Advisor to the world’s leading subscription-based companies Robbie Kellman Baxter drops by to discuss her new book, The Forever Transaction: How to Build a Subscription Model So Compelling, Your Customers Will Never Want to Leave. Listen and learn how to turn your “clients” into “members” who are so committed to your organization that they stop looking for alternatives.
Andy Paul: Robbie, welcome to the show.
Robbie Kellman Baxter: Thanks so much for having me, Andy,
Andy Paul: Pleasure to have you. So where are you? Where are you riding out the storm? This COVID-19 storm.
Robbie Kellman Baxter: I am riding it out in Menlo Park, California.
Andy Paul: Alright. One of my favorite places. And so you just like you venturing outside at all and do you have a yard or
Robbie Kellman Baxter: We have, we have a yard. I spend a lot of time in the yard. I spend a lot of time in the garage, on our Peloton Bike.
Andy Paul: Ah, Peloton. OK, so today we’re gonna talk about your book, your new book, The Forever Transaction, which follows up your previous book, The Membership Economy, which is also an excellent book. And tell us what you meant by the forever transaction. Cause I thought this was interesting and really want to dive into this. Again, primarily from a, you know, we do talk about it in the book, both from a consumer and a B2B standpoint, and we’re going to dwell more on the B2B side here today, but tell us what it is.
Robbie Kellman Baxter: The forever transaction is that moment when a customer takes off their consumer hat, where they’re considering alternatives and they put on their member hat and they decide that your business is the way they’re going to solve their problem or achieve their goals for the foreseeable future. It’s when they’re, you know, a lot of times it’s when they decide I’m going to just subscribe and pay every month and not worry about this anymore. It’s when a company says, okay, we’ve solved that problem. Let’s move on to the next thing on our list. And it’s what we all want as business owners. We want our customers to say, you know, when I have these kinds of problems or I need to achieve these kinds of goals, this is who I go to. This is how I get things done. This is part of my habits.
Andy Paul: Hmm. Well, so what has to occur for that mindshift to happen? And we can start on the consumer side if we want, and then migrate to the B2B side because obviously a big audience and the show that are people who work at Saas companies, you know, certainly subscription-based and as I mentioned it before we started recording, it’s like, yeah, I’m not sure I’ve ever heard anybody in Saas refer to their customers as members. And I think this is really an important mindset to shift that needs to occur. But anyway, what has to happen?
Robbie Kellman Baxter: Yeah. So I think I’m on the, on the consumer side or on the customer side, they have to be comfortable paying on a regular basis. They have to be, comfortable with the level of trust that they have for the organization. So I’m not going to pay somebody regularly or give them access to my credit card if I don’t know and trust them, but on the business side, what I think is really important to note is that being part of the membership economy is not the same thing as having subscription pricing. So just because you’re a Saas, and I think this is what you were getting at, just because you’re a Saas business does not mean that your organization has a membership mindset. And there’s so much room to strengthen and deepen your model if you think of it more holistically.
So, so for example, a lot of organizations I’ve worked in, I worked with over the years, that have enterprise software. The first thing they do as they move towards Saas is they just start calling it Saas, and they, start doing subscription pricing around kind of a jury rigged product that was not, was not built or architected, for Saas.
So in other words, that’s slapping subscription pricing on a non-subscription product. Lot of organizations that. A lot of them say, it’s Saas and we’re going to leave everything else the way we’ve always done it. But over time, I think, you know, the last five years, ideas like customer success. So focusing on not just on solving problems for customers when they complain, but making sure that they onboard well and they engage, and tracking different metrics. So, you know, I don’t know, I’ve been, I’ve been in this world and it’s kind of membership world for about 15, 15 or more years. But I remember in the beginning I wanted to get t-shirts that said make retention sexy because no companies- You know, I’m in Silicon Valley so most of my clients were, were Saas companies. None of them cared about retention. Like I cared about retention. And, and none of them were really focused on the onboarding experience and seeing kind of the issues between, you know, the moment that you close the sale you really have to think about how to onboard those members so they actually engage with the product and use it, and it starts to expand across the organization and they make it a habit. That requires a whole different way of, of running your business, a whole different set of metrics, a deeper focus on retention, not just on, you know, what’s the cool new logo we’re going to get, you know, the new company logo, you know, that, that big logo slide that every company seems to have.
Andy Paul: Oh, yes. We don’t even refer to it as acquiring new customers anymore. It’s acquiring a new logo.
