What to do when customers aren’t renewing.

As the PMM of a mature SaaS product, one metric I paid attention to a lot was our renewal by value. I worked closely with our customer success team to understand what our customers were saying when it came time to renew and how the reception to our annual pricing increase. By working closely with my renewal team and by speaking to customers directly, I learned that our business care packages needed an overhaul in pricing, bundling, and messaging. Our customers were happy with the product but they did not understand what they were paying for when they renewed their business care plan. This posed a problem for our Customer Success team, and for Product Marketing.

Clues we needed to do something.

Clues we needed to do something.

Paraphrasing the clues

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Paraphrasing the clues 〰️

“It looks like most customers are buying the cheapest business care option. This means our good/better/best pricing model isn’t right.”

PMM Finding

“Customers don’t understand what they’re paying for. We have to discount their renewals to get them to stay.”

Customer Success Finding

“Customers must buy two mandatory business care packages - one from the channel partner and one from our company. It’s not always clear to customers what they’re getting for the price.”

Channel Sales Comment

“These rate increases make no sense - we’re not doing anything different - we’re not getting anything new .”

Customer NPS finding

What I did about it

  • To evaluate what needed to be done, there were a few things we needed to understand: How were competitors pricing their business care and how were we priced in comparison? Is good/better/best really the right pricing scheme for this product line? How much money was being brought in via business care? How much was it costing us to collect on this amount? What is our attrition rate in the last 5 years and what was the reason customers gave for leaving?

  • How did customers perceive the value they were getting in their annual renewal and what can we do to help them feel good about this once a year check-ing? Queue one-on-one check-ins, surveys, and lots of data gathering.

  • As a mature SaaS company, many legacy processes and business constraints existed whenever a new change was proposed. I worked with our internal teams to sketch out these constraints and to get internal stakeholder buy in for the massive change I had in mind.

  • Ultimately, I put together a more streamlined, easy to digest business care offering for the leadership team to evaluate. I shopped this new plan to internal stakeholders, key business partners, and customers to get their feedback to build my case.

What happened next?

One does not simply propose a new path forward and drops the mic. I spent weeks socializing the findings, proposal, and implications of this effort across the business to get buy in, feedback, and to formalize the next steps to make the proposal a reality.

Then, in a surprise twist, Sage reveals upper leadership has been in confidential talks with key partners and Microsoft to launch the next era of cloud-hosted ERP offerings via Sage Partner Cloud. This was ultimately the much better strategic decision for Sage100 and Sage300 customers in the long run as it enabled key cloud functionality to help customers move off of on-prem and clunky hybrid offerings to securely and confidently host their all-important ERP platform.

Sometimes PMM work yields clear and obvious changes within the org - sometimes PMM work yields a more subtle impact. Through this project, I started to build a better understanding of our customer base. I was looking into a problem that was well-known by a select few but was invisible to the majority of the company. My sincere efforts to uncover how to better support our customers and our partners helped me establish a better working relationship with key partners who’ve seen PMMs come and go. This is an especially important point because our products were sold exclusively through partner channels. And lastly, I started to develop a clearer understanding of our sales and renewal objections - insights which allowed me to better support the Sage Partner Cloud launch through better messaging and stronger relationships with the key stakeholders needed to pull off such a high profile partnership.