“Online learning businesses have it all wrong—they are not thinking like a product company.”
Every day, we speak to universities, nonprofits and corporations who are looking to put their training or education online with the goal of generating revenue, creating impact or influencing an audience. And these conversations are very similar – people usually anchor their thinking to the existing and ask “how do we create an online course.”
But that is all wrong. At least, it is in the eyes of the head of learning at one of our clients who I recently spoke with. In his mind you have to think and act like a technology product company. “Online learning businesses have it all wrong—they are not thinking like a product company.”
You are creating an online product and an online business, not just putting a course online. And your product — this program, course, certificate, or degree — has to be special, unique and very specific to what your market wants. You need to think like a product company.
There are many elements to doing this right, many of which are overlooked by people we speak with. You need a business plan that outlines the market, competition, revenue and cost projections, learner personas, team and operational resources, ecommerce, positioning, differentiators and more. You need to create organizational structure, processes and resources similar to a tech product company. You need product management and product vision. And, most importantly, you need your own technology platform, with the best commercial, open source or custom build options to create what your learners need, what your business calls for.
Now this is the most challenging concept for many. Many ask “with 700 LMS vendors on the market, why not just use one of those?” Sorry—while a traditional LMS maybe a component of an online learning business, it is not the complete solution. And it certainly cannot drive a modern online learning business alone. You need a full technology platform that incorporates tools that engage the learner and adapt to your strategy, constraints, competition and business model. We call this a custom learning experience.
For comparison, let’s look at some of the most successful online product businesses. Do you think Amazon uses an off the shelf eCommerce platform? Or eBay? What about Netflix or YouTube—do you think they use a generic video player? Can you imagine The New York Times using an off-the-shelf content management tool? Nope. Did Lynda.com, edX or Udemy choose an off-the-shelf LMS? Of course not. That is because to these organizations, the online platform is their business. It is core to what they do and they need to have complete control of the experience. They need to drive the direction. They are not putting offline products online—they are online businesses.
So if you are looking at online education, why wouldn’t you approach it the same way? That is how the head of learning I referenced thinks about it. They not only have a custom learning platform, they have an organizational structure similar to technology companies — development, product management, marketing, sales. They treat the learning platform as the centerpiece of their business. It would be unimaginable for them to not have complete control over this. And this is not a big company — they are no Amazon or Netflix. But they still see the investment in a custom learning platform as mission critical.
Let me give you one more way to think of this, especially for those of you in Higher Education. Let’s assume you were going to start a new on-campus degree program and it required new classrooms. Would you just call “Buildings-R-Us” and buy a generic building that was similar to scores of other buildings on other campuses? Would you then just ask students and faculty to adapt to that building and deal with the limitations?
Or would you hire an architect who is experienced in higher education and have them deeply understand needs of the faculty, the program, and the students? Would you ask them to think about this as more than just a building, but as a learning space, critical to the experience of the students and success of the program? Would you then hire a construction firm to build that building based on the architectural plans? Of course you would. That has been the standard for decades. So why are online programs treated differently? Why would you call “Online Learning-R-Us”?
Look, we are biased — we build custom learning experiences for clients. And more importantly, we help them think like product companies and create not only great online learning platforms, but create great online learning businesses. So we believe everyone should think this way.
But what do you think? We encourage you to add to the conversation on our twitter account @ExtensionEngine with the hashtag #ThinkLikeAProductCompany.
Generating revenues through online training depends upon taking the right steps up front, which requires a shift in thinking from “courses and learners” to “digital products and customers.”
This white paper provides a roadmap for how to make the transition and succeed in an increasingly competitive marketplace.
How to Build a Revenue-Generating Training Business Through Modern Online Learning