Dev Clever - Building a Brand (the bigger picture)9 Aug 2022 09:13
Having just raised $210m in funding, Indian EdTech firm upGrad announced this week that it was on track to record $400-500m gross revenue in FY23, out of which about 45 per cent of total revenue will be realised from its own-branded online courses and programmes. Started in 2015, the edtech platform has a learner base of over three million across more than 100 countries.
So, upGrad will achieve $400-500m revenue from a user base of approx 3 million.
According to Alan Greenberg, LMC has already on-boarded 3.5 million students. So, why aren’t we making $400-500m revenue, you might ask.
Well, LMC is distributed on a freemium basis (the product is free, with the option of opting for premium content). Currently, it appears we are earning money from approx 3% of these 3.5 million students, whereas upGrad are attracting income from close to 100% of their client base.
The difference is that Dev Clever is distributing a high quality, much needed, and in most cases free, age appropriate careers exploration platform directly to 1000’s of schools across India, aimed at children between the ages of 11 and 18. It’s a very inexpensive way for schools/parents/students to access a great resource that helps kids discover their ‘best selves’ in terms careers choice. In contrast, upGrad are distributing own-branded online courses and programmes to older students and professionals (lifelong learning).
So, let’s suppose Alan Greenberg is right, when he says the LMC platform alone could be serving 10’s of millions students (it’s a freemium product, so big numbers are achievable). At a 3% conversion rate, this in itself will generate significant income for the company, however, youngsters and parents (don’t forget LMC involves parents too), who’ve had positive, early, ‘in school’ exposure to LaunchMyCareer, are more likely to look to the same company for online courses and programmes in the future, when they reach an age where these resources become appropriate.
Let’s not forget, the on-line learning space is a very competitive market to operate in, especially in India. There is a lot of scepticism/mistrust about the quality and reliability of some online content providers. One reads daily complaints from parents feeling that they’ve been ripped-off by various edtech companies, “Lido” being a case in point. Propagating a sense of trust in the brand and a feel good factor with parents and children from an early age, offers a huge marketing advantage to the company going forward.
It’s the same strategy banks use…. to hook kids early, by offering parents incentives to open bank accounts for their children, knowing that a large percentage of those children will stick with that same bank throughout adulthood.
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