreasedinvestmentsin

existingcustomersto

maximizerevenueperuser.

retentionisasimportantas,ormoreimportant

than,acquisition

Actionableinsights

Tocapitalizeoncustomerretention,thinkaboutusingstrategiesthatprovidevaluetothecustomerjourneyandkeepsubscribersengaged.Considertheflexibilityofyourplans,andexploreupsellandcross-sellopportunitiesfor

additionalproductsorservicesorloyaltyprograms.Byfocusingonretainingandsatisfyingyourexistingcustomerbase,youestablishthegroundworkforsteady,sustainablegrowth.

STATEOFINDUSTRY2024

KeyFinding03

Top3concerns

Subscriptionleaderswill

continuetoembracetechnologyintheformofAItoincrease

efficiency,aswellasinvestinpredictiveanalytics,customer

loyaltyinitiatives,and

innovativeproductofferings&

contenttomaintaintheirgrowth

trajectoryandpathtoprofitability.

●Keepingup-to-datewith

technologyandtactics(14%)

●Maintainingcustomergrowthtrajectory(11%)

●Becomingmoreprofitable(11%)

Actionableinsights

Makewiseinvestmentsintechnologythatimprovesefficiency,implementfocusedstrategiestomaintaincustomergrowth,andseekopportunitiestoboostprofitability.Tacklingthesechallengesdirectlywillstrengthenyoursubscriptionbusiness'slong-termsuccessandresilience.

STATEOFINDUSTRY2024

KeyFinding04

60%expectchurnratestoincrease

60%ofsubscriptionleaders

anticipatehigherchurnrates,downfrom64%lastyear.Thischangemayreflectastrongeremphasisonretaining

83%haveacompany-widechurntarget

comparedto71%in2023and80%in2020

customersanddeliveringvalueateverystageofthecustomerjourney.

30%expectchurntodecreaseand10%expectittoremain

thesame.

Actionableinsights

Minimizeunwantedcustomerlossbyengagingcustomersandusersinmoretargeted,personalizedways,atkeymomentsthroughoutthe

buyer'sjourney.Actingnowtoreducethenumberofcustomersleavingwillprotectyourcurrentrevenueandhelpyoursubscriptionmodelgrowsteadilyandremainstable.

STATEOFINDUSTRY2024

KeyFinding05

73%planto

Withnearlythree-quarters

planningtoincreasepricesin2024,subscriptionleaders

arecarefullyconsidering

pricingstrategiesandthe

potentialimpactonretentionandchurn.

increaseprices

Anovertenpercentagepointincreasefrom62%in2023

Actionableinsights

Considerevolvingyourvaluepropositionandunlockingnewmonetization

opportunitiesbycreativelytestingpricingplans,packaging,anddiscounting.Doingsocanhelpyoumitigatechurn,driverevenuegrowth,andfoster

customerunderstandingandsatisfactionamidstpricingadjustments.

STATEOFINDUSTRY2024

KeyFinding06

ByleveragingAI,subscription

leaderscansimplify

workflows,streamlineprocesses,andboost

efficiency,ultimatelysavingtimeandresources.

Additionally,AIcanprovide

valuablemarketinsightsby

analyzinglargevolumesof

data,enablingleadersto

makeinformeddecisionsand

#1investmentareaisAI

Almosthalf(46%)areinvestinginAItechnologyto:

•Improveoperationalefficiencyandautomation

•Analyzethemarketandexpansionstrategies

•Enhanceproductfeaturesandtheuserexperience

anticipatecustomerneedsmoreeffectively.

Actionableinsights

ExplorethepossibilityofintegratingAI-poweredsolutionstosimplifyworkflowsandimprovetheuserexperience.Thisstrategicmovecanimprovedailyoperationsgivingyourteammoretimetofocusonyourproductresultinginabettercustomerexperience.

StrategicGoals

&BusinessPriorities

STATEOFINDUSTRY2024

Q9:DESCRIBETHEDOMINANTSTRATEGYOFYOURSAASCOMPANYINTHEUPCOMING12MONTHS14

“Expandingexistingproductfeatures”willbeatopstrategyforoveraquarterofsubscriptionleaders

2024TopStrategy

Expandingexistingproductfeatures

Strengtheningposition

incurrentmarkets

Prioritizingsustainabilityandsocialresponsibilityinitiatives

Exploringmergerand

acquisitionopportunities

Diversifyingintonewmarketsegments

Insight

Whenlookingattopstrategies,strengtheningpositionsin

currentmarketscloselyfollowsexpandingproductfeatures,

highlightingthedualemphasisonbothproductimprovementandmarketpresence.

Sustainabilityandsocial

responsibilityinitiativesarealsoimportant.Thedata

underscoresanuanced

approach,combininginnovation,

marketstrength,anda

commitmenttosustainablepracticesastopstrategies.

