I spent some quality time with David Sedaris a couple of weeks ago.
David Sedaris is a renown writer and humorist who has authored 12 books.
He tours regularly, reading his essays and gauging audience reactions. His book tours are famous for their long book signing lines. He enjoys chatting with each reader and often asks them questions.
David Sedaris shared how he turns observations into stories and that it often takes him weeks to find an opening sentence he is happy with.
He and I spent 3 hours and 23 minutes together.
But he has no idea who I am.
Our visit came courtesy of Masterclass.
Masterclass is an online learning platform that features celebrities and renown experts teaching courses in their specialty.
My friend Ira gifted me a 14-day guest trial pass (thanks Ira!). I took David Sedaris’s Storytelling and Humor course.
As I looked at the 14-day trial offer and entered my credit card, I noticed the annual membership was $120 per year.
I remembered it being $180 during the first year of the pandemic when Masterclass ads popped up daily in my Facebook feed.
I wondered “why would they lower their price?”
Widespread internet access and the high cost of higher education in the US gave rise to a host of online learning companies.
In 2002, Lynda Weinman shifted her educational company Lynda.com from in-person webinars to online courses featuring video instruction. Online video was new then. It took a while for students to adapt to it.
But adapt they did. Lynda.com grew to offer over 6,300 courses. Weinman sold it to LinkedIn in May 2015 for $1.5 billion.
Most of the other well-known online learning players launched between 2010 and 2012: Udemy (2010), Skillshare (2011), Coursera (2012), and Udacity (2012).
Masterclass appeared in May 2015, just as Weinman was cashing in.
Like any party late-comer seeking attention, Masterclass stands out with a key difference: celebrity instructors. Their tagline: “Learn from the best, be your best.”
Founders David Rogier and Aaron Rasmussen launched with 3 classes: Serena Williams teaching tennis; Dustin Hoffman teaching acting; and best-selling author James Patterson teaching writing.
Each instructor reportedly received $100,000 plus 30% of the revenue from their class.
Masterclass also invested in professional video production and set design for each course.
Classes sold for $90 each. Each class package included 10-25 videos, learning materials, interactive exercises (between students), and lifetime access.
Over 30,000 people bought Masterclass courses within the first 4 months.
Masterclass added dozens of courses each year and began offering annual subscriptions for unlimited course viewing at $180 in 2018, removing the $90-for-one-class option.
During the early part of the pandemic, you couldn’t go on Facebook, Instagram, or YouTube without seeing at least one Masterclass ad.
The heavy ad spending worked. Masterclass capitalized on the captive audience, doubling revenues from 2019 ($44.5 million) to 2020 ($88.9 million), and adding another $29.9 million in 2021.
But when the world reopened and people began returning to workplaces in 2022, annual revenue fell to $94.9 million, a $23.9 million decrease.
Since inception, Masterclass has raised $460 million in venture capital. Not yet profitable, the revenue backslide likely made investors antsy. Subscriptions provide all of Masterclass’s revenue.
In May 2022 the company laid off 120 of their 600 workers.
While layoffs reduced cost, Masterclass’s survival requires raising revenues which means increasing subscriptions.
Now 8 years old, Masterclass has hit brand adolescence as it struggles to grow.
In May 2023, Masterclass cut its individual annual subscription plan price by a third, from $180 to $120.
In a statement announcing the price drop, David Rogier, Masterclass Founder & CEO said, “By continuing to innovate the approach to our portfolio of content and making the platform more accessible, we’re not only unlocking potential in our members, we’re enabling them to realize it.”
I don’t know what that means.
It’s a jargon-filled declaration. Was the potential of members locked at $180?
The “more accessible” part I get. It’s the basic economic model we learned in school. You lower the price, more people buy.
I’m guessing Masterclass looked at their competitors, saw them offering free classes and cheaper individual courses (Udemy), and felt compelled to lower their subscription fee.
Antsy investors added pressure to sign more subscribers quickly.
Perhaps their smaller number of course offerings also pushed them to the lower annual fee.
