If you’ve read AI Revenue Institute (AIRI)’s study, “The AI-Powered B2B Buyer Has Arrived,” you may have noticed this heartburn-inducing gem on the propensity of B2B buyers using AI to find or vet alternative vendors during contract renewal.
AIRI surveyed 521 B2B professionals actively involved in researching, evaluating, recommending or approving business purchases. We wanted to understand what buyers were actually doing with AI, not simply whether they had tried it.
We added a question about B2B buyer use of AI at contract renewal to the survey because:
AI makes it easy to subject a renewal contract to new vetting.
Internal dynamics in B2B buying teams are driving use of AI to systematically scrutinize both purchases and purchasing recommendations.
When AI subjects renewals to fresh scrutiny, retention stops being automatic and starts requiring the same effort (or nearly so) that it took to win the deal the first time.
Even so, we were surprised by how quickly AI is eroding the power of incumbency. With 91 percent of B2B buyers indicating they’re likely or very likely to subject renewals to AI scrutiny, sellers don’t have a choice but to respond.
Attribution challenges keep customer retention underfunded
Getting a customer has long been harder than keeping one. It’s a simple, self-evident reality. Not that this stops most companies from taking customers for granted. Nearly all companies proclaim love for their customers. And internally, they engage in plenty of justification talk around the costs of acquisition versus retention (5X to 25X, according to which study you believe), of being customer-centric and all the tropes we could list here but won’t, for our own mental well-being.
But we know that, in most cases, it’s mostly talk. What’s that saying in politics about getting past claims to find the truth? “Don’t tell me your values. Show me your budget, and I’ll tell you your values.”
Few companies invest in customer retention like they do in customer acquisition because of the attribution problem. It’s just like the marketing attribution problem, only bigger. Acquisition attribution is fuzzy (and the source of plenty of friction), but at least a closed deal marks a visible endpoint around which to argue attribution. Retention’s win is a non-event. The customer simply doesn’t leave, so it’s effectively impossible to tie a dollar spent to a customer retained.
(Speaking of the marketing attribution problem, this comment in a related Reddit thread resonated: “The only attribution that matters is whichever one your boss/client believes.” Truer words, my friends. Truer words.)
Years ago, when I was a young analyst, I did some work with Dr. Sallie Sherman, president of Schaffer, Sherman and Sperry, a leading customer retention consultancy at the time. Dr. Sherman liked to say the inability of traditional cost accounting to justify retention programs was a weakness in traditional cost accounting, not retention programs. According to every statistic ever generated showing the benefits of reduced churn, she was right. When those “soft” areas are underinvested, the resulting losses become “hard” fast.
The same lesson applies today. If traditional retention models don’t account for how buyer use of AI is changing renewal decisions, that’s a weakness in the models, not evidence that the risk doesn’t exist. Sure enough, several emerging behaviors suggest buyer use of AI could increase churn.
How B2B buyer use of AI could increase churn
AI lowers research and comparison friction. As we touched on earlier, AI makes comparisons at renewal easy. In general, the lower the friction to switch providers, products or services, the higher the churn. Case in point: enterprise software providers with deep customer integration experience annual churn rates that SMB software providers experience monthly.
Buyers face their own AI-powered scrutiny. In our survey of B2B buyers, we found that more than half have already had their supervisors or other purchasing team members use AI to vet their recommendations. Even buyers who genuinely like you and your company may be uncomfortable defending their personal recommendations if your company (or product or service) wilts under AI scrutiny.
AI agents are coming into play. Our study also showed that B2B companies are further along in adopting agentic commerce than most research firms had predicted. As a result, contract renewal reviews will become increasingly automatic.
Why it matters: Incumbency still counts, but no longer by default
Now that you’re on this thought train of terror with me (you’re welcome!), you can probably see where it’s heading.
As buyer use of AI becomes a gatekeeper across all of your sales channels, genuine differentiation will become essential to avoid race-to-the-bottom pricing traps. Customers acquired today are also likely to face more scrutiny at renewal than customers acquired before AI entered the purchasing process. And those are only two of the implications.
None of this means that incumbency doesn’t matter. If you’ve been doing a good job for your customers and have proven yourself reliable over time, you still hold an advantage over your competitors. But your margin for error is likely much thinner than it used to be, and it’s a fair bet that most newer accounts will face more scrutiny at renewal than your long-term customers. This is simply our new reality.
What you can do: Make your value easy for AI (and humans) to find and verify
Buyers are innovating with AI faster than sellers are adapting. Some of the gap can be chalked up to the unprecedented speed of all things AI, including adoption and advancement. But much of the gap stems from the way AI has evolved asymmetrically as an “easy” button. For buyers, AI can quickly research, compare and expand vendor options. For sellers, using AI to quickly churn out content works against them, producing undifferentiated AI slop just when differentiation matters most.
That imbalance also applies to workload scopes. Early expectations were that AI would simplify sales and marketing efforts. However, it turns out that the easier AI makes it for buyers, the more sellers must do to compete.
Fortunately, you don’t need an entirely separate playbook for customer retention. Many of the same AI adaptations that help you win customers can also help you keep them. Take these four steps:
Strengthen the signals buyers and AI can verify
Start by strengthening the information and evidence buyers and their AI tools can find about your company. These signals help them understand what you offer, how you’re different and whether your claims are credible:
Be strategic and methodical about your on-site signals.
Make your claims easy to verify through credible third-party sources off-site.
Prioritize your evidence layer with customer reviews, awards, media mentions and other proof points.
Learn why customers leave and act on it
Talk with customers who leave to find out:
Why they chose your company to begin with
Why they left
Which competitor they went to
Why they chose that competitor
What, if anything, you could do to win them back (if you do this via survey, ask this question last or they’ll shut down thinking it’s a sales call in disguise)
Respond to what you learn. This could mean product innovation, improving CX, developing communications to clear up misperceptions or counter competitor tactics, or other actions based on what you learn from your customers.
Make your differentiation visible to humans and AI
Differentiating to the benefit of your customers appeals to both buyer AI agents and assistants and your human customers. But it only counts if they know about it. Make sure it’s in your on- and off-site signals and remind your human buyers of them (tactfully) at every possible touchpoint.
Create customer value that makes switching harder
Consider opportunities to deploy custom innovations when appropriate that solve problems or make it easier for your customers to do business with you. Depending on your company, product or service, this could be a custom integration, dashboard, process, etc., which may give you an edge at renewal time.
Buyer use of AI doesn’t make relationships or incumbency irrelevant, but it does make them easier to challenge. Your customers don’t have to be unhappy to explore their options. They just have to be curious or feel pressure to do due diligence now that AI makes it so much easier.
If your retention strategy doesn’t account for this new reality, that’s a weakness in the strategy, not evidence that the risk isn’t real.
The good news is that you’re not powerless here. Give customers reasons to stay, make those reasons easy for humans and AI to find and verify, and never assume that doing a good job means no one is asking whether someone else could do it better.
Editor’s Note: Buyer use of AI reshaping vendor evaluation and selection is only one of five major shifts uncovered in AIRI’s research. Together, they reveal how significantly buyer use of AI is changing the way B2B revenue is won and retained.
Download the full AIRI B2B AI Buying Behavior Survey Report, “The AI-Powered B2B Buyer Has Arrived,” to explore all five shifts and the complete findings.