It seemed like just yesterday that the sales cycle in district curriculum and technology acquisition was 12 to 18 months. Back then, districts would buy curriculum, which were predominately textbooks, once every five to seven years. And if you had the relationship, you were almost a lock in getting the order. The good old days? Perhaps for the handful of companies that controlled 80 percent of the curriculum. But for learners and all the companies with a better solution? Certainly not.
Since that time, the sales cycle has become increasingly compressed. And the control enjoyed by the giant publishing houses has steadily given way to acquisition from more than 7,000 digital publishers and education technology companies who are now successfully competing in the education market. Even before the COVID-19 pandemic, the education market was following the trend in other major industrial markets, altering buying habits and reducing the time of acquisition by steadying multiples. In fact, according to research form the international sales training company 2Win!Global, When asked to complete the following sentence, here is how sales and pre-sales professionals across industries responded: “Compared to 4 years ago, B2B stakeholders...,”
- are more directive in what they want to see (56%)
- are more likely to interrupt the demonstrator to ask to see something of interest to them (48%)
- are more educated on product solutions prior to the demo (67%)
- want access to information (product videos, demos, pricing, etc.) like they experience in their consumer lives (64%)
When we asked about preparation time for a significant product demo or presentation compared to four years prior, the overall response was a 41 percent reduction in time.
Suffice it to say, the evidence is compelling. Data is pouring in from experts across the globe that stakeholders are taking more and more control of the buying process, and sales engagement teams need to adapt.
How is it possible that in only four years, the B2B client engagement process could change so drastically? As part of our research, we sought answers to that question. The result is a rather lengthy list of causes which, taken individually, have minor impacts on change. Combining them, however, is a bit like an earthquake shaking an ocean—with the result being a tsunami. Below is a list of what we found to be sources of disruption:
- Consumer purchasing expectations
- Technology experience
- Smaller purchases
- Shorter commitments
- Empowered research
- Generational differences
- Virtual meeting acceptance
- Cost pressures
- Time pressures
- Sun-setting perpetual product licensing
- SaaS, PaaS, Cloud
Consumer Purchasing Expectations
As consumers, most people have come to expect immediate access to information and the ability to buy almost anything at anytime and anywhere they happen to be. We can thank FANG for that. FANG is the acronym for Facebook, Amazon, Netflix, and Google. Together, their net worth is equivalent to the entirety of the Russian GDP. On Facebook, you can be in constant connection with friends, shop stores, and watch videos demonstrating products. Amazon is the largest marketplace in the world, and everything from an obscure part for a fifteen-year-old dishwasher to fresh groceries can, in some markets, be at your door in minutes. Netflix is powered by Artificial Intelligence (AI) that knows your viewing behavior better than you do. Finally, YouTube (owned by Google) is an instant source of videos for everything from sports highlights to product reviews and demos.
The gang of FANG has had a significant impact on consumer behaviors and customer experience expectations. So has the fact that the B2B stakeholder has significant technology experience outside of consumer research and purchasing. Technology permeates many aspects of our everyday work lives, and this experience has enabled the B2B stakeholder to perform many aspects of vendor research that previously needed to be provided in a document or presentation. Hoovers, Yahoo Finance, and Glassdoor are just a few examples of sites many stakeholders can leverage. If a stakeholder is considering acquiring technology, software, or apps, their own experience suggests they may have been involved in two or three similar purchases at their existing company or while employed with another company. This experience results in a stakeholder who is now much more educated and directed.
Today’s B2B stakeholders rarely have appetites for large product, service, or solution rollouts. This has led to them making smaller purchases and commitments with lower risk. A software product or app, for instance, can often be swapped out for another with one month’s notice. With so little to risk in the stakeholder’s mind, they are much more interested in moving fast.
Connected to smaller purchases are shorter commitments. For example, many software companies have worked hard to transition their business to a Software as a Service (SaaS) model. In some cases, a stakeholder can cancel their subscription and put another product in place in as little as thirty days, but software companies have worked hard at engineering their products so customers won’t cancel their subscriptions. (As an example, have you ever tried to switch your music service from Apple’s iTunes to another service?)
