Jeff Swank’s Post

Here’s what’s going on with renewal ACV and how you can use it to your advantage buying SaaS 👇 Renewal ACV has remained relatively flat for the last year. This quarter, it declined slightly QoQ and YoY. This is because finance teams have spent the last few years cutting non-essential expenses. As a result, suppliers aren't seeing the recurring revenue they used to rely on, and more accounts are flagged as at-risk. This change has turned the tide in favor of buyers, giving them the chance to negotiate better deals and lower-priced contracts. Want help buying SaaS and negotiating the best deal? Vendr can help. 🛒 Click on any supplier name in our Q2 SaaS Trends Report, and you'll be taken directly to that supplier's page in Vendr’s Marketplace. 🔗 Check out our Q2 SaaS Trends Report, linked in the comments, for more data-backed insights and Marketplace access.

Vendr just dropped our Q1 Trends Report. Great view of the SaaS landscape across a number of different slices. Some really valuable insights for people buying and selling software - and it also just looks beautiful. Def take a look. And if you want to learn more, Vendr is free to try out. https://lnkd.in/eFks8mJz

Despite frequent headlines about price increases in SaaS, Average Contract Values for renewals have remained flat YoY. Curious how?! 👇 While software suppliers are adding uplifts, CFOs are simultaneously adding scrutiny to every new purchase and renewal. As a result, customers are downsizing agreements to meet budget constraints, which has resulted in flat ACVs. Read about these trends and more in our latest SaaS Trends report: https://lnkd.in/gNnAAb-K

Pricing increase for SaaS was easy in 2022 and 2023. 10-15% annual increases were fairly common. Customers mostly accepted these increases and as a result, churn was low. By late 2024, there are signs where customers are more careful with spending. There are more "silent cancellations" coming from non payment. SaaS businesses now have to go back to fundamentals in order to grow. If this applies to your business, start with these questions: a) What is the value you are providing to your customers? (cost saving? time saving? incremental revenue? b) How are you currently extracting value? (e.g. per seat? % of sales? CPC? per transaction) c) Most importantly: is your value extraction aligned with the way your customers value? If not, it could be the right time to re-examine your pricing structure. #pricing #value #SaaS #growth

Average Contract Values for net new purchases jumped 35% from Q4 2023 to Q1 2024. So, what does that mean for SaaS? Tracking ACV helps us identify shifts in pricing and purchasing strategies. It’s important to keep in mind that when ACVs rise, another metric typically worsens. In Q1, net new buying cycles grew 17% longer, due to additional scrutiny from CFOs. If your team is analyzing software purchases more than ever, our SaaS Trends Report is a great way to understand what’s happening in SaaS and where teams are investing. Check out the full report here:  https://lnkd.in/gNnAAb-K

Vendr's Q1 #SaaSTrends report is now live 👀 Landing new logos is not getting any easier with new purchase volume for the top 25 categories decreasing by 23% year-over-year 📉 Who's closing new ARR and continuing to grow revenue? Sellers who are making it easier for customers to buy their products 🤔 Congrats to the #VendrVerified partners who made it into our Top 10 🏆 NetSuite | 1Password | Drata | 6sense | LinkSquares Snyk | Mutiny | ZoomInfo | RudderStack | Reachdesk Vendr Verified partners are closing new revenue 50% faster than the average buying cycle for a new purchase 😤

At LateShipment.com, we are often questioned or scoffed at by competitors and pricing experts alike for having pricing models that either 1. Charge a percentage of what we save (or) 2. Ties pricing directly to usage, without a floor price We started with those models by sheer accident. But we also haven't changed them since, for pretty good reasons. Conventional SaaS pricing wisdom typically suggests a tiered pricing that maximizes revenue from each account and maintains a floor price for all accounts irrespective of usage. Even we internally run the numbers every so often and always find tiered pricing to come out ahead, in terms of immediate revenue. But what these pricing projections never told us about is the ability for customers to directly and effortlessly correlate value to cost, with our pricing models. Time and again, we hear from customers about how we are the easiest product to justify spend in internal discussions and a direct result of this is our remarkably better churn rates when compared to benchmarks from the SaaS space or just our own niche; a far bigger long-term gain overall than any immediate revenue gains. Yes, SaaS pricing is hard but our humble lesson from this is to not be afraid to keep the customer at the center of pricing decisions too, rather than leaving it solely down to number crunching.

SaaS buying trends are changing. (And here’s why it matters if you are in Sales, Customer Success, Finance, etc). 2021: Multi-year deal (in exchange for a discount).  Ramping commit Pre-buying licenses based on growth projections Aggressive usage for things like API calls 2024: Contract flexibility (including short terms) Conservative commitments (can always restructure later!) Higher ROI requirements for license utilization Optimization of usage based agreements These buying trends will not only impact ACV and TCV but NDR and CRPO as well. As a buyer, I see many companies haven't adapted and are pushing what they did in 2021. But it's 2024... So the question is, what are you doing about it?

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