Renewal specialists are responsible for ensuring customers renew their relationship with a company. Historically, the 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 renewal specialist and answer the question, “Is the renewal specialist a Sales role or Service role?”
The Renewal Process from a Sales Perspective
In the example below, you can see that the typical contract renewal process begins 180 days prior to contract expiration.
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.
- May want to re-negotiate terms or pricing
- Doesn’t renew on time, but continues accessing the technology
- Renews but doesn’t pay the price increase
- Contact that was an advocate left the company
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.
The Renewal Process from a Services Perspective
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.
In response to this gap, the role of the renewal specialist is evolving. They are not only responsible for effectively executing the commercial 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.
The Value Realization Call
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:
- Create a value realization scorecard:
- Keep it simple, one page
- Ideally create at time of subscription booking with the customer’s desired outcomes documented
- Create a structured approach for the call
- Develop a coaching model for the renewal specialist
- Calls are only effective with the renewal decision maker
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.
Learn More About Blending Service and Sales Motions at TSW
At our upcoming spring Technology Services World conference, taking place in San Diego, May 7-9, we’ll have tons of great keynotes, sessions, and breakouts all focusing on how to combine the expertise of your Sales and Service teams to land, grow, and retain customers. View the schedule online here for a preview of what you can expect. If you register before March 18, you can save 10% on your ticket. I hope to see you there!
In the meantime, be sure to subscribe to the blog and keep up with our “Blending Service and Sales Motions” blog series, where I and the rest of the TSIA Research team will be sharing how this topic relates to each of our respective areas of research, covering all areas of the technology and services industry.
Read more posts in the "Blending Service and Sales Motions" blog series:
- "Sales, Services, and a New Year's Resolution That Sticks"
- "The Data Analytics Take on 'Helping Will Sell, Selling Won't Help'"
- "Why All Tech Executives Should Care About Blending Service and Sales Motions"
About the Author
Julia Stegman is the vice president of service revenue generation research for TSIA. She has over 25 years of experience in the high-technology industry, and is responsible for helping TSIA members uncover new opportunities to grow their recurring revenue and gain clear line of sight into what is contributing to growth or erosion in their current renewal model.