Robbie Kellman Baxter: Yeah, forget the people or the businesses we’re supporting.
Andy Paul: Just getting a logo, right.
Robbie Kellman Baxter: Yeah. Yeah. So it’s, it’s really, I mean, I think the company has to take that step back and say, we don’t just want to acquire new customers. We actually want to engage and keep them and expand the relationships.
Andy Paul: Well, so words matter. And, and this idea of, that you talk about, as treating customers as members has implications for certainly how you relate to them, but also the customer perception of what they’re a member of. Right?
Robbie Kellman Baxter: Yeah. Yeah. So, you know, when, when I was writing the book, I’m like a pretty analytical person. And, you know, there were things that bothered me about my own, my own business model, my own book. Right. I was thinking, well, wait a minute. Does, does the company have to call them members? So does every Saas business have to stop calling them customers and start using Robbie’s language of members?
And what I would say is, first of all, it doesn’t matter what the customers call themselves. So, you know, if you listen to Spotify, you might call yourself a listener. You might call yourself a subscriber. You might call yourself a user, that’s your choice as a, as a customer. But the company, what I find is when they start using language of membership, when they start referring to the people they serve as members, it changes the way they think they, they focus more on the longterm. They focus more on the relationship. And I think that’s the part that really matters when you treat the customer like a member. The other thing is, you know, when you think about having a subscription business versus being part of the membership economy, to have a subscription business, all you need is subscription pricing to be part of the membership economy, you need to have a focus on the longterm success of your customers as your primary North Star.
Andy Paul: Right. But thwas getting to it, isn’t it sort of implicit in that though, is that this idea of community though, is that you’re that you’re a member of something, right? I think that, when we think about retention, on a Saas basis, again, this is a terminology I’ve never heard a Saas CEO use is, yeah my members are part of this bigger community, right. Or they feel like they’re part of this bigger community.
Now, tou see this being developed by Salesforce and others that are holding these events. Like Dreamforce is a big way to sort of encourage the sense of community. I think they’ve successfully built that, but again, that seems very rare.
Robbie Kellman Baxter: It’s very rare. I think Salesforce is a really good example of a, of a company that does this well. Wou know, and they’re, they’re kind of the leaders, when you talk about Dreamforce, you know. I, I work, I’ve been working for a long time with, with Saas businesses, but when my first book membership economy came out, I started getting a lot of clients in Washington, DC a lot of associations, professional societies, trade guilds.
And one of the things that they lamented was, they said, you know, nobody comes to our conferences. They said millennials don’t like conferences, and we can’t get them to come to the conference. And, you know, I live in Northern California. I’m like, well, you know, Salesforce has this event where every single hotel room for a hundred miles is booked and they bring a big cruise ship into the Harbor for extra, you know, room. Maybe, you know, they’re just not that into your conference. Because, because what Salesforce is doing is staying in-tune with their members and giving them a way to get the value that they came for.
So, you know, if I’m a Salesforce administrator, my community, maybe my communities, my colleagues job, but maybe I feel more connected to other Salesforce administrators because that’s like my professional society. and so when I, I need to get together with those people, and that happens to be under the umbrella of Salesforce. So it actually creates, you know, value for the company, but the value I’m getting is coming from my peers, from other customers. And tapping into that is one tactic of this membership economy.
It’s recognizing that I didn’t come for the software or maybe I came for the software, but I’m going to stay for the community. I’m going to stay for the support. I’m going to stay for the fact that maybe Salesforce cares about me being successful in my career. You know, I know that a lot of these events are places where people actually find new jobs.
Andy Paul: They can be. Absolutely. Right.
Robbie Kellman Baxter: Right. If I’m a Salesforce Administrator and I’m not happy at this job, that’s a really great place to figure out where I’m going to go next. It’s it’s serving the purpose of a professional society in a lot of ways.
Andy Paul: That’s I started thinking of when you’re saying, you know, Hey, feeling like members, if you’re developing this community around your particular application, then yeah. You get that interchange. And that starts reinforcing people’s individual decisions to stay. I mean, if you’re doing a bad job and everybody’s bailing, then it could reinforce the decision to lave. But in general, I think, but yeah, if you look from our retention strategy, that experiential component of it. Making people feel like members, but again, you just don’t, you just don’t hear the words enough.
