Because at the end of the day your customer insight defines who you are; it’s your competitive advantage. Lose the insight, and you lose yourself.

They allow them to give their customers what they actually want—the outcome, not the product. The milk, not the cow. That’s the story of Komatsu and Caterpillar in the construction industry. And this is why we believe that every company has the potential to reinvent and thrive in the Subscription Economy.

Expand. You want three things out of your subscribers: retention, growth, and advocacy. They have to get value out of your service and make sure you’re delivering something that’s better than what they can get anywhere else. How do you do that? How do you deepen the relationship?

You can see Cisco moving to a pay-for-what-you-use approach. It’s more natural. It spreads the risk out for customers and for us, and it forces Cisco and us to have a tighter relationship with customers.”

We eventually wound up supporting subscriptions for all of these things, but early on, they were just fun theoretical discussions. Here’s the secret we used to answer all of them in the affirmative—tease out the service-level agreement that sits behind the product. It works for everything. So instead of a refrigerator, it’s the guarantee of fresh,

But as technology shifts to the cloud, there’s a complementary shift happening in favor of opex over capex. Operating expenses bear the advantage of a pay-as-you-go model for services used with comparatively little to no up-front investment. Not only is this a greater value prop, as a business is getting exactly what it pays for, but it’s also a

OPTIMIZE YOUR PRICING AND PACKAGING

The surprising result is that companies that use just a small amount of usage-based billing in their revenue mix (less than 10 percent) grew more than twice as fast on average as companies that did not employ usage-based billing at all.

When you learn more about the company, though, it gets even cooler. I talked about agile software development—Graze has an agile factory. At our Subscribed conference in London, Graze’s CEO, Anthony Fletcher, pulled out his phone and said: “I can run my factory from my phone: the supplies, the distributors, the packaging. Every box that I ship is