The Customer Experience Podcast
The Customer Experience Podcast

Episode 129 · 8 months ago

129. Create Forever Customers With A Forever Promise w/ Robbie Kellman Baxter


The forever customer is someone who trusts you to solve their problem. They’ve taken off their consumer hat and put on their member hat. They aren’t looking for alternatives anymore.

In this episode, I interview Robbie Kellman Baxter, Strategy Consultant at Peninsula Strategies, about how to achieve forever customers with customer-centricity.

Robbie also talked with me about:

- Why short-term revenue matters so much less than long-term relationships

- Her journey toward the forever transaction — and what that looks like for businesses

- You want to balance acquisition and retention

- The importance of knowing what your best customers have in common

Check out these resources we mentioned during the podcast:

- Robbie’s books are The Membership Economy and The Forever Transaction

- Robbie’s podcast is Subscription Stories

Subscribe, listen, and rate/review the Customer Experience Podcast on Apple Podcasts, Spotify, Google Play or Google Podcasts, and find more episodes on our blog.

Listening on a desktop & can’t see the links? Just search for The Customer Experience Podcast in your favorite podcast player.

Forever transaction is that moment whenyour customer takes off their consumer hat stops. Looking for alternatives,puts on a nember hat and says I am going to trust your organization tohelp me solve this problem. Whatever this problem is or achieve this ongoinggoal for the foreseeable future, the single most important thing you cando today is to create and deliver a better experience for your customers,learn how sales marketing and customer success experts create internalalignment, achieved desired outcomes and exceed customer expectations in apersonal and human way. This is the customer experience podcast, here'syour host, ethen Baute, short term revenue versus long term relationships.I know which I prefer- and I think I know which is better for mostbusinesses, and I expect that today's guest here on the customer experiencepodcast, is going to agree with me she's the author of the forevertransaction, how to build a subscription model so compelling yourcustomers will never want to leave. It's a follow on from her previous book.The membership economy find your super users master the forever transactionand build recurring revenue. Sheos a podcast called subscription stories.True Tales from the trenches to her readers, listeners and clients, shebrings more than twenty years of experience, providing strategicbusiness advice to industry leaders like Netflix fit bit: Microsoft, Ebay,EA or electronic arts, as well as vcback startups and smvs Robbie CelmanBaxter. Welcome to the customer experience podcast! Oh thanks forhaving me I'm excited yeah. Me Too, I is. We were kind of warming up beforewe hit record a therre just so many themes that you're writing to andspeaking to and learning about, and coaching people on that are soincredibly relevant to the conversation we're trying to create here on the show.So I'm excited about it too, but I want to start with. Did I oversimplify it?Is it really that simple? Are we really looking at a short term revenue kind ofa miapic transactional mindset versus a long term one, or am I over,simplifying? No, I think you're right on the money literally, I think so.Many businesses suffer from quarterly capitalism and ar very sales numberdriven, in contrast to, let's say product centric, so we're trying tomake the best thing or you know where I think you and I go, which is customercentric, which is about maximizing the likelihess of that customer, is goingto achieve the goal or solve the problem that brought them in the firstplace and by having that that third focus that that customer sebjict focusit forces you to go with that customer on their journey and by default take along term. Look. I love it and I'm really glad that you already introducedthat idea. That was one of the things that really jumped out at me in theforever transaction. Was this? Are We sale centric? Are we product centric orare we customer centric? I think you know, depending who you ask on anygiven day and any given organization, you'll, get different answers and I'msure you'll also get answers like we're all of those things ar e. let's getgoing here with customer experience when I say that to you, what does itmean? Does it conjure anything in particular? Do you have thoughts,definition characteristics? What is hustomer experience to you for me, it'sabout putting yourself as the the organization into the shees of thecustomer and sying. What is it like to do business with us and it allows theorganization to take ut to apply a broader lens to what value they create,so what brought them in the first place? How do they interact when they'retrying to decide if it's right for them credibility and relevance and then dothey get the results that brought them in the first place, and I think organizations that have customerexperience, professionals or teams are...

