Selling to schools is one of the hardest parts of building an edtech company. It is critical to have a well thought-out, go-to-market strategy in place to demonstrate the value of your edtech product. This means analyzing the classic 4 P’s of Marketing: place, price, product, and promotion. In some industries, these marketing functions can be separated from sales functions. In edtech, that is impossible.
“Marketing drives sales,” states Glen McCandless of SellingToSchools. “They can’t be clearly disconnected because in a buyer’s mind it is not disconnected. Marketing’s role is to drive sales.”
In education sales, the multiple levels of hierarchy and complex sales cycles require an integrated sales-marketing approach. The first step of that approach is deciding which sales strategy best suits your product.
Key Considerations of a Top-Down Strategy
A top-down strategy means that you are selling to administration. Your startup is presenting a solution to one of their problems. More often than not, administrators go to Google and search for a solution, and then begin a process of evaluating a few different products to solve their problem.
Consideration #1: With an abundance of edtech products on the market, it is not always necessary to demonstrate efficacy. If you’re pursuing a top-down strategy, you should instead measure the impact of your product in a classroom and then lead your sales pitch with that data.
Consideration #2: In general, if your product has a high price tag, you need a top down strategy. Products that fall into this category include back office apps, analytics systems, and learning management systems.
Consideration #3: With a top down strategy, you are more likely to need a lengthy pilot program to prove results. “If it’s mission critical, there will be a piloting program. Sometimes you have to substantiate the claims a developer is making,” states McCandless. These pilots should have built-in check-in points throughout, so that you can fix problems before they evolve into weeks of product nonuse. (See this EdSurge article for a guide to the pilot process.)
Consideration #4: Be ready to face a long sales cycle and, initially, a pretty low adoption rate. Schools want to be absolutely sure of what they are spending money on before purchasing a product.
Consideration #5: In higher ed, a provost or president writes the check, and, even more so than in K-12, they need the professors to be on board before buying. This may mean devising a plan to reach and convert professors in parallel with the top down sales plan.
Key Considerations of a Bottom-Up Strategy
With a bottom-up strategy, founders are selling solutions directly to teachers or professors, typically those who are early adopters. Selling directly to instructors requires a very nuanced strategy, since there are now thousands of edtech startups providing solutions, often for free.
Consideration #1: Teachers often adopt products quickly. They are eager to try new solutions, and many take time to give their feedback. But the flipside of this is that teachers do not have much purchasing power. This dynamic is the root of much frustration for edtech founders.
Consideration #2: With this strategy, you will have the ability to develop deep relationships with the initial group of teachers who adopt the technology and can incorporate their feedback as you build your product. “Product development ends up being a lot of your marketing,” states Amin Kazi, founder of Unizin.
Consideration #3: This approach lends itself better to growth via word of mouth. If you are selling to teachers, they can become your brand ambassadors, making it easy to scale to any geography. It lessens your dependence on expensive field sales and inside sales channels. Loyal customers become the primary channel to drive demand.
Consideration #4: The freemium model is often utilized with a bottom-up strategy. The risk of using this pricing model is that teachers who use your product may be unable to find the funds to purchase the technology, or may get bogged down in lengthy RFP purchasing cycles.
Top-Down vs. Bottom-Up—Which to Choose?
In the end, the nature of the product often dictates whether a startup should pursue a top-down or a bottom-up strategy. If you are selling large, comprehensive products that must be implemented throughout an entire school, the top down sales approach is not optional but necessary. If you are selling a software product that you are confident teachers can easily adopt and will love, a bottom-up approach is a no-brainer. But with an explosion in the number of edtech startups, many business models fall between these two extremes.
If you know the costs and benefits of each approach and have a deep understanding of your own product, you should have no problem choosing the option that will close more sales.
Charles LaCalle (@charleslacalle) leads startup sourcing and and manages community at Dreamit Ventures, an education and health technology accelerator and venture fund. This article is based on a recent Dreamit #Get2A podcast featuring MJ Linane, Founder of GuildWay, Glen McCandless, Founder of Selling to Schools, and Amin Kazi, Founder of Unizin.
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