The past year has been a difficult one for schools.
It sometimes seems like everything’s in flux.
Many families have changed strategies. Some have left traditional schools to join neighborhood pods. Others have gone from independent schools to public schools to save money. At the same time, some public school families have gone private, fleeing the chaos of the public school system. And, to make things more complicated, some students have moved out of the area, but are still learning virtually from their original school.
Schools are left wondering—will the students who left come back? Will the new families stay beyond this year? And is virtual learning going to be part of our new normal?
In this uncertain time, loyalty has never been more important.
I’ve devoted much of my career to helping organizations build loyalty, building the kind of “forever transactions” that justify predictable recurring revenue.
So the question is, does what I’ve learned working with subscription businesses and membership organizations apply at schools?
My answer is yes…and I’ll show you why. But first, let me tell you how I came to be so interested in this question of how organizations build loyalty so deep and so trusted, that customers take off the consumer hats, don their membership hats and stop looking for alternatives.
I first got interested in this topic about 20 years ago. I had just been laid off from my job at a software company the day I got back from maternity leave with my second child Annabel. I decided that for the next few years at least, I needed to control my work, and consulting seemed like a good solution. Well, my fifth client was Netflix. I had already fallen in love with Netflix as a subscriber. As a new mom, I loved always having something to watch, and never having to leave home to return a DVD, and most of all, I loved no late fees.
As a business person though, I think I loved them even more—after all, predictable recurring revenue is the holy grail for businesses—it helps us plan for the future, lets us understand our best customers better and optimize future products and services based on what we learn, and of course, businesses with recurring revenue enjoy much better valuations than their more episodic counterparts.
Today, subscriptions are everywhere and nearly every organization leader understands the power of recurring revenue, engagement and loyalty—everyone—organizations big and small, public and private, not for profit and profit driven, around the world and across all segments.
But back when I was falling in love with Netflix, it was early. Slowly though, I started getting calls from all kinds of organizations that wanted to be the Netflix of news, music, bicycle parts, associations, dental pain management products, insurance…you name it, someone wanted to Netflix it.
So I started digging into this question. What did it mean to be “like Netflix”? I looked for patterns and for what was applicable across organizations. I begin to notice that many organizations were focusing on access over ownership. On prioritizing many small transactions over a single big one. How they began investing not just in one way communication where the organization has a loudspeaker and the customer just has to listen to not just two way communication, but multidirectional communication where members connect and find value in community under the brand of the organization.
I think that those patterns I saw and the frameworks I developed might be relevant for you, right now.
The first thing I noticed was that Netflix did one thing for subscribers, promising to “provide professionally created catalog of video content, delivered in the most efficient way possible, with cost certainty.” Over time, they’ve evolved HOW they delivered on this promise, from DVDs to streaming content, from other people’s content to their own proprietary shows–but they haven’t changed the promise itself.
The second thing I noticed was that their most important metric was retention. Acquisition of new customers was important, but only “counted” if the customers fit their profile, because they understood their ideal customer so well. They had confidence that if they attracted a new subscriber with their message and their trial, that person was extremely likely to stay for a long time. They knew how to onboard a new subscriber to engage them. They knew that there were certain early behaviors that indicated whether someone was likely to stay—things like how many titles were in their queue or how many categories of content they consumed. People are much more likely to stay if they’re watching both rom coms and documentaries for example. I wish more people focused on retention more carefully—it’s just not a very sexy metric. And engagement is the early predictor of retention—recency, frequency breadth and depth of activities.
The third thing I noticed was that they were continuously experimenting with the “how” of their delivery. They tried time sensitive downloads, streaming through video game consoles, and all kinds of content. The service they offer today looks nothing like the red envelopes of 2002, but the promise is the same.
So how does this apply to schools?
Well, the first thing is the importance of a clear forever promise. Your brand promise is the promise of what your organization stands for. Your Forever Promise is the promise you make to your customers. What is it that you promise them in exchange for their loyalty and support? As long as you stick with us, we promise you this outcome—that we will do everything we can to help you achieve THIS ongoing goal or avoid THAT ongoing problem.
1. First, What is your forever promise? How clear is it to your members? And who are you making this promise to? Who are your best members? And what do you expect from them in return? The clearer you are about your forever promise and best member, the easier it is to predictably help your members achieve their dearest goals. Also, how are you handling the gap between the public promise you make aloud –building global citizens, preparing young people for a meaningful life—may not be the one that your families think they’re getting—i.e. getting their child into a top college. If you have a public promise and a “secret” promise, that can lead to complexity, confusion and other challenges. Being clear about what you’re really promising, and standing by it, is key to attracting, engaging and winning lifetime loyalty.
