Solving The Digital Renewal Challenge? (Q&A responses)
If you're working to digitize renewals and registered for last week's TSIA Interact, you may enjoy viewing this on-demand session (30 min) entitled, Solving The Digital Renewal Challenge, that I did with @Jack Johnson of the TSIA: https://tools.eventpower.com/event_app/display/index/20TSIA-INTERACT
You may also find the following Q&A Responses from the session helpful.
Question 1: I'd love to hear any best practices processes that include auto renew, too.
Answer 1: Generally speaking, we believe auto-renew is the best experience for both the customer and the vendor. Some common best practices we'd highlight:
(i) Legal. Some countries regulate the use of auto-renew and be sure that your opt-in/opt-out process and related terms & conditions adhere to these requirements and are implemented in a transparent and customer-friendly manner.
(ii) Notification. 15 to 30 days prior to the renewal event on an auto-renew, you should send the customer an email notification of the upcoming renewal, while also providing the customer the easy ability to update their contact detail, payment details, and the ability to revise or cancel their subscription. Customers should be provided with offramps to human sales reps, and/or customer success / support representatives as appropriate. If the payment method requires customer intervention (e.g., wire transfer) additional advance notification to the customer could be appropriate prior to the renewal. This topic can get very granular and I would be happy to speak in more detail about best practices for things like handling of payment declines.
(iii) Customer Success. Where possible, we recommend ensuring that there are ongoing customer success communications (e.g., automated emails) prior to and incorporated within renewal communications that help ensure the customer is fully using, enjoying the benefits of your service, and ideally is made aware of the value / benefits already received. These can help ensure the success of the customer and the likelihood of their renewing their subscription.
(iv) Monitoring. Have appropriate automated and/or human processes to track and proactively identify opportunities for customer success engagement and/or engage human or automated selling to upsell or cross-sell the customer prior to the renewal event.
(v) Pricing model. Situations where you have billing in arrears (e.g., usage-based billing) can be particularly relevant for auto-renew.
Question 2: What do you recommend automating; quoting, PO entry, billing and rev rec or payment processing? Or all?
Answer 2: At a high level we recommend identifying where you have the highest volume of activities (e.g., long tail renewals) and points of friction in your sales process for your sellers and your customers, and then identifying the level of effort (or investment) required to address each of these. We think you will generally find these to be the highest priorities to address through automation: quoting, billing, and payment processing.
Question 3: How can we convince management that this is required? The perception is that at the moment our spreadsheet & manual effort is working...
Answer 3: For a relatively low volume of transactions manual processes can sometimes be sufficient. We suggest evaluating the consequences of manual processes on a variety of dimensions to get a clear picture:
(i) Customer experience. Are customers negatively impacted by manual processes such as their level of ease / convenience to transact, the accuracy of the quote and transaction, and timeliness to begin or continue using your service? If yes, what is the consequence to your company in terms of renewal sales, brand value and customer lifetime value?
(ii) Scale. Do your manual processes limit the scale of your sales and customer success personnel to focus on growing sales either through new customer acquisition, expansion or renewal (now or in the future)?
(iii) Cost of sales. Evaluate your current cost of sales for renewals and determine what potential impact automation could deliver, and whether this justifies potential investment in automation.
(iv) Competitive positioning and future proofing.
(v) Would automation enable new customer acquisition vehicles (e.g., ecommerce) and pricing models that could be advantageous to your business?