Q10:WHATAREYOURTOP3BUSINESSPRIORITIESINTHEUPCOMING12MONTHS15

Thetop3businessprioritiesareimprovingcustomerretention,thecustomerexperience,andexpandingthesubscriptionbase

Insight

Thetopthreebusinessprioritiesinthenext12monthsarecenteredaround

customer-centricstrategies.47%will

prioritizeimprovingcustomerretention,closelyfollowedbyimprovingthe

customerexperienceat43%.

Expandingthesubscriptionbaseby

convertingone-timepurchasesinto

subscribersisalsoakeyfocus,with

40%highlightingitsimportance.This

dataunderscoresastrongcommitmenttocustomer-centricinitiativesasacorepriorityforgrowthandsustainability.

01

02

03

04

05

TopBusinessPriorities

47%Improvecustomerretention

43%Improvethecustomerexperience

40%Expandsubscriptionbase

36%IncorporateAIand/oradvancedtechnologies

39%Improvecustomeracquisition

Q10:WHATAREYOURTOP3BUSINESSPRIORITIESINTHEUPCOMING12MONTHS16

STATEOFINDUSTRY2024

COHORTANALYSIS

TopPrioritiesforSkyrocketers

Improvecustomerretention

TopPrioritiesforClimbers

1

2

ImprovethecustomerexperienceExpandsubscriberbaseIncorporateAI

3

ImprovethecustomerexperienceImprovecustomeracquisition

4

5

ImprovecustomerretentionEvolvemybusinessmodel

IncorporateAIand/oradvancedtechnologies

Growmyonlinepresencetoincreaseourfootprint

6

ImprovecustomeracquisitionAutomate/increaseefficiency

Whileallcompaniesarefocusedonthe customerexperience(positions1&2), SkyrocketersareprioritizingretainingandexpandingtheircustomersfirstandusingAItobetterservethem,ratherthanacquiring.

Incontrast,Climbersarefocusedonimprovingacquisitionandretention,thenevolvingtheir

businessmodel.

Q10:WHATAREYOURTOP3BUSINESSPRIORITIESINTHEUPCOMING12MONTHS17

STATEOFINDUSTRY2024

COHORTANALYSIS

TopPriorities

Top

Priorities

1

ImprovethecustomerexperienceImprovecustomerretention

IncorporateAIand/oradvancedtechnologies Evolvemybusinessmodel ExpandsubscriptionbaseImprovecustomeracquisition

2

3

ImprovethecustomerexperienceImprovecustomerretention

4

5

ImprovecustomeracquisitionExpandsubscriptionbase

6

GrowmyonlinepresencetoincreaseourfootprintResearchanddevelopnewproducts

Althoughbothsectorsarefocusingon customerexperienceandretention,B2Bis prioritizingincorporatingadvancedtechnologiesandevolvingbusinessmodels.

AsB2Cisprioritizingacquisitionandgrowingitssubscriptionbase,championsinthespacearereflectingtheseprioritiesbydrivingthe

needforoptimizedmobilecheckout

experiencesandintegratedpaymentsolutionstogrowtheirreach.

STATEOFINDUSTRY2024

Q11:WHAT'SYOURREVENUEFORECASTFOR2024COMPAREDTO2023?18

96%expectsubscriptionrevenuetogrowin2024

5.4%

20%

24%

16%

11%

13%

6%

RevenueGrowthExpectations

Growbyupto10%

Growby10%to20%

Growby20%to30%

Growby30%to40%

Growby40%to50%

Growby50%to75%

Growby75%to100%

Insight

Arobustoutlookprevailsamongsubscriptionleadersas96%

anticipategrowthinsubscription

revenue.Closetoaquarterof

respondentsplanambitious

revenuegrowthintherangeof20-30%,whilenearly20%

forecastsubstantialgrowth

between50-100%.Thisdata

signalsalevelofoptimismandaggressivegrowthstrategies

withinthesubscriptionindustrythisyear.

Q15:WHICHKEYPERFORMANCEINDICATOR(KPI)ISYOURTOPPRIORITYTOIMPROVENEXTYEAR?19

CustomerrenewalsorretentionrateisthetopKPItoimprove

2024TopKPItoImprove

Customerrenewalorretentionrate

47%

percentageofpayingcustomerswhorenew

35%

Revenuegrowth

34%

Customersatisfaction

31%

Grosschurnbasedonaccounts

percentageofcustomerbasewhorenews

26%

NetRevenueRetention

dollarvalueofexpansionminuscontraction&churnrevenue

25%

Grossrevenuechurn

dollarvalueofallcanceledrevenue

Insight

In2020,40%ofcompanies

identifiedcustomerrenewalasthetopKPIforimprovement,afigure

thatincreasedto47%by2024.