But on an annual fee basis, they were already at the low end with the $180 fee ($15 per month). Now they are at the bottom.
Trying to fit in to your market arena by competing on price is a recipe for disaster.
There is a difference between having a competitive price and competing on price.
The former means your price is within the range of what your industry offers. It removes price as a differentiator so your prospect considers your brand on other factors.
The latter encourages price cutting and becomes a race to the bottom. Once you lower your price, your competitors may follow. Then what is your choice? Lower it again?
Competing on price destroys brands, especially premium ones.
Masterclass offers a premium product. Professionally produced, entertaining classes taught by recognizable experts and celebrities.
They have been challenged all along to get users who are attracted for one class to stay and take others. (This may have been behind removing the $90 one class option in 2018.)
Dropping your price doesn’t address that challenge.
Increasing your value in the eyes of your subscribers and conveying that value well do.
To do that, you need to understand your audience, their wants, and how your brand fulfills them.
A New Yorker article in October 2021 reported that Masterclass had an unusually high renewal rate of 52 percent after one year. The typical student watches 10 classes, hopping from subject to subject.
But, the article stated, the time subscribers spend watching classes does not relate to their likelihood to renew.
Masterclass doesn’t know why their subscribers renew.
In the article, Masterclass’s chief product officer says of his efforts to understand and guide subscriber behavior, “Asking them why they like a class doesn’t give you very reliable data.”
This tells me that while Masterclass may have done lots of research to get class feedback, they don’t yet know the segments of their audience well enough to know what attracts them and what makes them stay.
It is true that people have a hard time relaying why they do what they do. That’s where consumer insights gathering techniques shine, and how I’ve helped my clients.
Unearthing customers’ motivations requires creativity. You must ask the right questions to get the answers you want, and often they are not direct or obvious questions.
The only way Masterclass will surmount their brand adolescence and get into the black is to get clarity on their customer segments, understand their motivations, and craft messages and services that resonate with them.
I only managed to complete one full class before my 14-day trial ran out.
David Sedaris’ course on Storytelling and Humor gave me several tips I’ll use in the future.
His approach also made me feel good about my own. We’re both students of the world, observing often, jotting down experiences, and asking good questions.
I did not subscribe, however.
Masterclass is known as the Netflix of online learning. A binge-worthy distraction is not what I need right now!
Have you ever taken a Masterclass?
***
If you and someone you care about has a brand struggling to grow, pick up a copy of my book, Teenage Wastebrand: How Your Brand Can Stop Struggling and Start Scaling.
Or grab the audiobook here. I narrated it myself!
***
Masterclass’s ubiquity on social media platforms during the pandemic made it ripe for parody.
Andy Rowell Teaches Pooping (1 minute, 44 seconds)
Steve Emerson’s Masterclass on Daddy’s Money (2 minutes, 12 seconds)
And of course SNL delivered a Masterclass Quarantine Edition (2 minutes, 43 seconds), and another Masterclass Quarantine Edition (2 minutes, 58 seconds).
Enjoy!
This post is an updated and enhanced version of one published November 14, 2014.
Have you heard a December holiday song yet?
It always amazes me how early the holiday music starts. I am among the 81 percent of Americans who don’t want to hear it in stores before Thanksgiving.
But while I am not ready to endure endless loops of “Grandma Got Run Over by a Reindeer,” I am already thinking about my business holiday cards.
In fact, I confess, I ordered them November 1st.
Why do I look forward to this ritual that many people find stressful?
Two reasons. First, I love handwriting cards and making a personal connection that way.
Second, I do them by choice, not from a sense of obligation.
For most people though, business holiday cards present a conundrum.
To send or not to send? Paper or e-card? Clients only? Or should you include employees, vendors, referral sources and prospects? How will someone feel if you don’t send them a card?
And the biggest question of them all: is it worth the effort?
Business holiday cards are one drop in the relationship marketing bucket.
The answer to “is it worth it?” is the same as all your other marketing efforts: only if it furthers the relationship.