...really focused on looking at their processesin a customer centric way, yeah one of the lines that stood out to me in thebook, because one of the one of the words that a lot of people use indtalking when I ask that question here on the show is feeling it's the waypeople feel and you ere right there too, which is you know what does it feellike to be our customer? What does it feel like to work with us and one ofthe lines in the book that jumped out of me was it's easier to change? Whatpeople do then how they feel? and I wonder if you, if that triggersanything for you here in this context, for me it's you know, obviously, to getpeople to outcomes. oftentimes we need to make them behave a particular way anthat tends to be easier to do, but the feeling at some point to me starts tofeel more resonant or enduring, or that it might have a greater effect overtime. Talk about that. If you remember writing that lie talk about what youthink about about yeah, it's, you know what I think about withfeeling versus you know. Getting how you make someone feel versus what youget them to do is that people will cut you a lot of spuck if they feel goodabout you right. So I think about you know if you're a member of let's say aclub and the person, your waiter, your favorite laiter has a broken leg andyou end up having to go to the counter and pick up your own food. You don'tmind because you feel good about that place and it feels like your part ofthings, whereas if I walked into a restaurant where I you know never beenbefore, I didn't have a relationship and they asked me to go get my own foodand they were. You know charging me high rates I would be. I would judgethem for it differently. Even if I did the same action right, they got me todo it because they had the signs and they set the expectations. They did.All the you know, kind of behavior modification things that you knowproduct people are so good at. But if you feel good about the organizationyou're going to cut them, slack you're going to be more forgiveng you're,going to give them feedback and you're going to relax into the relationshipand and stay for the long term really good. I like that. So much and I thinkit speaks to why customer centricity is so important. We need to feel goodabout them too. I mean in a lot of these types of conversations, a startthinking about what it means to be a good friend to somebody and what youwant in a friend and where do we give patients and where do we giveforgiveness, and where do we give grace and it's n Hese kind of you know thesekind of good will situations where we're past? All of that, like we're,not making transactional decisions about whether to go one step farther,we are truly in before we get into the frever transaction. You just used, youknow membership it, which obviously is a theme throughout, but it's also thetitle in the title of your previous book really broad question for you:When did you personally see kind of membership and subscription coming on? How has it progressed relative to yourexpectations? Ore? We ahead of you know, like, obviously you can. You can have asubscription or become a member like I'm, a member of a nonalcoholic tearclub and and so I get special treatment and I get monthly shipments and I getdiscount prises, etce, etc. But you can also do that with underwear and socksand deodorent and all kinds of things we never expected kind of like. Whendid when? Did you see this really coming on and maybe pe never as Goin toask about the sharing economy, but that's a whole nother kind of Laer? Butyou know, when did you really see this coming on, because I think you ave Runique perspective? Where are we now and how far is this going to go? Willwe be subscribing to everything? For example, will we be subscribing toour smart refrigerator yeah? It's such a great question, so I'll. Take you alittle bit on my journey, so I've been interested in membership models andsubscription pricing for a little over twenty years and my first client inThas ecase. I I've always been a you know, O most of my career strategyconsultant, but Netflix client and I fell in love with the with the businessmodel, and I started writing about it and setting up frameworks, and you knowtrying to think about like what is Netflix doing that could be applied toother organizations, and I I ended up...

...working with survey, monkey and Oracleand eat a lot of different companies that were going on that journey, andone of the things that became really clear to me is it was about having amember mindset, and I realized you know. As I was writing, and you know, I'm avery analytical person. So you know I was like well, what does member meanand do you have to call yourself a member to be part of the membershipeconomy? And do you have to have subscription praising to be part of themembership economy like? What is it and where I came out was membership isabout how the organization thinks about their customer, whether or not theyhave subscription pricing so for a very long time, apple did not havesubscriptions, and yet they very much thought about their customers asmembers right, if you commit to apple products- and you only have appleproducts, that everything will work well together, if you, you know, Godforbid, bring in an anroid product or a IBM product or PC, you know all betsare off. We can't help you. We only help our members right and then theyeventually added subscription, but they had the member mindset all along andwhen I saw that like dinninding, all the lightbulbs went off and I startedbecoming this. You know zealout ambassador telling everybody. You knowanybody can have a member mindset and suddenly you're treating your customerlike a friend you're, effectively giving them your home phone number andsaying you know. If you have a problem. Call me I want to take care of you andthe long term. Revenue comes in the predictable revenue comes in the valueof your business goes up, but it took a long time for other businesses to seewhat I was seeing. I wrote the membership economy now six years ago tosay this idea could work for virtually any industry and here's why you shouldconsider it. But then, last year I published the furever transaction, asyou so nicely pointed out, and that book was no longer about the. Why whythis is so important why it can be so good for you, but really about the howeverybody is doing is doing subscriptions now and a lot of them aredoing it pretty badly without the member mindset, and it's been you know,I never could have imagined this, but it's really accelerated during this.You know covid pandemic, where you know not just startups, not just traditionalmembership organizations, not just digital first businesses, but every you know kind of business,including you know, durable goods. Refrigerators are working very hard oncreating recurring revenue streams by focusing on the long term goals of thecustomer. Instead of how much money they can get on a transactional basisfor the particular product itself, so good and a confession, you know Iobviously am attuned to helping people achieve their desiredoutcome and as more than just a checkbox, but actually as theexperience along the way. But I thought a lot about prior to encountering youand your work thought a lot about it as just a business model. Choice right,you know, is this going to hit hit a credit card for a small amount over andover? Is IT GOIN NA? You know, hit a credit card, a a sign contract at onebig amount and in this mindset piece is obviously so critical. So, let's diveinto the forever transaction- and I guess start with just a definition-yeah forever transaction. Is that moment when your customer takes offtheir consumer hat stops? Looking for alternatives, puts on a nember hat andsays I am going to trust your organization to help me solve thisproblem. Whatever this problem is or achieve, this ongoing goal for theforeseeable future, so this is how I'm going to get healthy or getting stayfit, or this is how I'm going to stay current on world events, or this is howI'm going to grow in my profession, or this is where I'm going to get myclothes and it's that transaction that results in recurring business. That'swhat everybody wants! It's why they come to subscriptions, but it's notabout the subscription pricing itself.