Thissuggestsashiftingemphasistowardsoptimizingtheentire

revenuelifecycleratherthansolelyfocusingonacquisition.Therehasbeenanotableriseinthe

prioritizationofcustomer

satisfaction,whichsurged5xfrom7%in2020to34%in2024.

Investment&

FinancialManagement

STATEOFINDUSTRY2024

Q16:HOWDOYOUPLANTOFUNDYOURCOMPANYINTHEUPCOMINGFISCALYEAR?21

Over20%willleverageefficientrevenuegrowthasakeyfundingstrategy

FundingStrategies

Growrevenueefficiently

Expandingrevenuestreams

16%

Increasemarketshare

15%

Reinvestingprofitsintothebusiness

Seekingnewinvestmentorfunding

Achieveprofitability

14%

9%

8%

6%

Focusingonprofitabilityovergrowth

21%

Insight

Asmallsegmentof

companiesisexploring

alternativefundingstrategies,suchasreducingoperationalcosts(5.4%),pursuing

mergersoracquisitions

(4.4%),orgoingpublic(1.9%).Companiesare4xmorelikelytoprioritizeefficientgrowth

overthesealternatives.This

year,efficiencyisemphasizedasacrucialroutetoachievingprofitability.

Q17:WHATWILLYOUBESPENDINGMOREIN2024?22

Subscriptionleaderswillinvestmoreinpredictiveanalytics,customerloyaltyinitiatives,andinnovativeproductofferings&content

2024InvestmentIncreases

Predictiveanalyticstoimproveourmarketingandcustomerretentionperformance

Customermarketingandloyaltyprograms

26%

23%

Developnewmessagingandcontent(blog,videos,webinars,etc.)fororganicgrowth

ResearchandDevelopmentfornewproducts

Launchingnewproducts,packages,and/orbundles

24%

24%

27%

Insight

Increasedinvestments

reflectastrategicshift

towardsleveragingdata

insights,fosteringcustomerloyalty,andintroducing

creativeproductsand

contenttoincreasethe

valueofsubscription

servicesforsubscribers.

Q17:WHATWILLYOUBESPENDINGMOREIN2024?23

STATEOFINDUSTRY2024

COHORTANALYSIS

SkyrocketersandClimberswillinvestmoreonpredictiveanalyticstoenhancemarketingandcustomerretention.

SKYROCKETERSCLIMBERS

2024InvestmentIncreases

Predictiveanalyticstoimprovemarketing&retention

Developnewmessagingandcontentfororganicgrowth

Customermarketingandloyaltyprograms

Surpriseanddelightinitiativestoimprovecustomerexperience

Launchingnewproducts,packages,and/orbundles

35%25%

33%21%

30%16%

30%13%

28%24%

Insight

Skyrocketersplantoallocatemoreresourcestothe

developmentofnewmessagingandcontent,alongwith

investmentsincustomer

marketingandloyalty.Climbers

willfocustheirincreased

spendingontestingnew

incentivesforcustomer

acquisitionandinvestinginresearchanddevelopment

fornewproducts,packages,orpricing.

STATEOFINDUSTRY2024

Q18:WHATWILLYOUBESPENDINGLESSIN2024?24

Subscriptionleaderswillinvestlessonin-personevents,

co-brandinginitiatives,andtraditionalmarketingchannels

InvestingLess

In-personeventsandconferencesponsorship

Partnerwithotherbusinessestoco-brandmarketinginitiatives

Testnewincentivestoacquirenewcustomers

Searchengineadvertising

22%

22%

20%

Developnewmessagingandcontentfororganicgrowth

20%

Investintoolstoimprovecollaboration&productivitybetweenemployees

25%

25%

Insight

Thefocusisonspendingwiselyandmaintainingasharp,focusedstrategygiventherealityoffixedfunding.Thishighlightsaprudentandconcentratedapproachto

businessgrowthandresourceallocation.Thisapproach

underscoresthevalueoffocusingoncorestrengthsandproven

channelsforresults.

STATEOFINDUSTRY2024

COHORTANALYSIS

SkyrocketersandClimberswillinvestless

onin-personevents

SKYROCKETERSCLIMBERS

InvestingLess

Investintoolstoimprovecollaborationandproductivitybetweenemployees

30%

Partnerwithotherbusinesses

toco-brandmarketinginitiatives

28%

28%

In-personeventsand

conferencesponsorship

Testnewincentivestoacquirenewcustomers

Testnewincentivestoretainandpreventcustomersfromcanceling

25%

27%

27%

In-personeventsand

conferencesponsorship

Competitiveintelligence

Predictiveanalyticstoimproveourmarketing&customerretentionperformance

21%

20%

Insight:

Bothskyrocketersandclimberswillspendlessonin-personeventsandconferences.

Skyrocketerswillspendlessonemployeeproductivityandcollaborationtoolsandnewcustomeracquisitionincentivetests.Climberswillspendlessonco-brandedmarketinginitiatives(likelyduetobandwidth)andcompetitiveintelligence.

