China's Online Education Sector Data in 2017

Source:iResearch January 29,20187:16 AM
Data from iResearch show that the revenue of China’s online education was expected to reach 200.3 billion Yuan in 2017, 27.9% more than that of 2016. In the next few years, the revenue of China’s online education industry will continue to increase steadily despite the decelerating growth rate, and the revenue is estimated to attain 543.4 billion Yuan in 2022, fueled by these factors: users are more receptive to online education, users are more willing to pay for it; and online classes are more abundant.
iResearch believes that after several years of irrational expansion and market test, some market segments have formed mature commercial patterns. Currently, the capital market has returned to rationality and entrepreneurs are more cautious, which imply that online education market is moving to maturity. At this stage, the online education market is more inclusive to the companies that possess higher ability of teaching & research and research & development of technology, and better operating service. Meanwhile, the companies need to increase users’ learning efficiency and complete service, and improve users’ learning experience in order to raise users’ loyalty. In this way, they will make more profit.

Data from iResearch indicate that online K-12 education, online higher education and vocational education will always be main part of online education market, taking up over 95.0% of online education market. iResearch holds the opinion that although extracurricular training for K-12 education is in rigid demand, its market share is still quite small in the initial stage for it is an irreversible process and has high cost. As users are cultivated and educated by the market, scenarios properties and experience of online learning are improving and online education are more acceptable to users, market share of this segment is keeping rising. In addition, since learning content of online vocational education is closely related to work and effectively makes up the mismatch between business and school, users and the requirements of job, users are willing to pay for it. With such a mature profit model, the market share of online vocational education is relatively stable.
Despite how beautiful the dream is, learning process for human brain will never change, that is, effect of education must be manifested through a complete teaching system, to be specific,(1) high quality content,(2)a series of teaching processes including “teaching, learning, practicing, testing and feedback”,(3)service and management after teaching, which helps to overcome inertia in learning and improving. Most of the time, as users fail to integrate scattered educational resources into an effective system, they cannot predict their future learning effects through a single educational tool or service, thus, it is not easy for them to make a purchase decision. and only in a few cases when users have strong motivation and capacity of self-study (such as when adult users are preparing for recruitment examination), or facing less complicated learning content (such as learning a language), users can integrate learning resources into their own knowledge reserve so that they can subjectively determine their learning effect which help to stimulate them to pay for online education.

In 2017, online education institutions are gradually aware that the core business logic is “to pay for effects”. It is also in 2017 when online education starts to make profits through popular live streaming. Despite this, the experiences for online education users are still insufficient and educational effects are still full of uncertainty. For online education institutions, the next step is to focus on teaching and service, solve the problem of insufficient experience and inapparent effects.

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