Welcome to our 4th annual LMS and learning systems “Trends” post!
What is a trend, anyway? And how much do trends matter? As fiercely independent learning technology analysts, we think a trend isn’t just a fleeting idea that comes and goes like fashion, or a social media hashtag. Nor is it some sort of distant vision to chase until the next distraction captures our imagination. A trend should matter to any buyer, seller or user of learning technology who wants to make ongoing, intelligent and informed choices.
How We Define Trends
To qualify, a learning system trend must have these characteristics:
- It is not necessarily “popular” – but it does deserve industry attention
- It is real – backed by evidence from business scenarios
- It directly affects learning technology buyers and sellers
- It is moving the market in a particular direction (for better or worse)
- It has implications for the future of learning, in general
As we’ve said before, we don’t have a crystal ball, and we don’t pretend to know the future. But we do have a ton of data from learning technology buyers and sellers and we have decades of experience in evaluating, recommending, marketing and implementing business learning platforms.
So we invite you to join us as we outline 18 key factors that are influencing today’s learning landscape:
18 Top Learning Systems Trends for 2018
#18 Market Expansion and Consolidation Roll On
It may seem paradoxical, but the learning systems universe is simultaneously expanding and consolidating. Almost daily, new learning technology developers contact us to introduce themselves. Yet, numerous companies are joining forces with others as they pursue growth through acquisition strategies. In 2017 we tracked more than 35 different mergers and acquisitions in the learning technology space. For example:
- LTG acquired NetDimensions
- iContracts acquired Educadium
- Callidus Software acquired Learning Heroes and Learning Seat
- VitalSource acquired Intrepid
- Saba acquired Halogen
- HLT acquired gWhiz
- GP Strategies acquired Emantras
- Blackstone and CPPIB acquired Ascend Learning
- Purdue acquired Kaplan University
- Alchemy acquired Wisetail
- Personify acquired Wild Apricot
- Strayer Education merged with Capella
- Instructure acquired Practice
Impressive list! And with continued interest from venture capital firms, investment banks and tech startup incubators and accelerators, we don’t see the pace slowing anytime soon.
#17 Specialists Steal Even More Spotlight
Among the more than 700 vendors participating in today’s LMS marketplace, we continue to see a wave of learning solutions designed to solve “niche” business challenges. These are not the generic kitchen-sink systems that originally defined the LMS space. Not even close. Instead, these are precision tools, aimed at customers who are grappling with well-defined issues.
Other specialists leverage their expertise in a particular sector by combining their industry know-how with technology to deliver compelling learning applications. And nearly every learning systems specialist we know is expanding its business by narrowing its focus.
#16 Licensing Levels Rise
Decades of expensive LMS solutions gave way to a pricing revolution over the last 10 years, as cloud computing paved the way for low-cost LMS competitors that drove the overall price point down. This has opened the door for small and medium-sized buyers to invest learning platforms to support education programs for employees, channel partners, customers and other external audiences.
Recently, however, the price point has been creeping up. Now it’s common to see LMS licensing in the range of $5/user/month or $60/user/year. Despite competitive pressure to keep price points lower, we expect licensing levels to continue drifting upwards, as vendors attempt to demonstrate value-add that differentiates their offerings. Price-conscious buyers will need to pay closer attention to identify solutions that fit their requirements while satisfying their budget parameters.
#15 Business Turns Up the Volume On Extended Enterprise Learning
The most successful learning organizations focus on demonstrating business impact. Of course, it’s essential to support employee compliance and other training basics, but where do you invest beyond those priorities? Smart organizations are pursuing ways to leverage learning systems by extending their reach across the entire value chain – to suppliers, channel partners and customers. This kind of holistic business learning strategy has potential not only to pay for itself, but also to transform L&D from a cost center to a profit center.
