Reflections on the Bett EdTech tradeshow: unlocking opportunities for providers selling to schools in the “new normal”

08 February 2019

Each year, our extended education strategy team visits pretty much every stand at the education technology event BETT to review new products and services and talk to providers about their experiences.

This year, despite negative headlines about school spending, we were encouraged to find that most of the c.100 exhibitors we spoke to at BETT were feeling positive and continuing to see growth both in the UK and overseas.

This was not entirely a surprise; goods and services providers to UK schools have been relatively protected from budget pressures (to date), because we have seen pupil-teacher ratios creeping up. This is likely to continue in secondary schools as the demographic ‘bump’ transitions from primary to secondary but may leave primary schools with more of a headache.

With around 99% of new academies joining MATs (multi-academy trusts) ‘MAT-ification’ is beginning to impact suppliers with clear patterns emerging in terms of how different products and services are being treated by central teams. Around 30% of suppliers engage with MAT schools differently and another 10% think they should do.

This centralisation of procurement comes with risks and opportunities for suppliers: MATs are more likely to be interested in value added services and more sophisticated purchasers (think benefits not features) than individual schools but will also target cost savings as they transition to group purchasing and consolidate their supplier base.

In particular we have seen some surprising pricing models where bulk discounts are treated very differently by direct competitors.

The proliferation of products and services on show at BETT and by extension available to schools, continues to increase, supported by a benign funding environment for new start-ups. Achieving scale remains challenging.

In particular, as products and services increase in complexity a higher degree of engagement with the customer is needed to demonstrate the benefits. Among companies that are increasing penetration of schools profitably, we’ve identified some key themes including rigorous lead qualification to control cost of sales, investment in online demonstration capabilities to improve sales team productivity and effective use of distributors and resellers with a clear plan for investment on both sides. Customer evangelism is critical - the majority of suppliers rely on inbound leads for most new customer wins and typically these are still closed face to face.

For those that have developed a portfolio of products (either organically or via acquisition) we saw some interesting developments in their go to market strategy including more coherent product positioning within the portfolio and a matrix sales effort. Clearly, this trend could have a major impact on the EdTech landscape.

It was noticeable that most companies with an effective international sales model were seeing volumes growing, sometimes substantially. However, half the companies we spoke to see less than a quarter of their revenue from international and typically these are not seeing any improvement, i.e. only those fit for international growth are benefiting from that opportunity.

Looking ahead from BETT 2019, we see lots of good products and services in the market but the key challenges for suppliers remain:

  • Managing cost of sale (efficiency of lead qualification and management) including how to actively drive customer referrals
  • Working out how to address MATs particularly in respect to pricing
  • Selling on benefits not features especially in the context of the limited bandwidth ofHead Teachers’ (who are still the key decision maker for most purchases) 
  • Understanding the real market potential for a niche product or service
  • Recognising the potential of different distribution structures both in the UK and internationally

 

Ian Koxvold

Ian Koxvold | Head of Education Strategy, PwC United Kingdom
Profile | Email | +44 (0)7715 487627

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