ISG Research is happy to share insights gleaned from our latest Buyers Guide, an assessment of how well software providers’ offerings meet buyers’ requirements. The Revenue Recognition: ISG Research Buyers Guide is the distillation of a year of market and product research by ISG Research.
The fact that many enterprises have already begun or are in the process of digital modernization is a testament to the rapid rise of digital products and services, new direct
With additional sales models other than one-time sales, the revenue from a sale is spread over the lifetime of the engagement rather than received as an upfront lump sum. This requires sustained engagement with customers beyond the break-even point in order to have a profitable business model. This sustained engagement can also be referred to as the customer lifecycle and, in this case, the processes and people supported by technology to ensure that a provider is doing all it can to encourage the customer to engage with the seller. Often starting at the quote stage of a qualified sales engagement, the revenue lifecycle follows the buyer’s journey through to contract negotiation and agreement, provisioning and fulfillment as required, invoicing, payment, and on to renewal or contract and potential amendments to the initial order or additions in terms of new product or services.
ISG Research defines revenue lifecycle management as a unified platform approach that connects customer-facing teams to boost revenue and margin through consistent, long-term customer engagement. We define revenue recognition applications as those that support revenue recognition activities within revenue lifecycle management. This includes supporting multiple pricing models, including subscription and usage; enabling different types of product, service and event-driven rules; providing automation and straight-through processing; creating journals and communicating with accounting systems; producing insights and analytics; and auditing reports.
More broadly, revenue lifecycle management can start with an initial quotation and move through contract negotiations to fulfillment and invoicing and on to renewal and expansion. Individual applications that could be used as part of this process are Configure, Price, Quote (CPQ), contract lifecycle management (CLM), billing, revenue recognition, and revenue lifecycle platform services. As this quote-to-cash process touches many different internal processes, to avoid common issues with handover from one team to another, a true revenue lifecycle management system not only manages digital documents but also extracts, digitizes and stores all the important terms from within the documents. In this way, errors are minimized, and all necessary terms and information is made available to all who are involved with the customer at every part of the lifecycle.
Likewise, with digitized billing schedules and calendars, key events can trigger automatic activity such as renewal outreach. With digitized terms, there is no need for one team to input data to pass on to the next team as the key data persists in the relevant platform data store. Likewise, analysis of repeated steps within the overall process can identify areas for process improvements; for example, a particular type of contract for a particular type of customer often requires responses from the customer’s legal counsel. In fact, all areas of the process are open to analysis if the overall process is represented within the revenue lifecycle platform. Analytics can be used to better understand what the ideal or expected intervals between processes are, or where certain characteristics of a customer, region or product cause processes to take longer or require additional steps. In this way, the revenue lifecycle management system and process can be continually analyzed and improved to the benefit of the customer experience and ultimately contribute to sustained customer engagement.
As has been previously mentioned, the overall revenue lifecycle management process has, at its core, clearly defined activities spread across different departments and teams.
Despite the business imperative, we assert that through 2026, more than one-half of enterprises will still be using manual processes to integrate quotes and contracts, leading to billing and delivery errors and poor customer experience.
In addition to our publishing of the overall Revenue Lifecycle Management Buyers Guide, we are also publishing sub-guides covering the individual component parts of revenue lifecycle management, including revenue recognition. More industries and verticals are adopting a hybrid pricing strategy due to the introduction of complementary digital products and services to physical, one-time sales. These include deferred revenue models such as subscription and usage-based pricing. Unlike one-time sales, this means revenue cannot be recognized once the sale is made, but only on a future billing event.
For products and services not sold on a one-time basis, the associated revenue is spread over the lifetime of the contract. Based on contracted terms, the details of what was purchased—known as obligations—are tracked to enable recognition of payments from an accounting perspective. As a contract can account for a variety of products and services, tracking the right level of granularity ensures that future invoice amounts are recognized correctly. Tracking the standard selling price to ensure contract prices are not skewed to high-margin or low-margin products sold at an extreme discount increases revenue recognition complexity. Standard selling prices are either estimated offline or the application can help analyze what an average selling price should be.
