Business models in foreign languages

Given that in foreign languages ​​there are 2 psycho-types of clients , as I wrote in the previous article, then the business approach to each of them is fundamentally different.

Business model number 1 - Monetization due to gamification of the learning process of the masses of the population.
Business Model No. 2 - Monetization through personal work with an individual client.
Business model number 3 - Monetization due to the guaranteed achievement of results by the client.

All models are viable and financially beneficial.

Business model №1

Monetization through gamification of the learning process of the masses of the population.
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Ideal for making money, if there is an initial capital. Very attractive to potential investors. The client belongs to the first psychotype.

Investments in this business model are unevenly distributed:

• minimum of funds goes to the methodical part (there is no sense);
• fixed assets go to automation, IT infrastructure, marketing and advertising.

With this model, large investments should be made only at the initial stage. After automation, fixed costs are minimal, variables are reduced to zero. That is, the high threshold of entry and subsequent work "on autopilot."

In an IT project, the task is to reduce fixed staff costs, automating everything as much as possible, and leave the user without the opportunity to ask a question about the methodology and language problems that arise during his training.

Due to the huge number of potential customers, there is no personal contact with the user and targeting occurs at the group level (Look-alike, behavioral marketing, socio-demographic targeting, etc.).

Sites that operate on attracted borrowed capital with large investments, the main task is to work out and increase the funds invested in them as soon as possible. And according to all the laws of business, working with an existing client is cheaper and more efficient than attracting a new one.

Thus, foreign-language learning sites working on borrowed capital are interested in artificially delaying the process of learning a foreign language in various ways: beautiful pictures, motivational videos, new levels, new courses, unobtrusive exercises, tests, social communication, and so on. The task is to “bind” a mass client in order to earn money on it as long as possible.

It is important to understand and remember that the hallmark of the masses is blindly following what they are told and what they put into their heads. That's why it is a mass market: it is convenient to manage the masses and, as a result, to earn money.

Many resources believe that you need to bring gamification, socialization and humor to make the learning process more enjoyable. But, as a result, in fact - less effective. It sprays attention.

A new type of learning is artificially introduced (gamification + socialization) which is obviously not effective in real life, but on which it is convenient to earn. It is much easier to get 1000 rubles for the entertainment process from a representative of the generation of gamers than to motivate him to get a measurable result in offline life.

The end user doesn’t really understand the concepts, and service providers are very good at using them - they make the learning process fun so that the client doesn’t get bored by monetizing the process.
The problem of the end user is not in learning, but in the application of a foreign language in life.

Speech about the end result in this model is not. This must be very well understood and distinguished in order not to err in choosing a resource for learning a language.

If you just need to have fun spending your time in front of the monitor screen, without having to bring your knowledge to real life, this is one thing.

If there is a need for practical application of a foreign language in life, namely, it is worth it, then such sites have absolutely nothing to do with solving the real problem in foreign languages.

Because it is much easier to move to a new level in English on any website than to switch to a new position in an English-speaking IT company. It's one thing, you sit in your underpants in front of the monitor and silently watch another video from TEDa, and quite another when you have a live interview and interviews you with a real HR from Ireland.

Talking about the effectiveness of training can only results in offline - in real life. It is difficult to measure the effectiveness of training points and points on the monitor.

If you replace such a favorite word “efficiency” with a more measurable concept of “effectiveness”, it is interesting that then modern training sites will issue as a result?

However, the main flow of money is circulating in this particular business model. So if the goal is to make money, then this is the most profitable model.

Benefits

• big profits;
• low risks;
• fast start.

disadvantages

• high entry threshold;
• competition at the price level;
• technological complexity;
• inability to solve the real problem of the client (this can be crossed out if morality does not matter).

Business model number 2

Monetization due to personal work with an individual client.

Ideal if there is no initial capital, but there is an effective method of training. Can be implemented as a private teacher, a loner, and a large company. The client belongs to the first and second psycho.

Initial capital is not required. Operating expenses tend to zero.

Due to the low entry threshold, it is used by individual teachers and aggregator services that place orders for individual teachers.

Teachers, as a rule, work one-on-one or with a mini-group.

The user is invited to engage with the teacher, the cost of classes in this case is higher than when using the business model No. 1 .

