how to make your renewals frictionless

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How to Make Your Renewals Frictionless

Service Revenue Generation

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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.

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Key Research Trend #1

of benchmarked companies execute an effective AutoRenew program.

23%

Source: TSIA Service Revenue Generation On-Premise Benchmark Study, Q1 2017

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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.

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Key Research Trend #2

of customer payments utilize purchase orders.

94%

Source: TSIA Service Revenue Generation On-Premise Benchmark Study, Q1 2017

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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

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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.

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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.

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To take the friction out of your renewal process and reduce customer attrition, TSIA research provides prescriptive advice on adopting 3 frictionless renewal capabilities.

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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?

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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?

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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?

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Set a goal to decrease your customer attrition rate by 2 to 5 points…

…let TSIA’s Service Revenue Generation show you how.

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© Copyright 2016 Technology Services Industry AssociationSource: 2016 TSIA Service Revenue Generation Benchmark Study

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