Robbie Kellman Baxter: Well, there’s, I think there’s a few reasons for this in the, in the, in the Saas world. So, so one of them is, you know, they’re very focused on growth and so there’s a lot of emphasis on growth through new members. that’s what people want to talk about. You know, it’s more interesting to talk about new members than to talk about, you know, lifetime value or how long someone stays also those metrics are harder to track.
Andy Paul: Within a few years. You know. Two thirds, three quarters of your revenue is coming from recurring revenue from your existing customers. But yeah.
Robbie Kellman Baxter: Right, right. And they’re, they’re starting to get that. I mean, I do hear them talking about, you know, MAU, monthly active users and, you know, ARR and like those numbers are starting to be more, more important, but the companies aren’t always digging into kind of unit economics. So when, when a new customer signs up, how long do they stay? How much does it cost? How much revenue do they drive. And starting to kind of break that down and then to say, well, what are the leading indicators that let us know if somebody is going to expand or contract or cancel? It’s just a different way of thinking about the relationship. I also think that they tend not to worry about keeping people as long. They don’t, it’s not what they’re thinking about. The salesperson’s thinking about closing the deal, you know, big game hunting, bringing the woolly mammoth back to the cave, and leaving it for the, you know, women and children To, to take care of, that’s a very different mindset than kind of this, nurturing mindset that really goes with, with, a membership economy vision.
So I think it’s changing, I think more and more, you know, when I wrote The Membership Economy, software company leaders didn’t necessarily get it. They didn’t understand what I was like, well, Robbie, I don’t really, your book doesn’t really apply to me. Or, you know, your concepts don’t apply to me. I haven’t read your book.
But then when they read the book, they’re like, Oh, well, this kind of actually is the problem we’re having. And maybe the solution could work. So I kind of wrote membership economy as like a five, a one pound business card to say, okay, here’s how you can use this and why it would work. And if you’re having these problems, maybe this is a way that you can rethink your model.
Andy Paul: Yeah. Yeah. I wanted to go back to a point you brought before, before I forgot it, which was that this doesn’t necessarily have to apply to subscription based products. And I think Tesla is an example of one that I would say that probably from a, you know, I think there’s a little small recurring revenue element of it, but in general, you’re buying a car, but you certainly feel like you’re a member of something, not a consumer. And they, they do that, you know, access to their charging stations, you know, all the, all the things that surround the product itself.
Robbie Kellman Baxter: Yeah, exactly. Well, the things that surround the product themselves, certainly. So, you know, I know people know that when, you know, when, when everybody wanted their cars and there were like lines and wait-lists, when the day came, when you can actually go pick up your car, they invited existing car owners to come and help with the event and made it kind of a celebration where, you know, you have a car, I just got one. You come over to say, Hey, Robbie, let me show you how to use it. And let me show you what I do. And let me teach you
Andy Paul: onboarding.
Robbie Kellman Baxter: Yeah. Onboarding exactly. But having, bringing your superusers to onboard your new members, which is like so smart, but then they also, did things in the product itself. So the way they design- you know, Elon Musk talks about it as being a software product wrapped in metal.
Right. And the idea is that, you know, in a normal car, you roll it off the showroom floor and it immediately becomes less valuable. It’s immediately obsolete, but with a Tesla, you know, because they continue to update the software on a regular basis, your car gets better over time, not worse. And that’s the kind of mindset of membership, which is, I don’t want to own a car.
I want to have the best ride, the best transportation for my needs. And, you know, so the best way I can do that maybe is by buying a car or maybe it’s by using Uber, or maybe it’s by signing up for Porsche passports, a membership model where I can have a, you know, a Carerra on Friday and a cayenne on Monday.
there’s a lot of ways of doing packaging that value in different ways, but Tesla, you’re right. I think without actually having a subscription model, they’ve done a really good job of aligning the way that they. That they provide value with the way that their customers need that value. The most valuable way for the customers layering in more value than just the car itself, the community, the updates, the feedback, all of that.
Andy Paul: Yeah, I think you sort of, you can summarize a lot of that in saying the experience right.
Robbie Kellman Baxter: Yeah, of course. Exactly.
Andy Paul: And I think that that is such a critical part. And I think that is becoming more important. I’ve started reading Matthew Sweezey’s new book on the context marketing revolution, which talks about this, this importance of the experience.
And it seems like for a forever transaction is, it’s not just one experience though. It’s because so often, you know, we started thinking, yeah, let’s onboard them. Let’s make sure they engage with the product quickly, but then what’s the next experience.
