Xero has passed 250,000 customers globally, an 85 percent increase in 12 months from 135,000, the company announced in a market release. But its rate of growth, which had slowed from the year before when customers grew 125 percent from 60,000, was slightly below expectations for some analysts.
“Xero needs to be adding customers from territories other than New Zealand as growth in the New Zealand market has slowed,” said Andrew Harvey-Green, senior equity analyst of Forsyth Barr. “Hence the comment that Xero appears slightly behind where we would expect it to be.”
Xero was in the main selling season in New Zealand and hoped to add to its 90,000 small business customers who brought in NZ$25 million in annualised committed revenue.
Xero had a smaller foothold in the Australian market where there was a lot of potential for growth. Numbers were “fast approaching 100,000”, Xero CEO Rod Drury in a press release, up from 40,000 a year earlier.
At its Sydney roadshow this week Xero claimed it only had single-digit market share in Australia. However, a multi-million dollar advertising campaign on buses, billboards, local newspapers and radio had raised unprompted brand awareness from 9 percent to 14 percent in seven weeks, Chris Ridd, managing director for Australia, said in Sydney on Wednesday.
Xero Australia was about to launch the second phase of its marketing campaign with a more aggressive call to change accounting programs.
Image: Xero Roadshow 2014
Image credit: Xero