Q18:WHATWILLYOUBESPENDINGLESSIN2024?25

STATEOFINDUSTRY2024

COHORTANALYSIS

B2Bwillspendlessononlinecustomeracquisition.

B2Cisreducingspendforin-personevents.

B2BB2C

InvestingLess

Searchengineadvertising

28%

In-personeventsand

conferencesponsorship

38%

Testnewincentivestoacquirenewcustomers

Newadvertisingandacquisitionchannels

Advertisingonsocialmedia

23%

26%

26%

29%

25%

25%

Partnerwithotherbusinessestoco-brandmarketinginitiatives

Customermarketingandloyaltyprograms

Competitiveintelligence

Insight

B2BisreducingitsinvestmentinonlineacquisitionchannelsandtacticswhileB2Cisdoinglesspartnerandco-marketing,loyaltyprograms,andcompetitiveintelligence.

Q18:WHATWILLYOUBESPENDINGLESSIN2024?26

STATEOFINDUSTRY2024

Q19:REGARDINGPRICING,INTHENEXT12MONTHS,WEWILL...27

73%ofbusinessesplantoincreaseprices

PricingPlans

Insight

Increasingvalueisaccompaniedbypriceadjustments,and

Decreasebyover20%0.9%

Decreaseby10to20%3.1% Decreasebyupto10%5.4%

subscriptionleadersareoptimisticaboutit.There'sbeenanotable

shift,withovera10percentage

pointincreaseinthenumberof

companiesplanningtoraise

prices,comparedto62%in2023.

17%

Keeppricesthesame

Increasebyupto10%18%

30%

Increase10%to20%

Increasemorethan20%25%

Customer-CentricGrowth&MarketExpansion

STATEOFINDUSTRY2024

NetRevenueRetentionimprovementstrategieswillbecustomer-centric

NetRevenueRetentionStrategies

CustomerSuccessinitiatives

CoreneedsofIdealCustomerProfile(ICP)

Churnmanagementandcustomersaves

Product-ledgrowth(PLG)

29%

29%

25%

24%

Implementationsandonboarding

24%

Creditcardoptimizationandretries

24%

Upsellandexpansionefforts

42%

Insight

StrategiesforkeepingNet

RetentionRevenuehighshowastrongfocusonputtingthe

customerfirst.KeyeffortsincludesolidCustomerSuccessprograms,matchingthecoreneedsofthe

idealcustomer,andmanaging

churneffectively.Thisapproach

highlightshowimportantitisto

keepcustomershappyandloyalasawaytoimproverevenue.

Q22:WHICHSTRATEGIESWILLYOUINVESTINTHISYEARTOIMPROVENETREVENUERETENTION(CUSTOMERRETENTION)?29

Responsivecustomersupport,onboardingandtraining,andproactivechurnmitigationaretheleadingretentionandgrowthstrategies

Retention&GrowthStrategies

Improvethequalityandresponsivenessofourcustomersupport

42%

Improvenewcustomeronboardingandtraining

Usepredictiveanalyticstoearlyforecastandpreventchurn

Launchpartnershipsthatdelivervaluethroughoutthelifeofthecustomer

BuildandexpandourCustomerSuccessteamsandprocesses

32%

34%

34%

47%

Insight

Improvingcustomersupportresponsiveness,optimizing

onboardingandtraining

processes,andimplementingproactivechurnmitigation

emergeastheleadingstrategies

forcustomerretentionand

growth.Thesestrategies

highlighthowproactiveand

customer-focusedapproachesarevitalforbuildinglasting

relationshipsandachievingongoingbusinessgrowth.

Q20:WHATCUSTOMERRETENTIONANDGROWTHSTRATEGIESAREYOUPRIORITIZINGIN2024(BEYONDIMPROVINGYOURPRODUCT)?30

STATEOFINDUSTRY2024

COHORTANALYSIS

ForSkyrocketersandClimbers,onboardingandtraining,andcustomersupportaretopretentionandgrowthstrategies

SKYROCKETERSCLIMBERS

Insight

Retention&GrowthStrategies

Improvenewcustomeronboardingandtraining

41%

50%

Athirdofboth

SkyrocketersandClimbersareusing

Improvethequality&responsivenessofourcustomersupport

45%

43%

predictiveanalyticsto

forecastandprevent

churn,stayingtwosteps

Developnewpaidconsulting

39%

aheadoftheproblem.

andadvisoryservices

30%

Createprogramstobetter

36%

understandwhycustomerschurn

33%

Usepredictiveanalyticstoearly

33%

forecastandpreventchurn

33%

Q20:WHATCUSTOMERRETENTIONANDGROWTHSTRATEGIESAREYOUPRIORITIZINGIN20