Downsell
This is when a customer moves down a lower-priced tier to continue product usage with the same vendor. A downsell reduces the scope of the customer’s contract as well as the revenue of the vendor.
It contributes to contraction and impacts Gross Revenue Retention (GRR).
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THE HONEST TRUTH
A downsell can result from poor product fit, reduced customer budget, or the customer not having immediate need for all the services/features within a package. Not all downsells are churn signals. All downsells, however, benefit from thorough investigation to ensure there are no surprises at the renewal conversation.
A downsell can result from poor product fit, reduced customer budget, or the customer not having immediate need for all the services/features within a package. Not all downsells are churn signals. All downsells, however, benefit from thorough investigation to ensure there are no surprises at the renewal conversation.