Subscription Billing Management Market by Type (Fixed and Variable), End User (Entertainment, Ecommerce, Fitness, Publishing, and Others), and Region (North America, Europe, Asia-Pacific, and LAMEA): Global Opportunity Analysis and Industry Forecast, 2023-2032

Subscription Billing Management Overview

The subscription billing management software tracks and manages actions linked to the payment of company's subscription products. The subscription billing management covers entire lifecycle features, including subscription plan design, subscriber onboarding, price management, automated invoicing and payment processing, handling subscription modifications, and revenue tracking. The goal of subscription billing management, as well as a subscription management system, is to assist businesses in successfully monetizing their subscription business models. Although these business models might be challenging to maintain, subscriptions can provide dependable and recurring revenue as compared to traditional sales. In addition to developing products that customers want, businesses also need to establish long-lasting relationships with them. Poorly handled subscriptions can cause increased volatility and damage to the reputation of the company. A subscription billing management platform not only makes it easier to handle all necessary procedures, but it also helps to build enduring relationships with customers by providing personalized products and easy & secure payment processing.

Subscription billing management engages in providing easier and faster experiences from buying the product to using it and paying for it, that keep customers require for a long period. One-time sales bring in new clients, but businesses with recurring income, such as those that rely on subscriptions, depend on maintaining current clients who regularly make on-time payments. The recurring subscribers are the prime customers of subscription billing management. The primary subscription models used are fixed pricing models, usage (or consumption) pricing models, contracted pricing models, percent of total models, and block (or tier) pricing models. Examples of subscription pricing models in B2B companies across industries include financial services, communications and media, manufacturing companies, and professional services.

Global Subscription Billing Management Market Analysis

The global subscription billing management market size was $6,862.6 million in 2022 and is predicted to grow with a CAGR of 21.7%, by generating a revenue of $47,661.5 million by 2032.

Source: Research Dive Analysis

COVID-19 Impact on Global Subscription Billing Management Market

According to the COVID-19 Subscription Impact Report by Zuora, 53.3% of businesses did not observe a substantial change in their subscriber acquisition rates. In the meantime, 12.8% of businesses observed slow expansion but were still expanding, while 22.5% of businesses saw their subscription growth rate increased. The remaining 11.4% of businesses, subscriber turnover had outstripped subscriber acquisition rates. The OTT video streaming, digital news and media, and e-learning, observed expansion. B2B and B2C software & information services were affected during the pandemic. Memberships, small business software, consumer IoT, and business IoT services witnessed slow growth. Travel, hospitality, and sports-related services observed contracting growth. However, the established players observed a progressive growth during the pandemic as numerous customers switched to online platforms to purchase goods. The positive growth in number of subscribers during the pandemic positively influenced the growth of subscription billing management market.

Increasing Number of Online Subscribers Driving the Growth of the Market

As the digital model continues to evolve, organizations are observing a significant transition towards subscription-based models. From streaming services and software platforms to SaaS companies and e-commerce, subscriptions have become a preferred choice for both businesses and consumers. This rise in subscription-based services has created an urgent need for effective subscription billing management solutions. The subscription billing management platforms offer comprehensive solutions to automate the billing process, ensuring accurate and timely invoicing while reducing the risk of errors and payment delays. They also empower businesses to implement flexible pricing models and personalized plans, catering to individual customer needs, which, in turn, enhances customer satisfaction and retention rates. Moreover, as companies expand their offerings and reach, they often encounter diverse payment methods and global customers. Subscription billing management systems streamline the payment process by supporting various payment gateways and handling international transactions, reducing conflict for both businesses and customers. In addition, subscription billing management systems provide valuable insights through data analytics. This data-driven approach enables businesses to analyze customer behavior, identify trends, and make informed decisions to optimize pricing strategies and improve overall subscriber retention.

Failure to Adapt Changes According to Technological Advancements to Restrain the Market Growth

The success of subscription billing is dependent on the capability of the service providers to keep pace with process innovations, technological advancements, new business models, and their ability to create new products and services. In case the service providers do not adapt go-to-market approach and the products to cloud-based delivery and consumption models, the users are expected to not be satisfied, which may result in unfulfilled demand and a consistent loss of customers. The market is vulnerable to risks and the resulting consequences, including the inability to create and market new cloud products across several enterprises on schedule and in accordance with market expectations because of complexity in diverse technical environments. The potential for failure of the product and technology approach; customers might not adopt technology platforms, applications, or cloud services quickly enough; they might consider other competing solutions in the market; or the strategy might not match customers’ expectations and needs, specifically in the context of expanding the product portfolio into additional markets. Any of these occurrences might have a significant negative impact on the operations, finances, earnings, and cash flows of the subscription billing management company.

