Increasing FE revenue is a hot topic. I'm told it isn't easy.
For example, I'm told that getting more revenue from employers is almost impossible. I'm told that they often go to several providers and compare prices. I'm also told that employers are looking for a bargain and buy training on price. I disagree.
Certainly employers want value for money. But that isn't the same as buying the cheapest training on offer. But if you provide an employer with a training quote based solely on the price of delivery plus your normal mark-up it is incredibly easy for them to compare prices. In this situation they are unlikely to buy the most expensive when each quote is for exactly the same course.
The answer lies in the quote
Most people hate being sold to, which isn't the same as not liking to buy. But when faced with three quotes for exactly the same thing they would be remiss if they didn't buy on price. How could they justify anything other?
But make your quote stand out as being more relevant, more carefully considered and more appropriate to their actual needs and they have a reason to look closer at your quote and buy on value rather than price.
This is basic psychology really. People want to feel in control and that they have a choice. So give them a choice.
Instead of just quoting for the basic training course, provide them with some options that add value and make decision making more interesting and easier. Give them a reason to justify spending more money with you.
This principle also applies to the provision of other services.
Providing three options
Let's look at an example. I was recently asked to quote for a marketing appraisal for a university. They also went to my competitors.
The work is fairly standard and we therefore left with competing on price ... unless we provide more.
So my quote looked like this:
1. Basic marketing appraisal
Includes written report with action points
Cost: 15 goats
2. Basic marketing appraisal plus planning day
Includes written report with action points plus Action Planning Day with SLT and/or Marketing Team
Cost: 18 goats
3. Basic marketing appraisal plus planning weekend and mentoring
Includes written report with action points plus Two Action Planning Away Days with SLT and/or Marketing Team and follow up coaching/mentoring for one month
Cost: 87 goats
In the above scenario the university was provided with choices. I knew that my competitors would offer something similar to number 1.
Number 2 answered the question they were likely to ask after the report was delivered and provided added value at this earlier stage.
Number 3 provided the gold option. It was unlikely they would go for it... But some customers do (particularly if you suggest a venue that really stands out - a conference room at Michelin starred restaurant with lunch included sways some people).
In most circumstances option 2 is chosen. It certainly boosts revenues and has the added advantage of not being capable of being compared with competitors that just quote for the basic offer.
In this example they went for option 2.
FE provider options
The above provides a template that can be reused in many situations. The product or service required might be somewhat different to mine and you will need to think laterally when producing your revenue increasing options.
For example, if you provide training think about the follow up you might provide delegates. It might be a series of webinars or videos delivered over the next few months that will reinforce their learning or answer any questions that might arise.
Alternatively, if you provide consultancy services, offer a three-month review to see how things are progressing.
The thing is most people writing quotes are worried about increasing prices as they think they will lose the business if prices are too high. And if they quote one basic price they are probably right. But provide some options and you still have the basic price on the table, plus you give the buyer options to buy terrific added value.
Terrific value means increased revenue
Rarely should one price be quoted. And if you fail to offer options you are likely to be leaving a ton of money on the table.
One of the easiest and fastest ways to increase revenue and profits from existing customers is to give them more purchasing options.
P.S. Why not book a marketing appraisal for your business? We quote in £sterling as well as goats.
Marketing consultant Stefan Drew was previously director of marketing at two FHE colleges and now works with colleges, universities and private providers throughout the UK, Europe and the US - visit: www.StefanDrew.com and http://www.providermastermind.com