Processes and Cadences to manage renewals

Read Time: 9 minutes

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Renewal has been the new NEW for quite some time. My view is that with liquidity in a rapid decline in the world economy there is simply less capital to spread around. Those who offer exceptional customer value, experiences, and service are going to be the vendors of choice. While growth is still our mandate, those who preserve their book of business best through high retention makes it that much easier to achieve a path to > 100% NRR.

Managing renewals! We're diving straight into CS Operations in this article. We covered what a good and great renewal rate looks like for different segments and industries. We'll get right into the nitty gritty of how to actually manage your renewals.

Here’s what I think makes sense at a high level to set up your renewal management program for success:

1. Separate your customer base to have the appropriate level of resources

2. Manage renewals off the Opportunity object and not the Account object

3. Product usage metrics as only one of your leading indicators, Customer Health Score

4. Power up your Business Reviews by reconfirming where you stand on the priority stack

5. Establishing renewal management cadence

Separate your customer base to have the appropriate level of resources

In a CS (Customer Success) organization, the terms "high touch" and "low touch" refer to the level of interaction and engagement between the customer and the organization's customer success team.

A high touch model typically involves a higher level of personalization, engagement, and support for each customer. This model often involves regular communication and interactions between the customer success team and the customer. Customer success managers (CSMs) are assigned to specific accounts and work closely with customers to ensure their success. This approach is typically used for high-value, strategic accounts or customers who require a more customized approach to meet their unique needs.

Source: www.bow-now.com`

On the other hand, a low touch model is more self-service-oriented and relies on automation and digital channels to support customers. This model is typically used for customers with less complex needs or who are less high-touch. The organization may have a customer portal or knowledge base that provides self-service resources, and the customer success team may only engage with customers on an as-needed basis.

The main difference between a high touch and low touch model is the level of personalization, engagement, and support provided by the customer success team. The high touch model provides a more customized and personalized approach, while the low touch model is more self-service-oriented and relies on digital channels for support.

In this environment, low touch models are back in fashion

It’s worth touching on low touch models. Truth is, as companies lay off staff it can mean that the remaining team members shoulder a larger load than before. One decision is to increase your low and medium touch motions. In a low touch model, the focus is on self-service and automation, which means that digital tools are key to providing a seamless customer experience. Some common tools that are used for a low touch model include:

1. Customer portals: A customer portal is a self-service platform that allows customers to access information and resources related to their account, such as billing information, product documentation, and support resources.

2. Knowledge bases: A knowledge base is a repository of information that customers can use to troubleshoot issues or find answers to their questions. It can include FAQs, tutorials, and other support documentation.

3. Chatbots: A chatbot is a computer program that can interact with customers via chat to provide basic support or answer frequently asked questions. Chatbots can be integrated into a company's website or messaging platforms such as Facebook Messenger.

4. Automated emails: Automated emails can be used to onboard new customers, send product updates, and provide support or feedback requests.

5. Customer feedback tools: Tools such as surveys and feedback forms can be used to collect feedback from customers and monitor customer satisfaction levels.

6. Data analytics tools: Data analytics tools can be used to monitor customer behavior, identify trends, and optimize the customer experience.

7. CRM (Customer Relationship Management) software: CRM software can be used to manage customer data, track customer interactions, and automate customer communication.

The tools used for a low touch model are designed to provide customers with quick and easy access to information and support, while minimizing the need for direct customer success manager involvement. It’s infeasible to deploy ALL of these solutions above at once. It’s best to lay out a roadmap for your CS surface area. Each one of these, when done well, are a large project unto itself. I often stress to not take on more than two or three large strategic projects per quarter. Plan accordingly.

Manage renewals off the Opportunity object and not the Account object

I’ve started to come around on this topic a bit. Should CS teams work from the Account or the Opportunity object? I used to be in the opportunity camp coming from a RevOps point of view, but lately I think Accounts may be the superior model.

In a Customer Success (CS) organization, managing customer renewals is a critical part of ensuring customer satisfaction and revenue growth. Salesforce, as a customer relationship management (CRM) platform, provides various objects to manage customer data, including the Account object and the Opportunity object.

Here are some reasons why:

1. Account-based approach: CS teams typically work with customers at the account level, rather than the opportunity level. By managing renewals from the Account object, CS teams can more easily view and manage all opportunities associated with a particular customer account in one place.

2. Visibility and reporting: Managing renewals from the Account object provides better visibility and reporting capabilities, as all opportunities associated with an account can be tracked in one place. This allows for more accurate forecasting and helps CS teams prioritize their efforts based on the account's overall health.

