Renewals and account leaders, now is your time to shine.
Downturns are hard, even on recurring revenue businesses. In a time like this, your existing customers are even more precious: with slower top line growth, it’s more critical than ever to protect what you have. That means the pressure is on to close as many renewals as possible, close them on time, and find pockets of upsell.
This is where Account and Customer Success leaders have the opportunity to step up to the plate and demonstrate what their teams can do. But what’s really critical to focus on? Here are five things you need to start doing right now in your renewals or account org to ensure you’re set up to weather the current economic landscape and bring in every last renewal dollar.
1. Ensure you have a process such that every renewal comes in on-time
In times of massive growth, you might be less worried about letting a few low-value renewals come in late or even slip. But in a downturn, ensuring every single renewal comes in on time, no matter how small, is mission critical – because the cash flow can literally make or break your business.
What that means is you need to be able to keep tabs on your book of business and stay alerted to whether there are any renewals that aren’t on track. For example, if you’re 90% through the quarter but only half of your renewals still don’t have a contract out, that’s a problem waiting to happen.
Our Revenue Optimization product surfaces off-track renewals, placing them front and center for CS and Renewals leaders to get their team focused on acceleration.
2. Create a method to identify at-risk renewals long before you start the conversation
Many businesses (and you may be one of these) have hundreds or thousands of customers up for renewal at a time. Most of these will be non-events – that is, the renewals will roll in without much effort. Others, however, will need extra hand-holding. How do you know which ones those are so you can direct your resources efficiently and close a higher percentage of renewal overall?
Unsurprisingly, your riskiest renewals are accounts that are in poor health (poor champion sentiment, low usage, large numbers of support tickets submitted) or have undergone other changes (M&A activity, Exec changes, downsizing, etc). For example, we found that, within our own customer base, customers who had had some sort of M&A activity in the 6 months preceding a renewal were 50% more likely to churn. That’s valuable information to have upfront.
The most successful renewals organizations keep track of this information, run analytics on it, and alert their team to where they need to focus their attention. This is probably the most compelling reason why we created Renewal Center and Company Intelligence, two Applications within our Revenue Optimization product. Renewal Center productizes the data science effort of analyzing all your customer health data for correlation to churn and produces a likelihood-to-renew score for each open Opportunity you have. To complement this, Company Intelligence scrapes publicly available news sources for the signals most highly correlated with churn (like M&A) and delivers those alerts to you. Our goal is to ensure you know about risk early enough for you to do something about it.
3. Set up a way to process renewals with fewer human touchpoints
Even when you have a fully resourced team, it’s never possible (or, really, strategic) to give every renewal the same amount of attention. But with hiring freezes and headcount limitations that accompany slowdowns, businesses now have to be able to do even more with less, which means you need a way to layer in automation into your renewals process. Best-in-class Account leaders segment out their customers by tech touch, mid touch, and high touch accounts, and set up prescriptive flows for engaging with these respective customers when it comes time for a renewal. Tech touch accounts may not need a human to intervene at all in the renewals process, whereas a high-touch account might need a very personalized step-by-step playbook like the one below:
4. Make sure you’re staying close to your champions
Relationships close all deals. Businesses that weather slow periods well, have a lot of relationship currency built up prior to the downturn so they are able to cash in during hard times. They also painstakingly keep track of details about their key champions – everything from their sentiment to who they influence to what their favorite type of wine is. If something changes, they know it immediately, especially for the accounts that are coming up for renewal.
Our People Maps application within Revenue Optimization is like an org chart on steroids! We enable CS and Revenue leaders to superimpose customer data on each contact – sentiment, recent conversations, open opportunities, who they influence, who in your internal org has a strong relationship, etc.
It’s easy to feel a sense of security when you have long standing contracts, but eventually they come up for renewal. If you follow these tips, you’ll be set up to close every renewal on-time, in-full, and hopefully with some upsell to spare. And that’s critical now more than ever.
To learn more about how to gain control over your renewals business check out our website or feel free to reach out to me directly on LinkedIn.
Priyanka Srinivasan is a Director of Product Marketing at Gainsight and leads go-to-market for Gainsight’s Revenue Optimization product. She has spent her entire career advising and operating both consumer and enterprise technology companies, including as a consultant at Bain & Company.