rti - Support Contracts - Utilizing alternative methods for charging for customer support.


		UTILIZING ALTERNATIVE METHODS FOR CHARGING FOR SUPPORT Customer Relationship Management strategies direct us to manage the relationships with our customers in order to acquire new customers and retain existing customers. Increasing competition requires companies to provide superior support for their existing customers. Software companies have the additional burden of not only answering questions, but providing fixes and new releases to their customers. The personnel requirements for these functions are not inexpensive. Software companies have traditionally charged customers for support. As personnel costs increase, many companies are looking for alternative methods of supporting their customers and also for charging for their support services. In recent years, there has been a push to provide support interfaces via e-mail and the Internet. While this may reduce the time a support rep spends chatting with a customer, it does not solve the entire cost problem. With Customer Relationship Management systems in place, companies are aware that the amount of support required by each customer can be drastically different. Some customers abuse support and use it instead of purchasing training. This has forced most companies to consider alternative methods of charging for a "support contract". Some companies are restricting support to only 1 or 2 individuals from the customer who can call for support. Alternatively, they may require that only individuals who have attended training classes can access support. This requires that your CRM system allow your to record the names of those contacts who are authorized to obtain support. Other companies are looking at alternative pricing for their support contracts in an effort to charge customers in proportion to the amount of support services they are using. Customers that use more support time, will pay more than the customers who hardly ever contact you for support. Some of the mechanisms that can be used to replace the fixed-fee annual support contract are: Offer an annual fixed-fee contract with a limit on the number of hours of support time or the number of incidents. For example, you might have an annual contract that expires at the end of a year, but the customer will be billed an hourly fee if they use more than 100 hours of support time during the year. Allow the customer to pre-purchase banks of hours or incidents in advance. Your CRM system would then decrement from the number of pre-purchased hours or incidents and warn you when they have been reduced to a specified level. Charge the customer on an hourly or incident basis as they use your support services. These alternative types of support contracts are provided by CUSTOMERFIRST^® to allow you to optimize your services revenues.

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