Understand Your Buyer> How to Engage > Long Term Contracts
What is it?
If you want to make yourself easier to buy from and also have the ability to make more revenue per client, then offering long term options can be a great move.
Why does it work?
It works because some things are better in the longer term, but we tend to only think in the short term.
We are also familiar with paying for things in advance or getting a better deal when we commit to the longer term, most Software companies offer a 12 month deal which is significantly better than simply paying month by month.
How can you use it?
Consider if offering a 12/24/36month (or more) version of your current contract would add more value and be useful for your buyer.
Then consider how we communicate this to them – often it’s about having a better discount because they are committing for the longer term, but what other benefits could a longer term agreement have?
Example
In the world of car leasing, a longer term contract offers a lower monthly rental to the buyer and as such it can make the deal more likely than if there were only a 2 or 3 year option.
See also
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