But if in the first case, the performance is somehow predictable, then in this model everything looks like a roulette. It’s not a fact that a competent teacher who is able to train quickly and efficiently will get to the client. The human factor plays here the strongest role of all three models.

In addition, single teachers use generally accepted textbooks and manuals, which are designed for multi-stage, step-by-step instruction, which cannot be a priori fast. Very few teachers are able to separate the important and necessary from the unimportant and even outdated. Almost every teacher in the examples of explanations uses sentences like “Students study in the library”, while all students already study via the Internet and mobile devices.

Benefits

• low entry threshold;
• fast start;
• low risks;
• almost complete absence of operating expenses;
• easily projected income.

disadvantages

• top bar in income;
• very high competition;
• strong dependence on the quality of teaching;
• difficulty in accepting payment.

Business model number 3

Monetization due to the quick and guaranteed achievement of results by the client.

This model is ideal for result-oriented VIP services. The client belongs to the second psychotype.

Investments in the first stage: the development of effective methods, manuals and training systems.

The main operating expenses in this model are the salaries of living people: methodologists and teachers. But this is inevitable, since with an individual approach to solving individual client requests, these costs will always be. However, they can be reduced by automating processes and developing a more effective teaching system.

In our company, we use this model because we have found solutions to eliminate or minimize its disadvantages.

I will outline how this model has taken root in our country (we have a net bootstrapping - no initial investment).

Since 2010, we have been working to ensure a measurable customer result in a short time. And we are working on scaling to help as many clients as possible.

Even at this stage, our marketing is taking place only at the expense of “word of mouth” - in the old manner, slowly, solely at the expense of reputation. All the money we have entered into the site is invested in the development of new languages ​​and courses, but not in contextual advertising. Specifically for us, contextual advertising does not work, since the cost of our courses is quite high and you need to prepare for classes every day for several hours. This is not what a “cold client” is willing to pay for. So now we are looking for more effective methods of advertising and promoting the resource.

Until today, all clients come to us on the recommendation and pay only 1 time. Well, or more, if you go to another language or level up. But we do not “squeeze” him - he comes when he needs it. And brings with them acquaintances. As the reputation grows, the cash flow situation improves.

If one of the readers is working in the field of marketing and there are ideas taking into account our specifics, I will be very glad if we can work together.

Benefits

• low competition;
• relatively low entry threshold;
• exclusivity;
• work with professionals;
• communication with very interesting and famous people;
• the possibility of installing a high price.

disadvantages

• market limitations;
• the difficulty of guaranteeing results;
• large operating expenses;
• higher level marketing;
• individual approach;
• slow start;
• the complexity of creating effective methods.

It is precisely because the shortcomings are significant and there are more than advantages to them that very few work according to this business model.

In fact, there are only a handful of market players who individually solve a client’s problem. And most often these are single teachers, because on a large scale it seems to be an economically expensive business. But the potential of this model is very high.

Conclusion

The first 2 models do not guarantee the result to the student, but give a profit to the business. In the second case, the results are, as a rule, better, but there is a high probability of running into the wrong teacher, which can not only delay the process, but also generally discourage the desire to learn a language in principle.

All models are viable and a startup that can minimize the drawbacks and enhance the advantages of the model is guaranteed to “shoot”.

What model to choose to build a business?

• Business Model No. 1, if there are investments, seed capital, IT specialists, and you need a big profit;
• Business Model No. 2, if there is no capital and you are a private teacher or mini startup;
• Business model №3, if you build a business not only for making money, but also for moral satisfaction and you have a really effective teaching methodology.

Which model company to choose for training?

• Business Model No. 1, if you have time, there is no learning goal and a minimum of money;
• Business Model No. 2, if you have time, a not very critical goal and some money;
• Business model number 3, if you don’t have time, a very important goal is money.

As you can see, coming up with foreign languages ​​from the other side, not methodical, but already commercial, it becomes clear that very often when discussing methods and techniques these 3 business approaches are mixed, with the result that such discussions lead nowhere: the client and does not understand, he is taught to learn or to apply knowledge in practice.

Having understood and determined exactly where I want to invest my time - in the process of studying or in the practical result, it becomes clear what resources, methods and business models behind them are suitable for this.