Cecile White: September 2018

Tuesday 25 September 2018

Best Customer Education Blogs: 25 Must-Reads for Learning Professionals

Which blogs offer the best advice about customer education practices, strategies and technologies? Great question. But with such phenomenal recent growth in the customer experience market, there is no obvious answer.

That’s not just a gut reaction – it’s a business reality. One glance at the data and you’ll see what I mean. The sheer volume of solutions that define the broader marketing technology landscape has ballooned from only 150 in 2011 to nearly 7000 this year, according to Scott Brinker at ChiefMartec.com. What’s more, consolidation is nowhere in sight.

The thirst for tools that drive profitable customer relationships seems unquenchable. And education is only one tiny piece in that massive puzzle. (In fact, most learning-related solutions are tucked into the gold column under “Customer Experience, Service and Success.” Interestingly, some customer-oriented LMS vendors aren’t even on ChiefMartec’s radar yet!)

Nevertheless, education is a critical factor in the customer experience equation, and marketers are eager to learn how to leverage customer education for better business results. That’s why martech vendors of all stripes are responding with topical thought leadership. And that’s where our quest to find the best blog content begins.

So Many Possibilities, So Little Time

If you close your eyes and toss a dart anywhere at this martech vendor map, chances are you’ll find a site brimming with information about the role of onboarding and ongoing training in the customer lifecycle. But only a few of these resources actually focus exclusively on customer education. Even fewer are backed by firsthand experience that makes their observations credible and useful. So it’s important to choose wisely.

Of course, technology vendors aren’t the only source of customer education guidance. For example, as an independent extended enterprise learning analyst, I’ve been writing for nearly 5 years about the explosive growth in customer training and the learning innovators who are defining this space.

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And I’m not the only one who’s passionate about this topic. Useful insights come from every corner of the customer experience ecosystem. That’s why our choice of must-reads draws from a variety of sources – other analysts and consultants, customer education leaders, professional association executives and learning systems vendors, as well as marketing technology providers.

While not exhaustive, the following list also showcases multiple topics, including slice-of-life cases that demonstrate lessons learned from companies with customer training programs.

Although this represents only a fraction of the shareworthy insights and advice we’ve uncovered in our travels, we hope this gives you a taste of what’s available from the brightest strategists and practitioners who are shaping the future of the customer experience discipline. Enjoy!

25 Must-Read Customer Education Blogs

CONNECTING TRAINING AND CUSTOMER SUCCESS

What is Customer Training?
By Eoghan Quigley, Product Marketing Manager
LearnUpon
Many learning professionals still focus exclusively on employee training and development. If you’re in this camp, customer education concepts are probably new to you. For those who need an overview, this post covers the basics.

7 Ways Education Services Fit Into Customer Success
By Maria Manning-Chapman, VP Research, Educational Services
Technology Services Industry Association (TSIA)
Customer success is mission-critical for all kinds of companies – especially subscription-based software providers. Yet this relatively new term is often misunderstood. What exactly is customer success and how can specialized training support these objectives? Here’s a helpful introduction from TSIA, an organization at the heart of the SaaS industry.

Does Customer Success Mean Anything Outside of SaaS?
(Published on the Amity blog)
By Lindsay Smith, Director of Customer Success
BestCompaniezAZ
If you think that customer-centered strategies apply only to SaaS products, think again. Drawing upon her experience in multiple industries, this brand evangelist explains why smart businesses everywhere should make customer success a core competency.

The 80/20 Rule of Customer Education
By Donna Weber, Customer Onboarding and Engagement Consultant
Springboard Solutions
This marketing-savvy customer success expert explains why it’s important to consider the Pareto Principle when developing customer training. In other words, focus on 20% of your product that 80% of your customers actually use. Donna also outlines 5 ways that customer education leaders can apply this principle for best results.

