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Renewal specialists are responsible for ensuring customers renew their relationship with a company through their SaaS contract. Historically, the contract renewal process began with the end in mind. It started from contract expiration, then backed up to define a customer contact cadence, allowing the customer enough time to renew prior to their contract expiration. However, there are new emerging practices. In this post, I’m going to be going over the responsibilities of the evolving role of contract renewal specialist and answer the question, “Is the renewal specialist a Sales role or Service role?”
In the example below, you can see that the typical contract renewal process begins 180 days prior to contract expiration.
Here's an example of the renewal process and timeline for a XaaS business.
The ultimate goal is to secure payment for a new contract period, and everyone has their eyes on the prize! Who doesn’t like to ring the cash register?
But, we shouldn’t take lightly what is involved with securing payments from customers. Below are typical challenges a renewal specialist may face during the renewal process.
Effectively managing through these scenarios requires both sales and negotiation skills. And the result to the company is maximum retention rates and minimized revenue erosion. So clearly, effectively managing the commercial relationship requires sales skills.
However, there is more to the story. Not all customers have a customer success manager available to them to help drive adoption and unlock value from the technology. It’s actually quite common to lack customer success manager coverage for small-to-medium sized subscriptions, as many companies just simply run out of customer-facing resources.
The renewal engagement model will vary by customer segment.
In response to this gap, the role of the renewal specialist is evolving. They are not only responsible for effectively executing the commercial contract renewal transaction, but are also starting to play a role with proactively driving adoption with their larger customers. It will always be important to focus on the contract expiration date and manage the renewal of the contract, but that’s not where the process should start. It should start with the beginning in mind, not just the end.
It’s critical to get customers to engage with your technology within the first 90 days. The customer should participate in an onboarding session and other one-to-many adoption services your company offers. Webinars where your other customers talk about how they are receiving value from your technology is one good example. There should also be an exception report for the renewal specialist if the customer is not engaging in the first 90 days.
Creating value for your customers is your best shot for securing the contract renewal.
There is also an emerging adoption play being conducted by the renewal specialist around 180 days prior to contract expiration (or earlier). A value realization call is conducted for the renewal specialist’s key accounts.
TSIA’s recommendations for the value realization call:
It’s not very helpful to conduct these types of calls with junior people in the organization, nor with procurement. It’s necessary to engage with the renewal decision maker to maximize the ability to influence their perception about the value your company delivers.
So clearly, proactively driving adoption and value realization requires service-related activities.
Let’s return to the question at hand. Is the renewal specialist role a Sales role or a Service role? I would argue it’s a blending of both Sales and Service, as it will require both sales skills and service skills to get customers to renew.
Read more posts in the "Blending Service and Sales Motions" blog series:
To learn more about how to maximize renewal rates, check out our Customer Growth and Renewal research practice, or contact us today.
March 1, 2018
Julia Stegman, is the former vice president of research, Service Revenue Generation, for TSIA and was with the company for 7 years. She has over 25 years of experience in the high-technology industry, and was responsible for driving the TSIA research agenda related to the growth of maintenance, SaaS, and managed service revenues as well as the expansion of product revenues with existing customers.
Topics discussed in this post
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