I don’t run into all the problems people say that you’re supposed to with an agreement. In other words I’m not constantly on the phone with specific customers, they’re not calling every minute of the day, etc.
Yes, it does result in an increase in call volume. It also results in an increase in customer loyalty — and recurring revenue.
I’ve not had to staff any extra people to meet the call volume – though I hear that other VARS do.
We also don’t specifically designate someone to “sit in a chair and wait for a call” (most other VARS don’t either though some consultants are permanently assigned to office work/projects).
I think if you’re talking any more than 150 customers on a phone support plan that you probably would have to (we have about half that number).
Our plans are all online – we keep them that way so prospects can review them and know exactly what they’re requesting for services:
Our unlimited plan is presently $2,800 and includes phone/remote/email support.
In the last year we’ve modified it slightly to address companies that are larger in size. The one area I’ve found you must be cautious with is those companies who come in via the Internet and have multiple entities — those are generally high support volume customers.
Here’s our current unlimited plan:
We’re not currently advertising a measured # of calls (silver) plan – however in the past we’d basically used the same plan as above but inserted a cap of 3 calls per year for $1,000.
We offer a “bronze” plan — not because we want to but because clients who drop support ask us “can we just go to pay as we go?”.
I happen to think pay as you go is a crappy way for VARS to provide support because it essentially requires you to fully staff, educate and be prepared for calls that come during your busiest time.
Customers want pay as you go to mean:
1. Don’t bill me for calls I deem quick
2. Don’t bill me for calls I deem easy
3. Don’t bill me for calls where I’m too lazy to look in the manual
4. Don’t bill me for calls that aren’t my fault – where the person who usually uses MAS 90 is out sick/quits
5. Don’t bill my IT guy when he calls you with 20 questions about setting up my server and why Windows 2008 64 Bit isn’t a good idea because the software publisher hasn’t yet certified the platform – and then proceeds to debate you for another 30 minutes about what a “no good such and such” the software publisher is
6. Don’t bill me for the 40 minutes my IT guy spends “educating you” about what a crappy setup [insert software] is because he’s never seen a system so [pick vice: slow, memory hog, undocumented]
7. If you are going to send me a bill — make sure it’s in 5 minute increments and bill me at the rate you first used when we met in 1998 and don’t include time for the first half hour of the call where I rambled on about how confused I was
8. Even though I’m unwilling to commit to any type of support agreement – treat me as if I am your best paying customer (though I’m invariably the worst)
What’s important is that you re-define the term pay-as-you-go.
After receiving a few requests by unlimited support customers to drop back to pay as you go — I came up with our version of pay as you go.
Essentially we’ve converted the PAYG concept to be a:
1. Per incident
2. Prepaid in advance
3. Non-priority response — 24 hours from RECEIPT OF PAYMENT (the most important concept)
Ultimately very few customers choose this plan. Those who go on it – tend to either move to another VAR (where they run them through the seven annoying billing questions that I’ve noted above) or they live happily ever after driving that VAR into bankruptcy with free quick questions.
We tell clients right up front that our pay as you go is a bad plan and they should not enroll.
Some of them just have to find that out for themselves.
Here’s what I call my Bronze (aka pay as you go) plan:
Hope this is helpful — I definitely recommend moving to support plans. The big question is not what the plan should look like – but how you can get your customers from the pay as you go treadmill over to prepaid annual support agreements.
Perhaps the best way to move toward prepaid plans might be to offer them a choice.
Since most customers will choose the path of least resistance — be sure that there’s at least some inconvenience in the “stay as you are”.
One possibly thing you could do is offer three levels of support:
1. Stay as you are — (Bronze) – Per incident (not hour)
2. 12 “diagnosis” per year – (Silver) — $1,000 – $1,500 per year — you can call us and we’ll tell you how to fix it yourself or quote you on the cost for our firm to fix it.
3. Unlimited plan – you call / we fix – as much as you need per year.
Have you figured out a better way to offer support — or a smoother way to convert pay as you go customers to support plan customers? Let me know in the comments below.