We’ve analyzed results from LMS vendors who publish outcomes of their customers’ extended enterprise learning initiatives. Consistently, they indicate these results:
- Dramatic improvement in channel performance
- Significant increase in sales effectiveness
- Increased customer satisfaction
- Reduced support calls
- Accelerated product rollouts
- Increased customer renewals/retention
- Decreased new store/dealer onboarding costs
Across the learning community, we see stronger interest in extended enterprise solutions. As more organizations enjoy measurable business impact from these programs, demand should accelerate.
#14 Customer-Focused Learning Systems Are On Fire
Businesses everywhere are tapping into customer success as a source of competitive advantage. And for many product and service companies, customer education directly influences acquisition, onboarding, retention and profitability.
Employee-oriented learning systems could be leveraged for this purpose. However, because customer-facing departments typically fund, develop and deliver training to their constituents, they tend to prefer platforms that integrate with Salesforce.com and foster relationships with external constituents. So it’s no surprise that customer-focused learning systems are gaining steam. In fact, we estimate that this is the fastest growing LMS segment.
#13 Video Takes Center Stage
Video-centered training is going mainstream and every vendor seems to be pushing new boundaries. Thanks to the rise of modern cloud-based learning platforms, high-speed wireless networks, connected mobile devices, social media channels and live video streaming standards, video is becoming the great equalizer in the long-running debate about “live vs. online” learning strategies.
Only five years ago, embedding a YouTube video was a progressive move. Today, video is displayed in customized players that let learners or instructors add bookmarks, make notes, write on top the video content, see others comments, share, mark as a favorite, add to a channel, link to related content, embed assessments, take polls, and use the camera for remote proctoring – all supported by interactive written or slide transcripts supported by in-video search, tags and indexing.
#12 Virtual and Augmented Reality Get Real
While virtual reality (VR) envelops individuals in a virtual environment, augmented reality (AR) enhances their existing environment. Both have tremendous potential as enabling technologies for learning and early applications support those assumptions. While VR had a head start its momentum has slowed. AR revenues are expected to surpass VR this year, thanks in part to a surge in enterprise applications.
Nevertheless, more powerful, easy-to-use VR capabilities are becoming accessible as a wider range of wireless VR headsets come to market. VR provides immersive, emotionally engaging learning experiences that lead to higher recall than traditional training modes. Early adopters have introduced VR learning experiences effectively in a variety of scenarios:
- Training first responders in critical thinking skills for disasters
- Preparing high-potential leaders for fluid, high-stakes global decisions
- Developing group conflict resolution capabilities to elevate team performance
- Helping nonprofits gain support by immersing potential donors in daily experiences of refugees
On the AR front, existing business-related educational and upskilling solutions include guided office tours for new-hire orientation and field training and support for remote repair technicians. Even more new applications are expected soon, with Apple’s push for iPhone X AR applications driving rapid innovation and continued developer support from Google.
#11 Learner-Focused Interfaces Level Up
The LMS – long the ugly duckling of the corporate software world – has transformed into a beautiful solution by modern standards. As learning content evolves into smaller, richer, more index-friendly chunks, platforms are differentiating themselves by offering learners better, faster ways to find relevant content, whenever and wherever they need it. Look for even more progress in user interface design, as the most advanced systems roll out more innovative ways to personalize, access and utilize learning content. Among the vendors to watch are Axonify, Canvas, Litmos and PlayerLync.
#10 Effective eCommerce Pays, Bigtime
Selling instructional content online involves much more than a catalog, a shopping cart and a checkout process. What’s more, finding buyers and convincing them to voluntarily pay for training is vastly different from requiring employees to participate in mandatory training.
However, the business model for selling online content is simple and profitable. Once you recoup your upfront investment in content development, the only significant expenses are the cost of marketing and maintaining that content. So smart sellers maximize their profit potential by finding multiple ways to sell the same content.
