Zoom’s CCaaS sales surge with new bundling strategy
CALIFORNIA, UNITED STATES — Zoom Video Communications reported a significant surge in its Contact Center as a Service (CCaaS) sales, driven by a new bundling strategy.
The tech giant recorded a 246% year-over-year (YoY) increase in deals worth over $100,000 in annual recurring revenue (ARR). This growth translated into 90 six-figure contracts, marking a substantial milestone for the company.
Strategic bundling and new customers
Kelly Steckelberg, Zoom’s CFO, attributed this success to the recently launched CCaaS packages, which offer organizations a more affordable way to integrate CCaaS across their operations.
This strategy has not only appealed to Zoom’s existing Unified Communications as a Service (UCaaS) customers but has also attracted new clients.
Eric Yuan, Founder and CEO of Zoom, highlighted the unexpected influx of new customers: “When we started… we thought most of the deals would be with the existing Meeting and Phone customers. However, that’s not right. Often, they are not Meeting or Phone customers. [Instead,] they are becoming ‘first’ Zoom customers, deploying the Zoom Contact Center.”
Innovation and channel partnerships
Zoom’s investment in channel partnerships and continuous innovation have played a crucial role in this growth. Last quarter, the company introduced several new features, including advanced data encryption, a next-gen dialer, and various agent—and supervisor-assist tools. These innovations were showcased at Enterprise Connect, further enhancing Zoom’s CCaaS platform.
Yuan emphasized the importance of these advancements: “As a result of how far the product has come, we have seen strong growth in the number of deals where we have beat or displaced a Gartner top four CCaaS player.”
Competitive edge and customer trust
Zoom’s ability to compete with top CCaaS players is evident in its recent wins. For instance, a Silicon Valley-based cloud software company switched to Zoom from a “top three” CCaaS solution, citing Zoom’s superior feature set, seamless integrations, greater uptime, and built-in AI. Another notable win was a 1,000+ seat contract, where Zoom outperformed another leading CCaaS provider.
Yuan summarized the company’s approach: “They know that we listen to customers, and we innovate. That’s the reason why – with our contact center – we’re making very good progress.”
New authorizations and partnerships
In Q1, Zoom received FedRAMP moderate authorization for its essential and premium SKUs, enabling U.S. government agencies to utilize the Zoom Contact Center. The platform also achieved PCI compliance, facilitating payment processing for customers. Additionally, Zoom announced partnerships with Avaya and Meta, further expanding its market reach.
Strong Q1 enterprise growth amid consumer business decline
Thanks to its CCaaS success, Zoom reported a steady quarter of earnings growth, with enterprise revenues up 5.3% YoY, reaching $665.7 million. This growth helped offset the decline in its consumer business, resulting in total Q1 revenues of $1.14 billion, a 3.2% increase YoY.
Zoom’s strategic focus on CCaaS and continuous innovation positions it well for sustained growth in the competitive contact center market.
