We love it when we get to witness the performance economy in action. Why? We believe that, now and in the future, sustainable business success is dependent on delivering greater value with every transaction. But, not just any value... it must be demonstrable to the customer. 

This demonstrability—or “transparency,” as the model calls it—is woven through every fiber of the modern-day performance economy, especially in the way that businesses measure and optimize success for their customers. And digital technology is a key tool in making that transparency possible.

This next performance economy spotlight features a company—Indigo Agriculture—that’s using technology to embed value in every level of their business. What’s more, they’re working to support the environment while doing so.

Tiered pricing can be a real boon for companies that are looking to generate new revenue, particularly in ultra-competitive or crowded sectors. Yet, flexible pricing often introduces a level of complexity that can slow you down come month- and quarter-end. The solution: Utilize a unified SaaS automation solution that’s capable of streamlining all types of billing plans.

This year’s Business of Software conference featured an experimental Unconference session where attendees could choose topics to discuss and debate.

I led a discussion about moving beyond simple subscriptions. It definitely struck a nerve with the attendees and the conversations that ensued centered around a few emerging themes facing all businesses.

Revenue growth at scale is the core goal of every business. Increasing profitable revenue growth is not the sole responsibility of the sales or marketing team. In today’s dynamic world, revenue optimization is a function of the entire organization and the technology and process that supports the effort: pricing experimentation, billing efficiency, CRM, professional services, and other processes. It is in this context that technology is playing a big role in revenue optimization through automation.

It’s 2019, and what was only recently chiefmartec.com’s Martech 5000 has swelled to a whopping 7040. As a result of this proliferation of technology, advertising tech (adtech) and marketing technologies (martech) continue to converge, into what is now being affectionately dubbed “Madtech.”

This series of blog posts is exploring companies in the emerging performance economy. Performance based pricing—also known as outcome-based pricing or results-based pricing—refers to a pricing model where the product is priced based on the customers’ expense reduction or revenue gained as a result of the adoption that product.

In the first two posts of this series, we covered performance-based pricing models that use revenue gained as the lever for shifts in pricing.

• [24/7].ai leverages artificial intelligence and machine learning, combined with human intelligence, to create a personalized, predictive, and effortless customer experience.
• Clerk.io helps companies drive sales by using artificial intelligence to power a personalized shopping experience, for every customer in their online store.

In performance economy spotlight #3, we’ll look at the other side of the performance-based pricing coin—using expense/cost reduction, rather than revenue gained, as a mechanism for setting customers’ price. What better industry to examine cost reduction than sourcing and procurement? LevaData stood out as an interesting company planting a flag deep into the performance economy.

In the first of four posts exploring companies that are embracing the emerging performance economy we highlighted [24]7.ai. [24]7.ai is redefining the way companies interact with consumers by leveraging artificial intelligence and machine learning—and a performance-based pricing model—to deliver customer acquisition products and customer engagement products.

Over a series of four posts, we’ll explore companies that are embracing the emerging performance economy. Aligned incentives and transparency of metrics are key to performance-based pricing that fuels this new trend. Technology and software are allowing business leaders to share both upside and downside risk with their partners, customers, and vendors.

SaaStr Annual 2019 was a little Burning Man, a little United Nations, and a lot of great ideas and sessions to help scale your business. Our team enjoyed networking, learning, and evangelizing how billing and revenue recognition can become a source of joy for businesses (not a hodgepodge of manual processes and disparate systems).

The technology stack you choose not only supports growth, it shapes it.

Software is such a integral part of the modern work environment that it impacts all areas of your business, from how you do things, to who you hire.

TLDR Version:

• Companies are at risk if they don’t adapt to customer desire for flexibility
• Playing it safe on productivity software can inhibit growth
• Safety means paying for enterprise-software salespeople’s boats
• Smart companies are reevaluating legacy software
• Modern approaches lead to better outcomes.