Robbie Kellman Baxter: Yeah. Yeah. And when I work with organizations, one of the things that I like to do is to say, okay, you want to have this customer for how long, right. So let’s say that it’s a dating site. We might say, well, that’s six months. I want to have them until they get married or until they find their true love.
but let’s say that your, which is actually the business that the LinkedIn guys started before LinkedIn, right? SocialNet, you know, unfortunately for them, you know, they’re very lifetime oriented, but that’s a very short lifetime of relationship. Your whole career, right? That might be 50 years thinking through what are all the moments when you’re going to need value and how do we deliver it?
All of those points. So a lot of companies already are doing the, what are the touch points for us? You know, very product centric. When do they touch our product? But this is more member-centric thing. What are the moments when they would really benefit from our help and then how are we doing that? So it’s not, so yeah, certainly when they sign up because they have some pressing problem that motivated them to do that. But then over time. So one example, I done a lot of work with Haggerty, which is a insurance company for classic cars.
Andy Paul: Right. That was a good story in the book.
Robbie Kellman Baxter: Yeah. Oh, good. And yeah, and one of the things really interesting about them is that they found that, you know, most other clients are insurance. You know, people who own classic cars, you need them insured, but they realize that car guys don’t necessarily always own a car. That there are people that want to be part of the Haggerty community and hang out with, you know, I’m calling them car guys or car people, but they’re mostly guys, people that want to hang out with them, like. That might start when you’re 13 years old. And you’re always like looking for that cool car down the street and seeing if you can get a ride in it and you have the pictures on your walls, how do you engage that person from that moment through when they’re, let’s say, you know, 18 and they buy a clunker and they’re working on it on the weekends too.
You know, then they maybe have a family have extra resources or extra time to own a car, but they still want to feel connected to the community. To that time when there may be empty nesters and they, you know, buy their dream car, Haggerty is saying, well, we want to have that relationship the whole time.
So we mapped out all of those moments in a car lovers life. And what could a company like Haggerty do for them? You know, their mission is to help people who love cars, get the most enjoyment out of cars.
Andy Paul: Right.
Robbie Kellman Baxter: Right? And one way is through insurance. You don’t worry about your car, but there’s a lot of other ways to help people enjoy, you know, the classic car experience.
Andy Paul: Well, another story you talked about the book, it’s interesting. It resonated because I just read another book which used EA electronic arts serve an example. Have you read Peter Faders book, Customer Centricity Playbook. Yeah. So he has a similar story about EA and I had just interviewed him a week ago is why don’t you tell people about EA, electronic arts and how they’re, you know, Making this forever transaction.
And then I want to transition again and we’ll go back and talk about a Saas company example.
Robbie Kellman Baxter: Yeah. So, so Eelectronic Arts is, you know, pretty well known for the amazing and fun games that they’ve created. FIFA and Madden. And, you know, they have a whole slew of games across a lot of game player categories. you know, everything from, you know, shooter games to sports games, to strategy games. And the games are, you know, historically have been boxed games, you know, 60 bucks for the title and you’re on a new one, comes out every couple years, you know, FIFA 2020, or, you know, FIFA 2015. And over time they’ve layered in more value to make the game fun kind of all year round in an ongoing way. And the CEO there and the company culture is very much focused now on what they call player first. So how it’s kind of like customer centric, how do we make the players experience as good as possible?
And one of the things that they’ve done is they’ve created a subscription or a series of different subscriptions that allow players to be exposed to a lot of different games. So you can subscribe to be, you know, to get the catalog of games. And then they’ve also got a network, which is free to be a member of which allows you to interact with other people who are playing the games.
You know? So in other words, something that’s sort of crazy to me as a, you know, not target audience, is people like to watch other people play video games.
Andy Paul: Twitch. Twitch. Yeah.
Robbie Kellman Baxter: Twitch. Right. And, you know, they’re enabling that kind of community around the game players world. So, you know, they’ve done that in, you know, and there’s, there’s a lot of really interesting things that I’m happy to talk about, but I think the big point is that electronic arts as a company is moving from being product centric, which is we have this game, that’s a hit, we have this game, that’s a hit to, we have these players who want to play games who want to get access to games first, who want to be exposed to new games and who want to connect with their friends who also play games. And we’re going to optimize our offering and our exclusive customer experience around them.