It's about the way, the entire! I likethat you said you know it's about the business bottle. It's about the way theentire business model is structured from product to how you sell it to howyou support it. Well, beyond what kind of pricing structure you use yeah inthe book, you use language around the North Star, which I think is justreally. It really helps like in one little term or phrase. It reallycaptures that alignment, or you know, organizing principle across the wholeorganization. You also did a great job covering a lot of the metrics. Do youhave any guidance like frequently ask questions or things that you see peoplemisusing or not, understanding with regard to the metrics around this? Doyou have a couple just basic tips yeah. So the first thing is that no onemetric is the only metric right. So for a long time I was saying you know, stoplooking at your acquisition metric focus on your pretention metric. Thereare some organizations, especially long standing ones like professionalsocieties and gyms, where they're great on retension but nobody's joininganymore, because people look in the window and they're like that's not whatI want. That's not a good fit for me, so they don't join. But the people whoare already in you know don't confuse inertia with loyalty they're there,because they, you know they took off their member Ha. Their consumer haveput on their member at stop looking for alternatives. They have no idea,there's a better a option out there. So I would say you want to balanceacquisition and retention, and then the leading indicator of retension isengagement and I think about engagement as recency frequency, depth and breadthof usage, and that's going to let you know well in advance of someonecanceling if they're going to be a good and loyal customer or not. So thosewould be the metrics that I would encourage organizations to focus on andyou don't need to have. You know sophisticated technology systems totrack that, even if you desay this is how many customers we have. This is howmany customers left, and this is how we could tell that they were getting valuefor what they were paying for and whether that value was increasing ordecreasing over time really good, and for folks that are listening- and I saythis from time to time: There's a sixty second bounce back button. For a reason.It's not just because you lost your train of thought. It's also whensomeone like Robbi runs through things like frequency, recency, depth andbreadth of usage. So worth hearing again now. The forever promise is partof the forever transaction tells about the promise yeah. So the promise isthat that North start at we were talking about earlier. It's the reasonthat someone trusts you enough to pay you on a regular automatic basis. Sosometimes I hear language from entrepreneurs or exacts where they saywe want subscriptions, because you know we want the customers to not even payattention and we just want to keep charging them. And what's reallyimportant for business leaders to understand is that the reason thecustomer is trusting you and willing to be on an automatic basis is becausethey trust you not because they're stupid and what they are trusting youto do is to keep helping them achieve that forever promise. So I join a gymbecause I want to get in stay fit in the most efficient way possible. ITrust that my gym is going to continue to improve how they deliver on thatpromise. On maybe fifteen years ago it was jazzer size or a stair stepper, andmaybe today it's a boot camp kind of experience or a pilates class, but Ican trust that they're staying current, so I don't have to go out and researchit. I can just go to them and say I trust you. You know it's like walkinginto a restaurant saying bring me the special. I trust you, you knowI'Macassa, and you put me in you know, put me in the chef's hands: that's notbecause they're stupid and they're giving you permission to take advantage.It's because they're saying I trust you... solve my problem and that's reallywhat should be driving all of our product development investments soimportant, because switching costs are not as high as most of US tend to thinkin most businesses, and so when you violate that trust and do treat peopleas if they were stupid, it's not that hard to feel terrible immediately andperhaps change your change. Your behavior, which brings me kind of theword forever. That's quite a commitment on everybody's part. Obviously, it'saspirational instead of literal, but might these things change a little bitover time? I mean you talked about like this natural kind of evolution, so Iwould expect that if I committed to a gym just to stay with that, one that ifI keep showing up you know six years from now, they're going to have newequipment, a it's not just going to be the same equipment. Does anythingchange? Have you seen anything, that's a maybe a necessary or successful partof a change beyond like a standard, I'm staying current in my expertise andbehalf of you, my customer is forever shorter than forever in any time. Yes,okay, so there's two parts of this: I'm go N, I'm going to break it into twopieces. The first one is about forever and the second is about evolution ofthe offering so forever funny story, the guys who started linked in beforethey started linckon. They started a dating site called social met and samemind that they're, fantastic they're. All about the you know the foreverpromise theire long term thinkers they want to solve problems for theircustomers, ongoing problems right, but they pick dating as their firstindustry right and if you do a good job on a dating club right, your membersare turning out like every six months right and you don't even want people tostay longer. Like last thing you want are people who are already hooked up tobe. You know polluting your dating pool right, and so they said the next timewe start a company we're going to make sure we have a longer run way. Tbat theforever is really forever and, as you know, you know people are joininglinked in. Like my teenagers, my high school kids are on Linkdon. My father,who is you KNOWAS, been retired for five years, is also active on Linkdon.So it's not quite forever, but it's a pretty long time. So that's kind ofanswer your question on forever. It's about what journey you're, choosing togo on with your customers and what goal you're going to help them to solve. Sothis gets into the product. ITERATION QUESTION: If I set up: let's say thatdating sighe example. Again so, let's say that's my membership model, so sixmonths is a great that's, a great duration right! Great lifetime value issix months of revenue. What if I called it a relationship membership instead ofa dating membership, and once he said you know no, I'm hooked up. I've founda soul mate or I found a perfect for now date. Now we work on relationshipdevelopment or we work on great places for great dates or how to havedifficult conversations. And then I help you with your your marriage and Ihelp you with buying a home, and I help you with all of the other things thatI'm guessing might be on your journey. So, instead of being focused just onthe six months, I'm really focused on taking you through the most importantrelationships that are by choice as opposed to by birth. So it's reallyimportant how you define what problem you're solving for your members andwhat journey what customer journey you're going? Ta Go along for the rideon or even be the guide on really good ind. It you just went some place. Iwanted to go, which is you know, two really really critical questions thatI'm not sure that enough businesses are clear on or disciplined enough aroundare fundamental to the forever transaction, an the forever promisewhich ar who is your best customer. And what problem do you selve for them? Ais my impression: Do you have a similar impression yeah? I totally do and Ithink in the world of subscription. That's, I think what you just said istrue in any business, you've got to know who you who your customer is andyou've got to know what problem you're...

