7:33 pm - April 18, 2025
Zuora report shows strong growth for subscriber businesses – but rising costs risk driving users away.
Businesses built on subscription models are continuing to outgrow the wider market, according to the latest Subscription Economy Index from Zuora. The report found that subscription-based companies achieved an 11% revenue growth advantage over the S&P 500, based on data from more than 600 firms.
The findings suggest that recurring revenue models remain resilient in uncertain economic conditions. A separate survey commissioned by Zuora and conducted by The Harris Poll found that 68% of US adults used a subscription service for the first time in 2024. In the past two years, subscription-based businesses have seen a 25% increase in unique subscribers, with 84% of respondents saying they received the same or better value from their services over the past year.
But price sensitivity is becoming a challenge. Nearly half of those who cancelled a subscription in 2024 said cost increases were the reason. This puts pressure on subscription companies to prove value and avoid alienating users as they adjust their pricing strategies.
The report introduced a new performance metric – the Product Portfolio Balance Score – designed to track product diversity and purchasing frequency. Companies with higher scores showed better average revenue per account, pointing to the financial benefits of offering a wider mix of services.
Amy Konary, founder of Zuora’s Subscribed Institute, said the findings show the subscription economy continues to evolve. “There is still enormous opportunity for businesses that can match recurring revenue models with the right monetisation strategies,” she said.
The report also found that businesses using four or more revenue models saw average revenue per account grow 2.3% to 4.5% faster than those with less diversified approaches. This suggests a clear advantage in building flexibility and resilience into pricing and product strategies.
However, enthusiasm for some new services may be cooling. While 40% of consumers reported using generative AI tools, 64% said they wouldn’t pay extra for them – a warning to companies looking to monetise emerging features without a clear value proposition.
As the subscription economy matures, the SEI report argues that growth will depend on how well companies balance innovation with customer expectations – particularly on pricing. Intelligent portfolio management and clear value delivery, it suggests, will be key to long-term success.
Source: Noah Wire Services
- https://www.zuora.com/press-release/zuora-subscription-economy-index-2025/ – This URL supports the claim that businesses in the Subscription Economy Index have experienced an 11% revenue growth advantage over the broader market, as measured by the S&P 500. It also provides details on consumer engagement with new subscription services.
- https://www.zuora.com/resources/subscription-economy-index/ – This URL corroborates the significance of flexible revenue models and hybrid monetization strategies in driving growth for companies in the subscription economy. It highlights the impact of multiple revenue models on customer retention.
- https://www.zuora.com/press-release/sei-report-2024/ – This URL offers insight into the resilience of subscription-based businesses during economic challenges, supporting the trend of companies adapting monetization models to stay competitive.
- https://www.inma.org/modules/event/2024SubscriptionsSummit/presentations/Benchmarks-Zuora_INMASUBSUMMIT24.pdf – This PDF provides historical growth metrics for the Subscription Economy Index, showing its consistent outperformance compared to the S&P 500 over the past decade.
- https://www.zuora.com/press-release/zuora-subscription-economy-index-2025/ – This URL is relevant to understanding the significance of the Product Portfolio Balance Score in optimizing product offerings and improving Average Revenue Per Account (ARPA).
Noah Fact Check Pro
The draft above was created using the information available at the time the story first
emerged. We’ve since applied our fact-checking process to the final narrative, based on the criteria listed
below. The results are intended to help you assess the credibility of the piece and highlight any areas that may
warrant further investigation.
Freshness check
Score:
9
Notes:
The report is recent, referencing data from 2024 and discussing current trends in the subscription economy. It appears to be a press release from Business Wire, which typically indicates timely and new information.
Quotes check
Score:
8
Notes:
The quote from Amy Konary, Senior Vice President at Zuora, is plausible and relevant to the context. However, no earlier reference to this specific quote was found online.
Source reliability
Score:
8
Notes:
The narrative originates from Business Wire, a reputable platform for press releases, although not a traditional news source. Zuora and The Harris Poll are recognized entities, adding to the credibility.
Plausability check
Score:
9
Notes:
The trends and data presented align with recent shifts towards subscription-based services and consumer preferences. The findings seem plausible and consistent with current market dynamics.
Overall assessment
Verdict (FAIL, OPEN, PASS): PASS
Confidence (LOW, MEDIUM, HIGH): HIGH
Summary:
Overall, the information is fresh and appears reliable, considering it is a recent press release with credible data sources like The Harris Poll. While the quote’s originality cannot be confirmed, it aligns well with the narrative’s context.
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