Contract renewal is the extension of recurring cooperation for a further period. For services and subscriptions, this is a crucial commercial moment, because retaining a customer is many times cheaper than acquiring a new one. However, the customer does not decide on the day of renewal, but continuously throughout the whole period, based on whether the cooperation delivered results for them. Preparation therefore begins months in advance, with a summary of the results achieved and a conversation about plans for the next period, not with an email containing a new invoice. With automatic renewal, care must be taken to notify the customer in advance and to give them a genuine option to decline – an automatic extension that the customer only learns about from a statement damages the relationship and is also legally questionable for consumers.
See also: Customer retention, Customer churn, Key account management.
