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SEVEN BEST PRACTICES FOR SELLING RENEWALS

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Seven best practices for selling renewals

Selling renewals uses different skills and practices than new product/service sales. To be successful, you’ll need to think a little differently.  The following renewal sales best practices are based on our experience managing renewals sales for all types of companies, and applied across industries and company sizes.

1. Start from expiration when building out your contact strategy

Margot Schmorak

Margot Schmorak

Timing is critical. Why? After you’ve passed the optimal time for your first contact, renewal rates drop with each passing week. The closer you get to the expiration date, the more vulnerable you are to competition. And once a contract is 30 days past expiration, renewal rates typically drop by 50%.

In general, your first renewal contact with the customer should be at least 90-120 days before the contract or subscription expires. This gives you enough time for quote revisions, missed calls, vacation schedules, etc.  Set a specific timeline with milestones and track performance against it on a daily basis.

2. Segment your customer base

Segment your customer base in the way that makes the most sense for your business – by product, geography, contract size, or some combination of these factors. Segmenting customers gives you better visibility into your true renewal opportunity, and a way to strategise and prioritise your efforts. Better yet, with customer segmentation you can deploy the next best practice: customised sales plays.

3. Run tailored sales plays

Seven best practices for selling renewals

Seven best practices for selling renewals

Personalisation is the new big thing in sales and marketing, and that’s because because it works.  Once you’ve segmented your renewal customers, customise your sales plays for each segment. This way, you can give customers the personalised attention that they expect from you.

4. Make friends with a numbers cruncher

Step away from the phone for a moment and find someone working with a spreadsheet or analysing your financial and customer data.  This person might be your new best friend – because no matter how good you are with people, renewal success requires having the right data.

Data about what’s working:  You’ll want data about the average renewal rates for different segments, reasons for cancellation, and timing of renewals to tailor your efforts.

Data to prove your effectiveness: You’ll need accurate data to demonstrate whether your efforts are moving the needle on renewals and having a revenue impact on your business. Show management how you’ll improve the business, and you’ll get more support.

5. Listen to your customers

Don’t just sell the renewal – use the event to really talk to your customers.

  • Is a customer having a problem? Build equity in the customer relationship by helping them fix it.
  • Is a competitor moving in? You’ll need the right ammunition to retain the customer.
  • Have you lost the customer?  Update your forecast and find out the reason for the churn. It’s always better to know ahead of time than to be caught by surprise.

6. Look for the cross-sell and up-sell opportunities

If you’re talking with the customer and building equity in the relationship, then you can look for meaningful ways to cross-sell or up-sell. Offer the customer a new module or a higher service level if it would meet their needs. If you’ve earned their trust and understand their needs, your chances of success are pretty high.

7. Document the end of the renewal cycle

Before you chock up the result and move on, make sure you document what happened in the renewal cycle.
If you’ve lost the customer, document the reason for customer churn – this is critical insight to give to marketing and account teams.

If the customer has renewed, document the customer disposition and pass anyopen issues to the right members of the account team. Then you’ll have a head start when the customer comes up for renewal again.

For more strategies for successful renewals, download the eBook “Recurring Revenue: Five Secrets to Fly High and Fuel Growth.”

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Business

Bank of England sets out interim ‘bail-in’ debt targets for banks

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Bank of England sets out interim 'bail-in' debt targets for banks 1

via Reuters

LONDON (Reuters) – The Bank of England on Tuesday set out interim levels of special debt that banks including HSBC, Barclays and Lloyds must issue over coming years for writing down in a crisis to avoid taxpayer bailouts.

The BoE said it would review how the minimum requirement for own funds and eligible liabilities or MREL is calibrated, and the final compliance date before setting “end state” amounts.

“In doing so, we will have regard to any intervening changes in the UK regulatory framework,” it said in a statement.

(Reporting by Huw Jones; Editing by Andrew Heavens)

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British firms call for immediate $10.3 billion in COVID aid

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British firms call for immediate $10.3 billion in COVID aid 2

via Reuters

By William Schomberg

LONDON (Reuters) – British firms called on Tuesday for another 7.6 billion pounds ($10.3 billion) of emergency government help, saying they cannot wait until finance minister Rishi Sunak’s March budget to learn if they will get more pandemic support.

With Britain back under lockdown and companies adjusting to life after Brexit, firms are taking big decisions about jobs and investment and need to know if their financial lifelines will be extended, the Confederation of British Industry said.

“We just have to finish the job. Now would be a very odd time to end that support,” CBI Director-General Tony Danker said in a statement.

Sunak has extended his support measures several times already and has said his response to the pandemic will cost 280 billion pounds during the current financial year, saddling Britain with a peacetime record budget deficit.

