E-Learning Market Update (May 2008)

This month we have taken a look at e-learning trends in the US. The US is the single largest eLearning market worldwide with revenues exceeding $17.5 billion in 2007, as stated in a report published by Global Industry Analysts. In 2007 the US represented over 60%. Europe is the second largest e-learning market with a share of less than 15% but the Asian market is reported to be growing faster.

We had a look at Bersin’s latest research into the US market which is contained in their 2008 Corporate Learning Factbook. The good news is that, like in Europe, e-learning continues to grow each year as a proportion of all training expenditure.

Growth in spending

It was only slight but the US corporate learning market grew from 2006 to 2007, increasing from $55.8B to $58.5. The average spending per learner was $1,202, a figure similar to the year before.

Key spending areas

The picture looks similar to Europe with management/supervisory training and leadership development the top priority overall. However, there is significant expenditure on customer service, sales and compliance training. Examples included:

  • Telecommunications companies spend 23% of their training budget is spent on customer service training
  • Technology companies invest 29% of training expenditure on sales training
  • Pharmaceuticals spend 25% on compliance and other mandatory training

E-learning growth

The use of self-study e-learning now accounts for 20% of student hours in the US, up from last year’s figure of 15%. This growth is driven largely by an increase in online training among small organizations (100-999 employees), which are acquiring the skills and technology to make online training a reality.

The Bersin Factbook appears to support the findings of last year’s ASTD survey that one of every three hours of training is now being delivered via some form of technology, a ratio which is expected to increase in coming years.

There was increased expenditure on custom content development though there was a decline in the use of offshore content developers.

Virtual classrooms rule

38% of organizations are now using a learning management system (LMS), with the highest growth in usage among mid-market buyers but over half of all companies are using a virtual classroom tool. This might reflect the greater geographical spread in the US.