For example, you can sell a course to an organization with many learners, rather than only selling to individuals. You can add consulting as a premium upsell or provide a digital badge or certification as an enticement to purchase more than one course. You can present a course within a portal environment to more deeply engage your customers. Additionally, you can find sponsors to share content creation costs and offer advertising to help cover ongoing maintenance costs. Whatever methods you choose, you can now find ecommerce-oriented learning systems with all the functionality you need to launch and manage an online training business.
#9 “Augmented” Platform Approach Gains Wider Appeal
Many large and global organization remain stuck with their established LMS of record. Since these employee-oriented learning systems are integrated into broader HR/ERP/financial software suites, change isn’t coming anytime soon. But a new class of learning technology vendors is making it possible to “augment” these existing systems with cloud-based applications that can be easily integrated with an enterprise-scale technology ecosystem. Prime examples of companies to watch in this space include Allego, Training Orchestra, Salesforce, Degreed, Visier and EdCast.
#8 Custom Learning Experiences Offer Flexible Alternatives
Mapping learning experiences to individual needs, interests and behaviors is no longer only wishful thinking. Sophisticated solutions now make it possible to drive continuous learning, with easy access to a stream of personalized activities that are supported by on-demand resources, social tools and collaborative capabilities.
In addition, with advanced analytics technology like xAPI, organizations are now tracking and analyzing learning experiences with incredible precision. This intelligence can be used to inform ongoing program improvement and improve business outcomes. Some companies at the forefront of custom learning experiences include OnPoint Digital, Extension Engine and YourMembership.
#7 Microlearning Proves It’s Bigger Than Any Trademark
The concept of microlearning has gained strong support from the learning community in recent years. Apparently, that’s why learning technology vendor Grovo decided to ruin this commonly used term by attempting to trademark it last year. Put simply, microlearning is a way of delivering highly relevant digital content at the moment of need. Often, these personalized interventions are served in bite-sized chunks for learning reinforcement or performance support.
Even if Grovo wins exclusive rights to use “microlearning” in its marketing, the methodology still has broader merit and will continue to be supported by most modern learning systems. Today’s digitally savvy learners want access to content wherever they are, and mobile-friendly learning platforms are applying deep user profiling and AI-driven algorithms to deliver even more value with greater precision. So no matter what vendors call it, microlearning will remain a hallmark of learning ecosystems that are built on forward-thinking instructional strategies.
#6 Associations Prioritize Professional Development
The most profitable source of revenue for associations now comes from selling continuing education to members and non-members, alike. These programs are fueling an entire industry of learning systems providers who understand associations’ unique requirements.
Fortified with ecommerce and integrated with AMSs, association-oriented learning systems are creating value by delivering exam prep and certifications, repurposing live event content and pushing the boundaries of social learning and mobile apps.
#5 Digital Badges Make the Grade
Digital badges (sometimes called micro-credentials or digital credentials) are a graphical symbol verifying competencies earned through learning. For a digital badge to be truly valuable, learners, employers and others must recognize and trust the source. In addition, they must agree that it ties directly to desirable professional skills. Recipients can display these badges on social media, websites, email signatures and online resumes.
Prior to the digital era, these credentials were called certificates of completion. But because they were paper-based documents, they were typically hidden from the world — tucked away in file drawers or framed on office walls. Digital badges are gaining popularity among corporate channel and developer certification programs, as well as professional certification programs offered by associations, commercial training companies and academic institutions.
#4 Integrated Content Authoring Joins the Modern LMS
Typically, learning professionals use Articulate Storyline or another third-party tool to author self-paced, asynchronous elearning courses. Then they deploy the courses through an LMS via SCORM as standalone content or as an integrated component of a learning curriculum. The idea is to create portable content you control, so if you switch LMS vendors, your content can move with you.
