With our blogs, the Seal team is often talking about how Seal helps organizations through Contract Discovery and Analytics. This value is often centered around:
- Reducing the time and costs to find contracts
- Being the foundation of a regulatory compliance initiative
- Helping M&A due diligence or post-sale integration
- Managing risk and getting a company’s contractual “house-in-order”
- Extracting contract data for enriching and migrating into a business system
And the list goes on…
But, one area that isn’t talked about very often is driving the top line. Yes, increasing revenue with Seal — and it starts with customers.
“Existing customers are 50% more likely to try new products and spend 31% more, when compared to new customers.” Source: Econsultancy Market Research
Engaging with Customers
In B2B environments, a significant number of resources including sales reps, sales leadership, pricing teams, finance teams, legal teams, and others invest significant amounts of time negotiating the right agreements with customers. But once that agreement is executed, it’s filed away somewhere.
At some point down the road, someone from that team, or perhaps a new team will invest much more time locating that agreement. They need this information to:
- Reuse critical language and terms to help with a similar deal – trying not to reinvent the wheel
- Protect what was negotiated in the first deal – enforce price increases, limits of use, etc.
- Ensure a timely renewal
- Figure out how to better upsell and cross sell into specific customers
- Improve their forecasting of revenues from customers
- … Or possibly to appropriately allocate revenue for reporting purposes
They spend time hunting contracts from multiple systems and repositories, and then try to piece together the pricing, terms, and other customer transaction data. Many salespeople won’t go through the trouble and end up working with customers with a cloudy view of the relationship. Worse, they leave money on the table as they inconsistently enforce negotiated terms and conditions.
You may be thinking that CRMs are designed to solve this. Well, they don’t. Customer data captured in contracts must be manually put into some set of metadata fields, which is inconsistent when done at all. The entered data is often inaccurate and rarely captures the essence of the negotiation or the details of special terms or pricing. If errors are made in data entry, there are no mechanisms to catch them, and bad data is worse than no data.
“The probability of selling to an existing customer is 60 – 70%, while the probability of selling to a new prospect is 5-20%.” Source: Econsultancy Market Rearch
How Can Seal Drive Revenue?
Seal’s Contract Discovery and Analytics provides full transparency into customer agreements. It extracts data buried in contracts and enables sales teams to quickly find commercial terms, legal terms, and complex or incentive-based pricing structures. It provides this data in meaningful context for business users, in a way that makes sense to them. A growing number of Seal customers are using Seal on the sell-sides of their businesses.
With Seal, sales organizations can:
- Find contracts much more efficiently. The last thing anyone wants is their salespeople spending time searching for, and reading through contracts when they should be selling!
- Shorten the time to create new agreements, with pre-approved terms and language from existing contracts.
- Quickly locate negotiated price increases, discount expirations, cost pass-throughs and many other untapped opportunities.
- Always know when renewals are coming, so they can work more effectively with customers to increase renewal rates.
- Stay on top of their customer agreements quickly, so they can always be considering ways to grow their TCV, or total customer value with upselling or cross-selling.
- Use contract data to support rev rec compliance initiatives such as IFRS 15
What Specifically Would I Find?
There are so many pieces of information buried in contracts. Even if sales teams have easy access to contracts, they are not trained, nor very tolerant in reading through contract language to tease out the terms and conditions they have with their customers. Seal puts these terms at their fingertips, including such items as:
- What discounts have already been approved?
- Where do I have any Most Favored Nations (MFN) pricing risks?
- Where do we have overlapping customer agreements?
- Are we invoicing and collecting per contract terms?
- Where have we made non-standard commitments?
- Are there agreements in place within other geos or business units?
- Where and when can we increase prices according to the CPI or other index?
- Which expiring customer contracts do I need to focus on this quarter?
- How can I quickly identify similar clauses in my historical contracts when drafting new ones?
- What does my customer-specific price book look like?
- When do I need to address renewals?
- Should I work to renegotiate autorenewals?
- What was the last deal signed with this customer?
And so on…
It’s good business strategy to focus on maximizing revenue from existing customers. But too many sales organizations do not utilize one of their most valuable assets: the information within customer contracts. It’s spread out across the organization, too hard to find, too time consuming to find it, and too hard to read for non-lawyers.
With Seal, this knowledge and insight is easily accessible across many business groups. Sales is now informed, Compliance teams know what the obligations are for each party, Operations can fulfill more accurately, Finance can more easily analyze pricing structures, and Accounting can better track rev rec reporting. Seal ensures the value of customers is maximized, resulting in happy lines-of-business and more satisfied customers.