Negotiating contracts can be stressful, and when it’s for something as important as your favorite SaaS tools (like Twilio’s Segment), the stakes are quite high. You want to ensure you’re getting the best deal possible, but that’s tough without insight into how the company runs negotiations.
In this blog series, we’re sharing our best advice for SaaS buyers to optimize contracts during the renewal process. Our tips are based on years of negotiating and procurement experience across our team of experts, so you know they’ll be effective.
(Would you prefer to hand the negotiating over to a team of experts so you can focus on what matters in your business? Sastrify is ready to help.)
In the coming weeks, we’ll bring you exclusive subscription management and renewal tips for tools like HubSpot, Salesforce, Mixpanel, Datadog, Zendesk, Docusign, and much more.
Today, we’re talking about Segment.
Top tips for Segment renewals
Segment, part of Twilio, is a leading Customer Data Platform (CDP) with over 25,000+ customers. Alternatives to Segment include mParticle, Insider, and Blueshift.
When it’s time to renew your Segment contract (or when you’re starting off with the tool), these are our top 5 tips to get the best deal.
1. Ask for a larger discount when dealing with the Segment Sales reps
Discounts for the Segment platform vary greatly but can go all the way up to 80%. Our biggest advice is that you dare to ask for more, especially if you use the entire business suite and have a large contract volume. Also allow for several negotiation rounds and don’t say yes too early.
If you are interested in the Team plan, try asking for a 50% startup discount.
2. Forecast on your Segment MTU volume
Take the time ahead of your negotiation to forecast your volume of Monthly Tracked Users (MTU). This is the main license metric for Segment and it’s what your contract will be based on. If you are projecting changes in your MTU numbers (e.g. you expect them to increase each quarter), you’ll be able to choose different volumes per month or quarter.
Keep in mind that higher pre-committed MTUs will leverage much better discounts while also avoiding overage charges.
3. Ask Segment for an annual allotment of MTUs (if applicable)
In some cases, when your volume is very high (starting with about $100k annual contract volume), you can challenge Segment to go for annual allotment of MTUs. This gives you more flexibility and also helps avoid both overages and underutilization. For instance, if your usage fluctuates a lot throughout the year, an annual allotment means the vendor won’t check your volume monthly or quarterly, but only at the end of your contract year.
This condition is subject to approval with their internal teams.
4. Unbundle Segment’s pricing quotes for full visibility
When you receive your quote from the Segment Sales team, ask to unbundle it so you can have full visibility on a line item level. This will be helpful in your negotiations if there are certain products or features in the bundle that you don’t need or want to change in some way.
When comparing prices, always calculate your price per 1000 MTU. This ensures you aren’t comparing apples to oranges. Also keep in mind that add-ons (like Protocols and Personas) will increase the base price per 1000 MTU, so make sure you’re benchmarking the right packages and only sign up to what you really need.
5. Ask for a free Segment implementation service
Segment has staff who can help with the implementation of their platform within your company. You may be able to get this implementation service for free just by asking. It doesn't hurt to ask the question!
Get the best Segment contract with Sastrify
All these tips come from the procurement and negotiation experts at Sastrify, who can help you get the best prices on the market for your SaaS licenses. Our team has a very strong relationship with Segment – our founders have even received “thank you” emails after our negotiations on behalf of our customers.
Achieving the best outcome for your SaaS contracts can be a combination of these tips with the right timing and preparation. Sastrify knows best how to approach Segment in negotiations to ensure you end up with the best deal terms possible.
Find out how much you can save with our free SaaS savings calculator, and be sure to check back for the rest of our series on things you didn’t know about renewals for popular tools.
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