Increasing 5G Coverage to Drive Excellent Opportunities

Currently, the 5G network is growing at a faster pace globally. According to 5G Americas, the global number of 5G subscribers were 1.1 billion in 2022. Service providers in majority of sectors, such as healthcare, entertainment, restaurants & food services, e-commerce, online multimedia magazines, sports & e-sports, manufacturers & resellers, and others, are adopting 5G services to obtain a wider customer base. According to Ericsson an established player in the telecommunication industry, it is anticipated that 5G subscribers would reach a count of 4.6 billion users globally by 2028, which is expected to account for half of all mobile connections globally. It is projected that 5G subscribers in the Middle East and Africa region are anticipated to increase from 22 million in 2022 to 290 million by 2028. The wider the 5G coverage, the greater will be the utilization of subscription-based services by people across the world. This may create a huge demand for a subscription-based billing management system in the upcoming years. As the 5G network reaches from urban areas to rural areas, the number of 5G customers can reach a renowned number. This may result in more people using Internet-based services, which is expected to increase the demand for subscription-based services and thus increase the revenue generation owing to increasing customer base. The reach of the existing 4G network has given subscription-based services a boom. Further introduction and adaptation of the 5G network is anticipated to take this to another level in the future.

Global Subscription Billing Management Market Share, by Type, 2022

Source: Research Dive Analysis

The fixed sub-segment accounted for the highest market share in 2022. The convenience offered by subscription-based model to both customers and companies is shifting more industries towards subscription-based services. A notable trend contributing to the growth of subscription billing management is the significant increase in fixed subscribers across various sectors. The increase in fixed subscribers has subsequently necessitated efficient subscription billing management systems. Companies are recognizing the importance of streamlining and automating billing processes to manage the growing customer base effectively. These systems not only handle recurring payments but also offer other benefits, such as tracking customer preferences, managing upgrades and downgrades, and providing personalized offers. As consumers seek convenience and flexibility, companies have adapted by offering subscription plans for products and services ranging from software, entertainment, healthcare, and even household essentials. This shift has resulted in a surge of fixed subscribers, wherein individuals commit to recurring payments for a specified period.

Global Subscription Billing Management Market Share, by End User, 2022

Source: Research Dive Analysis

The entertainment sub-segment accounted for the highest market share in 2022. The entertainment industry has undergone a significant transformation, shifting from traditional cable TV to digital streaming platforms. The advent of streaming services such as Netflix, Amazon Prime Video, Disney+Hotstar, and others has revolutionized the way users consume entertainment. This transition has also given rise to a surge in subscription-based models, where consumers pay a recurring fee to access a vast library of content. As the number of subscribers continues to increase, so does the need for efficient subscription billing management systems. The exponential growth of subscribers in the entertainment industry is a result of several factors. First and foremost, the convenience and flexibility offered by streaming platforms have attracted millions of viewers worldwide. Moreover, the COVID-19 pandemic further accelerated this trend, with people turning to streaming services for entertainment while staying at home. In addition, implementing robust subscription billing management software can benefit both providers and consumers. For companies, it minimizes the risk of revenue leakage due to failed transactions, improves customer retention through personalized subscription plans, and optimizes overall financial operations. For consumers, it ensures a hassle-free payment process, easy upgrades or downgrades of subscription plans, and clear visibility of billing cycles.

Global Subscription Billing Management Market Size & Forecast, by Region, 2022-2032 ($Million)

Source: Research Dive Analysis

The North America subscription billing management market generated the highest revenue in 2022. North America has witnessed an unprecedented surge in online subscribers, leading to a substantial demand for efficient subscription billing management systems. With the advent of numerous software platforms, streaming services, e-learning portals, and digital content providers, consumers in the region are increasingly adopting the convenience and flexibility of subscription-based services. In addition, the pandemic resulted in an increase in adoption of digital services as people in North America pursued education, entertainment, and remote work solutions from the comfort of their homes. This rapidly growing trend has not only transformed the way individuals access products and services but has also presented new challenges for businesses in managing their billing processes. As the number of subscribers rises, businesses face the complex task of managing an ever-expanding customer base, diverse subscription plans, and varying billing cycles. This led to an increase in the need for robust subscription billing management solutions that can streamline operations and ensure a seamless customer experience.

Competitive Scenario in the Global Subscription Billing Management Market

Investment and agreement are common strategies followed by major market players. For instance, in August 2022, Francisco Partners (FP), a major global investment firm that focuses in partnering with technology businesses announced that FP signed a definitive agreement with SAP America Inc., a wholly owned subsidiary of SAP SE. Under the terms of the agreement, Francisco Partners is expected to acquire SAP Litmos (Litmos) from SAP. Litmos is an established player in the learning management system market. The transaction winded up in the fourth quarter of 2022 and was subject to customary regulatory clearances. Financial terms of the transaction were not disclosed.

Source: Research Dive Analysis

Some of the leading subscription billing management market players are Zuora Inc., Salesforce, Inc., SAP SE, Oracle Corporation, ZOHO Corporation., Chargebee Inc., Chargify LLC., Recurly Inc., 2Checkout, and Apttus Corporation.