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!

About Bruce Temkin, CCXP
I am a customer experience transformist, helping large organizations improve business results by changing how they deal with customers. As part of this focus, I examine strategy, culture, interaction design, customer service, branding and leadership practices. I am also a fanatical student of business, so this blog provides an outlet for sharing insights from my ongoing educational journey. Simply put, I am passionate about spotting emerging best practices and helping companies master them. And, as many people know, I love to speak about these topics in almost any forum. My “title” is Managing Partner of the Temkin Group, a customer experience research and consulting firm that helps organizations become more customer-centric. Our goal is simple: accelerate the path to delighting customers. I am also the co-founder and Emeritus Chair of the Customer Experience Professionals Association (CXPA.org), a non-profit organization dedicated to the success of CX professionals.

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