Here are my holiday card guidelines to help you decide if you should send them, and to increase your success if you do.
The inspiration for this article came from a rant my husband sent me. He received several e-cards that turned out to be 1 – 1 ½ minute-long videos he characterized as “a completed waste of my time.”
He also said, “[With a traditional card] I know my contact put in the thought of signing their name and making it at least a scintilla personal. I will display cards in my office for a few weeks. The video? Gone as soon as I forward it to you.”
The companies that took the time to make the videos and send the email link actually hurt their relationship with him by annoying him. They would have been better off sending nothing at all.
Companies don’t celebrate holidays. People do. A holiday greeting should be from sender to recipient. Recipients see right through efforts to delegate the greeting. If you can’t sign the cards yourself, don’t send them.
This does not mean you have to spend hours thinking up what to say.
Find a short, meaningful phrase you can use for everyone (like “wishing you a happy and prosperous year!”), then add something else only if you want to. That phrase and your signature will be enough.
Like the rest of your business communications. This helps your cards remain inclusive and keeps the focus on your relationship.
The presence of a business card casts a marketing-pitch-pall over the greeting and loses the sentiment.
I aim to get my New Year’s cards to recipients in first week of the New Year.
Many people have thanked me for the cards. No one has ever chided me for not getting them there before New Year’s (and many people aren’t in the office that week anyway).
Over time you will add and delete names from the list and that’s okay.
You can always choose another holiday. And a handwritten card on a non-holiday is always welcome!
Remember that your goal is to further your relationship with the recipient. It’s better to send 50 personalized snail mail cards than 5000 meaningless and forgettable e-cards.
Fifty? Did she say 50? OMG. [Heart palpitations.]
Okay, step back from the email.
Take a few deep breaths. Come back once your regular pulse returns.
Sending handwritten cards can actually improve your health, especially if you are expressing gratitude.
If you want to send cards but still feel stuck or overwhelmed, I can walk you through.
1. Choose a holiday. Yes, I’m serious. We’re being deliberate about everything. If this time of year is crazy in your business, choose another holiday.
St. Patrick’s Day. Arbor Day. Independence Day. King’s Day (for my Dutch friends). Bastille Day (looking at you, France).
One year our family sent out Groundhog Day cards. Unusual? Weird? Yes.
Did they get noticed and bring smiles? You bet. Especially from the people to whom we sent the same card two days in a row!
Handwritten cards are always welcome.
2. Start with 10 or 20 cards. That’s it. I saw your reaction to 50. We’re not going there.
You can support small businesses, museums, and/or artists and feel doubly good about your effort.
Here are some great places to get business holiday cards for the December holidays. (I receive no compensation from these places.)
If you want help finding cards for a different holiday – or choosing a different holiday – reply to this email and I’ll help you.
3. Choose your recipients. Don’t overthink this. Who do you appreciate in your work? It can be a mix of customers/vendors/partners/co-workers.
Sending to employees is an excellent idea too.
If you are a boss, sending to some employees and not others could stir resentment, so please consider sending to your entire team if you are going this route.
4. Schedule card-writing time. Really. For this to happen, you need an appointment you will respect. For 10 cards, budget an hour. For 20, two hours.
5. Craft your message. Another place to not overthink. Something short and genuine will do. It could be as short as “Wishing you a fabulous 2022!”
6. Handwrite the cards and address the envelopes. Typed or printed-label addressed envelopes lose the personal aspect, while hand-addressed ones make the open rate soar.
One business owner reported a 99 percent open rate.
My hand-addressed-envelope open rate goes to 100.
Optional: add a sentence or two to your holiday message referencing one small aspect of your relationship.
If you have lunch plans in the new year, that could be “looking forward to our lunch on [date].” Or, “It was great to see you at [name of conference].”
