I recently attended a dinner with several young marrieds and I asked each of them how they got engaged. In addition to their adorableness, the stories shared a second consistent theme: none of the brides were at all surprised by the proposal because they’d been expecting a ring for a much longer period of time than the grooms were even considering it. That’s just like B2E sales. We’re all the foot tapping, clock’s ticking girlfriends and the customers are the boyfriends slowly plodding along in life oblivious to our urgent need for them to make their move. Today’s post will help you understand the length of the education sales cycle and how to shorten it.
Most ed tech investors, founders, and execs have never worked a B2E sale from either side—as a buyer or seller. If they had, they’d understand that their business models, which build in 3 months’ time to take a prospect from expressing interest to making a purchase, are tragically flawed. They are basing their “average sales cycle” on anecdotal data from the industry, or perhaps a few examples of the best case scenario where early in the company’s development a few maverick administrators snatched up their product after a single presentation. This is the most dangerous data point undermining the ed tech industry today. Most startup business models are extremely inflated as a result, which can be ruinous to their finances. Furthermore, established businesses fail to realize the true length of their own sales cycle, or that it will change over time based on a number of factors – their own market penetration chief among them—and this is why they are not making their sales goals. The reality is that on average school sales take 9 months, and district sales take 18 months. Things that will affect where your particular sales fall on this continuum are:
The role of your product – the higher the integration with other curriculum, systems, and personnel, the longer the buying cycle. This is why things districts purchase takes twice as long to sell as things schools purchase.
The dollar amount of your product – the higher the investment, the longer to pass through approvals.
Your market penetration – only mavericks and close friends buy a new, unproven product. Over time, your company’s sales cycle will shorten as this is an industry of followers and sales beget sales.
Your experience as a rep – but you can keep reading Selling B2E to accelerate your learning curve!
The best rule of thumb if you are building a sales model is to take the number of months you guess your sales cycle length will be and double it. Seriously, it takes far longer for a purchase decision in education than you would logically think. That has a lot to do with education budgets and how they are planned, about 6 months in advance of a school year, as well as the extremely murky accountability and policy environment issues education administrators must respond to. If there’s a clear directive central to your product, such as you help schools file a mandatory report for every ELL student, you can count on a shorter sales cycle. If you have a great science supplement for ELL’s, it could take a year or more to cull interest, round up all the decision makers, run a pilot, figure out what curriculum minutes will be devoted to it, and then build it into the budget.
I am sure the business model you are locked into as you read this, whether as a CEO, sales manager or rep, has been built on a sales cycle substantially shorter than it really is. So how can you do your best to shorten your sales cycle? If I were advising one of those young ladies hoping for an engagement ring, I’d offer this advice which applies to B2E as well:
- Make sure he’s ready to settle down. Has your prospect fully vetted your product? Establish a plan for evaluation and help them check off all the steps. Ask lots of questions about the universe beyond the adoption of your service so that you know all the factors involved and can address each of them. Just like that young man wonders if he’s secure in his job before he takes a wife, your client is wondering if state policy central to your product’s function is stable. Help them understand why timing is good and they can feel comfortable in their commitment.
- Drop hints. Sometimes a little nudging goes a long way. Get help developing lots of great content to share with your prospects that gives you a reason to touch base frequently but not with annoying “are you ready?” pings. The more the topic of you comes up, not necessarily the topic of making a decision, the more likely he is to realize he should make one.
- Be direct. Just like most guys need to be told it’s time to talk engagement, you need to ask for the sale directly. Because after following my first suggestion you found out the conditions under which your prospect can buy, when those conditions are met, you should let them know that time has come.
- The Ultimatum. No one likes to give or get an ultimatum but they are effective. Your only real ultimatums as a rep are price-based. But a price increase or the expiration of a special offer is a great “ultimatum” that should be applied when a prospect is otherwise ready to commit and just needs a logical reason why they should act now.
- And this one for all the mom’s out there…He won’t buy the cow if he gets the milk for free. You know this is true. No one is buying what they get for free. Keep your pilots and samples to a minimum length, realize how rare freemium success in ed tech is, and don’t get bullied into relationships that don’t make sense for your business.
Work smart to reduce your sales cycle and you’ll get your July 1 wedding. Remember that all prospects need time, so give them space to make a good decision they are comfortable with. However, if the courtship has run its course and no commitment materializes, you’ve got to learn to move on. There’s plenty of fish in the sea!!