By Navin Gautham P., Director and Country Head, Acara Solutions India

A report by Redseer and Omidyar Network India states that the pandemic has been a total game-changer for India’s EdTech sector. Online education for grades 1 to 12 is most likely to spike by more than 6 times its current rate by 2022, manifesting $1.7 billion in the Indian market.

The COVID-19 pandemic has been revolutionary for India’s EdTech sector. The lockdowns and the fear of virus spread has placed schools, colleges, and educational institutes online.

• The report has mapped growth from 2019 to 2020. Surprisingly, it has revealed that EdTech users – both premium and free – in K12 and post-K12 segments have seen a massive hike in their user bases, doubling from 45 million to 90 million.
• The time spent on EdTech platforms has increased by 50 percent, as users have increased their activity to 90 minutes on average.
• The report also states that there has also been a hike in 40 percent hike in willingness to pay for these platforms, which has led to the 83 percent jump in the paid user base.
• According to the report, online classes from grades 1 to 12 are likely to increase by 6.3 times by 2022, creating $1.7 billion in the market. The post-K12 market is likely to grow 3.7 times its current rate, eventually touching $1.8 billion in the market. This means that the sector will create numerous opportunities for incumbent players and start-ups.

Upskilling is Need of the Hour:

The report also states that with several professionals’ jobs getting impacted, EdTech players will play a vital role in ensuring overall job security by making higher and technical education more accessible while promoting the upskilling of the workforce.

As per the Global Competitiveness Report (GCR) published by the World Economic Forum (WEF), India ranked 68^th among 141 countries in 2019, sliding 10 places down as compared to the previous year. However, in terms of the market size, innovation, and economic stability, the country lacks substantial workforce specialized skills (ranked #107) such as vocational training, digital skill sets, and headhunting trained and specialized employees.

Despite the soaring internet market, India is ranked at #120 on the list of Information and Communication Technology (ICT) adoption. The extended usage of online education can catalyze improvements in the skillful workforce. EdTech for adults in tertiary, higher education, and even upskilling for managerial growth would make India’s workforce competitive on a global scale.

So, what changes the EdTech sector will witness in a post-COVID-19 world?

India’s current addressable EdTech population is 150 million students, which are segmented across city tiers, income groups, language proficiencies, and curriculum. A huge chunk of sub-segments and students’ preferences makes it less profitable for the EdTech players to cater to the large swathes of this population. The key factors will lie in pricing, offering, course coverage, delivery, offline support elements, and teacher training services. As per the report, pricing will be the key for wider paid adoption, particularly EdTech platforms trying to strengthen their roots in tier-2 cities and lower-income segments. The annual price innovation will touch $100-$150 and will increase the market by 3 times its current rate, leading to the wider paid subscriptions.

Cross-Sector Partnerships

Building partnerships will be the key factor for the EdTech players to win these different segmented customers. Institutional and cross-sector partnerships will allow the market players to widen their reach and expand their userbases.

• Undoubtedly, there is a need to push towards an expansion to cater to lower-tier cities and lower-income group, which comprises of close to 70 percent of the addressable students.
• Merely 10 percent of the current student population comprises the active EdTech users (free and paid)
• The partnerships include regional languages on these platforms for an increased reach. These have approximately over 300 million monthly users and close to 70 percent users in tier-2 cities.
• Partnerships with the devices are also required for the mass adoption of EdTech platforms among the lower-income groups.

Partnerships with educational institutes will further increase the reach. Investment in relevant content, productions, and/or acquisitions will be the key factor, particularly for the user base with lower grades located in tier-2 cities, which is a huge userbase of regional language users. EdTech adoption by schools and other educational institutes will lead to a wider array of available opportunities.

Out of the total population size, close to 65 percent of students are from government schools, while 85 percent of the remaining set are from affordable private schools. This population represents close to 15 percent of the students attending institutes having limited tech-readiness.

The Role of Start-Ups

The report further shines a light on the role of start-ups, which will evidently have their tasks cut out for them. “Start-ups must focus on better onboarding, student engagement, and delivering outcomes through their line of products,” said a Redseer spokesperson. “This will ensure the slight push for the adoption of the EdTech platforms, after the restrictions are lifted. Along with the investment in content production, EdTech market players will have to innovate their sales and pricing strategies to acquire a wider student base.”

The educational focus in a post-COVID-19 world will be on retaining the customer base. The report suggests that 40 percent of customers expect they will refrain themselves from using EdTech platforms after the restrictions are revoked, which will lead to the fall in the engagement with these platforms.

To combat this, start-ups will play a vital innovative role in strategizing their sales and pricing to lead to the expansion of the user base.