THE IMPORTANCE OF CUSTOMER ONBOARDING

The Secret to Successful Customer Onboarding
By Lincoln Murphy, Customer Success Consultant
Sixteen Ventures
Onboarding is widely accepted as a key to product adoption and ultimately, customer success. Yet oddly, there is still no universally accepted definition for this critical term. Customer training and onboarding are closely connected, but they aren’t interchangeable concepts. If you need clarity from a no-nonsense source, check this post by one of the most articulate independent thought leaders in the customer success sphere.

Why Smooth Onboarding is the Key to Customer Success
By Joshua Thayer, Sr. Inbound Marketing Manager
Thought Industries
In every customer journey, there are pivotal moments that determine the likelihood of customer success. In these moments, learning experiences can drive customer engagement and momentum. This post takes a closer look at why and how to make it work.

The Ultimate Guide to Customer Onboarding
By Christina Perricone, Content Strategist
Hubspot
If you’re looking for step-by-step guidelines to develop a case for customer onboarding, this long-form post provides all the details you need to create a compelling game plan. It begins with a simple definition of customer onboarding and statistical evidence of its business value. Other sections are devoted to onboarding best practices, how-to tips, metrics and real-world examples, as well as advice about how to avoid common missteps. A great resource to keep handy as a quick reference in the future.

The Delightful Secret of Successful User Onboarding
By Pulkit Agrawal, CEO
Chameleon
An acceptable annual churn rate is 5-7%, yet more than 30% of SaaS companies face churn rates of 10% or more. That’s simply not sufficient to grow a sustainable business. So, what can companies do to turn new users into lasting customers? This post uses real-world examples to illustrate precisely how “aha” moments in onboarding make all the difference in customer adoption, retention and lifetime value.

Customer Education is Your Onboarding Scale Engine
By Adam Avramescu, Head of Customer Education & Training
Checkr
Research reveals that weak onboarding is the biggest cause of customer churn in the SaaS industry, representing 23% of attrition – more than poor relationship management, product deficiencies and other common issues. What is a “mature” onboarding strategy and how can it help you avoid this fate? And how can you bring together multiple learning elements to create an effective onboarding mix? Adam offers valuable food for thought.

76 Tips to Optimize User Onboarding
By Ty Magnin, Director of Marketing
AppCues
Don’t let the length of this embedded Slideshare deck intimidate you. This chunky compilation of best practices reflects in-depth analysis of 400 real-world onboarding experiences and it’s worth reading from front to back. Why? Because onboarding is 2.6x more important for retention than any other customer journey metric. Plus, strong onboarding drives 74% more bottom-line revenue than later stages in the customer lifecycle. Fortunately, these tips are straightforward, so you can easily imagine how to apply them in your own environment.

PRODUCT TRAINING STRATEGIES AND TECHNOLOGIES

How Much Education Does Your Marketing Require?
by Jeannie Walters, CEO, 360Connext
(Published on the Litmos blog)
We know that integrating education with marketing increases conversion rates, but what does that mean for ongoing business? Continuously sharing product-related tips, reference tools and other information helps keep customers engaged and up-to-date, while also helping them discover other products they might value.

Why In-App Onboarding Deserves a Spot On Your Product Roadmap
By Shaun Juncal, Sr. Product Marketing Manager
Product Plan
Have you considered using in-app tools to support customer onboarding? If so, you may wonder if they’ll compete for precious development resources with must-have features on your product roadmap. Fortunately, new code-free onboarding tools are putting these worries to rest. Learn what to consider from a product manager’s perspective.

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Creating Customer Learning Paths That Scale
(Published on TrainingIndustry.com)
By Linda Schwaber-Cohen, Senior Manager, Training
Skilljar
In today’s complex customer technology stacks, educational content is often distributed across multiple systems – each with unique owners and processes for development, maintenance and expansion. In this kind of environment, how can you address customer needs as your company grows?

The Missing Piece of the Software Adoption Puzzle
by Kevin Hanegan, VP Knowledge and Learning
Qlik
Organizations everywhere are discovering the benefits of moving from traditional software ownership to cloud-based subscription models. They’re also facing significant user adoption challenges as users struggle to keep up with continuous software improvements. To stay ahead of the curve, organizations must rethink learning strategies.

