renewals 🔑

Kate Peter, Chief Customer Officer at PayScale, joined the Land and Expand podcast last week.

We exchanged insights on unbundling the CSM role, improving cross-functional alignment, and using automation and AI to eliminate inefficiencies. Check it out here, on Apple Podcasts, on Spotify, or wherever you get your podcasts.

Now… Let’s talk renewals 👇

Customer success managers shouldn’t own renewals.

Renewal managers should.

A couple of CCO jobs ago, I had the CSM team responsible for renewals, and a few things started happening:

1. Because our systems were messy, the CSMs often "messed up" renewals. If you didn’t do things in the exact right order (and hold your tongue a certain way), issues popped up between CPQ, Salesforce, and Intacct. Now, should we have fixed the systems? Absolutely. But at the time, it wasn’t the highest priority.

2. Our CSMs weren’t negotiators — and that was okay. Most CSMs are product and service experts. Their strength is helping customers use the product and ascribing value to it, not negotiating contracts.

   Unless your CSM team is really focused on account management, they probably don’t have a sales skillset. And besides, I wanted my team to consult with customers on getting more leverage out of our product — not hammer out renewal terms.

3. To make matters worse, every renewal was custom. There were no clear rules for one-year vs. multi-year renewals, annual vs. more frequent payment terms, or price increases. Everything was arbitrary.

So, what did we do?

First, we centralized renewals into a small team of Renewal Managers.

While most contracts auto-renewed, plenty required negotiation — around price increases, new packaging, or expansion opportunities.

That’s why we built structured renewal offers that gave customers options but weren’t custom. They could “choose their own adventure.”

For example:

• If a customer wanted a one-year renewal, the price increase was X% with payment terms of Y.

• If they signed a 2- or 3-year agreement, we offered different benefits.

We also revamped our pricing plans to include additional value at renewal time — encouraging customers to adopt standardized plans with annual payments (if they weren’t already).

And CSMs still played an important role.

In larger, high-touch accounts, the CSMs’ relationships and insights were invaluable. They leaned on their rapport to articulate the value proposition to executive buyers.

In low-touch accounts, Renewal Managers handled everything directly. These accounts relied more on one-to-many and community-led adoption anyway.

We also began treating the renewal program as a commercial program, not just a “customer success” program. We developed a forecasting methodology and operating cadences around it, and we used MEDDICC to inspect and validate our larger renewal opportunities.

This approach proved extremely successful.

One thing I preach constantly about customer success is that specialization is key as you scale a subscription business. And renewals are one of the most important areas where this principle applies.

Here are a few perspectives from some readers who added thoughtful nuance to this discussion recently on LinkedIn:

• “CSMs own the relationship, so they own the renewal.”

  One commenter agreed partially but added: “There should, however, be operational backup for them in the form of a Renewals rep or someone else who is basically their 'assistant' on the backend.”

• “Why not train CSMs?”

  Another asked why we don’t focus on training CSMs to build negotiation skills:

  “Obviously, having another team entirely can be the solution, but I never see anyone talking about training up current CSMs. Sales gets training all the time — why not include CS in that same training?”

• “The answer is always ‘it depends.’”

  Another comment offered a balanced take: “In the scenario you laid out, those CSMs absolutely shouldn’t have had to manage that level of complexity when it comes to renewals. But in other scenarios, where it really is as easy as clicking a couple buttons, there’s little point (or financial reason) to add renewals specialists.”

To read the full discussion and join the conversation, check out the LinkedIn post here.

Have you specialized renewals? If not, what are the reasons, and do you think this approach will work in your company?

Hit “Reply” to share your experiences.

🤘

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