While some experts expect a second honeymoon period for edtech, founders in the space need to change their tactics and learn how to get more results with less money.
If you have a good product, a great marketing team and a stellar sales team, it makes sense to expect that you’ll earn a lot. Unfortunately, the reality is that these things don’t help much at all.
As soon as you figure out what makes each of your strategies “effective” or “good,” you’ll succeed. It is important to learn how to break down your tactics to improve revenue.
Direct ways to improve revenue
Address sales department effectiveness
Analyzing metrics begins with determining each manager’s target results. Since a person can only do so much, it is important to know how much time and effort everyone is putting in daily.
It’s important to assess your sales department’s workloads to see if anyone is getting too much or too little work. Often, a sales manager may be assigned too many leads, but this can be detrimental to their effectiveness. Overloaded sales managers cannot communicate with clients efficiently, which negatively affects the overall return on marketing investment.
You can calculate “normal” workloads based on your product and take steps to avoid assigning new leads to overloaded sales managers until their workload has normalized.
The service-level agreement (SLA) of each lead
SLAs can be used as an indicator of how quickly sales managers respond to incoming requests. Our data indicates that elapsed time directly correlates to conversion rates.
Managers should call customers back within 5-20 minutes. Conversion rates can decline by 20% to 30% if callback times are between 30 minutes and an hour. A manager who calls back customers after an hour reduces their conversion rate by half.
Create a simple dashboard to track SLA per day and see if your team is overloaded or does not have not enough leads.
Approval rate of bank deferrals and students loans
In times of rising inflation, some students prefer deferral programs to begin their education. In some cases, about 95% of students may want a loan to fund their education. If you can manage that rate, you can increase revenue.
Keeping in touch with local financial institutions will let you establish customer flow while helping smoothen the bank approval process for new customers.
Indirect ways to affect revenues
Impress your investors with low refund and rejection rates
You can use these metrics to understand your product’s potential and evaluate your business’ performance. While they don’t directly affect your revenues, these metrics can help you build trust with investors.
If you want to monitor your performance effectively, you must first understand the reason for the refund. Once you’ve done that, check with marketing for key messages to ensure you’re hooking the right leads. You should try to improve every step, from entry into the educational funnel to postgraduate recommendation, wherever possible.
Create new supplementary products
As customers use your product, their needs will change. That’s why it’s important to ask yourself these two questions to continue growing with your user base:
- What were my customer’s needs before they began using my product?
- What are their new needs now that they’ve used my product?
If you can answer these questions, you’ll find it much easier to continue making money with your users. For example, an adult who seeks out an edtech company may do so to get trained for a new career path. Once they’ve received that training, they might need supplemental materials to help with their new job or a community of graduates who can provide support and encouragement.
Another example might be young students who need tutoring in a specific subject: Once they have mastered the study material, you could offer help with related subjects or provide early prep work for advanced classes to give them a head start for their next school year.
There are many creative ways edtech companies can continue to expand and add value for existing users. Supplementary products, such as subscription-based models for bonus content or memberships that grant access to student communities, offer continuous opportunities for a company to evolve based on its users’ needs.
Realize your customers’ expectations and ask newcomers about their experience and expectations. Lastly, use the staged self-directed learning model to help students connect the dots between education and practical application of the knowledge.