“If you need to optimize for lifetime customer value, you need to bring in the right customer.” – Robbie Kellman Baxter in today’s Tip 778
How do you build a forever transaction with your customers?
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Robbie Kellman Baxter on LinkedIn
The Membership Economy
The Forever Transaction
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Scott Ingram: You’re listening to the Daily Sales Tips podcast and I’m your host, Scott Ingram. Today’s tip comes from Robbie Kellman Baxter. Robbie is a consultant, speaker and the author of two bestselling books: The Membership Economy and The Forever Transaction, and hosts the podcast Subscription Stories. Robbie has more than 20 years of experience providing strategic business advice to major organizations, including Netflix, Microsoft, and The Wall Street Journal as well as dozens of venture-backed private SaaS businesses. Here she is:
Robbie Kellman Baxter: In traditional business, the goal of selling is to get the customer to buy. That moment of transaction is when you’re done hooray. And then you go out and sell the next account. It’s like big game hunting. And you’ve brought in that wooly mammoth and left the carcass on the floor of the cave while you go out and find the next big animal. But today with software as a service and an emphasis in many businesses on recurring revenue, rather than on that initial transaction size, the goal is to get the customer to come and stay in this membership economy. It’s all about building a long-term relationship with an emphasis, not just on the initial transaction, but on extending and expanding that transaction over time.
If you need to optimize for lifetime customer value, you need to bring in the right customer, a customer who is going to get value out of what they’re buying on an ongoing basis. And then you need to optimize the customer experience for engagement and retention. This means that it’s not enough to close the deal. You also want to make sure that they are onboarded for success and that your colleagues are tracking engagement as well. The sale itself is going to be easier because the upfront price is lower and the implementation is faster, but suddenly it’s critical that the customer is actually using the product and encouraging their colleagues to do the same. Instead of big game hunting. Now, what you’re doing is a lot more like farming.
Scott Ingram: We’ve got all kinds of stuff for you from Robbie, including a copy of an excerpt of her new book The Forever Transaction as well as links to her LinkedIn profile and her podcast at DailySales.Tips/778.
Once you’ve checked that out. Be sure to come back tomorrow for another great sales tip. Thanks for listening!