However, some LMS vendors have vastly improved their integrated authoring capabilities, so it’s worth noting the advantages of authoring and delivering content on the same platform. For example, you can upload or reference any type of digital content in some systems and make it available as a standalone element or integrate it with a learning plan. Also (similar to PowerPoint or WordPress), systems now offer page templates for various types of content, such as videos, assessments and graphics with text, which make authoring easier than ever. Furthermore, since authoring and deployment are shared on a common platform, SCORM and xAPI issues tend to matter less. Finally, LMSs are offering export capability to ease migration but I admittedly never have tested it.
#3 Social Learning Drives Deeper Connections
Social learning capabilities are evolving with the LMS on multiple levels – across the platform, within classes and in online content. At the platform level, each learner typically has a unique profile that can follow others and see content they post or recommend, find mentors or experts, post questions, like, comment and chat. Within a cohort or class, course-private communication is available to support, assignment submissions, workgroup discussions, peer and instructor grading and other interactions. Within online content, learners can comment on any page or video and link to other resources. All of this is integrated into the useable workspace and not far off on a “Collaboration” tab somewhere.
Using xAPI and other tracking methods, all of these interactions can be translated into course credit, leaderboard rankings, content recommendations, future assignments and improvement of learning content.
#2 GDPR Sweeps the E.U.
Here’s a special note for anyone who sells online content or learning systems in Europe. If you don’t already know about General Data Protection Regulation (GDPR) – you soon will. By May 25 of this year, companies that collect data from E.U. citizens must comply with strict new data privacy rules – including what type of data you can collect, how you reveal this data to anyone using your system and how users can review and delete data related to them.
All of this is antithetical to how an LMS operates, so it will be interesting to see how the industry solves this formidable compliance challenge. Early solutions include dedicated hosting solutions in local areas that automatically direct certain IPs to a different compliant environment. Time will tell what issues and opportunities may come from this fundamental shift.
#1 Good Sales Help Wanted!
Every one of the 700+ LMS solutions available today is sold through proactive sales professionals or online self-service mechanisms. But with so much competition, selling is never easy and stellar talent is scarce. In startups, founders or key executives often drive the sales process because they understand the product, they’re persuasive brand representatives, and they’re highly motivated to close deals. But this model doesn’t scale, so professional salespeople soon become a necessity.
Developing inexperienced college graduates or converting professional services representatives can be costly, time-consuming and risky. Likewise with experienced salespeople who have no LMS industry background. Recruiting LMS industry sales stars is challenging because strong salespeople make great money so they’re not motivated to switch. In addition, sales veterans are usually plagued by non-compete agreements.
Don’t even get me started about the outrageous demand for LMS-savvy, business-speaking solution architects!
My recommendation for 2018: Prepare to pay the price for proven sales talent as the core of your team, but also invest in creating a sales training and mentoring culture to groom less experienced people who demonstrate interest and potential.
If you’ve read through all 18 trends on our list, then you know that this is only the beginning of a year filled with promise. I’ve been following the learning technology industry for 22 years and have never seen this environment more diverse, innovative, profitable and filled with business impact. Never a dull moment! The definition and semantics surrounding LMS platforms may have changed over time, but the learning systems landscape is increasingly rich with issues and opportunities for technology innovators to solve. I can’t wait to see what 2018 brings – and I’ll tell you all about it throughout year!
Follow along as the story continues.
Thanks for reading!
Want more insights? Replay the webinar!
In a complex market packed with 700+ possible solutions, how can you be sure your next learning platform will work for your organization? What kind of functionality is essential? Do you know what’s available? What budget parameters makes sense? How can you avoid overpaying? Do you even know if an LMS is the best solution?
Where should you start?
Before making your next move, why not tap into the knowledge and experience of a successful independent learning technology consultant? Join John Leh, CEO and Lead Analyst at Talented Learning as he tackles today’s trickiest LMS buyer challenges:
- How to make sense of today’s expansive LMS landscape
- How to determine if you can afford a new LMS
- Why requirements definition is essential to sort through the learning tech “specialist” market
- How to narrow your options from 700+ vendors to a qualified shortlist
- When and how to use an RFP (or not)
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