Achieving your goals through career has become a challenge before the corona pandemic. You can be a professional with years of experience or, a student who has just passed out of college and is out to join the workforce. After the pandemic, companies are looking for only the best talent in every field. Therefore, you need to acquire new skills as per the requirements of your industry. But there is a challenge. Time. Do you want to join any institute or college for new course? Then, you’ll need to balance between your work (as a professional) or attending classes (as a student). But, online digital platforms like Udemy meet your needs by offering over a lakh online courses from renowned instructors at a nominal cost. That being said, after browsing the Udemy website and being satisfied with the courses offered, are you wondering about the Udemy business model? How does this platform generate money? Then you have come to the right place. Stay tuned, and you can get the details right. Let us first get to know about Udemy, and then we will move on to the topic of this article, shall we?
Udemy:
Combining two words – AAP and ACADEMY, this platform has gained global recognition. The reason being, it facilitates the process of online learning devoid of a brick-and-mortar institution. Little did its founder, Eren Bali, know, his idea would trigger a wave of online digital platforms that would change the education landscape. It currently has 1,30,000 online courses. With that last sentence, let’s move quickly to the Udemy business model.
Udemy’s Market Place Business Model
Like Amazon and Flipkart, Udemy also organizes various instructor courses on its online platform and sells them to deserving students. Udemy is a simple platform for instructors to showcase their courses and as per its policies, does not own the content. In fact, even the prices of each online course are decided by the instructor. But, Udemy charges for administrative services and various marketing options. Now let’s focus on this topic.
How does Udemy generate money through its business model?
Udemy also offers free courses. Although, it is on paid course basis, this platform generates revenue of 2 billion every year. A student can opt for courses in more than 80 languages. Also, the business model splits into two lossless types. The first type is for an individual, and the second, for businesses.
There is no charge for the instructor to host your course on the platform. But, a student may have to pay a fee for attending a specific course. The cost structure of a course by which Udemy generates revenue is through the acquisition of a student. The process is as follows:
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A popular instructor will get most of their students through word-of-mouth marketing or favorable reviews. Instructors can also advertise their own courses and get students to sign courses through coupons. In such a situation, he gets 97 percent of the fee of the entire course. Udemy charges a mere 3% for administrative fees.
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Udemy can also promote a course through YouTube, Google, Facebook and various other methods. If a student opts for a course through any channel, the instructor will have to pay 75% of the total fee. However, Udemy gives the instructor the freedom to limit the number of times courses appear on a channel. The instructor can also decide the type of channel where his courses can be displayed to the public.
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If a course is chosen through an Android or iOS app, the platform gets 30 per cent of the total fee.
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Let’s say, a student comes to the Udemy website and opts for a course without any coupons from the instructor. Then, 50 percent of the course fee is shared between the instructor and Udemy.
Did you know that Udemy’s business model is specially designed for small to medium companies and large organizations? Called “Udemy for Business”, it provides training to employees to develop their skills. In this type, there are two plans which are called team planning and enterprise planning.
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Team Plan – caters to companies with a workforce of 5 to 20 employees. Yes, there is an annual subscription and the minimum requirement should be five users.
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Enterprise Plan – Designed for companies and organizations that have more than 20 employees. Prices may vary with the courses selected and the duration of training.
Udemy has also provided a two-week trial period for both these plans. If the company does not find the training satisfactory, they can go for other options.
conclusion
Udemy’s revenue generating model is flawless and extremely attractive not only to the instructor but also to the students. The main reason why Udemy is successful is to provide value, comfort, cost reduction, brand awareness and easy access to not only the students but also the instructors. In addition, the platform provides a variety of technical features free of cost for the instructors to host their courses and provide training to the students.
Overall, Eren Bali has realized his dream of providing online courses to the needy through its digital learning platform. His model has inspired over a million working professionals and students to acquire new skills through courses on the Udemy platform. As per the recent news on the website, the payment structure for the trainers is set to change. Yes, there will be more changes in the future, but until then we salute Eren Bali and his platform for revolutionizing the education industry.