...solving for why they came to you in thefirst place that allows you to create your headline benefit that gets them tobuy in a world of membership in a world where you want to generate recurringrevenue, you also have to have the engagement benefits. You have to reallynot justunderstand what brought them to you, but how can I continue to solvetheir problem and anticipate what problems might arise over time? So itbecomes even more important that you really know who your best customers areand not just who your worst customers are. That's where a lot of people gobut who you're not best. Customers are the ones that are pretty good, but notas profitable or the ones that are pretty good, but are pushing yourproduct in a different direction. You really want to understand. We want tomake. You know, make more of these ere's a concept of look alikes. We wantto know WHO's. The looka like who do you know will buy from you get greatvalue, recognize that they're getting great value and stay for a long time,and how do we make more of those yeah? I see a lot of challenge in the thekind of the focus and discipline pieces there. I think, at least in myexperience, it's hard to turn down revenue, but sometimes some of thatrevenue turns out to be bad revenue for any of a variety of reasons youoverwork for you're, doing one off solutions or fixes or things activitiesthat aren't a benefit to your core customer. What advice do you havearound determining best customer and key problem in a way that allows thatfocus and discipline, obviously carrying it forward, requires you knowa lot of good internal conversations around? But how would you guide someoneto create some of those definitions in away that is broad enough to be doable profitable from a totaladdressable market standpoint or whatever, but also narrow enough thatit does have some inherent focus in discipline to it? So the first thing Ithink, that's important if you're just starting out is to start narrow tostart really narrow and to know you're nailing it. A hundred percent like thisproduct is a perfect fit for these people. It's going to meet them wherethey are they're going to find us they're going to love it they're goingto stay for a long time and then over time you can experiment with adjacentce.You can expand the features to better serve adjacent market, so, for example,Amazon when they started they had the vision of removing all friction fromall buying occasions, but all they sold was books and they didn't remove allfriction. Even from that process right, it's you still hade to sometimes wait,two or three weeks for the book. The Nice thing was, you could just goonline and order any book you wanted, but they had a vision of like layeringin more benefits over time and over time it became more attractive to morepeople, as those benefits became broader. So I think that it's reallyimportant to both have your big vision. You know, I imagine a world whereeverybody bought everything from our organization and it appearedinstantaneously. That's The big vision, and today we're going to sell books inthe United States. Do people who have computers, which is not the wholepopulation. So it's all about like that vision and then, starting withsomething very, very narrow and very very granular super. This is going tobe kind of a really ground level in the weeds type of question. In terms ofdefining a customer, I mean when it's some things that come to minor. Ofcourse, industry role title the channel they came in on. You know these typesof things. What are some ways that you've seen people successfully definea best customer? What are like, if you're going to find like three tosfive characteristics or something or is it or is that too many years at too fewlike how? How do you help people define a customer, because you know Theyr,defining part by common characteristics? What are those or is it all that stuffaside and its usage and spend in Expanson or, like you know, yeah? Thisis such a good question and it's something that I grapple with all thetime with client uis tat, juse yeah. I...

