This is a scenario a lot of us will go through.
There’s no magic solution here, but a few thoughts:
- First, build a “better” edition they can choose to upgrade to. Even if they have an unlimited right to your Professional Edition, add an Enterprise Edition. Or Global Edition. Or Unlimited Edition. And truly make it better. This worked well for us when we added a localized version of the product. We didn’t force legacy discounts to upgrade, but offered them a path to a great deal on the truly better, now more enterprise edition. We used our “Global Edition” to increase prices 50%-100% on legacy enterprise customers that wanted those feature. But we left them on their legacy plans if they didn’t want to upgrade, no pressure (well, not too much) and zero drama.
EchoSign E-Signature Global Edition from FromEchoSign on Vimeo.
- Tell the truth. This often works. Tell the customer you gave them way too good of a deal, and while it’s fair for say up to 100 users, it’s just out of whack today beyond that usage. Tell them you’d like to work on a win-win deal for any larger deployments. I did this with our second-largest customer at the time by usage, and tripled the deal size. They still got one of the best deals of all customers, however. We also upgraded them to the new, “better” edition at the same time. I also told them it was an ask, not a requirement.
- Do the math and decide if it matters. If you are growing > 80%-100% or even faster, it’s easiest to leave the early customers with their nice, grandfathered contract. It just won’t matter over time. What does matter is their goodwill. Their tiny % of your revenues at $100m+ in ARR won’t matter.
- Instead of more money, ask for case studies, testimonials, attending your events, referrals, etc. There is more than one way to make money from a customer. Ask them for help getting other customers. Don’t ask for more $$, but do remind them of the incredible deal they have now, and just ask for 1–2 favors a year back. This is almost always worth more than the incremental revenue. I remember when Qualcomm was an early customer of ours and got an insane deal. They got angry when we asked for a more “normal” contract. But instead, our champion did multiple webinars for us, and took tons of reference calls. That was worth more. A lot more.
Qualcomm on EchoSign Electronic signatures from FromEchoSign on Vimeo.
Learn, and focus on close your newer customers for more money in most cases.
Also, one thing I have learned: the best VPs of Sales are pretty good at this, one way or another.
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Jason Lemkin, Khareem Sudlow
