Looking for a way to build an online business with low overhead, significant flexibility, and plenty of upside for growth?
Selling online courses could be right up your alley.
However, before you start creating a slideshow presentation and curriculum for Underwater Basket Weaving 101, it’s important that you understand what it takes to be successful and profitable in this industry.
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The Rise of Online Learning
Consider these incredible online learning statistics:
- The global online learning market will be worth $325 billion by 2025.
- 98 percent of U.S. corporations planned to use online learning in 2020.
- Between 2020 and 2024 the U.S. online learning market will grow by $12.81 billion.
The online learning industry has enjoyed significant growth and maturation over the past decade. However, the COVID-19 pandemic and ensuing shutdowns kicked everything into high gear.
If the online learning was a pot of simmering water before 2020, the pandemic turned it into a roaring boil within a matter of months. And regardless of what happens in the future, it’s becoming increasingly clear that online learning – both in terms of academics, professional development, and skills training – isn’t going anywhere.
We’ve seen the independent transition by thousands of public school zones across the country from physical classroom-based learning to virtual and hybrid environments. And while this shift has been tough on parents, the academic side of things has gone swimmingly.
For those with access to the right technology, evidence suggests that online learning is actually more effective. On average, students retain 25 to 60 percent of content when learning online, compared to just 8 to 10 percent in a classroom. (This is largely due to the fact that online learning requires 40 to 60 percent less time to learn, which increases focus and attention.)
Higher education has been forced to adapt as well. Nearly all public universities have shifted some of their resources to online courses, including top colleges like Harvard University and Stanford University. (Both have made online courses available in categories like business, mathematics, computer science, art, and engineering.)
Then there’s the personal and professional development side of things, which is where most entrepreneurs get excited about the opportunity to grab a piece of the growing pie. If there’s a skill or area of expertise, there’s a market for online course content. From photography and painting to copywriting and leadership, courses are in high demand.
As the saying goes, when the student is ready, the teacher will appear. And if the rising tide of demand shows us anything, it’s that students are becoming ready by the masses. Now it’s time to fill the supply side of the equation with more courses and better quality content.
The Benefits of Selling Online Courses
We’ll dig into some of the details of how you create online courses momentarily, but for now, let’s explore some of the top benefits that course creators enjoy:
- High demand. As mentioned, demand for online content is at an all-time high. Whether it’s teaching kindergarten, CPA prep courses, or how to build amazing Lego sculptures, there are millions of people actively looking for online courses.
- Robust margins. Looking for a business with extremely low overhead and high margins? You won’t find many opportunities better than this. Once you create a course, your only expenses are hosting the content and advertising. It’s not uncommon to see net margins of 70 to 80 percent.
- Passive income. While no successful business is truly 100 percent passive, this is as close as you get. Depending on how you organize your courses and the types of marketing, advertising, and support systems you put in place, an online course business provides a hands-off opportunity to generate revenue.
- Freedom. When you run an online business with no physical inventory or location, you have the freedom to set your own schedule, choose your own lifestyle, travel, move around, and enjoy unique experiences. Or, if you’d like, you can work from home, relax in familiar surroundings, and live a quiet, stress-free life. It’s your call!
- Creativity. People often complain about how they’re miserable in their jobs and would just love the opportunity to pursue the things they’re passionate about. Well, here’s your chance! When you sell online courses, you get to talk about and teach on whatever your passion is. From making surfboards to developing a budget, options are limitless.
While there are certainly some people who are better off working in another industry, the beauty of selling online courses as a business is that you can tailor it to your needs and interests. You can make it whatever you want!
Online Course vs. Online Course Business
Before going any further, it’s important to make a distinction between selling online courses and starting/growing an online course business. Because while they might be related, they’re not one and the same.
Anyone can create an online course. All you need is some basic software, a few good thoughts, and an ability to record audio/video. And thanks to some of the democratized learning platforms, you simply create an account, upload your course, and you’re good to start selling.
The problem with this approach is that nobody will purchase your course. Unless you already have a captive audience or happen to know somebody at one of these learning platforms who can pull some strings and get your course feature, a course alone isn’t enough to generate revenue.
