Gainsight can be used for recording and reporting on financial transactions. This article will guide you through the components to creating transaction attributes and transaction line items. These configurations pertain to LRM 1.0, as opposed to LRM 2.0. We recommend that new customers use LRM 2.0.
Each financial transaction can be categorized into one of the following Booking Types:
New Business: This is the first transaction with the customer. The effective date for the first transaction is also known as the Original Contract Date and is used for calculating the customer lifetime.
Upsell: An Upsell represents any financial transaction that can result in an increase in the recurring revenues and/or additional one-time’ revenue.
Downsell: A downsell represents any financial transaction that can result in a decrease in the recurring revenues and/or in one-time revenue.
Renewal: A renewal epresents a renewal of the current transaction for the term specified against the transaction. This assumes that the customer is renewed with the same recurring revenues. The renewal date and current MRR is auto populated in the user interface based on the current MRR and User counts.
Renewal with upsell: A Renewal with Upsell is a combination of renewal and upsell transactions posted as a single transaction. This can be used when the customer is renewed with an increase in the recurring revenues and/or user counts and/or one-time revenues.
Renewal with downsell: A Renewal with Downsell is a combination of renewal and downsell transactions posted as a single transaction. This can be used when the customer is renewed with a decrease in the recurring revenues and/or user counts and/or one-time revenues.
Debook: A Debook transaction is used for posting one off adjustments to the earlier transactions.
Churn: A Churn transaction is used for recording customer churn. When a churn transaction is posted against the customer, Gainsight automatically passes a negative entry that sets the customer’s MRR and User counts to zero. You can optionally configure additional line items to post adjustments to other line items such as one time revenues.
Transaction Line Items
Transaction line items are used to capture the details of transactions. Gainsight does include some default line items such as: Subscription revenue, Activation or Services revenue, Users etc. While line items provide the granularity that you need for recording the transactions, the application uses Line Item Type as a method to aggregate and report the summarized data at the customer level and across all customers. Below are the four line item types supported by Gainsight:
Recurring revenue: Line items tagged as Recurring Revenue line items are used for calculating key metrics such as Monthly Recurring Revenue (MRR) and Annual Subscription Value (ASV). If your configuration includes multiple recurring revenue line items, then data against these line items are aggregated for reporting purposes.
One time revenue: Line items tagged as One Time are used for separately showing the one-time revenues realized from the customer and are NOT included in the calculation of MRR and ASV.
User count: Line items tagged as User Count work similar to the recurring revenue line items, except that these are used to represent the # users and is used for reporting on the licensed users.
Statistical: Line items tagged as Statistical are used to store any other numerical data against the transaction which cannot be categorized into the above 3 line item types. While this data is not directly shown in Gainsight directly, except for the edit transaction user interface, it is available for usage in any custom reports.
Churn transactions in Gainsight can be tagged with reason for Customer Churn This data is used to drive churn analytics across the organization. Churn reason currently allows only one churn reason to be selected and it is recommended that the churn reasons are setup keeping this in mind.
To see a list of and configure new Transaction Line Items scroll down to Transaction Line Items. Click NEW to add a new Line Item.
Filled in required information:
Click SAVE to continue. A new Transaction Line Item is now added to Gainsight but is not used by any of the Booking Types.