...know it's a really really hard questionand I don't think that, at least for me I haven't found like the perfect recipe,but what I try to do is to sit to work with them and say who do you know whowould be a great customer if they have customers if they're a going concern, Isay: Let's make a pile of your best customers and then let's make a pile ofyour, not best customers and let's put them on the wall, and let's talk aboutwhat the differences are. Tho jump out at you, so, for example, you know I'vehad I've had clients look at it and they say. Oh all, the really like is a funnystory, but you know all the really good customers. Those were the worst ones toon board because they ask so many darned questions and you're like Oh, sosomething that we know about our best customers is that they take theonboarding process really seriously. Why is that? Well because they'replanning to use the product heavily right, and so like that, a Ha momentthat comes up when you see here's our best customers? We all know who theyare, and here's some that have not been that great. We all know who they are.What do we notice and we write? You know a lot of times I'll? Have them dohypothesis driven and then we contested it's a lot easier to test things. Butyou know your original point about. You gave some demographics, you know theylive here. They have this much income. They work at this kind of organization,that's as kind of starting ground psychographics how they think and feelbehavior what they do, and you know what they do before and after buying. Ithink is important and another kind of interesting example of best bestmembers that that I found really instructive was was working with anassociation, a professional society and one of the things that they realizedwas that their best members were usually brought in by their boss. Sotheir boss said this was you know their boss said: Hey Welcome to the firm youneed to join our society, because that's how we learn and that's how wegive back in our community so come with me. So it becomes this opportunity tobe mentoward and those people that were mentored by their bus end up being theones that volunteer the most bring in the most people spend the most money,but it wouldn't necessarily come up as a demographic or psychographic. It'slike, oh, that's how they onboarded. They had a mentor who they trusted andrespected, who onboarded them and that's the secret sauce really good. Itreminds me of there's a woman, I know named Lauren Bailey, who founded anorganization called Girls Club and it's about creating female leaders in thesales, business, industry or profession, and she observed that, like conversionon the website to new membership is like one percent, but it's sixty fivepercent. If that woman's manager or supervisor refers her to the club,because it say exact, same dynamic, this kind of implied permission right.This is important. I see I see something in you. I think it'simportant for you. I think it's important for us, and I just gives thisextra layer of permission andto your point. It's not something that you seewithout really wrestling with all the details of WHO'se best and who is notbest, and I like that. I, like that break by the way bad versus everybodyelse not best yeah. Let's go back a little bit intothat sale, centricity versus product centricity versus customer centricity.Is My speculation fair here to that that some people see themselves as onething but they're really something else and wore they want to be all of thethings and it's impossible to be. Those things is like are those thingsapproximately true yeah? Oh totally, and you know when I you know, I toldyou, I was a strategy consultant for most of my career. I worked in strategyand then for five years I was in product product management, which isvery different. Skill set much more in the weeds, much more operational, muchmore detail oriented- and I remember when I was working with the productpeople they would talk about. You know we love product managers where detailoriented who get into you know, aren't Afraie to get Intho weeds. WHO- and Iwanted to be that because that's what was cool in that group, but reallythat's not me, I'm a strategy person and there's nothing wrong with that.But when I have to make a choice and be...