In fact, if you want to know the truth, creating an online course is just a small part of building an online course business. If you’re serious about this, you’ll have to invest in branding, customer retention, content marketing, social media marketing, networking, sales funnels, webinars, email list building, email marketing, advertising, and more.
We don’t say all of this to overwhelm you, but rather to impress upon you the importance of viewing this as a business opportunity – not just a chance to make a few quick bucks.
It’s one thing to sell a course. Building an online course business is something else entirely. If you continue on, we’ll explain some of what goes into launching and growing a successful online course business.
9 Tips for Building an Online Course Business
If you want to be successful in this space, you have to look at it as more than just a course. You aren’t selling a course, you’re selling education at scale to people who have a desire to improve their knowledge and enhance their skills. This requires a comprehensive effort that prioritizes marketing, advertising, networking, sales, and customer experience.
Want to learn the basics of building and scaling an online course business? Sink your teeth into the following best practices:
1. Set Clear Goals
It doesn’t matter what type of business you’re building, you should always start by setting clear goals. This helps crystalize your mission and gives you some vision/motivation for where you’re going.
Setting clear goals also helps you focus your efforts. If you ever find yourself distracted, all you have to do is return to your goals and quickly recalibrate. Goals may include:
- Generate $1,000 in revenue each month
- Teach 500 students a month.
- Create a business that closes the knowledge gap in personal finance.
Your goals will be unique. They’ll serve as shining beacons of light when things get tough. And it’s worth noting that your goals can change over time.
2. Choose a Niche
One of the first steps is to choose a niche, subject matter, and/or target market.
While it’s possible to create courses in almost any area, certain niches offer more opportunities than others. It’s also important to note that your niche and your courses are separate concepts.
A niche is the area that you serve – the industry or market, if you will. Examples of niches include medium-sized businesses, college students, finance, or marketing.
These niches then give way to courses. If medium-sized businesses are the niche, courses might include content related to leadership, management, and productivity. If marketing is the niche, courses would likely focus on elements like SEO, PPC advertising, content marketing, etc.
The niche is the heading and individual courses will serve as subheadings. Your business is focused on the niche, while the courses are your products. (This is what sets an online course business apart from a course. People who sell a course think the course is the business, when it’s really just a product.)
3. Identify Your Competition
Demand for online courses is high, but so is the competition. And while high competition shouldn’t scare you off, it’s imperative that you get a lay of the land. At the very least, you should know:
- How many other businesses and course creators are selling courses in your niche?
- Where are they selling their courses?
- How much do they charge?
- What do the reviews and feedback say?
- Are there content gaps in what’s being taught?
- When was the last time content was updated?
Competitive research is time well spent, especially when you’re working to find the right keywords to target. It’ll may take you hours or days to pull all of these pieces together, but put in the time. The more you know about your niche, the better your business will become.
4. Identify Your Opportunity
Based on your research, you can begin to highlight opportunities and look for areas to grow your own online course business. Examples include:
- Content gaps. Let’s say, for example that all of the content in personal finance courses is focused on budgeting, saving, investing in the stock market, and lowering taxes. This exposes a content gap around the topic of cryptocurrency and gives you a chance to fill the void with quality courses.
- Audience gaps. Digital marketing is an oversaturated online course niche, but are there opportunities to reach a new audience that’s never been targeted? Instead of developing a “SEO 101 Course,” you might be able to launch a “Digital Marketing 101 for Wedding Photographers” course.
- One-ups. Sometimes you don’t have to reinvent the wheel – simply one-upping existing courses could be enough to set yourself apart. This might look like adding bonuses, extra modules, or additional support.
- Better quality. Many of the best courses available online have good content but atrocious execution. Now imagine if you could mirror the content (making it original, of course) and improve the quality with better video, audio, graphics, and interfaces.
- Content refresh. If all of the courses from your competitors were created three to five years ago, there’s likely an opportunity to come in with updated and refreshed content that speaks to some of the new developments and changes in this space.
