The growth of subscription-based services is dramatically changing the way companies build and maintain relationships with their customers. Even companies with seemingly no relation to cutting-edge technology are reaping the benefits of the new subscription economy. At this year’s Zuora Subscribed event in San Francisco, California, much of the buzz centered around customer stories of new applications for subscription services.

“Caterpillar is showcasing their machinery spitting our petabytes of telemetry data, and they’re able to monetize those. They have autonomous vehicles, virtual reality, drones over job sites. … All of that is available as a subscription,” said David Gee (pictured), chief marketing officer at Zuora Inc.

Gee spoke to Jeff Frick (@JeffFrick), co-host of theCUBE, SiliconANGLE Media’s mobile livestreaming studio, about the most exciting customer success stories, as well as implications of the new subscription-based economy on. (* Disclosure below)

Beyond the transaction

By signing customers up in subscription services, companies can extend their relationship beyond the first transaction into a long-term engagement. Fender guitars is one example, according to Gee.

“You walk into a store and buy a Fender guitar, and you leave and they never hear from you again. They want to turn that into a lifelong music experience and really change the way you learn how to play an instrument to being part of a community and having a long-term relationship versus just walking out the store,” Gee explained. 

Gee also issued one word of caution to adopters of subscription-based business models regarding an upcoming regulatory change in the way the revenue streams are accounted for.

“There is a looming, big financial accounting change that’s coming where the way subscription economy companies is going to have to change the way they account for their revenue and their expenses,” he said, explaining how Zuora is well positioned to ensure customers are ready for this change. 

“We just acquired [Leeyo Software Inc.] that is the market leader in automated revenue recognition. We’re educating the market in what is a very compelling value proposition,” Gee concluded.

Watch the complete video interview below, and be sure to check out more of SiliconANGLE’s and theCUBE’s coverage of Zuora Subscribed 2017. (* Disclosure: TheCUBE is a paid media partner for Zuora Subscribed 2017. Neither Zuora Inc., the event sponsor, nor other sponsors have editorial influence on theCUBE or SiliconANGLE.)

Photo: SiliconANGLE