Andy Paul: So what are you seeing similar? Do you have an example? Let’s say the Saas world, where people are letting the customer drive that, that really your direction, your, your product direction and so on, to, you know, develop again, this forever transaction member mindset.
Robbie Kellman Baxter: Hmm. Well, I mean, one, one company that I talked about in the book, and I don’t know if I’d call them a Saas company. All though Saas is a key portion of their business is, Carbon 3D. Makes 3D printers, that you can subscribe to. So you can’t own the printer, you have to subscribe to it. and the reason is that the data that they’re collecting about how people use the printers actually allows them to optimize the experience.
So for example, they might be able to tell you, Hey, you’re only using your printer eight hours a day. You should be using it, you know, around the clock. Here’s how to do that. So it’s basically making sure that you’re getting the full value that you’re paying for of the printer and also connecting them both through the network.
So maybe, I don’t know who else is using the other printers, but I’m being benchmarked against them so that I can get the best value. And right. So they’re using that data to help me as an individual. That’s I, I always think of kind of the distinction between maybe a network and a community where the community is people that I know and I interact with, but the network is the power of many people coming together to help one another.
And so they’re doing both of those things. the community is letting you know the members talk to each other to come up with best practices and also give feedback to the company. And then the network is them tracking all the data so that they can continue to optimize for the wellbeing of the entire group.
It’s a very, very different way to think about manufacturing, right? Where it used to be that you’d buy this custom, you know, these custom tools, and have this custom line that was fixed. And if somebody said let’s change it, you know, that’d be like, okay, well in 18 months we’ll-
Andy Paul: We’ll retool. Itll take X amount of time. Right.
Robbie Kellman Baxter: yeah.
Andy Paul: So I’m sorry, go back a little bit. Reset to talk about the cultures. So how does, how does, if you’re a leader in an organization, how do you begin to set this expectation that, Hey, this is, this is how we want to treat, and consider the transaction we have and the customers we have.
Robbie Kellman Baxter: Yeah, so it definitely starts at the top. The board, the CEO, setting expectations. I think, you know, I, I started when I first became interested in the whole model when I was working with Netflix. You know, many, many years ago. And I saw how they were setting expectations with shareholders, that, you know, Hey, don’t just look at our acquisitions, look at our retention number, which is, you know, that’s the thing to notice because look at, you know, we have 36 month relationships or longer with our subscribers.
So the first thing I would say is you want, as a CEO to say, I am focused on lifetime customer value. I am focused not just on how many people we acquire, but how that relationship expands and lasts. So yeah, what I see in a lot of companies is they have a Saas model, but then they’re very focused on quarterly revenue. And they’re very focused, you know, and to the, to the detriment, to the, to the detriment, the overall business. So not focusing on how are we onboarding them, how are retaining them? Are they expanding? A lot of times I see in companies like, you know, the sales team might sell a book of, you know, a seller bill of goods, and get the deal closed.
But the people who have to use the product weren’t brought along and so they don’t onboard. They don’t use the product. They don’t, you know, there’s pushback. And then what happens is a year later, either there’s a new manager that comes in, or somebody looks at the books and says, what are we paying for that nobody’s using?
Andy Paul: Yeah, let’s get rid of this.
Robbie Kellman Baxter: Let’s get rid of it. So I think the first step is to focus on some of those other metrics and have leadership saying, this is what we’re going to expect. We might have, you know, lower acquisition because we’re really focused on only acquiring the people that are going stay.
Andy Paul: But you make a good point in the book that your acquisition behavior will have an impact on your retention. And so, for instance, if you are saying to the customer and you’re selling and getting the initial initial deal done, we’re here to help you. We’re here to support you. Our motivation is just to help you and then suddenly it’s, but you know, If you can close this month and we give you that extra discount. Well, suddenly all that trust, you start building up dissipates and it doesn’t mean they’re not going to do a deal with you, but thattrust is never going to reach the level that you want to turn them into this member mindset. And you can expect where I serve this rule of thumb, which is purely rule of thumb is not scientific at all, but you know, the degree that you rely on, on discounts to close those deals is you’re going to have a shorter lifetime with them.
Robbie Kellman Baxter: Yeah. Absolutely. I totally agree with you. I think that it, it hurts the brand, it to companies that have Underlying trust because it makes you think, well, gosh, if they don’t really think the product is worthwhile, At the full price. What else? Don’t they think where else? And it also teaches you to, if you, if you’re negotiating, it teaches you that you’re foolish if you don’t negotiate. So, you know, we see this with telcos, right? you know, your friend tells you, “Oh, you should call, you know, fill in the blank, your telco, and threatened to cancel because the, they did that. They gave me a 10% discount on the spot.” Then you’re like, well, got it. If I’m on call, then I’m stupid.