Finally, the revenue recognition application should generate journal adjustments and integrate them with the general ledger (GL) for adjusted accounts to be generated accurately based on revenue recognition rules. Some approaches output a report, but the superior option is to produce entries that are posted to the GL, which requires the application to support a sub-ledger to align accounts with the GL. Audit reports are important, as are more analytic capabilities to monitor revenue trends and compliance to help project revenue. This information, combined with revenue recognition rules, is used for revenue and cash projections to determine when payments are recognized under common standards such as ASC606 (IFRS 15).
Although revenue lifecycle management is a relatively new term, the need for such an approach has been around far longer. As hybrid pricing models extend into the broader economy, many of the existing systems enterprises are using will be unable to accommodate the challenges of a shift to more complex pricing and revenue models and, more importantly, are not platforms that support rapid change and innovation. The danger, as highlighted in this overview, is that by not modernizing processes and systems that support the revenue lifecycle of customers, there exists the potential for mistakes across teams as one group hands over to another. As part of the need to maintain sustained engagement with customers, meeting the customers’ expectations in terms of responsiveness and accuracy is essential. These platforms and applications are an important set of functions and capabilities to ensure that changes to business models, necessary for competitiveness, are not held back by process or technology. And whether you are looking for a single supplier or a series of applications that work in conjunction with a core platform, this Buyers Guide will help identify providers that represent a relevant set of suppliers to seek out and evaluate.
The ISG Buyers Guide™ for Revenue Recognition evaluates software providers and products in key areas that support the revenue recognition aspects of the customer's revenue lifecycle. This Buyers Guide evaluates products based on capabilities that facilitate the use of an integrated and extensible platform that can help orchestrate activities across all teams involved in sales, finance, legal and operations. The data and data model should be accessible using a set of standard reporting and analytic methods. The revenue lifecycle management platform supports these distinct activities with applications for revenue recognition.
This research evaluates the following software providers that offer products that address key elements of revenue recognition as we define it: Aptitude, Aria Systems, BillingPlatform, Chargebee, Conga, DealHub, Gotransverse, Maxio, NetSuite, Oracle, Recurly, RecVue, Sage, SAP, SOFTRAX, Stripe, Zoho and Zuora.
This research-based index evaluates the full business and information technology value of revenue recognition software offerings. We encourage you to learn more about our Buyers Guide and its effectiveness as a provider selection and RFI/RFP tool.
We urge organizations to do a thorough job of evaluating revenue recognition offerings in this Buyers Guide as both the results of our in-depth analysis of these software providers and as an evaluation methodology. The Buyers Guide can be used to evaluate existing suppliers, plus provides evaluation criteria for new projects. Using it can shorten the cycle time for an RFP and the definition of an RFI.
The Buyers Guide for Revenue Recognition in 2025 finds BillingPlatform first on the list, followed by Oracle and Zuora.
Software providers that rated in the top three of any category ﹘ including the product and customer experience dimensions ﹘ earn the designation of Leader.
The Leaders in Product Experience are:
The Leaders in Customer Experience are:
The Leaders across any of the seven categories are:
The overall performance chart provides a visual representation of how providers rate across product and customer experience. Software providers with products scoring higher in a weighted rating of the five product experience categories place farther to the right. The combination of ratings for the two customer experience categories determines their placement on the vertical axis. As a result, providers that place closer to the upper-right are “exemplary” and rated higher than those closer to the lower-left and identified as providers of “merit.” Software providers that excelled at customer experience over product experience have an “assurance” rating, and those excelling instead in product experience have an “innovative” rating.
Note that close provider scores should not be taken to imply that the packages evaluated are functionally identical or equally well-suited for use by every enterprise or process. Although there is a high degree of commonality in how organizations handle revenue recognition, there are many idiosyncrasies and differences that can make one provider’s offering a better fit than another.
ISG Research has made every effort to encompass in this Buyers Guide the overall product and customer experience from our revenue recognition blueprint, which we believe reflects what a well-crafted RFP should contain. Even so, there may be additional areas that affect which software provider and products best fit an enterprise’s particular requirements. Therefore, while this research is complete as it stands, utilizing it in your own organizational context is critical to ensure that products deliver the highest level of support for your projects.
You can find more details on our community as well as on our expertise in the research for this Buyers Guide.