Research on the web has never been more powerful. Search engines are more contextual and, due to AI, they’re smarter as well. Reviews, videos, price comparisons, product specifications, product manuals, and product and styling configurators are all part of our empowerment. B2B supplies data for much of this research, but it is often unmanaged, outdated, and inaccurate. Nonetheless, we’ve come to expect our consumer empowerment in our B2B world.
As generations continue to turn over the workforce, there is no doubt that the newer generations have customer experience and responsiveness expectations. Why deny them? This doesn’t mean you have to throw expensive human capital at this time compression. On the contrary, a combination of a skilled workforce and automation will connect these newer generations to your B2B products, services, and solutions faster and more effectively than ever before. Not only is there a generational turnover, but it is not applied evenly. Within a given opportunity, there is often a large generational difference (with their associated technology expectations) between buyers and sellers, and between the different “roles” within the buyer. Staff, managers, and executives are more likely to be from different generations with different experiences and different expectations in the buying process.
Virtual Meeting Acceptance
Virtual (web) meetings have grown as B2B stakeholders and sales engagement team members have adopted this technology. The growth in the number of stakeholders in recent times and their geographic dispersion necessitates the use of this cost saving technology. This has led to a global acceptance of the replacement of in-person meetings, presentations, and demos with virtual.
Both stakeholders and sales engagement teams are under pressure to reduce costs. This translates into a desire for shorter, less expensive buying and selling cycles and, as stated earlier, a need to accept virtual meetings. This leads to a need for B2B sales engagement team members to become more efficient at meeting the needs of stakeholders. The use of video automation and virtual meetings are just two examples of cost-reducing moves by B2B sales engagement team members.
B2B stakeholders expect the process to move faster than ever before. Once asked to initiate research and purchase processes, a B2B stakeholder expects to find information quickly, connect with sales engagement team members efficiently, and gain stakeholder buy-in rapidly. This leads to time pressures on sales engagement team members and their organizations to be more responsive than ever before.
SAAS, PAAS, AND Cloud
In the technology space, selling organizations are transitioning from a one-time perpetual license to monthly recurring licensing such as Software as a Service (SaaS). But this trend is not reserved for technology. In the B2C market, razor blades and beauty products have done the same thing, as have clothing, coffee, and even laundry detergent, turning those offerings into Products as a Service (PaaS). As a perpetually licensed product is transitioned, it opens the field up to competitive solutions. And switching from one vendor to another has never been easier for B2B stakeholders who store their data in the cloud, because they don’t have to re-invest in expensive IT infrastructure. This means B2B sales engagement team members must move quickly to provide B2B stakeholders with alternative solutions.
Six Key Strategies
1. Video and video automation strategies that will improve prospect responsiveness, reach, and perception.
2. Virtual meeting strategies that will drive stakeholder engagement and effectiveness.
3. Agile and responsive strategies for in-person meetings, presentations, and demos.
4. Improving teamwork in every event that requires more than one sales engagement team member.
5. Assessment and coaching strategies for managers that will help you bring your entire team to Excellence.
6. Organizational execution strategies for large, midmarket, small, startup, and reseller enterprises.
What all this means to you
Since the start of the pandemic, and especially now that schools and districts are forced to make extraordinarily quick buying decisions, understanding the trending compression of the buying cycle is paramount to making sales in curriculum and technology. And more and more, the line between curriculum and technology has become blurred, eliminating, or combining an entire step in the education purchasing chain.
According to research from the Learning Counsel, since the start of the pandemic and availability of CARES Act funding, education is not only matching the trend of compressed buying cycles in other industries, they are now leading the trend. School districts are making decisions at lightning speeds, and many of the companies recently surveyed report record sales, with this year’s sales totals already exceeding the volume of all other sales years. It is a trend that is expected to continue throughout the remainder of 2020 and well into 2021. Understanding the new buying preferences of your prospects should place you squarely in the category of “Best Year Ever,” and you will gain market share and be poised to continue a string of very strong years. However, don’t expect things to return to the way they were. Once school and district buyers have tried this new and more efficient buying system, it is unlikely that they will ever return.
About the author
Bob Riefstahl founded 2Win! Global on the simple concept that if we focus on more than best practices and correct our bad practices (as Bob calls them, “Crimes”) then we separate ourselves from the competition. Bob is a thoughtful, practical senior executive with a passion for helping pre-sales professionals advance their careers and their lives.