7. Seal and stamp the envelopes. Or have your assistant or child do this. It’s the one thing you can delegate!
8. Mail the cards so that they arrive on time.
9. Reward yourself. A fist pump, a victory dance, your favorite indulgent beverage. Acknowledge your accomplishment!
Please let me know if you get inspired by this post and follow through on your holiday cards. I’ll send you a congratulations card celebrating your effort.
Whether or not you listen to holiday music as you write your cards is up to you. Just don’t play it before Thanksgiving!
Early holiday music isn’t the only autumn irritant related to December festivals.
The North Ridgeville, Ohio police department had to reassure residents they would not be charged for putting up Christmas decorations before Thanksgiving after half-joking it would constitute disorderly conduct in their Halloween Facebook post. (Facebook account necessary for that link.)
Did you know that IMDb displays the user rating for This is Spinal Tap out of 11 stars? (You can catch the original trailer there too.)
Finally, in this video from Studio C, The Hartfords and the Joneses show how not to use holiday cards. (6 minutes, may be a bit traumatic for cat owners)
This post was originally published on March 11, 2016 and updated on March 26, 2021.
In addition to my roles as wife, mother, healer, and finder of things in our household, I am also Chief Operations Officer. Like any good COO, I seek to keep overhead costs down.
Our Comcast bill seems to grow every few months, so they’ve been in my sights. In the past year, both my husband and I have called to find ways to reduce our bill.
My husband’s call a few months ago yielded us a two-year contract for $134.99 per month that included 205+ TV channels and up to 800 bps (bits per second) for our internet.
Somehow our bill still ends up being way more than that. I decided to check Comcast’s website to seek a better deal.
Comcast requires you to state your address before they will show you any deals. For existing customers, that means signing in to their account. Sure enough, there was nothing better than our current contract.
Feeling impish, I logged out and then went back masquerading as a neighbor. It took inputting a couple of neighbors’ addresses to find one that wasn’t using Comcast.
Boom! There on the new customer offers page was the same deal we have, but $35 per month cheaper.
I knew it!
To be fair, Comcast was requiring paperless billing and automatic payment for the deal, and that accounted for $10 off the monthly fee. We don’t give access to our accounts for automatic payment. But still, getting the new customer deal would cost $25 per month less.
That’s $300 per year!
Armed with my screenshot of the new customer deal, I called Comcast.
My heart went out to Adam, the customer service rep who took my call. I pressed him for the same deal they were offering new customers. Adam was not authorized to give it to me.
The best Adam could do was to advise me to buy my own modem to avoid the monthly modem rental charge and to call back next month to see if they had a better promotion.
Sensing my dissatisfaction, Adam handed me off to his supervisor, José.
Can you imagine treating someone you just met better than a longtime friend?
That’s what you do when you offer new-customer-only deals that are better than your current customer offerings. You penalize patronage and loyalty, instead of rewarding them.
Companies rationalize that the better deals provide the bait needed to entice new customers, or to steal them from a competitor.
Bait being the operative word. Because that’s the best deal they’ll ever see in their lifetime with the brand.
Companies spend lavishly on repeated direct mailings and advertisements to dangle their new customer bait. The number of new customers represents important brand growth to them.
Meanwhile, existing customers provide regular revenue streams for services like Comcast. Renewing them to keep those streams going, and possibly upselling them, costs much less than acquiring new customers.
Yet that fact fails to deter the emphasis on new customers or gain better treatment for existing ones.
These brands count on their customers’ inertia, gambling that once customers sign on, they will stay.
For services like Comcast, with few competitors, inertia or lack of a better choice may keep customers from switching.
But captive customers are not necessarily happy customers.
Companies not concerned with their customers’ feelings remain blind to the role customers play in their brand’s marketing.
A McKinsey study showed when consumers are looking to buy, two-thirds of the information they get comes from consumer-driven marketing activities, like online reviews and recommendations from friends and family, plus their own in-store interactions and recollections of past experiences.
The remaining third comes from company-driven marketing.
All the money companies pour into deals, direct mail, and advertising still contributes less to consumer decision-making than what consumers share and experience themselves.