Finding the Right Mix of Application and Context Training for Customer Success
By Barry Kelly, CEO and Co-Founder
Thought Industries
As training becomes a more integral part of the software customer success playbook, two distinct learning delivery mechanisms are emerging: contextual learning and application learning. What’s the difference and how can you make them work for your customers?

How to Price Customer Education When Customers Expect It to Be Free
by Bill Cushard, Director of Marketing
ServiceRocket
Should you charge customers outright for training, or should that cost be built into the cost of your product? The answer to this question is tricky and often highly strategic. This article looks closely at the pros and cons of treating training as a direct source of revenue, versus a path to customer adoption, renewal and growth.

Why Connected Experiences Are So Critical – And So Difficult
By Peter Gaylord, Senior Director, Product Marketing
Salesforce.com
Today’s customers have remarkably high standards for engagement. For example, 70% of survey respondents said that connected experiences are “very important” in winning their business. That’s a tall order in today’s multi-channel digital environment. This article offers insight into just how big the challenge is.

8 Ways Training Automation Helps Attract, Onboard and Retain Customers
By Peter Schroeder, Head of Marketing
Northpass
How can training automation help your organization more effectively attract new customers, facilitate onboarding and every other step in the customer lifecycle? Using real-world stories as examples, this article explores 8 ways that customer training technology can lead to significant business benefits.

Why Software Companies Should Develop a Certification Program
by Julia Borgini, Content Marketer and Copywriter
Learndot
Professional certifications are growing in popularity among associations and other continuing education providers. But how exactly do certification programs enhance customer education and add business value? This post looks at 8 reasons why product certifications can be a smart strategy.

Customer Education and Your Customer Health Score
By Linda Schwaber-Cohen, Senior Manager, Training
Skilljar
The correlation between customer education and lifetime value is compelling. For example, trained customers use SaaS products 135% more, on average, than those who aren’t trained. Training is also linked to longer and more profitable customer relationships. So how can you take this data one step further, as an indicator of customer health? Interesting.

LESSONS DIRECTLY FROM THE CUSTOMER TRAINING FRONT LINES

How Fender Guitars Is Solving a Product Adoption Problem
By Bill Cushard, Director of Marketing
ServiceRocket
Your company doesn’t have to be in the technology industry to benefit from customer education. Fender is a perfect example. Electric guitar sales are fading fast. And 90% of new players quit within the first year of buying a guitar. This case offers specific recommendations for any organization facing similar obstacles.

12 Brands That Nail Customer Education With Video
By Wyzowl
What does great customer education actually look like? Check these onboarding videos from some of the brightest minds in customer success. From consumer product companies like Oral-B and Ikea to B2B brands like Slack and Canva, you’re bound to find inspiration somewhere in this collection.

How Gainsight Built Customer Success Into The Onboarding Process
By Kendra McClanahan, Customer Success Solutions Architect
Gainsight
Gainsight is a leader in the customer success space. So what does this company do during the onboarding phase to facilitate customer success with its own product? The strategy emphasizes sales-to-service knowledge transfer, a “success for all” philosophy, in-person kickstart training and a mix of high-touch and low-touch methods.

How Product Education Plays a Critical Role in the Customer Journey at Intercom
By Ashley Minogue, Director of Growth
OpenView Venture Partners
These notes from an interview with the head of product education at messaging software company Intercom reveal multiple factors that contribute to customer success. In particular, this focuses on 5 steps to a winning product education strategy. Key takeaway: If you’re serious about increasing product adoption, create cross-functional teams that focus on relevant activation metrics.

My Growth Story: Building HubSpot Academy
By Mark Kilens, Leader of Hubspot Academy
Hubspot
How does the leader in inbound marketing software educate its own customers? This is the story of why an early brand advocate decided to join the Hubspot team and how he created a compelling learning experience that empowers other marketing professionals to succeed. This isn’t just a nostalgic nod to a successful program. It’s an epic saga with lessons for learning, marketing and customer experience professionals everywhere.

