There has been significant media commentary about the need for individuals to upskill and reskill regularly through short courses. Given the rapid advancements in technology, and the impact this is having on the nature of work, this has only become more critical. Many universities have launched or are considering launching online short courses to serve this growing education need and to increase and diversify revenues. For example, recent launches by prominent universities include Melbourne Business School Online and London Business School Online (one of the top business schools globally).
Through conversations within OES’ global education network, we understand that while demand for online short courses is growing, many online short course providers find it challenging to achieve significant scale and financial sustainability. We believe there are several key factors driving this and have distilled this down into four key questions for university leaders to consider before launching an online short course portfolio. Universities that have considered these four key questions have the potential to be more successful in the growing but challenging online short course segment.
1. Does the university have the brand strength and expertise to compete?
The competition in the online short course market is global and includes the world’s strongest brands across higher education and industry. Some well-known providers offering online courses are Harvard Business School Online and Google. In 2023, almost 42,000 students took Harvard’s online short courses, and Google’s Career Certificates on Coursera attracted around 700,000 students. These providers have strong brands, charge relatively competitive fees, and have minimal to no entry requirements.*
Implication: University leaders will need to be confident that the online short courses they launch can effectively compete with products from some of the world’s strongest brands. In addition to this, they must ensure competitive pricing and minimal to no entry requirements. To stand out, universities must identify innovative ways to differentiate, for example, by focusing on specific course areas (where advantageous) or providing a more engaging/high-touch online learning experience.
2. How can the university compete with low-cost options in the online short course market?
For the online short course market, barriers to entry are low, especially in comparison to the formal degree market. As a result, there has been a mushrooming of online short courses by a variety of providers, across all price points (including free). For example, Coursera has a library of ~7,000 online short courses, mainly by prominent global universities, and charges ~US$60 per month (with free options). Udemy has a library of more than 11,000 online short courses predominantly by individual experts, with prices starting from ~US$15 per course.
OES has a deep understanding of key online student cohorts globally, and we have observed increased price sensitivity, including a focus on return on investment (ROI) for educational products in general. This is likely in response to rising cost of living pressures and will make it even more challenging for universities to compete with cheaper or free online short courses that meet the key needs of these students.
Implication: University leaders will need to design online short courses that provide students with a strong ROI, based on the key needs of target students. For example, universities could create stackable short courses that provide a pathway into formal degrees with strong career outcomes or design online short courses using best practice pedagogical principles to maximize student completion of the course.
3. Can the university recruit online short course students sustainably at scale?
Student marketing and acquisition costs are generally very significant for online education providers. This can be a particular challenge for online short course providers keen to achieve global scale. Some providers with formidable global brands attempt to promote their course portfolio through their website and mainly through digital marketing. Harvard Business School Online (HBS), for example, adopts this model; however, even though they arguably have the strongest university brand globally, HBS reported in 2023 that they were facing margin pressures due to “heightened competition” driving “higher student acquisition costs.” Others have adopted alternative models, such as using a global platform with a large existing member base. Google, for example, promotes its certificates through Coursera, a global (mainly MOOC) platform with over 140 million existing users.
Implication: Universities will need to carefully consider and plan their marketing and acquisition strategy, particularly if the aspiration is to achieve global scale. This includes considering possible innovative distribution models, such as partnering with an established global short course platform or large professional associations.
4. How can the university facilitate the financing of online short courses?
In many developed countries, students can receive government subsidies and loans for formal degrees. Unfortunately, these government subsidies and loans generally do not apply to short courses, and students end up having to pay the full price out of pocket. There are, however, some exceptions, which can create unique windows of opportunity for relevant providers. The Singaporean Government, for example, has SkillsFuture initiatives that provide funding support for a variety of courses, including short courses, and this may benefit select local short course providers.
Implication: Universities can explore innovative avenues to help students finance their online short courses. Some bootcamp providers, for example, General Assembly, offer students different payment plans. Options like installment plans or income-contingent repayments, where installments only commence once students earn above a threshold, are provided. In addition, universities should monitor and act quickly when unique and relevant funding pools for short courses emerge (noting many governments globally have an increasing focus on upskilling and reskilling, which is promising for short-course funding).
A key takeaway is that the online short course market is competitive and challenging, so universities keen to enter this market segment need to carefully consider and strategically respond to the four key questions above to be successful. Construct and OES have deep market knowledge of online courses and online student cohorts globally, and we are excited to work with university leaders interested in online short courses to explore, brainstorm, and address these critical questions.
About the Author:
Jun Wei leads the strategy for OES’ university partnerships. He helps drive growth by identifying highly scalable degree products, enhancing existing degree products to maximize market share, and leading cross-functional initiatives that enable OES to provide students with more value. He was previously a consultant across Nous (focused on HE nationally) and Kearney and completed the MPP with Distinction at Cambridge and BCom (1st Class Honours) at Melbourne.