...honest with myself, that's how I thinkand that's how that's how I like to work- and I think when you ask somebody,do you care about sales, you care about product or you care about your customer.They rightly should say I care about all three, but the question is: Whenpush comes to shove and something has to suffer, which one are you willing tolet suffer or which people on your team. This is like. I have all these kind oflittle tests so that I can tell which culture they have, even if they don'twant to tell me. You know, for example, like what are the hero shots on thewall. Is it of the product or is it of customers who is most respected? Wheredid the CEO come from? Did they come from a kind of customer? You knowaccount management, ongoing relationship, kind of space, or didthey come from engineering or you know journal an journalism? It's the writersright, that's the product, people or they avfiht. Do they come out of theCFOS office right? Are they? Are they financial types or sales people wherethey're very much focused on you know if we hit our number, the business isgood, so there are clues what the culture is and, of course you're all ofthem. But the question is: When things get hard, which one becomes mostimportant, you say you know we got to hit our quarterly number, so I don'twant to say, let's pull a fast pone on our customer. Nobody uses that language,but let's throw in a late fee so that we can hit our number. Is that what youdo, or do you create a product that's over engineered because that's whatyour techteam wants to build, even though it's not necessarily you knowwhat the customer wants and Younow it best. It's the bask on the market likein the world of cars right some people, love the engine and could talk about itall day and love the cars that win the prizes, and some of us just needsomething to get us from here and there to there with all of our stuff, andsometimes it's just about the cupholders right and Yoknow. If you'rea sophisticated automotive engineer, you don't want to be designingcupholders, you want to be designing awesome motors and you have to decide.Are we designing awesome motors or we designing for the people that havemoney in their pockets to buy cars? Such a good distinction, and I reallylove that you mentioned I'm doing something for those of you who arelistening, I'm doing something I haven't done on the show before whichis hold up a book. I actually have it marked to the quiz that you put in thebook on Pageeen to how customer centric is your organization, I'm just going toread a few, and- and maybe you can tack a couple more on or share your thoughtsabout them because I just loved it so much I mean I mark, I mark up the booksthat I read and like, and this one it's all th, this page in particulars allmarked up. We always speak as if the customer were in the room with us.These are yes or no questions. We always speak as if the customer were inthe room with us. I love this one. Every employee knows at least a few ofour best customers by name every employee. Every is the word that Idouble underline there. You know sure. Of course our customer facing like asalesperson, can tell you the last five people that they brought into thebusiness, and maybe your account managers or other people could. Butevery employee is a high hurdle. A couple more. Our organization focuseson the marriage post transaction more than on the dating, which is marketing,and we talked a little bit about that already and then the last one, which Ithink is last on purpose. Everyone shares an understanding of whatcustomer centric means. This idea that we're not just going to say that we arethis thing, but no one agrees on what it means. It's just so important, yeah,it's it's funny. I was just doing a a club house. Talk was my first time onclub house and someone asked ut that she said you know. I have a really hardtime finding people that have that are kind of experienced in membership andthat can help me grow my business and I said to her. You know it's really aboutthe mindset of that person. They don't have to have experience, running amembership, business or running a suscription. It's that they think thatway they think about the longterm relationship is being most importantand that you give them permission to do...

...that, but you can feel it right whenyou walk into an organization. I I'm guessing. You feel that when you, whenyou talk to a company, if you can tell if they're, customer centric or notyeah, it's one of those, I know it. When I see it, you know it's hard toit's hard, maybe to put on paper, but we all know it. When we see it, I'mgoing to go to something kind of fun that you did a drive by on at leastonce in the book, and it's this idea that all of us all, I'm assuming thateveryone listening a has a smartphone and some kind of a subscription planfor that and be some kind of Internet service at home. Perhaps with sometelevision subscriptions attached to it, those businesses treat new peopledifferently, th they treat their current customers. I can't get like yousee, you know, get two brandnew iphones for the price of one. Only if you'recoming from another service, these types of things talk about that dynamic.Why do you think it happens? What are your thoughts or feelings about that asa consumer and as a professional yeah? So I hate them both as a consumer andas a professional. That is m my point of view, because what you're saying isthe people who trust us you going back to this concept of trust, they'restupid enough that they won't notice that we're charging them a lot morethan we're charging our new members we're not going to give them thebenefits that were giving our new members, because they don't compare uswith other alternatives, because I would say, because we trust you andthey would say because they're so stupid. So I think that that's oftenthe driver of doing those kinds of things there are reasons to give peoplea free trial right to give them a taste of what you have that's most delicious,because they don't understand or they don't believe it's as good, as you say,but really, if you really believe in membership, the people that have beenwith you longest should get the best deal, because they've demonstrated rtheir commitment to you and their loyalty. So when I see these kinds ofseventy five percent off an your first year, you're talking about you, know,cable companies and a lot of like the telcoes. You know Ijust feel like that is you know number one. It's rewarding people who switch alot. It teaches you that what you need to do is cancel and join somewhere elseor call and threaten to cancel. Hou didn't mention that, but it's in thesame family right I'm going to cancel my subscription because my neighborisgetting seventy five percent off great, we'll give you seventy five percent oftwo great so mark your calendar. You know every year round. This time calland threaten to cancel so that you can get a fair price. The whole idea ofmembership is that you can relax into it and trust that you're getting a fairprice for the value that you're getting yeah Goud call picking up on some of thosethings I left out an. I just had all these feelings, as you were describing,and it's just like- I'm too lazy to play that game and or I'm at aprivileged enough point in my life in my career, where you know, if I'mgetting a little bit overcharged, it's less. I prefer my time to be savedrather than my money on some of these things that I just roll over, which is,I think, part of how they get away with it, because we can't all play thesestupid games that they design around us a little bit of a change of pace. Here.You know, I think, between some combination of hustle culture and thatthe idea that you know guys like billgates, got where they are, but theydropped out of college. I noticed you did your Undergrad at Harvard inEnglish and you did an NBA at Stanford and Strategy Marketing anentrepreneurship. What thoughts do you have about higher education, eitherfrom a value for your life in generalperspective or a you know, any of the more current thoughts about the costversus the benefit, like you have any thoughts about higher education. I haveso many thoughts is like my favorite topic. I think about it all the time I've, three college, age, kids, so sure very friend of mine and a lot of myclients honestly, are in either the professional development or theeducation space right now. So you know, I can't tell you the number of peoplethat tell me that you know the Harvard...