But he is facing calls on many fronts to spend yet more including from lawmakers, some from his Conservative Party, who want an emergency welfare benefit increase to be prolonged.

The CBI said Sunak should extend until June his broad job retention scheme, which is scheduled to expire in April, and then follow it up with targeted support for jobs in sectors facing a slow recovery such as aviation.

He should give firms more time to pay back value-added tax which was deferred last year, grant a similar deferral for early 2021 and extend a business rates tax exemption for companies forced to close by the lockdown as well as their suppliers.

“The rule of thumb must be that business support remains in parallel to restrictions and that those measures do not come to a sudden stop,” Danker said.

The CBI said its longer-term priority was an overhaul of the business rates system that it said was outdated and discouraging investment in low-carbon energy.

Danker said it was too soon to start raising Britain’s corporation tax rate, one of the lowest among rich economies after a Times report that Sunak was drawing up plans to increase it to start fixing the public finances.

“It would be wrong to raise business taxes when we don’t have a recovery,” Danker said.

($1 = 0.7380 pounds)

(Writing by William Schomberg; Editing by Alexander Smith)

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BOJ’s policy review may make ETF buying more flexible – Reuters poll

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BOJ's policy review may make ETF buying more flexible - Reuters poll 3

via Reuters

 

By Kaori Kaneko

TOKYO (Reuters) – The Bank of Japan will likely focus on measures to make its purchases of risky assets, such as exchange-traded funds (ETF), more flexible as the economy comes under growing strain from a spike in COVID-19 infections, a Reuters poll found.

Analysts polled also revised down their economic projection for the fiscal year ending in March on expectations a recent resurgence of coronavirus infections would dent growth.

Economic activity could stall in the world’s third-largest economy from pandemic curbs and the BOJ may have to look at more effective ways to achieve its 2% inflation target as renewed infections force it to maintain its massive stimulus longer, analysts said.

The central bank said last month it would undergo an examination of its yield curve control and quantitative easing policies to seek ways to make them more “effective and sustainable”. Its findings will be released in March while new GDP estimates will be issued at its Jan. 20-21 policy meeting.

“The BOJ may be thinking of correcting distortions caused by its policy that could become an obstacle for maintaining its current framework through Governor (Haruhiko) Kuroda’s term that ends in early 2023,” said Izuru Kato, chief economist at Totan Research.

Asked what steps the BOJ would take when the central bank unveils its findings in March, 31 economists said the central bank would “make its ETF, J-REIT buying more flexible,” the poll conducted between Jan. 7-18 showed.

Eight analysts said the BOJ would revise its three-tiered deposit rate system that applies negative interest rates only to marginal excess bank reserves and two said the central bank would change the 10-year bond yield target to other durations.

The question allowed multiple answers.

The central bank will discuss ways to scale back a controversial programme that buys massive amounts of exchange traded funds without stoking market fears of a full-fledged retreat from ultra-loose policy, sources have told Reuters.

 

RENEWED STATE OF EMERGENCY

Japan expanded a state of emergency it declared for the Tokyo area earlier this month to seven more prefectures last Wednesday amid a steady rise in COVID-19 cases.

Many analysts expect the latest measures to inflict less damage to the economy than the stricter and broader curbs imposed in April and May last year.

In the poll, taken before the government’s decision to expand the state of emergency beyond the Tokyo area, analysts expected the economy to contract 2.4% in January-March. The poll had predicted a 2.1% expansion in December.

For the current fiscal year ending in March, the economy was forecast to shrink 5.5%, the poll found, slightly weaker than a 5.3% contraction projected last month.

The economy was expected to expand 3.3% in the fiscal year beginning in April, starting with 4.1% growth in the April-June quarter, the poll showed.

“Restrictions under the renewed emergency status are relatively moderate, so it could take a long time for infection numbers to fall,” said Hiroshi Namioka, strategist and fund manager at T&D Asset Management. “Downward pressure on prices could strengthen.”

Core consumer prices, which exclude volatile fresh food prices, will slip 0.5% this fiscal year before rising 0.2% next fiscal year, the poll found.

Economists were split on which direction the BOJ will move when it next changes policy.

Twenty-one of 39 analysts forecast the BOJ would scale down stimulus, while 18 said it would ramp up monetary support.

Sources have told Reuters the BOJ was likely to slightly revise up next fiscal year’s economic forecast and hold off on expanding stimulus at its Jan. 20-21 policy meeting.

 

(For other stories from the Reuters global economic poll:)

 

 

(Polling by Shaloo Shrivastava, Editing by Leika Kihara and Jacqueline Wong)

 

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