Back in the … gulp … late 90s, many software vendors were slow to realize that customer finance (successfully used for providing leasing to grow and accelerate hardware sales) had any utility in their fast growing industry. For a short period of time, it wasn’t even clear that cost justification was required. And then the dotcom bubble burst. Suddenly financial sales execution mattered again—cost justification to help customers understand why they should buy and extended payment deal structures to make it easier to buy.
Fast forward to the present day and everything is feeling a bit cloudy. Offering subscriptions has become a popular bridge to establishing more consistent recurring revenue in the hopes of cranking up a company’s valuation multiplier. And now many software subscription vendors are questioning whether customer finance (successfully used for providing extended payments to grow and accelerate software sales) has any utility in their fast-growing industry.
Um … déjà vu?
TFP has supported software subscription providers—both old and new—for many years and has posted a subscription brief on leveraging extended payments to help those still in the question. The brief covers:
- How extended payments are used to support subscriptions
- The value of prepaid multi-year subscriptions and extended payments
- Best practices for prepaid multi-year subscriptions
- Recent examples of how extended payments were used to drive big subscription wins.
In short, it turns out that customer finance is relevant for growing and accelerating subscription sales, especially when prepaid multi-year subscriptions are desired. This is largely due to the fact that payment flexibility continues to overcome financial hurdles, making it easier for customers to buy! Click here to learn more regarding the path forward.
As always, TFP is here to help you with your financial sales execution—vendor finance programs, value selling programs, and sales training—so don’t hesitate to contact us to discuss your needs.