Post Tags

A Winning Solution to a Common Recurring Revenue Tracking Challenge

Glowing light bulb with sketches at background


At Revenue River, we value being team players and working collaboratively. Still, it's hard to turn down a little healthy competition when it entails a cash reward!  

Late in 2021, the Revenue Acceleration Team introduced the agency's first Solution Hacking Challenge, activating a deluge of creative energy and critical thinking across the office. The demand for life hacks is plentiful, and it was time for us to dream one up for our clients and prospects.

Behind the Solution Hacking Challenge

The contest was designed to allow Revenue Technologists and HubSpot Success Managers, our agency's foremost digital inbound marketing experts and revenue geeks, to generate valuable solutions and innovative ideas toward common pain points for HubSpot customers.

Chief Technology Officer, Amanda Althaus, set out to dig deep into HubSpot's Community forums and quickly uncovered a common issue begging to be addressed.  

The Hacking Challenge: Proactive Revenue Retention for Renewals

Many SaaS organizations track revenue monthly and need to follow revenue associated through upgrades, downgrades, and churn during the annual renewal process. These organizations would benefit if Account Managers received an automatic notification months before renewal to proactively kick-off the process and retain revenue.

Objectives for the challenge were to build the following:

  • Metric to track total monthly revenue for the organization
  • Metric to track how much income is associated with upgrades on the calendar year
  • Metric to track how much revenue is lost (churned vs. downgraded) on the calendar year
  • Workflow enrollment criteria for pre-renewal notification

The Winner Is…

Several solutions were served up, but the top-scoring idea was submitted by our Director of HubSpot Success, and former "HubSpotter,"  MK McDonough. MK's solution aims to successfully track a Monthly Recurring Revenue (MRR) model within HubSpot's Sales Hub Pro by breaking up different categories into multiple pipelines to see revenue with each MRR metric separately.  

Solution Overview

Envision for a moment, different Deal Types for the following: New, Existing (Upsell), Downgrade, Churned – that trigger against automation purposes.  

There would be a Sales Pipeline for one-time sales (i.e., pay for a subscription in full or a product service without a recurring payment). 

Then, you'd also have an MRR Pipeline that automatically updates with the  recurring monthly revenue amount when a deal is set to 'closed-won.' 

Should the deal have a one-time upfront cost separate from the MRR, when it is 'closed-won,' the sales rep can use the duplicate deal product to maintain the original deal information reflected in the MRR Pipeline.

Solution Revenue Hacking Map

The MRR pipeline would also have an Upsell Stage showing additional products purchased, so the company can see where the most upsells come from. Each product pipeline stage would have an assigned probability of 100, so the forecast is weighted equally, clearing the way for an accurate view of the MRR.

This setup would allow you to view deal stage reports and quickly see attribution for your MRR so sales can push more of that product or mimic the sales process for other products. 

A Multi-Product deal stage could also serve as a catch-all for multiple upsells. 

Additionally, you could have a Downgrade Stage in this pipeline to keep the view of MRR in the same

 pipeline. If there's a downgraded deal, it goes into that stage, and the amount is adjusted. Like the product Upsell, the product Downgrade property would track the most highly attributed products and address potential problems. 

By keeping all this data in the same pipeline, you can better understand the total MRR expected while factoring in downgrades.

The Churn Pipeline would consist of deals where a contract ends, the customer chooses not to resign, and they've paid their last invoice, allowing for similar inquiries to understand the "why" behind the churn. 

With this setup, MRR forecasting would not be affected, yet you'd still have a view of the aRenewal Workflow visual examplemount lost due to churn. Sales reps would be required to update a Churn and Downgrade reason dropdown properties before moving into the appropriate pipeline to track the most common reasons for losing business.

This solution allows organizations to track the following metrics:

  • Total monthly revenue = dollar amounts within MRR pipeline
  • Revenue lost in calendar year = dollars associated with churned/downgraded deal types
  • Workflow enrollment criteria for pre-renewal notification
  • 'Renewal date as xx/xx/xxxx' - trigger following action 90 days before the renewal date  
  • Use date-based workflow so enrollment criteria can solely revolve around the renewal date property
  • Notifications to trigger both internally to account manager and externally to the customer at 90, 45, and 30 days before renewal

MK McDonough photo

Words From the Winner – MK McDonough

"Being able to track metrics across different pipelines will give a full-circle view of where the company's revenue is coming from. This provides critical insight into where the business is and isn't doing well. Suppose SaaS customers can see where they can most expect their revenue from and patterns in churn or downgrade (whether it's product-related seasonal). In that case, they can forecast better because they'll have more historical data on when to expect their revenue.

If you're tracking all this in the same pipeline, you have no idea what of that total amount is recurring revenue you can rely on, and you don't know what to expect as far as what you might be losing that month churn or downgrade.

Aside from benefiting the sales team, others across marketing and product development experience tremendous insight. Marketing can see which products are attributed to the most upsells and focus on an ABM strategy to get similar accounts to upgrade and know which products they should be pushing. Product gains insight into which products are causing the most churn can help with which products to prioritize or add to the road map."

What's Next?

Solution Hacking Challenge #2 is currently under research and investigation! In the meantime, if you're interested in learning about the stellar revenue-generating solutions we offer at Revenue River, or you're ready to collaborate with our HubSpot experts, please reach out --- we'd love to connect.  You can also read about the revenue success stories we've experienced with our clients and partners.


Schedule a Consult