Conclusion

Wow. If you made it through this entire reading list, you’re definitely ready to master customer education! Did you find these resources as interesting and helpful as we did? What other resources would you recommend? If you have helpful customer education advice or a case study you’d like to share, feel free to send us a link. We always appreciate hearing ideas from other customer training enthusiasts.

Thanks for reading!

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The Competitive Advantage of an Externally Facing LMS

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There is tremendous diversity among the nearly 700 learning management systems available today. And when customer education is a top priority, it pays for organizations to choose an LMS designed specifically for that purpose.

What exactly are the business benefits of choosing a specialized learning management system (rather than an employee-oriented LMS) to support customer learning initiatives?

Join John Leh, Talented Learning lead analyst and CEO, and Terry Lydon, VP of Training Operations Projects at Litmos, as they explain the value of choosing an externally focused LMS. Specifically, they discuss: You’ll learn:

How to quantify the benefits of customer learning
Which factors set a customer LMS apart from employee-focused platforms
What case studies reveal about the value of customer learning technology
How to find the best LMS for your customers’ needs, and
5 areas of innovation unique to customer LMS solutions

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Looking for a learning platform that truly fits your organization’s needs? We’re here to help! Submit the form below to schedule a free preliminary consultation at your convenience.

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Wednesday 12 September 2018

Podcast 15: Tying Training to Customer Success – With Barry Kelly of Thought Industries

WELCOME TO EPISODE 15 OF THE TALENTED LEARNING SHOW!

To learn more about this podcast series or to see the full collection of episodes visit The Talented Learning Show main page.

EPISODE 15 – TOPIC SUMMARY AND GUEST:

I’m excited for today’s discussion because it focuses on one of my favorite topics – customer learning strategies and technologies.

Our guest is Barry Kelly, CEO and Co-Founder of Thought Industries – one of the first and now leading extended enterprise learning solutions. Barry is a passionate innovator with proven product development success and extensive experience in elearning, digital strategy and social media marketing.

KEY TAKEAWAYS:

For product and services companies alike, customer success drives the length and profitability of customer relationships.

Customer training directly influences product adoption and ultimately, customer success.

High-quality training teaches customers not only how a product works, but also how to achieve relevant business objectives.

Q&A HIGHLIGHTS:

Barry, when I discovered your company, I knew I’d found kindred spirits. Maybe you should start by telling us why you founded Thought Industries…

We’ve been around just over 5 years. Originally, we wanted to build a platform that enables organizations to deliver extended enterprise learning. I’ve been in this industry for 20 years, and in the past, I found that when companies wanted to get a learning business off the ground, they had two choices – they could build something from the ground up, or start with an existing LMS and bolt on lots of different types of technologies. Our vision was to bring all those things together in one solution. That includes things like microsites, storefronts, ecommerce, licensing and the ability to author courses right in the browser.

What kind of use cases do you see?

We focus on two market segments:

1) Learning Businesses: We enable for-profit organizations to create and license learning content to large organizations, or sell it directly at scale. This includes training companies and consulting firms, as well as associations that provide continuing education and certification programs for many different industries, from aviation to healthcare.

2) Customer Training Organizations: We also serve software companies – SaaS companies in particular – that want to do a better job of training their customers. The process of training and behavior change is strongly correlated with customer retention and reduced customer churn. That’s very important for subscription software companies, where customers pay monthly or annually. Customers need to see value in a product, and that requires training.

It seems every industry should be training customers to some degree. Why do you mention SaaS companies, specifically?

Certainly, any product 0r service company may find it beneficial to educate their customers. But I would that say a much higher percentage of software companies offers customer training than any other kind of business,

Why is that?

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We’re a SaaS company ourselves, so we face a lot of the same challenges our customers do. With SaaS technology, you frequently release new features. You want customers to get value for your technology, and “value” means that they have a successful experience.

