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How to Make Your Renewals Frictionless

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Creating a frictionless renewal landscape is vital to ensuring recurring revenue growth. Here’s a look at the top 3 renewal friction points to avoid and the top 3 capabilities you can adopt to set your renewals in motion.

Published in: Economy & Finance

How to Make Your Renewals Frictionless

  1. 1. www.tsia.com How to Make Your Renewals Frictionless Service Revenue Generation
  2. 2. www.tsia.com Creating a frictionless renewal landscape is vital to ensuring recurring revenue growth. Here’s a look at the top 3 renewal friction points to avoid and the top 3 capabilities you can adopt to set your renewals in motion.
  3. 3. www.tsia.com Key Research Trend #1 of benchmarked companies execute an effective AutoRenew program. 23% Source: TSIA Service Revenue Generation On-Premise Benchmark Study, Q1 2017
  4. 4. www.tsia.com Friction Point #1: Never Ending Contract Negotiations Source: TSIA Service Revenue Generation On-Premise Benchmark Study, Q1 2017 Why This Matters… Over 75% of companies leave themselves open to term and price negotiations with their customers every year.
  5. 5. www.tsia.com Key Research Trend #2 of customer payments utilize purchase orders. 94% Source: TSIA Service Revenue Generation On-Premise Benchmark Study, Q1 2017
  6. 6. www.tsia.com Friction Point #2: Inefficient Payments Why This Matters… Purchase orders are slow and expensive for your company and your customers. Source: TSIA Service Revenue Generation On-Premise Benchmark Study, Q1 2017
  7. 7. www.tsia.com Key Research Trend #3 Source: TSIA Service Revenue Generation Benchmark Studies, Q1 2017 16% 26% On-premise Cloud of SMB customers are not contacted prior to contract expiration.
  8. 8. www.tsia.com Friction Point #3: Renewal Coverage Gaps Source: TSIA Service Revenue Generation On-Premise Benchmark Study, Q1 2017 Why This Matters… Renewal coverage models are sub-optimized, resulting in revenue erosion and/or customer attrition.
  9. 9. www.tsia.com To take the friction out of your renewal process and reduce customer attrition, TSIA research provides prescriptive advice on adopting 3 frictionless renewal capabilities.
  10. 10. www.tsia.com Capability #1: Implement Standard, Perpetual Terms Source: TSIA Service Revenue Generation Benchmark Study, Q1 2017; N = 66  Transition customers to perpetual terms to achieve higher renewal rates and lower customer attrition  Automate quote generation For a $300M recurring revenue business: • 1.2 pts of renewal rate improvement is $3.6M • 5 pts pf renewal rate improvement is $15M Did you know?
  11. 11. www.tsia.com Capability #2: Efficient Customer Payment Methodologies Source: TSIA Service Revenue Generation Benchmark Study, Q1 2017; N = 66  Offer purchasing card payment options (B2B credit cards)  Allow customers to renew online Purchasing card usage is growing exponentially, accounting for: • $245B of transactions in North America • 12% growth for B2B purchasing card transactions Did you know?
  12. 12. www.tsia.com Capability #3: Optimize Coverage Models For Renew & Adopt Source: TSIA Service Revenue Generation Benchmark Study, Q1 2017; N = 66  Increase customer-facing resources  Pivot to customer adoption & business outcomes • Reducing investment in back office functions can free up investment for customer-facing activities • Creating value is your best shot at making the renewal a non-event Did you know?
  13. 13. www.tsia.com Set a goal to decrease your customer attrition rate by 2 to 5 points… …let TSIA’s Service Revenue Generation show you how. www.tsia.com © Copyright 2016 Technology Services Industry Association Source: 2016 TSIA Service Revenue Generation Benchmark Study
  14. 14. www.tsia.com Find out what other trends are impacting your annual recurring revenues in 2017. Download the State of Service Revenue Generation Today

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