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7 Pillars of successful Customer Renewals
Markus Rentsch
December 12, 2023
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Hi, Markus here. Welcome to a premium edition of the Customer-Value-Led-Growth Newsletter.
Every week, I share strategies, guides, and frameworks to help you create exceptional value for your customers and company.
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You may have heard this before: “Customer Renewals are not an event”.
There are many golden mantras in Customer Success and I don’t agree with all of them.
But this one hits the nail on the head.
It would be convenient if all you had was to send a reminder and customers would re-sign no questions asked but that’s not how it works.
If you are doing it like the company below you need to hit the reset button because this is how you will kill your business.
Here’s how to do it right:
1. It’s all about value
Contrary to popular belief and what a search on Google suggests, there’s only a single Customer Retention strategy.
It’s called “delivering value”. Your customers purchased your product because they want to
increase their revenue
reduce costs
improve productivity
…
What will make them buy it again? The value they have received.
New customers buy based on expected value, and existing ones are based on whether their expectations have been met. It’s really that simple.
That leaves you with only 3 possible scenarios to determine whether customers will renew
They achieved their goals —> 99% probability they will renew
They overachieved their goals —> 99.9% probability they will renew
They underachieved their goals —> at risk by default
and you don’t need to measure it with 157 KPIs spread over 23 dashboards sourced from 29348458 data points.
You need to know their goals, how they are measured and their actual results to predict customer renewals with high accuracy*.
(*excluding churn from reasons not under your control like a customer going out of business)
