From Cost Center to Profit Center - Packaging Training

From Cost Center to Profit Center - Packaging Training

January 5, 2017
Training Strategy

Transforming training from a cost center to a profit center doesn’t happen by simply slapping a price tag on the work you’re already doing. It takes strategic planning, collaboration across the company, and time.

Last week, we shared some insight from our conversation with Jesse Finn. We talked about first steps and rallying the organization around your goals. Jesse’s extensive experience meant that we could ask her big questions, and we got big answers in return. In this post, we’ll continue to dive into the advice she provided, and take a deeper look at packaging your training.

Packaging Training

Training can be difficult to package and sell. In the SaaS world, many companies opt to provide it free of charge with the hopes that they’ll see the returns in the form of customer retention, and they often do. Others are investing significant resources in their training programs and see an opportunity to drive revenue and value further. Once you decide to put a price tag on training, how do you price and package it? Do you charge per course? Do you match a product subscription model?

Jesse described the different options, but one thing that stood out was the emphasis on creating a model where revenue driven by training was clear and recognizable. Blended models where core product subscription and training purchases are combined into a single SKU muddy the waters, and make it difficult to determine training revenue later.

When referring to SaaS companies, Jesse pointed out that bundled training subscriptions are often favored, and that these packages can be sold alongside the subscription. Whether you opt to offer an “all you can eat” subscription package, or a more defined number of courses, she emphasized the importance of developing discrete packages with discrete items in them.

It’s important to consider the different types of packages that may be needed for different customer segments and users. Jesse suggested defining training needs based on the size of the license/subscription and different functionalities purchased. This may come with different consulting and ILT options as well. She also recommended analyzing the types of users that need training. Some contacts that use your software are power users and will be spending significant amounts of time using your product, while others may be more casual users with more limited use cases. Create clear pathways for these different types of users to guide them through their learning, appreciating that each will have a curriculum based on their needs, and the price tag may vary.

Additionally, present training with distinct time boundaries to define when the training must be completed. Putting an end date on access to certain courses can drive users through onboarding, and naturally, if users request more time, you have an opportunity to build relationships and give a little more.

Regardless of how you end up packaging your training offer, it has to be easy to sell and clearly distinguishable for the sales team. Avoid complex free/paid models, and bundle and present your offering to sales so they can easily determine the right package for the customer they’re selling to. Due diligence here will make it simple for sales to attach training to a deal and help the business create educated, successful customers.


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