Daily Archives: September 5, 2022

When you have Options, Know the Benefits of Each

In addition to teaching executives how to design and deliver winning corporate presentations, I teach courses at universities. As part of a business strategy/policy course, I discuss the different subscription models that exist, and why they can help companies more effectively keep clients and increase profits. For example, Amazon’s Prime and Adobe’s switch from selling “boxes” of Photoshop into a SAAS (subscription) program are illustrations of different kinds of subscription services companies can offer. (See The Forever Transaction (Robbie Kellman Baxter) and Subscription Success (Robert Skrob).

Recently, Robert Skrob (BeUnleavable.com) shared a blog comparing trial, monthly vs. annual subscription offers, with some interesting data.

  1. Trial subscriptions have the highest conversion rates because they are discounting the monthly subscription charge by 80-90 percent.  They have a higher churn rate than the others but usually result in more members after 12-months because of the superior front end conversion rate. It's ideal for quick scaling to provide cash flow challenges and/or you have choreographed upsells as part of your new subscriber onboarding to maximize cash flow after subscribers join.
  2. Monthly subscriptions usually have a 50% higher conversion rate than annual subscription offers. Yet, even though monthly subscriptions have a lower retention rate, you will usually end up with more subscribers after 12-months as compared to annual, because of that higher conversion rate. 
  1. Annual subscribers are your highest lifetime value subscribers. These customers retain well and buy other products and services you offer. Only challenge is there will be fewer of them because front end conversion is not as high. 

In other words, saying you want to go with a SAAS offering isn’t enough. You will produce different customer buying patterns. 

Skrob says “I love creating cash flow forecasts for my annual subscription clients because it’s easier to fund your customer acquisition costs when you get a full year of subscription revenue on the day the subscriber joins.”  His advice is to “choose the subscription plan that balances your cash flow needs with your ambitions to scale recurring revenue. And, mix it up, testing different terms from time to time to appeal to unique segments within your target market.” (italics added.)  For more information, watch the Youtube episode. 

His final piece of advice is excellent, because life changes and these patterns could also change:  “Test out your offers before you actually offer it to your customers to better understand the interaction with format, your product and the customers you want!”

Remember, these rules apply to other options you have when making presentation offers. A recent CEO was trying to sell his company to another. The possible buyer had lots of other things going on and wasn’t committed to making a purchase. The seller came up with another way to sell the company to him—but knowing how overwhelmed the buyer already was, and wasn’t sure that offering an alternative or even both options to the Board wouldn’t make things more confusing and sink the deal. 

Once again, we recommended testing the waters, by having a pre-meeting conversation. The buy was very appreciative of the sensitivity that the seller was offering. At the end of the day, the Board felt this was not the right me for any acquisitions…but left the door open for a strategic partnership that hadn’t been considered before.

What have your experiences been in either of these areas? Share them with the community!

Heed the ADAP Advice!

As a Vistage Chair, I have the privilege of inviting expert speakers to share their insights at CEO workshops so members can use learned insights and skills to grow their companies faster.  Last month I invited Steve Yastrow to share his expertise on building a Unified Customer Experience for our customers , based on his experiences cited in two books, Brand Harmony and  We: The Ideal Customer Relationship. Our workshop focused on how companies can successfully create Brand Harmony in the minds of their customers by aligning the entire organization to tell one cumulative story that generates an excellent experience. 

This is more important than ever, because workers are distributed throughout several cities throughout the world but also often working from home and/or office. Given the division of labor, each is addressing a specific part of a transaction, and not the entire service encounter. Monitoring the tone and content of each person’s conversations with customers is extremely difficult. Yet it takes only one poorly executed aspect of the transaction (e.g., finding a customer service person; easy payment system) to ruin a positive experience that the customer had with everyone else.) 

During the presentation, he focused on a key point made in his other book Ditch the Pitch. All too often we prepare “scripts” for our sales and service staff, with the hope that they will dutifully present to the customer. His point is that the script – such as a recitation of features and benefits – is a one-way communication. A sales pitch is essentially the seller’s story; customers care about their own stories”. 

As Aristotle said, “the fool tells me his reasons. The wise man persuades me on his own.”

For two decades, we’ve been teaching the underlying secret of winning presentations:  a two part formula called: Audience-Driven, Authentic Presentations (ADAP).

  • The first part refers to the need for a presenter to fully understand what the customer wants and needs, and what challenges need to be overcome to take action. Go beyond why she/he wants the service, product, or idea, and understand what constraints exist (e.g., time, money, other team members, etc.) that must also be resolved.
  • The second part refers to what happens in a mutual discovery process. The customer needs to see you as integral to getting what he wants: that someone she/he trusts is looking out for her/his interests. That happens when the presenter is authentic – genuinely cares about the buyer making the best decision. You build trust when you’re self-aware of one’s biases and overcoming them often with some transparency.

Steve’s Ditch the Pitch title shares his message: abandon a scripted sales-pitch and help the customer reach a conclusion based on collaborative dialogue.  Similarly, Presentation Excellence’s approach is to train presenters so they naturally ask the right questions that get to the core issues, and authentically engage in a mutual discovery process that leads the customer to trust you enough to make the buying decision.  


From a Brand Harmony standpoint, it means your entire team of people and tools (including website) need to be unified in communicating your authentic concern in creating a unified customer experience.   

(*Vistage is a 65+ year old leader development organization serving over 27,000 CEOs. D&B’s data shows they grew 2-3X faster than competitors; during the pandemic, members’ sales grew 4.6% vs. non-members who lost 4.7%. I serve two dozen CEOs in the New York area.)

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