Right, because that’s what you’re supposed to. If I don’t call, then I’m paying too much. What you want to do is have your customers think I’m paying the fair price that everybody else is paying for this value. And so I don’t need to worry about the price, the more complicated your pricing, whether it’s discounts, whether it’s like special fees for different things, the more complex your pricing, the more work the customer has to do to understand your pricing and the less they’re going to trust you.
So you want to keep your pricing simple so that they don’t feel like they have to, like, when I think about it, an airline ticket, right? And you buy it on Tuesday, made it a little cheaper. And if you do this and you do that, then you can get a better deal. And if you wait until the very last minute, then you might get a deal on the upgrade.
It teaches you that you’re in competition with, with the vendor, the one of you is going to win. And one of you is going to lose. And what you want to do is have as much alignment as possible and say, look, I’m going to charge you a fair price, and I’m going to give you a lot of value. If you’re not getting value, you should leave. But I know that my clients are getting value at this rate.
Andy Paul: Yeah. And you can do that without the discounting, without the, I mean, first of all, if the discount is really necessary, you should have figured that out during the qualification phase. But secondly is, is, you know, switching costs are so low these
Robbie Kellman Baxter: Yeah.
Andy Paul: And if you have this type of transaction that goes on is it’s relived monthly, it could be live relived quarterly depending on the deal your sign, could be relived annually. You know, in the old days sold a piece of hardware, the tough negotiation, then, you know, they forgot about it, right? Because you weren’t, you weren’t renewing, but now this, this sticks with you.
Robbie Kellman Baxter: Right. It’s a different, like, you know, game theory, right? You know, how do you play the game? If you play the game every month. In other words, the person can leave every month. You’re going to play a different game. You’re going to invest more in the relationship than if you’re playing a game where it’s winner take all one time play.
Right, because then in the onetime game, and I learned this in business school, the hard way, right? When you, you play the game one time, the person can totally screw you, take advantage of you because they’re never going to play that game with you again. ut if they’re going to play every month, then you have to have a level of trust and they have to see value. And like you said, if you discount it. they’re going to be like, Hmm. Maybe it’s not that valuable or they’re going to say, well, gosh, if it’s that cheap, I’ll just try it. But I’m not going to invest any resources in implementing it. Cause we can always cancel it later.
Andy Paul: Well, an interesting conundrum about that whole part paradox. Let’s say what you just described though, is that you’re saying, okay, well, back when it was a one time purchase, so let’s, let’s sort of do a yesterday versus today type comparison is, is, you know, when at least this is sort of the mythology that exists is when the old days in sales, it was all relationship based.
Right. Even though we’re saying, if it’s a onetime thing, is the relationship wasn’t quite as important. And then today because of the ongoing nature of it, theoretically, the relationship should become more important. But when you look at the way sales is conducted, it’s oftentimes more automated mechanized, mechanized, and there’s not as much emphasis put on the connection and the relationship at a time when it’s really needed.
Robbie Kellman Baxter: Yeah. Well, that’s a really interesting, I’m thinking about this as you’re bringing up a really interesting point, because I think that at its best all time, trust was the handshake kind of trust. Which is, I don’t need a contract with you because I know you and I know you’ve got my best interests at heart. And I’m paying you a fair price. So there’s trust. I think that’s the best. The worst case that a lot of people have had is kind of that feeling of like the glad-handing, you know, I’m doing this deal with my buddy yet, or I’m doing the deal with my buddy and it’s not in the best interest of my company, but I’m doing it, you know, like the kind of sales guy with his Rolodex, kind of, you know, the old school kind of like, Oh, they’ll, they’ll do it with me because I’m going to take them out for some drinks and we’re gonna have a good time. And they like to work with me.
Andy Paul: Which, by the way, I was always overstated. But anyway, go ahead.
Robbie Kellman Baxter: Always overstated. I mean, people didn’t really do that.
Andy Paul: No, not to the extent, not to the extent this generation thinks it happened.
Robbie Kellman Baxter: Yeah. I think it also depends on the industry. I mean, I think it depends on what products you’re selling and I think it was more common with commodities. Just because, you know, if you could buy your lumber from this guy or that guy you’d buy it or your paper, but anyway, yeah.
