DISCUSSION GUIDEfor Students

A companion to The Forever Transaction by Robbie Kellman Baxter.

INTRODUCTIONWelcome to this discussion guide that accompanies The Forever Transaction. If you’re reading the book as part of a business school course, you’ll find that this guide gives you ways to apply the concepts of the book to the organizations you see around you.

The questions are aligned with the chapters of the book; I suggest you work through them in order.

1. LAUNCH

CHAPTER ONE: Welcome to the World of Forever

Make a list of the Forever Transactions in your own life or from your experience. Choose one or two to use as an example as you work through the discussion questions for this book.

On a scale of 1 to 10, how fully does this business embody the concepts of a Forever Transaction? How committed are you to the business, as a customer? How confident are you that you don’t need to revisit the decision to become a customer in the near future?

CHAPTER TWO: Are You Ready for Forever?

With your “Forever Transaction” organization as the model, work through the diagnostic in this chapter. (Download the diagnostic from RobbieKellmanBaxter.com/Resources for easier access.) Answer as many of the questions as you can, making your best guesses. For each of the categories in the diagnostic, give yourself a grade of 1 to 3. The more threes you check, the stronger your organization’s commitment to a forever promise. Twos mean that you have the necessary infrastructure but may not have a culture that supports this transformation. If you have mostly ones, you may struggle to successfully launch your new model, and you may want to work to build internal alignment before diving in.

• How mature do you think your model organization is? • Are you surprised by the extent of organizational change required for a Forever Transaction?

CHAPTER THREE: Create the Business Case for Forever

Download the business case template from RobbieKellmanBaxter.com/Resources

Read through the various sections. If you have a business in mind, try filling out some of the questions. Imagine you were on the board of your FT company in the early days.

• What data do you think would have given you confidence that the company’s business model was working?”

• What early markers would be most likely to indicate traction and opportunity. • If you were a venture investor in that company, what else would you have wanted to know?

CHAPTER FOUR: Define Your Forever Promise

Identify a business or organization that you think does a good job of offering a Forever Transaction. It could be the one you picked for the Chapter 1 discussion, or a different one. Then discuss:

• What’s the Forever Promise? • What problem does it solve? • Who is the ideal customer? • Who is not an ideal customer?

If possible, do this exercise as a group, analyzing multiple organizations.

CHAPTER FIVE: Choose the Right Who for the How

Review the story of Hagerty and its Driver’s Club in this chapter. What skills did each of the leaders bring to the different phases:

• Launch: • Leverage: • Lead:

If you were to work at an organization on a Forever Transaction, where do you think you would best fit?

CHAPTER SIX: Develop Your First Experiments

Imagine you own a nail salon. Today, some clients come in with appointments every week, and others just drop in. You currently have separate fees for basic manicure, luxury manicure and individual nail repairs. You also bundle mani-pedis. You are most crowded on weekends and lunchtime

• What kind of forever transaction might you offer? • What steps would you take to explore the idea of a membership?

CHAPTER SEVEN: Test, Learn, Adjust

Imagine you own a nail salon. Today, some clients come in with appointments every week, and others just drop in. You currently have separate fees for basic manicure, luxury manicure and individual nail repairs. You also bundle mani-pedis. You are most crowded on weekends and lunchtime.

• What kind of forever transaction might you offer? • What steps would you take to explore the idea of a membership?

2. LEVERAGE

CHAPTER EIGHT: Manage Emotions, Transform Culture, and Build a Shared Vision

Imagine two companies, both wanting to provide a Forever Transaction in the same industry. One is a start-up and the other a Fortune 500 moving changing its business model.

Discuss the different challenges they face with respect to:

• Emotional roadblocks • Corporate culture • Financial requirements and funding

CHAPTER NINE: Do Acquisitions Make Sense for Your Company?

Review the UnderArmour story in this chapter.

• What other kinds of acquisitions could UnderArmour make that would align with their Forever Promise?

• What acquisitions might they make that would weaken the promise?

What if you were a large manufacturer of another staple – say, garden equipment. What acquisitions could you make to bring a Forever Promise to your business?

Can you come up with other examples of successful acquisitions by Forever Transaction organizations?

CHAPTER TEN: Six Common Setbacks and How to Avoid Them

For each of the six common setbacks, can you come up with examples from your experience or the news?

• Organizational and skills gaps • Cannibalization concerns • Dealing with a middleman • Technology setbacks • Unexpected leadership priorities • Disappointing results

Which of those are most likely to impede a startup? A nonprofit organization? A large enterprise?

CHAPTER ELEVEN: Choosing the Technology to Scale

Have you ever had a particularly good experience with a consumer service trying to establish a Forever Transaction, particularly one with physical goods? (Think of subscription boxes or replenishment services, auto club memberships, etc.) What did that feel like?

Have you ever had a particularly bad experience? Do you think it could have been a technical failure rather than an organizational one?

CHAPTER TWELVE: Create and Fine Tune Your Pricing Strategy

As a consumer or member, would you rather have more or fewer pricing options? How many?

Do you use ‘free’ services? What expectations do you have of organizations providing those free services? How different are your expectations, if at all, when you’re paying for the subscription?

Have you ever upgraded from free to premium (in a freemium model)? If so, what were your reasons for upgrading?

Based on this knowledge, would you advise any of your favorite “Forever Transaction” organizations to make any changes to their pricing strategies?

CHAPTER THIRTEEN: Essential Metrics for Long-Term Relationships

This chapter describes how these various metrics can be useful in better understanding what’s happening in a business using a Forever Transaction. How could these metrics be misused? What could go wrong if any one of these metrics were prioritized as “most important” by a company?