2. The second thing, retention—this is the heart of loyalty. There is often a period after someone joins your organization when they’re still wearing their consumer hat. They’re still thinking about whether the should stay, and how they might leave. In the Membership Economy, the transaction, the moment someone joins your organization is the starting line for the real work of building loyalty. It’s not the finish line. From the moment someone joins, you need to choreograph their first seconds, minutes, days after making this commitment, to help them decide that your organization is going to be part of their everyday habits.
The way you choreograph this onboarding experience is by looking at your best members—the ones I call superusers—who go beyond just being good citizens, who support you and recognized that you provide good value and use the products and services you provide appropriately and well. The superusers go beyond just being good members, because they contribute their own time and money toward the good of the organization.
Superusers are the students who build community and take on the less popular leadership roles. They’re the parents who volunteer for the spring play. And of course, many go well beyond paying tuition, donating countless dollars—and hours—to attract new members, onboard them, and improve the experience for them. Superusers are the flywheel for schools. So how do you make more of them?
If you’re a superuser, I want you to think way back to when you first became familiar with your school. If you’re a school head, I want you to think of a superuser who you wish you had more of! Think about the earliest interactions. Why did you join? How did you learn about the school and its traditions? At what moment did you take off your consumer hat, and become a member, not looking for alternatives? And when and why did you decide to start volunteering and donating? Did someone ask you? Did something touch your heart? One association I worked with noted that most of their superusers were invited to join by their bosses or mentors, who encouraged volunteering. It’s often a personal friendship and invitation that launches the superuser journey. It can be really helpful to understand what experiences makes someone engage and commit, and build them into the onboarding process for every member.
3. The third area for focus is in experimentation. If your forever promise is “creating global citizens” what is the best way to deliver on that promise in today’s environment? Very often organizations launch around a promise, create a solution that is best in that moment, and then stop focusing on the promise and start focusing on the original solution as a product. For example, I do a lot of work with newspapers. Many of them have a “forever promise” that is something like this “a trusted source to help subscribers understand the world around them, so they can make better decisions.” That promise doesn’t mention paper at all. And yet many newspapers have been dragging their feet in the shift from print to digital. If you were starting fresh today with the goal of helping young people understand the world around them and make better decisions, how would you do that? Would you use classrooms at all? six hour days? Or would you design something different? Even as the promise stays constant, the way you deliver on that promise, the products and services you offer, need to be continually changing.
Maybe you’d offer courses, or conferences, or study tours, or community, or research resources, or access to experts…You could go beyond content to include the powerful triumvirate of Content, Commerce and Community. The possibilities are endless.
If you were starting today, and weren’t burdened by your successful legacy, and by the power of tradition, but wanted to achieve your same forever promise, what features and benefits might you invest in?
If there’s ever been a moment where the spirit of continuous innovation is needed, it’s right now. In some ways, COVID, the political divide, the movement for racial justice have created tremendous upheaval. That’s true.
But with that upheaval comes permission to move more quickly, to experiment more radically. Even low level employees are being given new opportunity to bring ideas to the table, share their technical expertise, be more fully involved in finding rapid solutions. Organizations that have historically innovated only slowly and methodically are now racing to solve problem after problem as they emerge.
Never before have organizations been so motivated to set aside their beloved processes and products and rethink the best ways to deliver what is needed to solve their members problems and help members achieve their goals.
The fact that families are rethinking what they had thought was a “forever transaction” with their schools, both public and independent, means there’s an opportunity to attract, onboard and engage new members, as well as an opportunity to prove your worth to your longtime members.
The easiest step you can take is actually the most powerful. Take a step back before you step forward. Look at what you’re offering your students, parents, and alums, today. Compare it to the forever promise you made to them. If you were starting fresh, what else would you do to help them achieve their goals and reduce their problems? What new tools do you have available, and how can you use them creatively?
A big part of building loyalty is being willing to evolve to solve the long-term problem or achieve the long term goal—because it makes members confident that the organization is looking out for them. Now is that kind of a moment.
The secret to a Forever Transaction is to love your members and the forever promise you make to them more than any product or process. If you focus on your members and their long-term goals, you’ll build the kind of trust and loyalty that will last forever.
Robbie Kellman Baxter
Robbie Kellman Baxter is a bestselling author of The Forever Transaction and The Membership Economy, named a top 10 marketing book of all time by BookAuthority. She is a speaker, and consultant with more than twenty years of experience providing strategic business advice to major organizations including Netflix, Consumer Reports and LinkedIn, as well as leaders in industries including Software-as-a-Service, Media, Retail, Consumer Products, Healthcare, Financial Services and Hardware. In the past ten years, her company Peninsula Strategies has advised over 100 organizations on subscription and growth strategy. Kellman Baxter has been featured in the Wall Street Journal and CNN, interviewed on over 50 podcasts, and invited as a guest on numerous business shows. She received her MBA from the Stanford Graduate School of Business and graduated with honors from Harvard College. For more information, please visit https://robbiekellmanbaxter.com/
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