You may have heard the expression – data is the new oil. In the case of renewing customer subscriptions, data is priceless. We received the results back from the 2019 Global Touch Partner Profitability Survey relating to renewals.  Two compelling figures stood out:

  • The cost of acquiring new customers is roughly six times more costly than renewing an existing customer.
  • The impact of renewal rates on bookings – the multiplier effect on 20% increase in renew rates equates to a 50% increase in bookings.

According to Forrester, companies that lead in customer experience outperform laggards by nearly 80%. We know that many partner companies adjusted their business model years ago and are already realizing these outcomes. That’s great. If you are not on this path, the time to jump in is now.

Even with existing practices, we heard from partners that Cisco’s process was complex. You told us we needed to do more in helping you with acquiring the data and that the existing tools needed to be simplified and automated. We heard you and when our partners ask, we do everything we can to deliver!

Using our approach to improving Partner Performance, we developed a strategy designed to encourage customers to renew their contracts. Our role is to help simplify the experience so that you can be more successful, more profitable. Let’s start by having a look at the four steps to creating more renewals. The steps apply whether you have an existing lifecycle practice or are just getting started.

Step 1: Aligning with Cisco

You don’t have to change what you already doing. You don’t have to adopt all of our partner tools. But we do strongly recommend you take time to understand:

  • Cisco’s Customer Experience (CX) construct
  • The renewals motions
  • The intersection of renewals and customer success
  • The new roles we put in place to support partner experience

Aligning with Cisco CX motions helps you anticipate field interaction with our joint customers. Learn more as Julia Chen and Denny Trevett share Cisco’s CX strategy for partners.

Step 2: Keep it simple

Customers are burdened by the number of contracts they have to renew. The complexity can be overwhelming, and lead to hesitation when it comes to renewing their existing contracts. We’ve taken a page from the CX Install Base (IB) methodology and identified the “three C’s” that will help us deliver the simplicity our customers deserve:

  • Cover. The more devices we cover, the lower our customers’ risk and non-compliance.
  • Co-Terminate. Identify unnecessarily spread out expiration dates and combine them.
  • Consolidate. Whenever possible, combine multiple services agreements into one.

Step 3: Automate it

Customers benefit when we spend less time searching for, aggregating, and adjusting renewal data and more time understanding their businesses. Last year, Lifecycle Advantage increased renewal rates by 9% and customer engagement by 14%. Combining the Lifecycle Advantage program and Cisco Commerce APIs allows us to engage with both partners and customers to simplify the customer experience and help with the renewal process.

We’ve also seen an increase in renewal rates with partners who have adopted the CCW-R APIs. That’s why we’ve heavily invested in expanding and enriching the APIs available to our partners. The increased need for the latest automated solutions has made us focused on how to get those technologies to our partners. We’ve adapted to meet those needs using innovative approaches including developing APIs that focus on business outcomes in each step of the customer lifecycle.

Let’s look at an example for a hypothetical partner for In-Quarter Renew Rate Performance. Let’s say that today their renewals are at 68% and their annual Services Revenue is $265M

  • If the partner embraces automation through CCW APIs, we could see the renew rate rise to 78%
  • If the partner embraces Lifecycle Advantage, they could see their renew rate rise further to, say 85%
  • Lastly, covering our customers active but uncovered devices not only reduces risk and brings into compliance but increases partner recurring revenue.

Step 4: Build a Practice and Optimize Profitability

We have created the building blocks for partners to build a customer success and renewals practice that mirrors Cisco’s practice. We do this through the Customer Experience Specialization and the Customer Experience Advanced Specialization. Partners who invest in the specialization will earn higher rebates for selling new CX offers.

Why should partners invest in a customer success practice? The long-term benefits will far outweigh the investment. For example, partners that invest can:

  • Increase customer loyalty/stickiness
  • Offer your own high-margin professional services
  • Differentiate with new lifecycle offers
  • Increase incremental revenue with cross-sell and upsell opportunities
  • Improve renewal rates and revenue predictability
  • Earn incentives throughout the lifecycle

Partners ask Cisco to be more transparent. We are telling our partners where Cisco will be in the next five years. Partners that do not align their existing practice or invest to build a new CX practice, run the risk of losing relevance. We are advising partners to start the journey now.

Are you ready to get started on increasing your profitability with Cisco Renewals? An easy place to begin is by reading all the details on the four (4) steps in our new partner Renewals Playbook.

SuccessHub: Cisco Customer Experience (CX) for Partners

CX Lifecycle Model for Partners – SalesConnect Hub


Jose van Dijk

VP, EMEA Partner Sales & Routes to Market

Global Partner and Routes to Market Sales