Savvy companies harness this reality, wowing their customers with wonderful experiences that achieve customers’ desired outcomes. Customers’ joy and satisfaction motivate them to share their experiences with friends and family, on social media, and in rave reviews.
Brands pay nothing for that sharing, but reap tremendous benefits. They gain more new customers at a lower per customer acquisition cost.
Comcast appears to have the opposite going on. Though their professional ratings exceed some of their competitors, many consumers disdain them.
A Google search for Facebook pages including ‘I Hate Comcast’ yielded two and a half pages of listings. And that’s just on Facebook.
I long ago soured on Comcast. This episode added the latest link in a chain of disappointments. I don’t trust them because what I see offered on their website is not available to me and because what they offer me varies from month to month.
Moreover, the huge discrepancy between the new customer rate and the existing customer rate makes me feel like they value my business less than landing a new customer.
New customer only deals damage your brand several ways:
When you invest in building a brand, your goal is to establish a relationship with your customers. A relationship that includes trust, mutual respect, emotional connection, and good will.
If all you do is compete on price, you don’t have a brand. You have a commodity.
What can you do to attract new customers without focusing on price or alienating your existing ones?
AT&T may have seen the light. Last October they began a campaign stressing that “New and Existing Customers Get AT&T’s Best Smartphone Deals.”
AT&T’s fourth quarter 2020 results show their mobile phone business revenues rose 7.6 percent, as they netted 800,000 additional phones and saw customer churn of 0.76 percent, their second lowest quarter ever. By comparison, Verizon’s revenues rose 2.2 percent, netting 703,000 additional phones, with 0.80 customer churn.
Verizon has kept their new-customer-only deal. But if AT&T continues to beat their performance, I bet they follow AT&T’s lead.
I’m not saying you can’t give great introductory deals to attract new customers. I’m saying at least extend those deals to your existing customers too. Or as Shep Hyken suggests, give existing customers even better ones. Reward them for their business and their loyalty.
In the end, it comes down to this: treat your customers as you would like to be treated. Wouldn’t you like the best deal available?
When Adam’s supervisor José got on the phone, he asked about my experience talking with Adam and with Comcast.
I expressed kudos for Adam who did the best he could within Comcast’s guidelines. But the better deal for new customers disappointed me, making me feel second-class despite my longtime customer status.
The best José could do was credit me $20 and tell me to call back next month in case they have better offers.
The frequent-calling-for-better-deals game lost its allure ages ago.
The research for this post led me to numerous articles about ditching cable boxes. Since we’re in a two-year contract, we’ll be looking into that as well as getting our own modem.
And in two years…maybe we’ll cut the cord.
Have I convinced you to ditch new customer only deals?
How do you keep your internet/TV/phone bills down?
P.S. Not convinced that new customer only deals should be banished from your marketing? Read about my father’s epic battle with The New York Times. Which he won.
As I write you, I await my author proof copy of my new book, Teenage Wastebrand: How Your Brand Can Stop Struggling and Start Scaling, from Amazon. I’m beyond excited! The book will be available in April.
You can hear about the book in my interview with Ira Bryck, host of the Western Mass Business show. I was honored that Ira slated me in before concluding his host run of the show after 7 years. (Tara Brewster takes over in May.)
You can watch the video of the show here.
You can listen to the show here.
Have you ever heard of Rax? I hadn’t.
This video explains why. It tells the cautionary tale of lack of target audience, includes a cringeworthy advertising character, and shows just how far management can talk themselves into something.
It’s hilarious. Hat tip to David Troen-Krasnow for bringing it to my attention.
Enjoy!
I have called SiriusXM twice in the past seven months to cancel my subscription and yet I am still subscribed.
Here’s why.
When I bought my Subaru Forester in April 2017 I got a free three-month subscription to SiriusXM radio. After three months SiriusXM offered me six months for $30 ($34.10 with U.S. Music Royalty fee) and I accepted.
Last March SiriusXM sent me a bill for the next six months at $114.26 ($95.94 subscription + $18.32 U.S. Music Royalty fee). That’s $19.04 per month and way more that I would ever pay to listen to music in my car.
