Tuesday, 11 November 2014 18:16

VIDEO: Swann Security goes subscription, Internet of Things and Zuora

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Swann Security is launching new subscription and Internet of Things based security services and monitoring at CES 2015 in Las Vegas, and is integrating Zuora’s subscription technology.

Swann Security is launching into the world of the Internet of Things in a big way, focusing on its security services, with a fascinating talk at a Zuora event, featuring not only Deloitte Private but also Geoff Wanless, CTO of Swann Security.

Geoff spoke at length about Swann’s upcoming launch, which will see product on store shelves in the US and Australia in January, and in Europe by February, and answered many very interesting journalist questions.

Swann also has over one million customers on its US database that it has gathered registration info over the past 18 months, and a large number in Australia, to whom it will promote its new security and monitoring services, paid for by the innovative and flexible subscription payment model.

Zuora’s media release notes that ‘Zuora enables Swann with the flexibility to launch new services and create subscription experiences that will bring them closer to their consumer than ever before.’

Zuora, bills itself (no pun intended) as ‘the subscription commerce, billing and finance leader’, and announced a new partnership with Swann Security.

Swann Security says it is ‘the world’s number one brand in do-it-yourself security surveillance’, and it is leveraging Zuora’s ‘Relationship Business Management (RBM) solution Z-Business’ to support the roll out of its new connected device to its consumers.

This is being done to transform Swann’s market leadership in the product economy ‘into deep customer relationships in the Subscription Economy.’

Swann started life making modems in Melbourne, Australia, in the 1980s, but today Swann has ‘a presence in over 40 countries and offices in the US, Canada, Australia, UK, Hong Kong, China and Russia’, with approximately ’70% per cent of its business is derived from North America.’

Here’s the video of today’s lunch event, which is a must-see if your business needs to get into subscription revenues and can support such an innovative model.

The video has great introduction by Tien Tzuo, CEO of Zuora; and has a talk by Ben Shields, the Partner and Head of Strategy for Deloitte Private, and then goes into a detailed talk by Geoff Wanless, CTO of Swann Security, as well as plenty of insightful questions from all the journalists present.

So, why is Swann going into subscription services to build this deep customer relationship?

It turns out that ‘Customers want more than a device’.

Anticipating the Internet of Things and subscription revolution, and the need to be at the forefront of technological change lest some competitor gazump Swann’s leadership position, the company acted two years ago.

Swann's management asked itself a question: ‘how could their security hardware have an edge in a market of consumers suddenly connected to a multitude of remotely operated smart home devices?’

Geoff Wanless, Swann's CTO explained that: “We realised the people buying from us aren't actually looking to buy a camera. What they want is security, a feeling they will be looked after.”

“Our challenge was to develop a more consumer-friendly product, broader in scope but one that would allow us to establish a much closer relationship with our customers, so we could instill that peace of mind.”

So, how did Swann go about ‘creating a Subscription Experience?’. Obviously it has partnered with Zuora, but what are the other details?

The company explains that it ‘set out to move from the box-shifting, single transaction approach of the past to a subscription service that offered a broad range of services.’

And, explains Swann, ‘unlike traditional push services that lock clients in for annual or multi-year contracts, this new offering would be completely flexible, with clients subscribing as and when needed.’

Winless added that: “If you look at traditional monitored security services, the prices range anywhere between $40 and $70 per month. It's a market that has quite a high churn rate, estimated at ten per cent after three years, mainly because perceived value is marginal. If a customer has no burglaries, there's no contact with the supplier.”

As Wanless explains in the video above, ‘if the consumer only has one touch-point with the supplier -- and it happens to be under negative circumstances -- it’s difficult to prove the continuous value add of the service. Only by reinventing the way Swann provided value to their consumers could it foster long-term commercial relationships.’

So, all of this required not only new technology, but a new business model - subscriptions.

Swann says it ‘set out to scope the technology needed to support their business transformation and the launch of their new connected device. It wasn’t long before they realized Earp’s core capabilities, oriented around one-time commerce and billing models, would not account for recurring subscription commerce and revenue models.’

The company sought out ‘new technology that would focus on acquiring and managing ongoing customer relationships -- the lifeblood of the Subscription Economy.’

Swann had several requirements for a recurring revenue-based financial platform. The new solution needed to provide:

- Flexible and dynamic pricing and packaging to drive revenue growth strategies.

- Integration of customer-centric data into the Intamac platform and future service apps, to be able to understand their subscribers -- what services they’re subscribing to, usage, length of contract;

- Unified commerce, billing and finance processes, in a way that puts customer relationships at the center of their business; and

- Have blue chip reference customers.

Swann naturally looked at several systems, but in the end it chose Zuora’s RBM platform, Z-Business.

Unsurprisingly in a joint media release from Zuora and Swann, we are told this was ‘for its ease of use, integration, flexibility and scalability to support Swann's business and their proven track record for enabling companies around the world to successfully pivot their business to the subscription business model.’

How was this taken ‘from Vision to Reality?’

Swann explains that it has been ‘demonstrating the new subscription-based offerings to major retail clients both in the US and in Australia to an enthusiastic response.’

We will see the first products available on major retail shelves and direct from Swann's online store by the end of January 2015 in the US and Australia, and Europe by February 2015 .

The retail product will consist of a central hub and gateway, to which cameras and sensors can be added. To activate the service, the customer simply has to go onto the Swann website, register the product and create an account. All the information will be captured in Zuora’s RBM platform, Z-Business.

A basic monthly security and monitoring package involving intelligent motion detection, remote camera access and push notifications to a phone will cost consumers approximately $10 per month, depending on options.

Wanless says that: “With Zuora, our system will be more sticky. We believe customers will want to interact with their home daily.”

He points to ‘applications such as unlocking doors when children come home from school or when tradespeople need access, turning on heating or air conditioning prior to coming home, monitoring electricity usage, or receiving alerts when a window is broken.’

“Developing the subscription management skills to handle this model was very important to us. It could be that customers are only paying for monitoring for a couple of days or weeks per month. We expect they will want to stop and start the service. We needed flexibility and that's what Zuora has given us,” Wanless added.

Greg Cullen, the VP of Zuora in Australia/New Zealand said: “As more and more devices - from appliances to cars - become connected to the internet, device manufacturers are finding that they must pivot to a new business model centred around subscriptions.”

“In this new world, the focus is on delivering an end to end subscription experience to build long term relationships built on trust. Swann is one of the leaders making this shift and they turned to Zuora because we are the recognised leader in Relationship Business Management."


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Alex Zaharov-Reutt

One of Australia’s best-known technology journalists and consumer tech experts, Alex has appeared in his capacity as technology expert on all of Australia’s free-to-air and pay TV networks on all the major news and current affairs programs, on commercial and public radio, and technology, lifestyle and reality TV shows. Visit Alex at Twitter here.

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