Customers stay longer when they get more benefit from a product. It increases their technology usage and prevents churn. Ultimately, most SaaS companies are working towards managing that big Mac Daddy metric called churn.

What does “churn” look like?

It’s like a faucet. If customers aren’t seeing success from it, they can turn it off at any time. That’s why we’re seeing massive growth in the customer success industry, with platforms like Gainsight, ClientSuccess, Totango and ChurnZero. These products help manage the customer success across the lifecycle. We fit-in by delivering learning experiences that drive behavior change needed for customer success.

So how do organizations measure if training is actually working?

Great question. I think we should start by looking at points in the lifecycle that are critical to customer success, engagement and growth.

The first is onboarding. For SaaS products offered on a trial basis, customers need to gain proficiency very quickly. Even with a longer onboarding process, it’s critical to configure the software so you help customer organizations succeed quickly. There’s a related metric called time-to-value, which defines customer success in various ways. It can be based on increasing customer revenue, or improving email campaign conversions or another relevant business performance indicator.

And how does customer training have impact on time-to-value? There’s a very specific, simple way to look at it. If you deliver training on a one-to-one basis, customer success takes a lot of time, it’s costly and it’s hard to scale. The goal with an integrated learning experience is to scale customer onboarding at a much faster rate – ideally immediately when they first engage with your SaaS product.

Is onboarding where customer training should focus?

With B2B software, it’s important to keep in mind that personnel changes are constantly happening in customer organizations. For example, when a customer first subscribed to your financial software, you onboarded their entire accounting team. But over time, many of those team members have moved on to other jobs.

Whenever a user is replaced, there’s risk. Onboarding needs to continue without disrupting operations. So the challenge is, how do you continuously influence behavior change among thousands or hundreds of thousands of users?

That’s a huge challenge…

Yes. In addition, it’s very important to remember that there are two types of customer learning experiences:

1) Contextual Learning: This focuses on becoming proficient with relevant features. For example, teaching a user which button to press, when to select that button and when to hit return. In an email marketing system, that could include steps like, “Enter a header here. Enter body copy here. Enter a call to action here. Then press send.”

2) Application Learning: This is about helping customers apply a product successfully. In this case, it’s about how to create and manage effective email campaigns.

That’s an important distinction…

Yes. Customer success isn’t just about learning how to use technology, but how to be successful with it. In this case, it could be things like, “Create a snappy subject line with X characters. Write body copy that’s no longer than Y words. Make sure keyword density is at least Z%. Segment lists by relevant interests. And always send on Tuesday morning.”

These behaviors may not directly focus on your product, but they do help customers put your product to good use. And that’s the key to customer success, retention and growth.

So, what metrics tie training to customer success?

You can begin to understand the impact of customer training by measuring churn. For example, you can create a specific onboarding learning path and we can certify it. Then when a new user completes the process, you’ll know they’re more likely to succeed with your product.

In addition to churn, we look at what we call negative churn, which is essentially your ability to grow your client base. You want product usage to increase because more customers know how to use your product and they’re more successful when putting it to use.

There are other types of engagement data, too. It’s a fascinating world. And we’re excited to be at the heart of this behavior change through training. We see a lot of growth potential in this area.

Exactly how do you connect these dots? How do you prove customer training ROI?

It’s about blending training data and product engagement data – focusing on specific milestones and event triggers in your product. For example, with the email product, maybe the measure of success is an X% increase in campaign clickthrough rates, or perhaps users who send at least 25 emails within 3 months of onboarding are Y% more likely to be retained or to grow as a customer. SaaS companies know these usage engagement metrics.

Interesting…

We can correlate a user’s training engagement very specifically with their product use and success. And that’s where the rubber meets the road. In our example case, the training goal is to make sure a user understands core email marketing strategies. We can analyze all sorts of training data from that. For example, how engaged are they? Which content modules do they interact with? How do they move through the path? Have they been onboarded successfully? Have we certified them?

