RightNow Revamps The Software Buying Experience

About 6 months ago, I gave the thumbs-up to RightNow Technologies’ new mission: “To rid the world of bad experiences.” Having spent considerable time with RightNow’s management team, I could see that the new mission was more than just a slogan, it’s a commitment to an operating model that’s driving all of the firm’s key decisions.

The company recently announced the next element of that new mission, a new client agreement for its SaaS (software-as-a-service) offering called a “Cloud Services Agreement.” Here’s how the company describes some of the key attributes of the new agreement:

  1. No Shelfware – clients should be able to buy only what they need and still get long-term pricing certainty 
  2. Minimum 5-Year Pricing Certainty –  clients should get long-term fixed and transparent pricing without long-term lock-ins
  3. No Long-Term Contract Lock Ins – clients should be able to walk away from contracts if vendors aren’t delivering value
  4. No-Haggle Flex Up / Down – clients should be able to easily adjust seats, capacity or even product modules up – or down – to meet their changing business requirements
  5. “Roll-Over” Usage – clients should be able to adjust for seasonality without having to purchase capacity for peak usage that then sits idle most of the year
  6. Cash Service Credits – clients should receive a cash reimbursement if a vendor fails to meet its service commitments

My take: I really like the Cloud Service Agreement; it reverses many of the customer-unfriendly practices in the enterprise software market. Not only does this look like a good strategy for RightNow, but it also provides lessons for other companies and other industries. Here’s what people can learn from this strategy:

  • Be consistent with your mission; this strategy supports a key pillar that RightNow calls “easy to buy”
  • Recognize that everything impacts customer experience; purchase agreements establish the framework for an ongoing relationship (or a constant battle)
  • Create a tighter linkage between your revenue stream and customer value; tension will grow when there’s a mismatch in value
  • Provide flexibility for customers so they can easily respond to variability and unknowns in their business
  • Adjust your business model to take advantage of new capabilities; RightNow is leveraging native SaaS capabilities to depart from typical enterprise software licensing models
  • Pick strategies that large competitors can’t easily match; it will be difficult for vendors like SAP and Oracle to replicate this strategy
  • Recognize that everything is connected; making an isolated change in just one part of your business may have little long-term impact

The bottom line: Software-as-a-service will enable more customer-centric enterprise software!

Written by 

I'm an experience (XM) management catalyst; helping organizations improve results by engaging the hearts and minds of their employees, customers, and partners. I enjoy researching and speaking about leading-edge XM topics. I lead the Qualtrics XM Institute, which is the world's best job. We're igniting a global community of XM Professionals who are inspired and empowered to radically improve the human experience. To achieve this goal, my team focuses on thought leadership, training, and community building. My work is driven by a set of fundamental beliefs: 1) Everything starts and ends with human beings, so you need to understand how people think, feel, and behave; 2) XM is a discipline that needs to be woven throughout an organization's entire operating fabric; and 3) Building the XM discipline requires a combination of culture, competency, and technology.

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