• Customer acquisition cost (CAC)? • Customer Lifetime Value (CLV)? • Churn?

3. LEAD

CHAPTER FOURTEEN: Forever is a Long Time: Don’t Take Shortcuts

Have you ever been on the receiving end of an organization trying to extract “every drop of value” from customers? Have you ever canceled a subscription or left an organization because of this?

What about an organization, like MoviePass, that gave away “too much” or was “too good to be true”? What happened with that service over time? Using MoviePass as an example, can you think of other businesses that have taken shortcuts and suffered as a result?

CHAPTER FIFTEEN: Continue to Iterate

Can you think of examples of businesses that have stopped adequately adapting to changing market and customer needs?

Do you imagine this was a conscious choice, or not? What do you think caused them to fall behind in their promise?

Come up with examples of businesses that continue to iterate on their Forever Promise.

CHAPTER SIXTEEN: Stay Forever Young: Avoid Aging with Your Members

Amedia and HFMA, both stories profiled in this chapter, have taken active steps to appeal to new members. What lessons can you take away from these stories that might be applicable to other businesses struggling to stay relevant to emerging audiences?

For the examples below, what kind of approaches might you consider to appeal to a younger audience with a Forever Promise:

• A regional opera theater • LinkedIn • Stationery business (greeting cards) • Knitting

CHAPTER SEVENTEEN: Protect Your Members from Subscription Fatigue

How many subscriptions do you personally have? Make a list.

When you hear the term subscription fatigue, what do you think of? Does it invoke an emotional reaction? Do you personally feel subscription fatigue?

Have you ever hard a hard time canceling a service? Share your experiences and how it made you feel.

In contrast, have you ever had a great experience when canceling a service? Did that make you more likely to speak well of the business?

Have you ever subscribed to something only to realize you wouldn’t be able to get value from it? (Health club sign-ups in January, for example, or weekly delivery of content you don’t have time for.) How does it make you feel? Did you ultimately cancel?

How can organizations prevent this kind of fatigue?

CHAPTER EIGHTEEN: Going Global with the Forever Transaction

Do you use any membership or subscription (online or otherwise) based in a different country than you? (U.S. readers – Spotify would count.) How obvious is the difference?

Have you ever had trouble using a subscription when you were traveling outside your home country?

If you were starting a business or service today, would you start in your own country or with an international reach? Why?

CHAPTER NINETEEN: Emerging Trends: Forever is Here Now

Revisit the trends described in this chapter:

• From digital to physical • Mature companies learning from startups • Premium membership instead of rewards • Healthcare • The Internet of Things

Which of these trends are you seeing your own life? How do you see these applying to different industries and organizations?

WRAP UPWhat’s the one thing you’ll do next, based on these discussions?

What have you discovered that surprises you?

What are you excited about doing going forward?

Robbie Kellman BaxterRobbie brings over twenty years of strategy consulting and marketing expertise to Peninsula Strategies, her strategy consulting firm focused on helping companies leverage subscription pricing, digital community and freemium to build deeper relationships with customers. Her clients have included start-ups and mid-sized venture-backed companies as well as industry leaders such as Netflix, Oracle, Electronic Arts and eBay. Over the past 18 years, Peninsula Strategies has advised over 100 organizations in over 20 industries on growth strategy.

A sought-after writer and keynote speaker, Robbie has presented to alumni organizations at Stanford, Harvard and Haas, associations including the AICPA, the American Society of Association Executives, and the National Restaurant Association and organizations including the Wall Street Journal, and Coursera.  She has been quoted on business issues in the Wall Street Journal, The New York Times, and Consumer Reports, and has had pieces published in  HBR.org,  CNN.com, Associations Now  and the Journal for Quality & Participation. Robbie

has created and starred in eight video courses in collaboration with LinkedIn Learning on business topics ranging from innovation to customer success and membership. Robbie is also on the board of Amava, an organization dedicated to helping people stay active and engaged post-career.

As the author of The Membership Economy: Find Your Superusers, Master the Forever Transaction & Build Recurring Revenue, a book that has been named a top 10 marketing book of all time by BookAuthority, Robbie coined the popular business term “Membership Economy”, which is now being used by organizations and journalists around the country and beyond. Robbie’s expertise with companies in the emerging Membership Economy extends to include SaaS, media, consumer products and community organizations. Her new book, The Forever Transaction: How to Build a Subscription Model So Compelling, Your Customers Will Never Want to Leave, releases in March, 2020.

Prior to launching Peninsula Strategies, Robbie was a strategy consultant at Booz-Allen & Hamilton, a New York City Urban Fellow and a Silicon Valley product marketer. Robbie received her MBA from the Stanford Graduate School of Business and graduated with honors from Harvard College.

About The Forever TransactionA veritable blueprint for success in the new membership economy, this book is a must-have for organizations of any size. It’s a true game-changer. Baxter takes readers through every step of the subscription business process—from initial start-up or testing of a new model to scaling the operation for long-term growth and sustainability to revamping your culture so everyone works together to optimize customer lifetime value.

It covers all the essentials like subscription pricing, Software-as-a-Service, digital community engagement, and freemium incentives as a way to turn casual browsers into cash-paying superusers. It also features first-hand insights into subscription superstars like Amazon and Spotify. Most importantly, it shows readers how to build lasting relationships with their customers that are the very foundation of business success—today, tomorrow, and forever.

www.robbiekellmanbaxter.comrbaxter@peninsulastrategies.com(650) 302-4401

linkedin.com/in/robbiekellmanbaxter/

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