Those are big questions. What kind of LMS features are needed to drive customer training and provide useful customer success data?

There are multiple components. For example:

1) First, you need authoring capabilities to create high-quality content and stitch all the various learning elements together seamlessly in a very efficient way.

2) Commerce is obviously critical, especially for customer training programs that operate as profit centers.

3) The ability to embed learning technologies inside of third-party software is essential to support the contextual product learning we discussed earlier.

4) And of course, reporting is a must. Organizations need advanced tools to analyze and manipulate customer training and business data in whatever way they need.

So the features may be the same, but their application makes a customer learning platform different. Why not use the same platform for all audiences?

When choosing a learning platform of any type, you want to look around a user conference and see other like-minded individuals with similar business needs. If you choose a generic LMS, the roadmap will be much broader and less relevant to you. That’s why focus is important. In the last 5 or 10 years, there are so many more niche learning applications. And I think that’s good for the industry…

FOR MORE QUESTIONS AND COMPLETE ANSWERS, LISTEN TO THE FULL PODCAST NOW!

WANT TO LEARN MORE? DOWNLOAD THE FREE eBOOK:

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The Ultimate Guide to Customer Training

This free ebook from Thought Industries brings together advice from leading experts about how you can design, develop and deliver customer training that makes a measurable business impact.

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Need Proven LMS Selection Guidance?

Looking for a learning platform that truly fits your organization’s needs? We’re here to help! Submit the form below to schedule a free preliminary consultation at your convenience.

The post Podcast 15: Tying Training to Customer Success – With Barry Kelly of Thought Industries appeared first on Talented Learning.

Podcast 15: Tying Training to Customer Success – With Barry Kelly of Thought Industries original post at Talented Learning

Wednesday 5 September 2018

Customer Training Pricing and Packaging: What’s the Best Strategy?

If you follow my LMS trends updates, you know that customer training is where the action is. What’s more, this trend is not just a passing fad. Here’s why:

When you buy a product or service, the faster you learn how it helps you achieve your goals, the more successful your customer experience will be.
As a successful customer, you’re likely to buy more and encourage others to do the same.

This means customer education is more than just a nice idea. It’s also a powerful business strategy that fuels a continuous cycle of revenue and profit. But an effective approach requires thoughtful pricing and packaging. So let’s look closer at the pros and cons of some popular ways to sell customer training content…

Customer Training: What Price Is Right?

Since learning is such a critical aspect of the customer experience, it begs the question – should you charge customers for educational content? If you educate new customers at no extra charge, will the long-term benefits outweigh any near-term revenue streams you could’ve captured from selling that content outright? What pricing scheme produces the best overall results?

Every organization will answer these questions differently. It depends on your business model, product positioning, competitive landscape and customer base. It’s also useful to consider relevant industry standards and practices. First, let’s compare free versus fee-based pricing.

Free Content: Pros and Cons

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Truthfully, there is no free lunch. Even if you offer customer training upfront at no additional charge, the cost of content development, delivery and administration must be included somewhere in the price of your product or service. Eventually, buyers will pay. But whether they pay separately is a packaging question that should be driven by your marketing strategy.

Our research reveals multiple reasons why organizations choose not to charge new customers separately for training:

To remove one of several roadblocks on the way to product adoption. Because adoption is a key factor in customer retention and lifetime value, ensuring that more customers are successful more swiftly can lead to stronger overall revenues and long-term profitability.
To differentiate their brand from competitors and drive more upfront sales.
To “pad” a bundle of core products when companies see that educated customers tend to buy additional items over time, through up-selling or cross-selling.