3. Relationship management: Managing renewals from the Account object enables CS teams to better manage the overall customer relationship, including tracking customer interactions, identifying upsell/cross-sell opportunities, and ensuring customer success.

4. Consistency: Managing renewals from the Account object ensures consistency across the CS team, as all members are working from the same data set and following the same processes.

I’m not telling you what you should do but these are the reasons that have swayed my thinking for the CS team. One caveat I will mention is that the renewal itself is an opportunity, but the reporting is done at the Account level via roll-up summaries.

Product usage metrics as only one of your leading indicators such as Customer Health Score

Product usage metrics can be a valuable source of information for Customer Success (CS) teams, as they can provide insights into how customers are using a product or service. However, relying solely on product usage metrics as a leading indicator of customer health can be limiting, as it does not take into account other factors that may impact the customer's success and overall satisfaction.

To use product usage metrics effectively as one of many leading indicators, CS teams can incorporate them into a larger framework, such as a Customer Health Score. A Customer Health Score is a metric that helps CS teams track the overall health of a customer account and identify areas for improvement. By incorporating product usage metrics into a Customer Health Score, CS teams can gain a more holistic view of the customer's health, taking into account factors such as:

1. Product usage: How frequently and extensively is the customer using the product or service?

2. Support requests: How often is the customer submitting support requests, and how quickly are these requests being resolved?

3. NPS (Net Promoter Score): How likely is the customer to recommend the product or service to others?

4. Customer feedback: What are the customer's opinions and feedback on the product or service?

5. Contract renewals: Is the customer renewing their contract, and if so, are they renewing for the same or expanded usage of the product or service?

By incorporating product usage metrics into a larger framework like a Customer Health Score, CS teams can gain a more comprehensive understanding of the customer's success and identify areas for improvement. This allows them to proactively engage with the customer, provide targeted support, and ultimately drive customer satisfaction and revenue growth.

Power up your Business Reviews by reconfirming where you stand on the priority stack

To identify how customers are doing with your solution in regards to achieving their goals, you need to gather data on their usage and performance metrics. Here are some ways to do this:

Establish goals:

The first step is to establish clear goals with your customers. Work with them to define specific, measurable objectives that they want to achieve with your solution.

Monitor usage:

Monitor how customers are using your solution. This can include tracking their activity within the product, such as how often they log in, what features they use, and how much time they spend using the product.

Track performance metrics:

Track key performance metrics that are relevant to your customer's goals. This might include metrics such as conversion rates, customer retention rates, or revenue growth.

Collect feedback:

Collect feedback from customers on their experience with your solution. This can include surveys, customer interviews, or other forms of feedback to better understand how they are using your solution and where they are seeing value.

Analyze data:

Analyze the data you collect to identify trends and patterns. Look for areas where customers are struggling to achieve their goals or where they are experiencing significant success.

Provide proactive support:

Based on your analysis of the data, provide proactive support to customers to help them achieve their goals. This might include targeted training, product improvements, or other forms of support.

Take a data-driven approach to customer success management. You can better understand how customers are doing with your solution in regards to achieving their goals. This allows you to provide more targeted support and drive better outcomes for your customers.

Establishing renewal management cadence

It goes without saying RevOps supports CS to establish an optimal operating cadence for managing renewals. But we’re in challenging times! The operating cadence we ran previously with a 90 days out mentality may not cut it. Tighten up that operating cadence by looking early. How early? I’d say it’s time to push out a 150-180 day view of the customer. Use the data driven business review approach above for your milestones. Here are my tips for a tried and true operating cadence:

Start REALLY early:

Begin engaging with customers well before their contract expires. This allows you to understand their needs and identify opportunities to add value before renewal discussions begin.

Set milestones:

Establish milestones throughout the customer's lifecycle that help you track progress and stay aligned with their goals. These milestones might include implementation, onboarding, training, and ongoing support.

Regular check-ins:

Schedule regular check-ins with customers to review their progress and discuss any challenges they are facing. This helps you stay connected with customers and identify opportunities to add value.

Proactive outreach:

Proactively reach out to customers to provide support and address any issues that arise. This shows customers that you are invested in their success and can help build stronger relationships.

Renewal planning:

Begin renewal planning at least 90 150 days before the contract expiration date. This allows you to have enough time to identify any issues and address them before the renewal discussion.

Renewal negotiations:

Start renewal negotiations no later than 60 days before the contract expiration date. This gives you time to address any concerns or objections the customer may have and reach a mutually beneficial agreement.

Thanks for reading this far!

Next week I’ll dive into how to potentially set up your Salesforce instance to automate renewal creation.

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