Cloud Marketplaces are a holistic solution covering the entire buyer lifecycle from purchase to usage to renewal. And we have recently seen new features from the AWS marketplace emphasizing their focus on renewals.
Renewals are now a crucial part of the Cloud Marketplace transaction experience. Through renewals, companies can reduce the friction while extending the existing customer subscriptions. This blog discusses the latest additions to the renewal workflow on the Labra platform.
In the world of SaaS, renewals play a key role in enabling sustained growth. According to Forbes, the cost of acquiring a new customer can be 4x to 5x that of renewing an existing customer. This is particularly important when organizations nowadays are using more SaaS apps than ever before, 130 according to the State of SaaSOps report.
These new capabilities are currently available for Labra.io users on AWS on app.labra.io UI. We will be adding renewal support to GCP and Microsoft Azure soon. These capabilities will also be available from our CRM apps within a few months.
About Cloud Offer Renewals
When dealing with subscriptions through the marketplace, renewals are a core and inevitable part of your marketplace transaction. AWS has built specific features to make the renewal process easier from both the buyer and seller’s end.
These include – agreements and renewal dashboard on the AWS Marketplace Management Portal, Private Offer Upgrades and renewals, and Future-Dated Offers and Agreements.
Here are a few terminologies to keep in mind:
- An offer is a set of terms for a buyer’s use of a product. Offers can be public or private.
- An agreement is an offer that a buyer accepted. Agreements include purchased and free products that a seller made available using a public or private offer. In the Labra platform, we will refer to ‘Agreements’ as ‘Subscriptions’ to keep the terminology consistent across all clouds.
- Agreement-based offer (ABO) is a renewal or upgrade action taken by the seller on an existing buyer agreement. This terminology is AWS-specific, and hence, to standardize it across cloud providers, we will be using the “Renew Subscription” term in our platform.
- Future-dated agreement (FDA) is a special offer/renewal in AWS Marketplace, the buyer receives the product license or entitlement on a predetermined future date.
How ABO works on AWS
Here’s how Agreement-Based Offers work on AWS.
- Agreements are created on the marketplace when a customer subscribes to your product.
- Assuming the initial agreement is for 12 months, you can create a new ABO anytime during these 12 months.
- The ABO can be to either renew a subscription, thereby extending its period or upgrade the subscription (to a higher tier for example).
- Buyers can accept agreement-based private offers the same way they accept private offers. Depending on the buyer’s action:
- If the buyer accepts the private offer upgrade or renewal, the new agreement takes effect immediately and the agreement is listed on the Agreements page in the AWS Marketplace Management Portal (And the Subscriptions page in Labra UI). Any remaining scheduled payments from previous agreements are cancelled.
- If the buyer doesn’t accept the private offer upgrade or renewal before it expires, the original agreement remains in effect with no changes.
AWS recently launched the Future dated agreements (FDA), whereby a customer can accept an offer and have the subscription start automatically at a future date. More on how Labra supports the FDA is below. Future dated agreements apply to both renewals and new private offers.
Renewing a Subscription vs Creating a New Offer
Renewals offer several benefits to you as the seller, as compared to creating a New Private Offer. It is also faster and easier for the buyer.
The table below compares the difference between renewing a subscription and requesting a new offer (at the end of a user’s existing subscription) on the AWS marketplace through the Labra.io platform.
| Renew Subscription | New Offer | |
| Time to create | 50% faster than the New Offer | Few minutes |
| Marketplace seller fees (AWS) | 1.5% | 3% |
| Customer Experience | Reduces friction – improves satisfaction, and increases retention rates | More friction in the process |
| Future start date | Yes | Yes |
| Finance and Accounting | With FDAs, one can account for a purchase before a certain date | Standard Process |
| Renewal process | Unified process across cloud providers | Different process |
New subscriptions page
Our newly updated subscriptions page adds a unified view of all existing subscriptions. From this page, you can easily check out the subscriptions that are about to expire and start a new subscription right from here. This page includes all your agreements with your existing customers through AWS Marketplace.
Subscriptions that are nearing expiration (expiring in 90 days or sooner), will have an expiring soon tag added to them so you can get started on the renewal process.
Future-dated agreements
Future-dated agreements (FDA) are a special feature that can be used both during renewals and when creating new offers. With the FDA, the seller can set the future start date to an offer/renewal that is extended to the buyer.
Note: Future Dated agreements are applicable only for SaaS contracts.
This provides flexibility to both buyer and seller and helps them adjust their schedule independently organizing deal bookings, invoice timings, and product usage schedules.
Additional capabilities include:
- The ability to pre-pay sellers and pre-charge customers before usage starts, using the flexible payment scheduler
- Comprehensive notifications support: Including email notifications at sign date/offer acceptance
- Comprehensive reporting support for sellers in standard AWS Marketplace reporting interfaces – including QuickSight dashboards and data feeds
You can check the AWS Seller guide on FDA for more information.
Steps to create a subscription renewal
A new subscription renewal can be created from two different pages: The Offer page and the Subscriptions page.
From Subscriptions page
- Head to the Subscription page on Labra.io UI
- Click on the “Create an offer to renew subscription” button on top right, or click on the three dots ⫶ in the row of your customer’s subscription
- You should see a list of the existing Subscription with your customer come up
- Select the one you’d like to renew/upgrade
- Update the price and duration, rest of the fields from the existing subscription is copied
- Verify the details select submit and your offer for renewal is sent
- As soon as your customer accepts, the existing subscription terminates and is replaced with the new subscription
From the Offers page
- Start from the Offers page on Labra.io UI
- Click on the “Create” button on top right, or click on the top right and select “Create an offer to renew subscription”
- You should see a list of the existing Subscription with your customer come up
- Select the one you’d like to renew/upgrade
- Update the price and duration, rest of the fields from the existing subscription is copied
- Verify the details select submit and your offer for renewal is sent
- As soon as your customer accepts, the existing subscription terminates and is replaced with the new subscription
Note on Auto-renew
Though all three major hyperscalers support auto-renewals, this is a feature that has to be accepted by both parties involved at the time of the initial offer and can be turned on or off anytime from the buyer’s side.
For more information, refer to the cloud provider pages on auto-renewal.
FAQs
- What happens to my running installments when the subscription renews using ABO?
In case your current subscription is installment based, then the day ABO is accepted all the installments from the previous subscription become null and void. While creating the ABO, you need to make sure you accommodate the pending installment sum into the new offer.
- Does Labra send reminders to me or the customer about upcoming renewals?
Yes, Labra sends an email and a Slack notification to the seller when a customer’s subscription is about to expire.
- What can I do to increase the chances of customers renewing a subscription on the AWS Marketplace?
The biggest driver in subscription renewals on cloud marketplaces is the quality of customer service provided. By ensuring smooth onboarding and good overall customer service throughout the customer’s lifecycle, you can improve the chances of your customer renewing.
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