...model is obsolete and that there is novalue in it and that their subscription based recort prerecorded digitalcontent is going to replace for year. Liberal Arts, colleges and graduateprograms, like you, know, Stanford Mba, and you know I hear that, and I thinkone of the things that I think that that they're overlooking is that theseexperiences have a lot of benefits other than just the coarse content.There's the relationships you develop, there's the signaling factor of youknow different institutions being hard to get into in the first place. There'sextra curriculars there's the push that comes. You know like. I have access tolinkedon learning because I'm a linked, an instructor access to thousands ofcourses, but how many courses do I actually watch every year and finishbecause nobody is going to make me and I'm not having like, even like the bookclub kind of conversation to discuss it. So there's all of those things areadditional benefits that increase the likelihood of me getting. What my goalwas, which you know I'd say going to college, is partially about getting agood job and partially about becoming an educated citizen of the world. Soanother piece of this: If you're thinking about your model- or you know,somebody's listening, O think about their model- is the goal of yourmembership to help someone get a job to get their first job to get and continuegrowing in their profession. Or is it to be a great citizen of the world andhave a broader knowledge, or is it to have a community of educated people wholove and trust you just because you're member of the same community? Those areall really different benefits and I think some universities have gottenlost some colleges, some programs about which of those benefits they're goingto provide and which ones they aren't or they miss represent what you'regoing to get from it. So you know lots of young people that are going to. Youknow racking up big debt going to four your colleges and they can't get a job.I don't recommend that there's cheaper ways to become trained to get a job,but I think that right now, there's so much disruption, especially with covidand people not being able to be on campus, that there's an opportunity tounbundle the benefits of education and repackit them for different marketsegments, different different customer groups with different experiences. I'mso glad I asked that, and what was echoing for me was: Who is your bestcustomer and what problem do you solve for them? And if you stont Fi, like youlost your way, it's time to reset? So I like this idea too of kind of liketearing it down and reorganizing, or at least tearing it down, to see what wehave and then you know I te're puting it back together as it was, or in a newway. That makes more sense. Yeah. I think you know one of the things as amom of you know, kids in private college, one of the things that's hardis that they still have access. My daughters Toak me a gap here, but theystill have access to the courses, but the course is like a tiny piece of whatthey get in that four years and other things that they're not getting. Youknow it could be. You know, I believe there are ways to deliver on that in adigital environment like building community extracurriculars exposured tonew kinds of people, but that's a big part of what I am paying for, and thatis why my daughter's taking a gap here so good she's at homeworking. If you are enjoying this conversation,I typically I share a couple. Others that you might like actually have fourof them, which might be too many, but they were you know in preparing forthis. One is like you know, because I structure these conversations a littlebit, so I kind of so at least. I know where we're going D than I try to makeit easy enough to be engaging for you, Robbi and fun, to follow along and thatyou sees episodes kept coming to mind, so I sluged them in, and so the firstone I was thinking of was episode. Sixty five with Chris Hickin, who spenteight years in executive leadership at user testing and then cofounded andserveds, a CEO Andnough, said we called that product usage as a vanity metric,and so we got into different ways to measure customer health and engagement,which I was obviously a theme here...

