5 Reasons Tech Leaders Should be Talking about SaaS and B2B Renewal Strategy (more often)

Seriously, why aren’t more tech leaders talking about SaaS based renewal strategy? Is it simply being overlooked? Or, is it a coveted secret for keeping an edge in today’s digital economy? Do my fellow recurring revenue aficionados see this trend too?

Before I share 5 simple reasons why the SaaS community should increase awareness and debate around managing the customer lifecycle, I’ll cover why it matters and the observations that led me to write this article.

Seriously, why aren’t more tech leaders talking about SaaS based renewal strategy today?

Why it matters

The lack of content on this topic is disappointing — baffling even. How tech companies structure and posture the dynamic of B2B contract renewals between/within Sales and Customer Success is a topic deserving much debate.

After all, B2B SaaS companies generate the majority of all revenue from their existing customer base.

1) So what are the thought leaders, experts and content authors that have this knowledge writing about instead?

2) Is it possible the conversation is indeed happening, but hiding behind the rising popularity of conversations tackling Customer Success and Business Development, and the state of AI?

A growing and notable trend here is that CSM’s, historically known for owning customer experience, on-boarding and product adoption, are now becoming a central role in farming, retention and revenue growth.

In other words, Customer Success teams are increasingly looked to to manage the full lifecycle, including renewal sales. Very interesting to see how it unfolds and if CS absorbs this function entirely, partially, or sheds the trend completely.

Observations

Not only are Inside Sales roles and SaaS companies more abundant than ever, but the sheer volume of content B2B tech companies produce is staggering (and still growing). And despite recurring revenue being the lifeblood of crushing any bottom line growth target, it continues to be top line sales strategies that attract today’s content writers and readers the most. (e.g. search and see for yourself…anything on SDR’s, BDR’s, Outbound sales tactics, etc.)

With the abundance of articles and content addressing the modern day sales funnel, lead generation and prospecting, maybe it’s assumed that everyone knows how to handle renewals. Spending a decade in tech — mostly leading inside sales teams — I can say with full confidence that more needs done to address the reality that a well oiled renewal engine can have a profound impact on the health of all orgs within your business.

…maybe it’s assumed that everyone in Sales Leadership knows how to handle renewals.

Let’s hope not. Without further ado…check out 5 Reasons why tech leaders today should really be talking more about renewal strategy for B2B SaaS companies.


#1: Cost of keeping a customer is less than acquiring new ones.

It’s 2018, everyone knows this right? Shore up resources and segment your customer base for full coverage. Existing clients are also more likely to close upsells by purchasing new products or increasing spend for new features and added benefits.

#2. Referrals can feed top funnel and top line revenue with leads that close faster and stay longer.

A strong renewal process isn’t only about the renewal. It’s about the client’s entire experience leading up to the event of license expiration. When the customer explicitly knows the value of your product and partnership, they tend to want the same for their peers, colleagues and network. Would you rather have 5 warm referral leads or rather chase down 50 cold leads? Low hanging fruit right here if you’re not asking for referrals.

#3. Inside Sales roles are growing more than any other role in the sales profession today

Not SDR’s, not BDR’s, but Inside Sales. Professionals in Inside Sales now make up almost half of all sales positions. Using census data, Insidesales.com estimates of the 5.7 million non-retail U.S. salespeople in 2017, 43.5% were inside sales pros.

#4. B2B renewal sales require a hyper-focused approach, process and talent pool different from your outside sales team.

This starts at the top. If leadership at your organization doesn’t know this already you’ll struggle to perform and probably already are. Don’t erode your user base because you’re too lazy to hire the right talent to keep your happy customers, well, happy.

#5. Renewal teams are often an untapped gold mine for BOTH the company they work for and the customers they serve.

Because the subscription based model is fueled by the customer experience and normally sold as a monthly or annual subscription, your renewal team has more access than ANYONE else to practice empathy and walk in their customers shoes. They should be cataloging behaviors and trends. So, establish a client feedback loop, collect the data and use it to build better products, stronger support offerings and well-tuned personalized journey. Customers should use their renewal account manager to get insights on product roadmaps for planning and to maximize the benefits and value received from the solution.

