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Does a Slowdown in Self-Paced E-Learning Signal Growth for Other Learning Technologies?
Monday, January 11, 2016
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The growth rate for self-paced e-learning in the United States is now negative at -2.7 percent, according to the recent Ambient Insight report, The 2015-2020 Self-Paced E-Learning Market. According to Ambient research, U.S. revenues will drop from the $21.3 reached in 2015 to $18.6 billion by 2020. But is this good news for other learning tech options that have been positioned for growth?

“There is ample evidence that consumers are opting for mobile learning products instead of e-learning, and this is cannibalizing revenues in the segment,” Ambient Insight chief researcher Sam Adkins. This is known as product substitution in market analysis.

A major catalyst affecting the revenue rates of self-paced e-learning is the reduction of training and education budgets in the organizational buying segments. Ambient notes that although training and education budgets have been increasing for the last three years, it is in the context of the deep cuts made during the recession.

“It may seem counterintuitive, but the weak economy in the U.S. was a major catalyst for learning technology sales and had a direct impact on the way buyers restructured their training and education budgets. Those new budget structures are still in place. It is now clear that organizational buyers will never return to pre-recession buying behavior,” says Adkins.

Consequently, reduced employee and personnel training budgets are driving organizational buyers to more cost-effective technology-based learning products. This entails more than just the adoption of self-paced products, but also the uptake of collaboration-based technologies, mobile learning, game-based learning, and simulation. Ambient reports that there is even an uptake in virtual reality and augmented reality training and education products.

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While the growth rate in the U.S. consumer segment is distinctly negative at -4.4 percent, the lowest of all the buying segments, there are many bright spots that provide evidence of a healthy demand for particular e-learning products in particular segments. The demand for the outsourcing of online programs (managed services) in the higher education segment is a good example.

Also, Adkins explains that despite the “flat-to-negative growth rate in the corporate segment, there are lucrative opportunities in that segment.” For instance, the demand for packaged online language learning content is also quite healthy in the corporate segment at 6.6 percent.

More importantly, though, the aggregate growth rate for e-learning in healthcare-facing companies is 7.4 percent. “Suppliers that specialize in healthcare-related training and education have significant pricing power and have been generating healthy revenues annually in spite of the decrease in training budgets across all sectors,” says Adkins. 

For a deeper dive into projections for the self-paced e-learning market, check out Ambient Insights’ complete report, The 2015-2020 Self-Paced E-Learning Market.

 

About the Author

Ryann K. Ellis is an editor for the Association of Talent Development (ATD). She has been covering workplace learning and performance for ATD (formerly the American Society for Training & Development) since 1995. She currently manages ATD's Community of Practice blogs, as well as ATD's government-focused magazine, The Public Manager. Contact her at rellis@td.org. 

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