Subscription Businesses Thrive in a Downturn

by K. V. Rao

This past week was filled with news about subscription businesses thriving in the downturn. Everything from socks by subscription(!) to the iPhone to Netflix.

In particular, last week’s news about Netflix is another feather in the cap for subscriptions. Since January of this year, in this dicey economic environment, Netflix has seen its subscription base grow by more than 600,000 to reach more than 10 million subscribers. With this in mind, we think it’s safe to say that we expect to see an increase in the number of companies looking to optimize their services via subscription.

Naturally, we’re a fan of subscription-based businesses for many reasons. As a consumer, subscriptions are cost-effective and efficient. You use what you need, when you need it. Same goes for the service provider - subscriptions are efficient, predictable, profitable.

Back in January, Ray Wang of Forrester Research was quoted as saying "I think SaaS has an element of being recession-proof." So far, that certainly seems to be the case. SaaS and subscription companies like salesforce.com are reporting strong earnings and customer growth.

This is all good news. If you’re a service provider and aren’t offering a subscription option to your customers, don’t you think it’s time to take a serious look at subscriptions?

Facebook Developers Make Money Through Subscriptions Thanks to Zuora’s Cloud Commerce Platform

by Erik Haus

Zuora’s Launch at DEMO 2009 was a huge success! First and foremost, we launched our latest product,

a really simple solution for Facebook developers looking for a better way to make money. Advertising and one-time purchases aren’t ideal for certain applications, but until now it was too difficult to offer subscription-based applications. But Z-Commerce for Facebook gives developers the tools they need to do just that –

• A subscription console,
• Plug-and-play commerce widgets,
• Access control API,
• User self-service subscription management.

Developers can now transform their applications into subscription based services with only a few lines of code.

Second, DEMO provided us with a great environment to spread the word out about Z-Commerce for Facebook. And judging by the great response we’ve had so far in the press, it seems that we’re doing something right.

Last, and most importantly, we were able to reach Facebook developers themselves. In addition to launching our product, we have also announced our "Subscribe, Don’t Advertise" contest. We are seeking innovative developers who want to turn their existing applications into subscription services with Z-Commerce for Facebook. We’ll select five winners, with each winning a free year of Z-Commerce for Facebook. The universe of possibilities of what you can do with Facebook applications just exploded.

I think Charles Cooper from CNET summed it up best, noting that Z-Commerce for Facebook makes Facebook a cloud computing platform ripe for innovation. If you’re a developer with a great idea for Facebook and need a better way to monetize, enter our contest!

What I learned from DEMO 09

by Annette Giambroni

Here are the top three things I learned at DEMO 09:

1) Twitter is truly viral - I was able to promote Zuora's Z-Commerce for Facebook – a subscription commerce engine for Facebook - in minutes with little effort. I was amazed at how members of the press who are hard to tackle for an interview will gladly follow my postings on Twitter. Be sure to follow Zuora news at http://twitter.com/Annette_G.

2) Zuora's Z-Commerce for Facebook is not like anything else at DEMO. Most of the demonstrators had really cool products like GagaPost's Blogging product or Gwabbit's email management system...but as cool as the products are, I had a hard time understanding how these companies are going to make any money? Sounds like a job for Zuora's flagship recurring billing product Z-Billing.

3) Tien really knows how to incite hallway conversations at DEMO. Everyone was asking..."Who would use Z-Commerce for Facebook? Are there any Facebook applications worth paying for?” But then they started to catch on...It's sort of the chicken and the egg scenario -- Zuora is providing the chicken, and betting that it will hatch the egg. I think Tien said it best in an interview with ReadWriteWeb where he gives some great examples of apps we here at Zuora would pay for.

Check it out and let us know what you would pay for on Facebook, if only someone had the courage to build it...we want to hear from you!

Monetize Facebook Apps with Z-Commerce for Facebook: Subscribe, Don’t Advertise

by Tien Tzuo

This week, we’re in Palm Springs at the DEMO 2009 event to launch our latest product, Z-Commerce for Facebook and our first developer contest, ‘Subscribe, Don’t Advertise.’ What’s it all about? First, some context:

Today, there are over 660,000 Facebook developers who collectively have built over 52,000 applications, and are adding 140 new applications every day. As impressive as these numbers are – the fact remains that, with a few exceptions, Facebook developers are not making any money.

Today, Facebook developers rely primarily on advertising to generate cash – and we all know that ads just don’t work. Think about it – do you click on ads in Gmail?....I didn’t think so.

But, what if Facebook developers had another choice? What if it was easy for them to sell their applications as monthly fees, quarterly fees, or even, crazy as it sounds, based on how much the application is used. This idea really got us thinking (and you know how we feel about subscriptions).

At Zuora, we imagine a world where every Facebook user pays some developer one dollar, per month, for some application that they found valuable. That’s 2 billion dollars a year that Facebook developers could be making.

That’s the world that is now possible, with our new Z-Commerce for Facebook. We’re so excited about this concept that we’ve also launched our first developer contest named ‘Subscribe, Don’t Advertise.’ We’re looking for five Facebook developers to be the very first to build a subscription-based application with Z-Commerce for Facebook.

All developers are encouraged to apply. Selected developers will receive free access to Z-Commerce for Facebook for one year.

More information about the product and the contest is available here: http://developer.zuora.com/facebook.

You can watch our presentation live at 9.30am on February March 2nd.

And, we’ll be posting videos and pictures from our on-stage presentation at DEMO 2009. Stay tuned!