...episode. Forty five with West Bush, whois the founder of the product, led institute, an author of product ledgrowth, and so on episode. Forty five. We talked about product led growthversus sales and marketing lead growth and some of the differences there.That's definitely on point here: episode, Thirty Six with Sarah Toms,who is the cofounder and executive director at Wharton, interactive at theWarton School of business at Penn She's, also the coauthor of the customercentricity playbook and she gets into Definan with Peter fader yeah, totallyyeah and she gets into define our or she and Peter defined customercentricity in a financial sense. You know in terms of lifetime value veryexplicitly, so that was more of a financial conversation and then I wouldbe remiss if I didn't mention episode: Ondred D, Twelve, with Lisa Earlmccloud, author of leading with noble purpose and selling, with noble purpose,because she introduced us so sixty five with Chris Hickin, forty five with WestBush, thirty six with Sarah Tobs and one twelve with Lisa Earl mccloud.Thank you for enduring that with Merobbie and fun that you are familiarwith her and Peter Fader's work yeah. I I'm Fomi Yeah lisays at least.Obviously I'm a huge fan, Sara and peters work, I think, is phenomenal andI mark wrote down number forty five number. Sixty five, I'm going to checkthose out awesome. Please do and for folks who are listening, we write allthese up at bumbomcom podcast. You can obviously scroll the episodes in yourpreferred player or you can go to bomb Bombcom podcast. We do short writeupswe put in video clips. You can see me flipping through the pages of Roppie'sbook, for example, if you visit this post and then, of course, we have aninvedable audio player there to hey before I let you go Robbi and this hasbeen fantastic. I always love to give you two opportunities. The first one isto think or mention a person. Who's had a positive impact on your life or yourcareer, and the second is to give a nod or a shout out to a brand or a companythat you appreciate for the experience they deliver for you as a customer, orI guess in your terms, a brand or a company of which you are a proud, proudmember. I love that that's great. So, on thetheme you know we talked a Lotte about dating and we talked about a good, agood relationship being more about the marriage than about the dating. I haveto take the easy one here and say you know my own forever transaction is myhusband Bob. We met Freshman Year College on the stairs. I was on thelanding. I said: Hey, hey there, we're having a Pizza Party and we've beentogether ever since so O. my my own forever transaction has helped me.Every step of the way has read every word that I've written edited them. Hewas an English major to, and so that's definitely who deservesdeserves a shoutout and then in terms of favorite favorite membership rightnow, then, we're talking we're still at least here in northern California,we're still mostly at home Palaton. I love my membership with Pelaton. It'sreally gotten me through the pandemic, the rides and the meditations and theexercise classes, but also the the community has really helped me stayfocused on on. You know fitness and health, even during this kind of crazyand difficult time, really good, I'm not keeping formal score, but I can sayfor a fact that that is the second pelaton reference at this point. Inthese conversations, Jeff Bronsbock of higher logic also mentioned it, and youwrote about Stitchfix, which is the only company that has come up threetimes when that question has been asked in including I, including by Sarah Toms.That's a whole nother conversation like this blend of personalization, but highhigh tech, but high touch is the really Uni Combo and I think Pelaton fits thatbill a little bit as well. If someone has enjoyed this, how should theyfollow up with you? How can hey learn more about peninsulas strategies? Howcan they learn about the frever transaction, where the membershoulpdeconomy or your podcast, which we...

...didn't talk about subscription stories?How can people catch up with you yeah? The easiest way to find me is RobbieKelman baxtercom, my namecom, the podcast, it's that podcast and you canfind me. You know on Linkon, twitter instagram and if you mention thePODCAST, I'm glad to glad to Lincoln with you awesome. Thank you so much.This has been a pleasure well done on the book and thank you for spendingthis time with us. Oh thanks for having me this was a great conversation,you're, a very, very good interviewr. I know you know that, but real pleasure,clear communication, human connection, higher conversion. These are just someof the benefits of adding video to the messages your sending every day. It'seasy to do with just a little guidance, so pick up the official book,Rehumanize Your Business, how personal videos, accelerate sales and improvecustomer experience learn more in order today at Bombamcom Book. That's Bo, MBvombcom book. Thanks for listening to the customer experience. podcastremember the single most important thing you can do today is to create anddeliver a better experience for your customers, continue. Learning thelatest strategies and tactics by subscribing right now in your favoritepodcast player, or visit Bombomcom podcast.

In-Stream Audio Search


Search across all episodes within this podcast

Episodes (174)