Part 3 is our favorite part of the series. This is the part where we get to talk about what we've learned from creating, iterating, and receiving feedback on our quarterly subscription pricing model. We want to tell you what's working well and what challenges we've encountered and before we do that, we want to share the (huge) impact this model has had on our business and our clients.
Key Business Impacts
From 2020 to 2022, our subscription model helped us deepen our client relationships, and double our revenue and team size. This model helped us stay strong as a team through COVID, and allowed our company to grow substantially while providing continued service and support to our valued client relationships.
One client increased their subscription amount by 50% each quarter for past four quarters. Our team is highly integrated in a collaborative backlog and we feel like part of their team. This relationship has grown and become more trusting because of the model and clarity around communication and work timelines.
Another client started with us on the lower end of subscription amounts and stayed there for four years. Because of our team's good work and our relationship focused approach, they increased their quarterly amount by 5x when they received new funding.
Finally, one of our clients has been steady for years, and decided to decrease next quarter. Though we were disappointed for the decrease, we felt gratitude and appreciation that they told us six months in advance during budgeting season. This kind of communication can only come from a significant amount of trust and we are honored to have that trust.
What's Working & Challenges
Every experiment in new ways of working or pricing your work has various sets of lessons learned. We feel it's incredibly important to track and stay connected to the things that are going really well and the things that are tricky and may need more thought or iteration.
- Continuation is built-in and the long-term relationship is clear. There is no need for renewal conversations! This makes for easy budgeting for client - “we already built this into next year’s budget.”
- Focus on value rather than deliverables or time.
- Flexibility to shift up and down is easy on both ends (ours and the clients). We have the flexibility to shift people on and off the project depending on needs, without changing pricing for the client.
- Our favorite - the ability to truly close down the quarter, pause, and step out of the unending backlog. Reviewing our work and our time during our all-hands 'Quarterly Campfire.'
- Educating clients into the model. We’ve lost sales because this model is complex to understand, and especially tricky to sell to a skeptical board (complexity usually = No).
- This ends up being a good filter for who will be the right fit for us. Some people find it really refreshing, and those are the ones we want to partner with.
- Workload shifts each quarter even if subscription does not - sometimes there is too much and we are constrained, sometimes there is too little and we need to figure out how to proactively deliver more value to the client while not overcommitting ourselves.
- This ongoing relationship requires us to build and maintain a team of consultants who can proactively identify the next best thing to do, each quarter and each iteration cycle, and confidently tell the client when their urgent idea isn’t going to fit into the two-week cycle. We’re working on this but it’s hard to be good at this consistently!
- Finally, measuring success in an ongoing relationship is not straightforward. This applies to most of our field, though. True change - not just project deliverables - takes time.
As we continue forward, we are always considering what's next. How can we measure progress toward quarterly objectives more? How can we help organizations to treat CRM investment as an ongoing budget, which we believe is the most sustainable path? How can we add more into the value of the subscription, without increasing our team's consulting time?
We don't have all these answers yet, but we can't wait to share more as the story unfolds.
To learn more about OpenTent's way of Working Out Loud, get in touch here!
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