Report: Online Education Industry Growth 2020
EdTech Industry Covid-19 Impact Analysis
Covid-19 Impacts Online Learning and EdTech Industry:
- Organic Traffic: 233.91% Average Increase
- Engagement: 188.56% Average Increase
- Sign-Ups: 290.55% Average Increase
- Revenue: 335.08% Average Increase
Summary of Findings
The data presented in the following EdTech report was based on a stratified sample of the EdTech industry, estimated to be worth $89.07bn in 2019. The sample had a cumulative revenue value of $2.78bn in 2019, representing a cross-section of small, mid-size, and large EdTech providers.
The purpose of the report is to measure the impact of Covid-19 on the EdTech & Online Learning industry, with the hypothesis that as Covid-19 disrupted in-person methods of education delivery, the EdTech & Online Learning Industry would see an increase in growth.
The data collected showed an average increase for EdTech companies in organic traffic of 233.91%, engagement of 188.56%, sign-ups of 290.55% and revenue of 335.08% for the period of March to July 2020, compared to March to July 2019.
Further analysis by revenue size, employee count, and type of EdTech company follows below.
Covid-19 EdTech Impact Case Studies
Michael Hansen, CEO, Cengage
The pandemic has forced higher education, which has traditionally been apprehensive to change, to pivot to online learning virtually overnight. While the experience cobbled together to complete the spring semester isn’t true online learning, it has shown that institutions need to be more flexible in the learning formats they offer.
If institutions cannot meet this challenge, they will face an accelerated loss of enrollment and powerful competition from online skills education providers who offer certificates at a fraction of the cost.
Shelley Osborne, VP of Learning, Udemy
While the surge of online learning has been accelerated globally by the COVID-19 pandemic, this is a fundamental shift that will be sustained over time. We’re also confident that continuous learning — for upskilling or reskilling to find new employment or to increase job security — is table stakes for the modern world.
Gabe Dalporto, CEO, Udacity
New technologies like AI and robotics, and the upheaval caused by COVID-19, have disrupted billions of people's lives and livelihoods and highlighted the need for individuals, companies, and governments to take responsibility for mastering new skills. The strong demand for Udacity's Nanodegree programs over the past six months reflects our commitment to deliver transformational, employable job skills in the careers of the future.
Jeff Maggioncalda, CEO, Coursera
The world is facing unprecedented economic disruption, and the need to develop skills for a digital future is even more apparent now. We are deeply inspired by how our community of top educators, enterprise learning leaders, and government partners are coming together to serve the world with generosity, innovation, and dedication. We are here to enable their efforts in every possible way.
Aaron Rasmussen, Founder & CEO, Outlier
When students pay upwards of $70,000 per year to go to an elite college, they are actually paying for four things. Those are: knowledge, the brand of the credentials, a social network, and the physical experience. As schools move online, they can deliver on the first two aspects, but will struggle on the latter two. In that sense, the traditional, in-person, higher education experience is suffering, since colleges are unable to deliver on much of their value proposition.
The online learning portion, on the other hand, is receiving more resources and investment than ever before. In my view, that increased attention and investment can only improve the experience and effectiveness of online learning. I have an enormous amount of sympathy for the students, professors, and administrators who are confronting these issues, especially on such a short timeline, and I hope that this experience will help evolve the cost structure of higher education to make it more affordable and flexible.
Gautam Tambay, Co-Founder & CEO, Springboard
Due to the pandemic, the trajectory of online learning just got accelerated by a decade. Both learners and employers are shedding long-held assumptions -- we'll see a rapid increase in the acceptance of alternative, online credentials. Disciplines like nursing that were previously considered off limits for online learning will quickly move online. This creates a great opportunity -- our unique mentor-guided offerings, focused on employability, appeal to those who are ready to adapt to the new reality and pursue new career trajectories.
EdTech & Online Learning by Revenue Size
EdTech & Online Learning by Employee Count
EdTech & Online Learning by Type
EdTech companies were organized according to reported annual revenue figures for 2019. Small EdTech companies ranged from $0-10M and comprised 40.8% of the sample. Mid-size Online Learning companies were 32.9% and ranged from $10-50M. Large EdTech businesses were $50M+ and comprised of 13.2% of the sample. An additional section (undisclosed), was featured where revenue figures could not be ascertained or were not provided.