Fee-Based Content: Pros and Cons

Given the potential business benefits of free content strategies, why would anyone charge customers upfront for training? Well, if you can generate revenue streams from training content while simultaneously expanding your overall business revenues and profitability, isn’t that a better choice? Here are several ways fee-based methods work:

In some industries, charging for customer training is a well-established model. Since customers expect to pay for educational content, there is no advantage to changing the status quo.
With complex products, it’s important to offer sophisticated educational content – including certifications. Typically, customers who purchase complex products want to gain skill, competence and expertise as quickly as possible. These buyers are inclined to invest in training that shortens their learning curve.
Free content can be an excellent introduction for new customers, but paid certifications can add value to a professional resume. For example, when developers obtain IT certification from Amazon, Cisco, Oracle or Microsoft, these credentials qualify them to earn more for their expertise. This is a win-win. It monetizes vendor relationships with developers while empowering developers to monetize relationships with their customers.

Best of Both Worlds? The Freemium

Over the past decade, the rise of cloud computing, software-as-a-service (SaaS) and subscription business models have popularized a strategy known as the “freemium.”

Another way to describe this is the “Trojan Horse” approach. Companies bundle free training with core products to demonstrate the content’s value. This initial exposure is intended to open the door to incremental paid training up-sells.

A freemium strategy differs from purely free content because it’s intentionally designed to drive conversions to fee-based relationships. Software companies offer freemiums in multiple flavors:

1) Land and Expand

This business-to-business technique focuses on attracting a legion of individual customers at a basic free level, one user at a time. When the total number of customers reaches “critical mass,” it often makes sense to invest in a premium volume based relationship. Numerous enterprise applications have succeeded with this kind of strategy, including Slack, MailChimp and Dropbox.

2) Alternative Product Strategy

The goal is to leverage a high-value free product to get a foot in the door, and eventually cross-sell an entirely different premium product. HubSpot is a good example. The company offers a “free forever” CRM, hoping to attract interest in its premium-priced marketing automation platform.

3) Network Effect

Widespread digital connectivity makes it possible for platforms to leverage users and their connections for content co-creation, learning and knowledge sharing at scale. Successful examples include Twitter, YouTube, TripAdvisor and Quora.

4) Free Tool

Who doesn’t appreciate a handy online calculator, assessment or decision support tool that resolves specific issues you regularly face on the job? Think of lightweight apps or browser extensions like SEO tools from Google or Moz. That’s the logic behind free functional utilities from brands that want to remain top-of-mind while aiming for a larger share of your business.

5) Ecosystem

This “marketplace” model depends on revenue sharing from a broad community of third-party developers or affiliates that support a central platform. Successful examples include Google Play, iTunes and Salesforce AppExchange. Also there are many examples in the commercial training space, including Udemy, Skillshare, Teachable and Pluralsight.

Although freemium models have become popular in recent years, success can be elusive. Conversion rates are typically less than 10%. Without a massive addressable market, it’s difficult to reach critical mass. Furthermore, if a product isn’t truly self-service, it may be too complex for a freemium model.

Picking Your Price: How Much to Charge for Training

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Pricing customer education can be tricky. There is no universal equation, but it helps to frame the problem strategically. Your best price depends on two critical factors: your business goals and your customers’ perceived value of the learning experience.

Can this content stand on its own as a profit center, or will it be more successful if it is positioned as an enabler of your product strategy?

For customer education profit centers, the primary selling objective is to achieve profitable recurring revenue streams. Price points should reflect the cost of the core product, the perceived value of educational content, the level of expected demand and competitive pricing pressures. More complex products naturally command a higher price for related education.

For example, a software company charging $1,000/user each year for an individual product license should expect to charge 10% or less for training. Alternatively, a medical device manufacturer selling a diagnostic system for hundreds of thousands of dollars could easily charge thousands or tens of thousands of dollars per student.

For training designed to drive product sales, you’ll want to consider customer mindset very carefully. Do they expect training to be free or fee-based? How confident are you about this assumption? While you may not want training costs to inhibit product adoption, it’s equally important not to devalue customer education at the outset.

Before you commit, conduct informal or formal research. Ask your best customers for feedback about your content value and various pricing/packaging scenarios.

Testing: Tips to Evaluate Pricing

All of the free and fee-based pricing strategies we’ve outlined are measurable. This means you can test their effectiveness, an essential step both before and after a product launch.