Andy Paul: Coming off of a tech background for since the beginning of tech. Yeah, it wasn’t. But anyway, go ahead. Not that didn’t happen, but not as prevalent. Go ahead.
Robbie Kellman Baxter: I lost track of my thought.
Andy Paul: Why don’t we just talk about this, this idea of trust being different and more trust being demanded now, but it’s more transactional today, which I think is, is, is problematic for sellers is cause they’re being sort of encouraged, is that, yeah, this, this is a more transactional, shorter term, especially, cause if you’re an SDR, you barely interface with the customer for X period of time and AE, again, you’ve got a limited period of time and then we’re handing it off to customer success.
Robbie Kellman Baxter: Yeah, yeah. And the trust there, I mean, the point I was, I know what I was trying to make before, before we kind of digressed to whether or not three martini lunches were a real thing, then we can, we can agree to disagree.
Andy Paul: Well, I think I agree with you that in certain industries I was talking about from my perspective and in the tech business, which, anyway-
Robbie Kellman Baxter: Yeah. So I think what, what I was, what I was getting at is the trust needs to be with the company, not with any one individual sales person, and-
Andy Paul: But it? Is it though? I think that’s, that’s a critical point.
Robbie Kellman Baxter: Is there a level of trust, right? Do I believe that there’s a level of trust in Saas companies right now between the customer and the company?
Andy Paul: Well, is it more because yeah, there’s been research on this and there was an article in HBR just a few years ago. I think, actually, Tiffani Bova was one of the coauthors is saying that based on a survey that customers trusted the individual seller more than the company.
Robbie Kellman Baxter: Right. And I think that company, the company needs to be the trusted relationship. And I think that there’s always a kind of battle between the company and the salespeople. You know, one of my early product management jobs, I grew up in tech here too, was, in financial services. And, there was this, there’s always this battle between the financial managers and a company who have their book of business and the brand.
You know, Goldman Sachs versus Goldman Sachs, private client services people, Morgan Stanley versus Morgan Stanley private client services people because the, the customers came from the brand, but then they had the relationship and loyalty to the individual salesperson who then took it to the next company.
So there’s always this kind of tension between the brand of the salesperson and the brand of the, of the, of the corporation of the organization. And there’s a question of what’s in the best interest for the customer. I think a lot
Andy Paul: And the company. Yeah. Especially in, yeah, in, in the model that you’re talking about. Yeah. So what do you, what do you see as ideally what it should be?
Robbie Kellman Baxter: Well, it depends on where you sit. You know, if you’re the customer, you want the company, you want everybody to have your best interests at heart. Right. You want the sales person, you want the company, you want everybody to be thinking what is in Robbie’s best interest. And, if you’re the company you want the loyalty and engagement to be to the company, to the brand to say no matter who sells to me, no matter who serves me, who w you know, I don’t need to get the right guy.
Like if you have a feeling in a company. Like, Oh, you want to, you want to work with that person? Cause that’s the best person. Then your company has a problem because they’re not providing consistent value to everybody. And yet, if you’re a salesperson, of course you want that. You want people to say, Oh, you know, go to Robbie.
She’s the, she’s the one that can give you a good deal. don’t, you know, if you, if, if they, if they try to palm you off to one of their salespeople, just call back or just say no, until you get Robbie.
Andy Paul: Yeah, no, I agree. I think that’s, that’s hugely destructive, but unfortunately it started gets set up that way. Right. So, or this hero hero thing-
Robbie Kellman Baxter: Yeah. Yeah.
Andy Paul: Okay. Well, we started running out of time, but love to have you back and continue talking about this. This is a fascinating conversation.
Robbie Kellman Baxter: It’s really interesting.
Andy Paul: So tell people how they can connect with you and learn more about the book.
Robbie Kellman Baxter: Yeah, so the book’s available now this week, it’s available anywhere books are sold, the Amazon, your indie bookstores, Barnes and Noble, and you can find me, pretty much anywhere on the internet. Robbie Kellman Baxter is my website. You can find me on LinkedIn. You can find me on, Twitter, Instagram, Facebook.
So yeah, link in with me, wherever, wherever you can, wherever, wherever you’re comfortable.
Andy Paul: Lots of options there. All right, Robbie, thank you very much. And this, I look forward to talking again soon.
Robbie Kellman Baxter: Thanks for having me, Andy.