This paper examines the true relationship between discount and win rate, with a more complete quantified view of the ultimate impacts of discounting on revenue.

Download the paper for the complete view of the the mathematics and frameworks that prove these concepts, and for the suggested actions for Revenue leaders.

Summary Points: 

  • The invention of SaaS and in particular the Recurring Revenue model, reduced what once required upfront investments of up to millions of dollars into a $1,000 to $50,000 monthly payment. As SaaS services became popular, the Recurring Revenue Model itself essentially was the discount! However, neither the buyer nor the seller fully understood the model’s impact, and the buying and sales behavior stayed the same: they continued to extend the same discount strategy and execute the same processes without knowing or understanding the implications of doing so.
  • Fast forward to today, in November 2022, where we anticipate that the SaaS industry will experience the largest revenue churn event in its history. We are entering a time when discounts will be used to force a decision.
  • Discounting is based on the assumption that the increase in discount will be compensated by the increase in win rate, thus increasing bookings and, subsequently, revenue.

Therefore:

    • Will a discount actually increase the win rate?
    • What is the true relationship between discount and win rate?

Download the paper to see the complete analysis for these questions.