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Benchmark: Product Catalog Optimization

Amy Konary and Carl Gold

Research by the Subscribed Institute in collaboration with McKinsey & Company

The Subscription Economy continues its expansion across B2B sectors, from financial services to manufacturing, giving companies more opportunities to innovate and scale than ever before.

But for all the enthusiasm about the subscription model from their customers, providers, and investors, companies can find it a struggle to keep up with the operational realities of meeting the subscription moment. And a lag in operations doesn’t just hinder growth; it can threaten your organization’s viability.

Building long-term relationships with customers is the route to value in the subscription economy. Yet the Quote to Cash (QTC) process at most B2B companies—even those with subscription businesses—is optimized for linear transactions, not relationships. This results in complexity and cost to the provider and a poor experience for the subscriber. Companies that set out to improve their processes are faced with multiple design choices. And making the right choices can take a long time and involves coordination with multiple teams in your company, which can be especially challenging for companies doing a hybrid of traditional and subscription sales.

Impact on B2B Business Growth

In order to identify the key QTC design elements of successful enterprise B2B companies, the Subscribed Institute collaborated with McKinsey & Company to analyze three years of performance data from nearly 500 companies and compared indicators such as revenue growth, expansion, and net retention against 30 metrics corresponding to design choices in the quote-to-cash process.

Our research found that when designing a QTC process, one of the most important choices revolves around the offering architecture or product portfolio. Revenues of higher-growth companies are typically concentrated in a more highly curated set of products.

Get more insights from the study and learn how to optimize your product catalog by downloading the entire benchmark below.

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