Although pricing models themselves may be challenging to develop, the measurement process may be easier than you think. The first step is perhaps the most difficult: You must clarify and operationalize your business goals.

For example, say your training goal is to increase the adoption rate among new customers. You’ll want to determine the appropriate metric, such as your customer satisfaction score (CSAT), net promoter score (NPS) or customer renewal rate. This will help you establish reasonable benchmarks.

Next, track and analyze relevant data from customers who engaged with each training package you provide. Then compare these scores with customers who didn’t use the training. After several reporting cycles, it should become clear which pricing approach generates optimal business results.

But remember that performance measurement never really ends. Successful learning organizations manage testing as a process. They continuously gather relevant, standardized intelligence and apply it to drive ongoing improvement.

How to Package Customer Training: Digital Business Examples

When developing content of any type, most of the costs occur up-front. The incremental cost of selling content is nearly zero. The investment required to design, build and deploy customer training is identical, regardless of whether you sell it to one buyer or a thousand. In other words, the faster you sell an individual piece of content to multiple buyers, the faster your profits will accumulate.

Now that we’ve considered various pricing models, let’s look at the most popular ways you can package training to accommodate a variety of customer preferences:

1) A la Carte

Pricing courses/content individually and charging for them upfront is the most common way to sell training, books and nearly every other product. The fee may cover a live training event or access to specific packaged online content for a predetermined timeframe. Pricing is typically based on quality, length and perceived value.

2) Bundles

Bundles are collections of individual courses/content sold as a single unit – often for less than the total cost of the individual components. These collections can feature any number of courses, but don’t necessarily involve a sequence or a clearly defined learning path. Access is typically granted for a specific time period. One creative training bundle comes from the HR Certification Institute (HRCI), which lets HR professionals build their own custom training bundle to save money on exam preparation.

3) Training Plans

Training plans, learning paths, customer journeys and curricula are different terms for the same concept. They are designed to help learners move through multiple pieces of content in a logical, pre-defined sequence. Prerequisites and timed content availability are typically specified. Upon successful completion of a training plan, learners often receive a formal certification or designation.

One of the most visible and successful examples of learning paths is the Salesforce Trailhead online training program. Participants can pursue a series of challenges and projects to earn points and badges while they learn how to use the product in a hands-on, self-paced environment.

4) Subscriptions

Subscription models provide access to educational content for a predetermined time interval. Typically, customers pay for access on a monthly or annual basis. (Annual plans often sweeten the deal with a one or two-month discount.) Subscriptions can apply to a single course, a series of courses, a bundle, a training plan, a catalog or an entire library.

Some providers offer access to all content for a single flat fee. Success with this kind of business model depends on selling a massive volume of relatively low-cost subscriptions.

Alternatively, some organizations offer subscriptions for select premium content, such as topic-specific bundles or training plans. This multi-tiered approach helps maximize incremental sales among multiple customer segments, each with different interests and price sensitivity.

Subscriptions and other packaging models are sometimes augmented with free and freemium concepts we outlined previously. A great example of this is Lynda.com (now LinkedIn Learning). Courses are sold on a monthly or annual “all-you-can-eat” flat-fee subscription basis, but they are also included for free with every LinkedIn Premium membership.

Conclusion

As you can see, in today’s digital business environment, there are countless ways to package, price and manage customer training initiatives. Established companies often charge for training through a customer education profit center. Startups tend to focus on broader objectives and forego immediate training revenues to grow their customer base more quickly.

There is no single “correct” solution. However, there are universal principles worth keeping in mind. Start by reconciling your revenue priorities with the need to drive customer success. And remember that you can modify your scheme as your business expands and evolves.

If pricing and packaging options seem overwhelming, let your business strategy and customer input be your guide. Then verify your assumptions by testing and tuning early and often. With relevant data, you’ll have a reliable foundation as you build a virtuous cycle of revenue and profit.

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