It pays to watch what for-profits in the learning business are doing. The fastest growing customer segment for online learning providers, like LinkedIn Learning, Coursera, and EdX, is the corporate market. Have you given enough attention to employers in your industry?
Let’s dig deeper into the business model strategies of these companies to find out how they make money. You might uncover new strategies to consider, steal, and adapt.
7 business model strategies to steal from for-profit online learning providers
The inspiration for this post came from Class Central’s deep dive into Coursera’s financials, which is why these suggestions are Coursera-heavy.
#1: A product line for every budget and schedule
Coursera offers a product at every price. Here’s a look at their learning portfolio with a few additions from EdX and 2U (the parent company of EdX).
Clips: These five- to ten-minute video lectures are free for Coursera’s enterprise customers—a good way to get employees used to the platform.
Try It Courses. EdX offers free bite-sized courses designed to give learners a “taste of a longer program experience.” These courses take from 10 to 60 minutes.
Guided Projects. For $10 and up, these step-by-step videos play in a split-screen: one side is your work area and the other is an instructor who walks you through the steps. Created by experts, these programs take less than two hours to complete and are intended to teach job-ready skills, tools, and technologies.
Courses. MOOCs, like Coursera, made their name with their four- to twelve-hour online courses from universities and corporate partners. Courses are free, but you have to pay $29 to $79 to get graded assignments, instructor feedback, and certificates of completion.
Specializations. These microcredentials are a series of three to ten short courses focused on mastering a skill. Learners subscribe to a specialization for $39-$79/month. Specializations take one to six months to complete.
After completing the capstone project, learners are awarded a certificate.
Professional Certificates. Certificate programs prepare the learner for an in-demand career. They’re sold on a subscription basis for $39-$79/month and can take from three months to a year to complete.
Coursera Plus subscription. Introduced in 2020, this subscription provides access to all Coursera programs. We’ll talk more about this below.
Boot Camps. Coursera’s competitor 2U offers immersive online classroom experiences called Boot Camps. Customers participate in hands-on project work and class discussions while learning in-demand tech skills from industry professionals. 2U constantly updates course content based on feedback from learners and their employer partner network. Learners also have access to:
• Job-related coaching
• Career counselors who review resumes and help them prepare for interviews
• Events with employer partners
• Support and resources before, during, and after boot camp
If you’re a regular reader, you know how highly we regard learning subscriptions. A Coursera Plus subscription provides unlimited access to 7000+ courses, certification, and projects. It costs $399/year or $59/month.
Learners can also subscribe to specific specializations for $39-$79/month.
Watching Coursera’s subscription success, EdX plans to introduce two types of subscriptions, similar to Coursera’s. EdX executive Anant Agarwal predicts that these subscriptions will double their course completion rates.
#3: Free samples
At Coursera, learners can audit most courses for free but must pay to get graded assignments and certificates. These free educational programs serve as a marketing channel for Coursera. They’re loss leaders that feed customers into higher priced products.
Why offer a selection of free programs?
• Free programs give learners a taste of the educational experience.
• They get to know your website and LMS, and see what else you have to offer.
• You can add these potential customers to your mailing list, then share relevant content to keep them close while promoting related paid content.
In our instant gratification society, learners can earn microcredentials more quickly than traditional certificates or certifications. Coursera promotes their Specializations as “degree-level knowledge at a relatively low monthly cost.”
Three new research reports confirm that microcredentials (or digital badges) bring benefits to both employers and learners. Higher education institutions are enthusiastic about the potential for microcredentialing programs to prepare students and recent graduates for the job market, increase their customer base, and bring in additional revenue. Don’t cede your microcredentialing market share to universities!
#5: Career engagement network for young professionals
If you’re worried about attracting the next generation of members (or customers), 2U’s Career Engagement Network is worth a look. Free to all students and alumni of 2U online programs, the program provides resume and interview preparation toolkits, workshops, webinars, virtual events, and career fairs with 2U’s employer network.
A recent study on boot camp outcomes from Gallup and 2U found that boot camp graduates saw significant median salary increases, growth in employment in STEM careers, and increased satisfaction with their career paths.
#6: Corporate content partners
Besides universities, Coursera partners with corporations such as Microsoft, DeepLearning.AI, Salesforce, Google, and IBM. Through licensing and revenue share agreements with Coursera, these companies provide content for Coursera courses, specializations, and credentials.
However, Coursera learned the hard way that cozy relationships (and recurring revenue) with content partners can change when the contract’s up. Google renegotiated their contract with Coursera and now keeps more of the revenue share to themselves, which affects the projected bottom line for Coursera.
Who would make a good content partner in your industry? Cast the net widely to member companies—both core and supplier members—allied organizations, industry influencers, and for-profit training companies.
#7: Enterprise customers
And now we get to the biggest takeaway from our look at the Coursera business model. Every association should have two customer segments: individuals and organizations.
Coursera’s fastest growing customer segment—businesses, governmental organizations, and academic institutions—account for 35% of Coursera’s revenue. In 2022, this enterprise segment grew at a rate of 51%, compared to 20% for the consumer segment.
Enterprise customers buy access to most of Coursera’s catalog for their employees, including specializations and courses that award certificates. Coursera offers a Team plan for organizations with up to 125 users for $399/year, the same price as Coursera Plus.
Team customers get:
• Company-branded homepage and learner communications
• Ability to send invitations to employees
• Priority technical support for learners
• Skills Platform with industry skill insights and benchmarking, and analytics that track progress, such as skills learned, proficiency, and time to mastery
The Enterprise plan for more than 125 users has “custom pricing.” These organizations receive all the Team benefits plus:
• Consulting services
• Customer success manager
• Integrations for a fee
• More sophisticated Skills Platform that can assess the organization’s skills baseline and make job-based content recommendations
• Data, Tech, Leadership, Marketing, Finance, and Career Academies
Is there anything from the Coursera business model that would help your association strengthen your relationship with industry employers and consequently increase participation in your educational programs? Learners have increasing options for online professional development besides your association. Establishing educational partnerships with industry employers will increase the chances of professionals coming to your association for their learning needs.