Conclusion

Customer Lifecycle Management, aka the client renewal process, should be at the heart of every B2B SaaS company today. It’s too competitive to not care, and it’s to easy for customers to switch to your competitors platform thanks to the cloud. What do you think?

If the SaaS world gave churn and customer retention the same coverage as content discussing SDR’s and BDR’s, what would change? Would we be better or worse off? Would anything change?

5 Ways to Maximize your Renewal Sales Team to Win in B2B SaaS

The battle for your Customer Base is about to get really real. The average SaaS company now has 9 competitors — that’s up from 2-3 competitors in 2013. Are you ready?

Do most B2B Companies plan to maximize and leverage recurring revenue to scale?

In other words, are they taking subscription-based renewal sales seriously?

This a question I often ask myself. Why? Because I genuinely do not know how B2B leaders across the globe, especially in the C-Suite, think about the long-term implications (good or bad of recurring revenue). Is it being overlooked? Is it a coveted secret for keeping an edge? Maybe. Maybe not.

Here’s the truth…

The battle for your Customer Base is about to get really real. 

Did you know?

  • Today it’s 3-4x more competitive in B2B SaaS markets than ever before.
  • New SaaS products and B2B companies are popping up faster than new customers. 
  • Tech companies are doubling down on delighting users with strong Customer Experiences
  • Inside Sales roles are growing more than any other role in the sales profession today. 

After all, B2B SaaS companies generate the majority of all revenue from their existing customer base in the form of subscription renewals, license/feature add-ons, and upsell expansion.

 Using census data, Insidesales.com estimates of the 5.7 million non-retail U.S. salespeople in 2017, 43.5% were inside sales.

Observations from the frontline

Is it assumed that everyone in Senior Leadership knows how to handle renewals?

  • B2B sales leaders are failing to use the power of recurring revenue to win in SaaS.

  • Existing Customers are an untapped goldmine of predictable scalable revenue for companies with subscription pricing models.

In 2013, the average SaaS company had 2-3 competitors. In 2018, that number exploded to average 9 competitors.

Despite recurring revenue being the lifeblood of achieving any real growth target in SaaS, new sales continue to be the bright shiny object distracting sales, marketers, and leaders away from delighting existing customers.

Spending a decade in tech — mostly leading inside sales teams — I can say with full confidence that more needs done to address the reality that a well-oiled renewal engine can have within your business.

The good news: The use of Customer Lifecycle Management is growing across B2B companies.

Customer Lifecycle Management alone can be the game changer that propels your brand to enormous success or causes catastrophic failure.

5 Reasons why tech leaders today need Renewal Sales to Slay it in B2B SaaS…

1) Customer Success has become a central role in the revenue farming, retention, and expansion

A growing and notable trend are that CSM’s— historically known for being separate from sales— can own every moment of the customer experience after the initial sale. This includes onboarding and product adoption, as well as contract negotiation and upsell / cross-sell expansion.

In other words, Customer Success teams are increasingly looked to manage the full customer lifecycle, including renewal sales.

2) Existing customers are 50% more likely to buy than new

Everyone knows this right? Account Based Marketing (ABM) is a key trend to watch for.

3) Build a Referral Funnel to supplement top-line revenue growth

When your customer base begins to evangelize your product with their peers, colleagues and network you’re on to something.

More importantly, if they are satisfied or delighted, why not ask for the referral?

Would you rather have 10 red hot referral leads or chase down 50 cold leads?

This is low hanging fruit. Just ask.

4) Customer Retention roles are different than traditional Selling roles. Hire accordingly

This starts at the top. If the leadership at your organization doesn’t know this already you’ll struggle to perform and probably already are. Don’t erode your user-base because you’re too lazy to hire the right talent to keep your happy customers, well, happy.

5) Existing customers are an untapped gold mine of mutual upside and win-win partnerships

Because the subscription-based model is fueled by the customer experience and normally sold as a monthly or annual subscription, your renewal team has more access than ANYONE else to practice empathy and walk in their customer’s shoes. They should be cataloging behaviors and trends. So, establish a client feedback loop, collect the data and use it to build better products, stronger support offerings, and well-tuned personalized journey. Customers should use their renewal account manager to get insights on product roadmaps for planning and to maximize the benefits and value received from the solution.

Written by Aaron Cowell 

@churnhurts