- Unique pricing. Another obvious point of differentiation is pricing. And there are a few different ways you can go. One option is to offer the same quality of content as the competition, only at a lower price. Another option is to actually increase the price and enhance your perceived authority. And finally, you can switch up the pricing structure. (Rather than a one-time payment, you may sell access to the course on a monthly subscription basis.)
These are just a few examples – and they underscore why it’s so important to research the competition and know what’s out there. If you go in with a laser-focus on a specific niche opportunity, you’ll dramatically improve your chances of being successful. As entrepreneurs commonly say, there are riches in niches.
5. Develop a Brand
Remember that you’re building a business – not just a course. And in order to grow a successful business, you need a brand.
Branding can actually be really fun. And while we don’t recommend spending a ton of time on your initial branding (you can always return and polish), it’s smart to get the fundamental building blocks in place.
You don’t need to invest tens of thousands of dollars into working with a branding agency. You do, however, need a simple logo, a well-defined color scheme, a sleek website, basic social media profiles, and other core elements.
When you’re small and growing, simplicity and consistency are key. You’re not trying to wow anyone with complex designs. You want your image to create a specific vibe. Furthermore, you want people to remember your brand (and the vibe) when they run across your brand in the future.
6. Choose a Platform
You’ll have to decide how and where you’ll sell your courses. There are a few basic options:
- Online course marketplace. There are dozens of online course marketplaces that make it easy to create, publish, and market your courses. Popular ones include Udemy, Skillshare, Thinkific, and Teachable. These platforms either charge a monthly fee or take a percentage of your sales as a commission.
- Self-hosted. If you’re serious about building a business and believe you have the marketing and promotional chops to build an audience, you might want to hire a developer to help you self-host courses on your own website. This requires some work and added expenses, but means you get to keep 100 percent of your profits.
- Webinar style. In some cases, you might sell courses to businesses or institutions. Or perhaps your selling point is that you teach classes live. If so, try a webinar-style approach where you charge people for access to the event.
Don’t get too stressed out about this part. In 99 percent of cases, an online course marketplace is the way to go. It takes out all of the guesswork and gives you some initial visibility and reach. You can always transition to another style in the future.
7. Establish a Pricing Structure
Pricing is a matter of positioning, value, and cash flow. Run the numbers and see what makes sense for you.
Let’s say, for example, that you want to generate $5,000 in top-line revenue per month. There are multiple ways to do this, including:
- Sell 500 courses at $10
- Sell 100 courses at $50
- Sell 10 courses at $500
- Sell 5 courses at $1,000
There’s clearly a difference between selling a course at $10 and $1,000, but sometimes it’s easier to opt for a high price target. Yes, you’ll have to back it up with value, but you don’t have to get in front of as many people. As long as you have your niche established, it’s just a matter of marketing and execution.
8. Build Up an Audience
You can have the best course in the world, but it won’t make you any money without an audience to serve it to. So in reality, you’re in the business of audience building.
When building an audience, slow your roll. Asking for a sale the first time you interact with someone can be a bit too aggressive. Instead, we recommend building rapport by offering free content first.
Lead magnets and free videos served up on a landing page are a great way to build a relationship, collect an email address, and start a relationship. Then, once you’ve established trust, you can promote your courses and go for the sale.
As for your website, you should work on creating high-quality free content and using the best link building service to drive traffic to your site. In addition to driving traffic, link building enhances SEO and allows you to capitalize on organic streams of search traffic for relevant search terms.
9. Stack Your Courses
One of the best strategies for building an online business is something known as a value ladder. It works especially well for courses, which are able to naturally feed into one another.
With a value ladder approach, you offer a series of courses or information products that increase in price and value. For example, your 101 course might be $20. But at the end of your 101 course, you promote the 201 course, which is $200. Then there’s a 301 course that’s $1,000…and so on.
By stacking relevant courses together and creating a cluster of valuable content around one main theme or idea, you’re able to increase customer lifetime value and build a true business.
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Want to learn more about how we can help you grow your online course business? Contact us today for a free assessment!
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