Small EdTech companies saw substantial increases in organic traffic and engagement at 297.79% and 328.35% respectively. This aligns with qualitative reports from small EdTech companies that created many new free or low-cost offerings in response to the pandemic. Notably, while small EdTech companies saw the biggest jump in user activity, mid-size EdTech companies saw the highest increase in sign-ups and revenue at 306.99% and 274.41% respectively.
Within EdTech companies segmented by size, small EdTech companies saw the single biggest percentage increase of 328.35% for engagement. The smallest increase was EdTech companies with undisclosed revenue for the metric of revenue at 102.83% increase.
EdTech companies were organized according to reported employee count for 2019. Small EdTech companies were determined to consist of 1-10 and 11-50 employees, making up 51.4% of the sample. Mid-Size EdTech companies consisted of 51-200 and 201-500 employees, making up 38.1% of the sample. Large EdTech companies consisted of 501+ employees and were 10.5% of the sample.
Small EdTech Companies, with 1-10 employees, had the largest surge in engagement at 573.45%, expected as Covid-19 was reported as the primary contributor to increased activity on their platforms. Sign-ups had the biggest average increase across all employee counts ranging from 239.2% to 336.17% for small, mid-size, and large EdTech companies.
The most significant bump in revenue came in the mid-size EdTech company category of 51-200 employees at 443.4%, closely followed by the small EdTech company category of 11-50 employees at 412.46%.
EdTech Companies were organized by type of company: Platform, Courses, or Service. See Methodology section below for definitions of each type of EdTech company. EdTech Platforms were the majority of the sample with 52.6%, followed by EdTech and Online Learning Service Providers at 36.8% and EdTech Courses at 10.5%.
EdTech and Online Learning Service Providers saw the largest increase in revenue of 559.84%. This was reported by participants in this category who noted an uptick in interest as EdTech institutions prepare to plan for the return of students. It is hypothesized that further increases are likely to accrue to EdTech Platforms and Courses as we move further into the Fall, due to Covid-19.
EdTech Platforms had the most consistent increase across available metrics, ranging from 192.2% in online learning engagement to 341.71% for sign-ups. Sign-up rates across all three types of EdTech companies saw the biggest average increase, ranging from 211.82% for Online Learning Service Providers to 341.71% for EdTech Platforms.
Statistics were collected via surveys conducted with EdTech & Online Learning Companies based on a Stratified Sample of the EdTech industry, estimated to be worth $89.07bn in 2019. The sample had a cumulative revenue value of $2.78bn in 2019, representing a cross-section of the EdTech & Online Learning industry.
Statistical data collected were as follows:
- Organic Website Traffic: defined as inbound website traffic from search engines from the period of March to July 2020, compared to March to July 2019.
- Engagement: defined as average session duration or time spent on the platform from the period of March to July 2020, compared to March to July 2019.
- Sign-ups: defined as an aggregation of new subscribers, clients, or applications from the period of March to July 2020, compared to March to July 2019.
- Revenue: defined as the increase in revenue derived from EdTech & Online Learning offerings from the period of March to July 2020, compared to March to July 2019.
Charts were derived by dividing into relevant segments based on Revenue Size, Employee Count, and Type of EdTech company.
Revenue Size was divided into 4 categories:
- 0-10M: representing small EdTech Companies.
- 10-50M: representing mid-size EdTech Companies.
- 50M+: representing large EdTech Companies.
- Undisclosed: represented EdTech Companies where readily-available revenue figures were not present.
Employee Count was divided into 5 categories:
- 1-10 and 11-50 - representing small EdTech Companies.
- 51-200 and 201-500 - representing mid-size EdTech Companies.
- 501+ - representing large EdTech Companies.
Type of EdTech Company was divided into 3 Categories:
- Platform: defined as online software that either enhances teacher-led learning in classrooms or provides educational services to students directly.
- Courses: defined as a niche with a singular consumer segment (e.g. an online nursing certification for trainee nurses).
- Service: defined as a service provider, offered either directly to consumers or to other EdTech businesses that is facilitated in an online environment.
Thanks to the following EdTech companies for sharing their insights about how Covid-19 has impacted their business and the Online Learning Industry at large.