I called to cancel.
Upon hearing my objection the customer service representative offered me the same deal I had before - $30 plus music royalty fee for six months - which I accepted.
On the Friday before Labor Day I realized that my subscription was going to expire in three days so I called SiriusXM.
The automated operator answered. I hit zero at the first opportunity after the initial screening questions to queue up to talk to a human.
After five minutes Josie picked up my call. I told her I wanted to cancel. When she asked why, I told her I did not want to pay $19 per month for music.
Josie reviewed my account with me and then told me she could not offer me a promotion but a different department could. She transferred my call and Francisco picked up.
At that point I was on the phone eight minutes and wondering if SiriusXM was worth the trouble.
Francisco offered me five months for $35. My thought was “Ugh then I have to call back again in five months?” I asked if he had anything longer.
His next offer was six months for $33. Though the offer was better I felt annoyed that he did not offer this one first. I asked if he had anything longer than six months because these semi-annual phone calls were not a good use of my time.
His third promotional offer was $5.99 per month for one year (plus fees and taxes of course) but the company required a credit card number and permission to bill automatically each month.
After all these dodges and shifts, SiriusXM wants authorization to access to my credit card on a monthly basis? No way!
This, ladies and gentlemen and people of all persuasions, is not customer service.
This is a game.
You’ve heard that the squeaky wheel gets the grease? It also gets the discount.
Wheels that don’t pick up the phone get fleeced.
As a human and perhaps as a customer of SiriusXM you can see my frustration with this brand.
Maybe SiriusXM’s management thinks that most customers will pay full price without complaining and that those who call will consider the steep discounts won from their promotions time well spent.
They would be wrong.
Because I, SiriusXM customer, was not thinking “Oh what a great deal. That was totally worth my time.”
My brand associations with SiriusXM are overpriced, frustrating, hassle and disrespect for my time. They have nothing to do with great deals, music or programming.
Moreover, SiriusXM has eroded my trust. They have a zillion deals and you never know if you are getting the best one. Given their tendency to keep billing as they raise their prices, I wouldn’t trust them with access to my credit card.
These are not associations that bode well for my future as a SiriusXM customer. Lost customer is more likely.
When you price your products and services of course you have to cover your costs and earn a profit. Most brands also have to consider their competitive set when pricing as well.
For any brand to thrive in the long run though, you have to deliver value to your customers.
Price is not the only measure of value.
Brand value barometers include:
If you deliver on these measures of value and price your offering appropriately, any price resentment customers may feel upon purchase will likely fade in memory. Impressive performance on those elements builds your brand value and goodwill in the mind of your customer.
On the other hand, if your pricing is out of sync with customers’ value perceptions your brand may already be on precarious ground.
Add time-consuming, hassle-laden semi-annual negotiations and your brand is now teetering on the precipice, ready to tip over into customer disengagement.
Brands betting on customer indifference and making attentive customers jump through hoops risk creating legions of disgruntled customers. And disgruntled customers share their negative experiences, like I am doing now with you, my wonderful reader.
I’ll never get back the 17 minutes and 22 seconds I spent on the phone with SiriusXM, only to end up paying 64 cents more per month than I did for the last six months.
Any manager who would claim I saved $74.96 from the full price would be dreaming. I would never have paid $114.26 to begin with.
Brands need to appreciate their customers’ business, not play roulette with them only when they threaten to leave.
Think about how you want your customers to feel as they interact with your brand and build every aspect of your business around that.
My last piece of advice?
If you are a SiriusXM customer, don’t pay full price!
For those of you left wondering, I took the six months for $33. I’m not sure if I will still be a SiriusXM customer after that.
What I am sure of is that SiriusXM isn’t the only one playing the subscription discount game. We have wrangled regular discounts from Comcast and The Wall Street Journal as well.
If you have a SiriusXM subscription (car radio and/or internet) that you want to keep and have been paying full price, here’s how to reduce your cost:
