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What will happen
EdTech market experts expect significant growth. Dmitry Krutov predicts a 15-20% increase. Despite upcoming challenges related to the key rate, which may impact scaling and installment options for clients, the market will continue to develop. The success of EdTech companies will depend on their ability to adapt to changing conditions and find innovative solutions to attract and retain users.
The growth of the EdTech sector may be limited by a general decline in purchasing power. However, this segment continues to attract new students, as more and more people recognize its value as an important tool for social mobility for adults. This aspect is becoming increasingly relevant, and this trend is expected to continue in 2024.
The CEO of Skillbox is confident in the significant potential for growth of educational companies, as the market is not yet fully covered, and work is being conducted with a limited audience. One area for expansion is increasing the segment of users over 35 years old. This is due to a shift in perceptions about the possibility of mastering a new profession at this age, which can lead to a life-changing outcome and increased income. However, according to Dmitry Krutov, the main potential for growth lies in focusing on formal education, including colleges and universities. He predicts that the EdTech business will actively develop in this direction. "This applies not only to higher and secondary vocational education, but also to expansion in the field of continuing professional education," he adds. Marianna Snigireva predicts EdTech market growth in 2024 at 15-20%. She notes that the need for digital training remains relevant, but the effect of the pandemic, which contributed to a significant increase in interest in online education, is gradually fading. The CEO of Netology emphasizes that almost all Russians—99%—are aware of the possibility of online learning. However, the number of people interested in taking courses is not increasing, and is even declining slightly. This is due to several factors: some students have already completed their educational plans, while some Russians continue to be wary of online programs due to negative personal experiences or negative reviews from other students. In addition, this year there has been a decrease in the unemployment rate, which has also reduced interest in obtaining digital professions.
The harsh reality of Russian lifelong learning: Reasons why Russian adults continue or abandon education
The concept of lifelong learning is becoming increasingly relevant in Russia. Adult Russians face the need for continuous self-education to remain competitive in the labor market. However, many of them still do not participate in training.
The main reasons why Russians continue to study include the desire to improve their professional skills, change their field of activity, or adapt to changes in the world of technology. Modern employers are increasingly looking for candidates with relevant knowledge and skills, which encourages people to learn.
On the other hand, there are many factors that hinder learning. These may include lack of time, financial constraints, or a lack of information about available educational programs. In addition, some adult Russians may not realize the importance of continuous learning or are afraid of change.
Thus, for the successful development of the lifelong learning concept in Russia, it is necessary to overcome the barriers that prevent adults from engaging in self-education. A focus on accessibility, quality, and diversity of educational opportunities will help attract more people to education and raise the overall level of knowledge in the country.
Ilya Kurmyshev attributes the increased demand for digital services to a shortage of qualified specialists in this field. In an environment of increasing competition and rapid technological development, companies are facing difficulties finding suitable personnel. This creates favorable conditions for market growth and increases the need for training and preparation of new digital specialists.
We expect an increase in demand for specialists as the digital economy continues to face a labor shortage. Traditional university education cannot quickly close this gap. Increased market demand and employment prospects in digital industries will encourage people to change careers and acquire new skills in programming, data analysis, marketing, management, and web design. In the second half of 2023, we saw an increase in the number of people willing to change careers and study in these in-demand fields.
Pavel Moseykin asserts that the continuing professional education (CPE) market will continue to show growth. At the same time, he notes that the EdTech market as a whole, including CPE, has reached a stage of maturity, which leads to seasonal fluctuations. The third and fourth quarters are traditionally the most active periods for EdTech and CPE, as autumn approaches and people begin to consider upgrading their skills, driving increased demand for educational products across all segments. Pavel predicts that the CPE segment will retain its leading position in revenue by the end of the year – according to Smart Ranking, it has already held a leading position in the first three quarters. By the end of 2023, the segment is expected to continue showing positive growth dynamics, reaching approximately 30%.
Ultimate Education Holding expects the positive dynamics in adult vocational education to continue next year. Demand for such educational programs remains high due to a labor market shortage and growing interest among Russians in career change and professional development. Pavel Moseykin and Dmitry Krutov identify key factors driving this demand. These include the active spread of the lifelong learning concept, as well as the volatility of the labor market, which requires continuous professional development and a willingness to change careers. These trends create favorable conditions for the development of professional education and increasing the competitiveness of specialists.
Denis Guzeev expects positive market dynamics due to people's desire to adapt to new conditions. However, he warns that in certain niches, a transition from growth to stagnation is possible. This underscores the need to closely monitor changes in various sectors in order to promptly respond to emerging challenges.
Analyzing individual segments, such as programming training, we see signs of stagnation in demand. From April to July 2023, there was a decline in audience interest in this area. However, since August 2023, demand has begun to recover and show growth compared to the same period last year. The main factors contributing to this stagnation are the departure of many foreign employers from the Russian market and a reduction in the hiring of entry-level specialists by Russian companies.
Denis notes that the labor market, particularly in IT, still faces a shortage of qualified specialists. Therefore, he believes that a focus on advanced training and providing practice-oriented education for young professionals could be a key driver of growth. The development of additional education and training programs will help prepare personnel capable of meeting modern industry requirements and effectively solving emerging problems.
Reading is an important aspect of our lives. It not only develops thinking and broadens horizons, but also promotes emotional development. Reading books, articles, and other materials enriches our vocabulary and improves communication skills. It's important to choose high-quality sources of information to gain knowledge that will be useful in everyday life and work. Regular reading also helps reduce stress, improves concentration, and promotes a deeper understanding of the world around us. So, devote time to reading and choose a variety of genres to study. It's not only useful, but also enjoyable.
A Regulatory Framework That Needs to Be Developed: How to Integrate EdTech into Public Education
The integration of technology into the educational process is becoming increasingly important, and EdTech plays a key role in this transformation. However, for EdTech and public education to successfully interact, a clear regulatory framework must be created. This will ensure the high-quality implementation of technologies while respecting the interests of all participants in the educational process.
Key aspects for effective cooperation include developing common standards, ensuring access to educational resources, and creating a system for monitoring and evaluating the effectiveness of implemented technologies. It is also important to consider the needs of students and teachers, as well as provide the necessary training for specialists to work with new tools.
Thus, creating a well-thought-out regulatory environment will form the basis for the successful integration of EdTech into public education, which in turn will lead to improved quality of education and prepare students for modern challenges.
What are the current difficulties in the continuing education market?
Dmitry Krutov notes that the key problem of the market is its unfinished investment product phase. This means that many companies and investors have not yet adapted to modern requirements and investment product capabilities. As a result, the market cannot reach its full potential, which hinders development and innovation. To successfully move to the next level, we must focus on creating and implementing high-quality investment products that meet the needs and expectations of users.
We have a large audience and significant potential, but we require adequate funding to implement the necessary technological changes. The technological solutions that will shape the future require significant development, which means significant investments, large teams, and complex products. This is an investment in the future that will allow us to remain competitive and meet the growing needs of our audience.
Dmitry notes that new regulations require companies to achieve profitability to ensure sustainability and development. At the same time, it is necessary to transform the product to improve student performance and employment rates. "We are now faced with a triple burden - product development, increasing profitability, and growth," he concludes.
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Experts expect a protracted investment crisis in the global EdTech sector. Amid economic instability and uncertainty, many investors are reconsidering their investment strategies in educational technologies. This could lead to a reduction in funding for startups and companies operating in this field. It's important to understand that this situation requires market participants to adapt and rethink their business models. Despite these difficulties, there is potential for innovation and development, which could lead to new growth opportunities in the future. Marianna Snigireva emphasizes that the main challenge in the labor market is employers' reluctance to develop and train their employees. This hinders the development of qualified personnel and creates a shortage of specialists capable of effectively performing their duties. Without investing in employee training and professional development, companies risk losing competitiveness and being unable to adapt to changes in the industry. This issue requires attention, as successful business development largely depends on the qualifications and motivation of their staff. The IT sector is currently experiencing an interesting situation. On the one hand, there are a significant number of vacancies, while there is a shortage of qualified specialists. On the other hand, there is an oversupply of job seekers, creating an imbalance. Companies are seeking to hire mid- and senior-level specialists, while the majority of job seekers are entry-level professionals. To gain the necessary experience, they require at least a year of real-world experience. The solution to this problem lies in the need to begin hiring entry-level specialists. It's likely a matter of time before companies begin to more actively engage junior professionals to address their challenges and develop their teams.
Pavel Moseykin emphasizes the importance of establishing an effective dialogue between educational institutions and the business sector, including employers. This approach will help identify the best methods for quickly and cost-effectively upskilling specialists, which, in turn, will improve the alignment of educational programs with labor market demands. Building partnerships between education and industry facilitates the adaptation of curricula to current business needs, which is a key factor in successful professional development.
For successful interaction between business and educational institutions, it is necessary for companies to actively participate in the educational process. This includes providing detailed feedback on the quality of student training, clearly articulating expectations for young professionals, and providing opportunities for internships and placements related to real-world business challenges. Active participation in educational programs and developing partnerships with career centers also play a significant role. Ultimate Education's CEO emphasizes that this approach contributes to improving the quality of education and better preparing students for the demands of the modern labor market. Denis Guzeev identifies several factors slowing the growth of demand for online courses. External factors include stagnant interest in IT education, high levels of student debt, and rising key interest rates, which impact loan costs and the availability of student loans. Internal factors include a shortage of qualified personnel with the necessary expertise in the EdTech market, as well as the difficulty of hiring entrepreneurially minded professionals. There is also a shortage of product marketing professionals and experienced managers, which negatively impacts the development of online education.
Netology's CEO emphasizes the shortage of candidates for senior positions in business development and sales. Meanwhile, Skillbox's CEO notes an improvement in the talent pool. He attributes this to people's growing awareness that EdTech is not only progressive but also socially responsible.
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Education is fundamentally a non-profit sector, but in today's environment, there is a trend toward its commercialization. This leads to a change in the principles and goals of the educational process, which is a concern for many experts. It is important to preserve educational values and ensure accessibility to knowledge for all segments of the population, despite the growing influence of the market. The commercialization of education can negatively impact the quality of education and access to important resources. It is necessary to pay attention to preserving the core purpose of education—the development of individuals and society, rather than profit-making.
What trends and challenges will carry over from 2023 to 2024
Dmitry Krutov identified increased efficiency in both the commercial and product areas as the main goal for the coming year. This desire to optimize processes and improve results will become the main priority for achieving success.
Our goal is to maximize the effective use of tools that enhance student productivity. If someone wants to quickly find a new job, we are obliged to use all available resources to achieve this. We understand the importance of rapid employment and are committed to ensuring that every student can successfully realize their potential in the labor market.
Dmitry emphasizes that this is not only about artificial intelligence and scoring, but also about the development of coaching, mentoring programs, and community management. Automating processes to improve efficiency is also crucial, and Skillbox is actively working in this area. "We are analyzing how we can improve the efficiency of operational processes at our level—considering hundreds of thousands of students—by speeding up and improving homework assessments, monitoring the quality of work across multiple teachers, organizing study groups, optimally structuring asynchronous and synchronous formats, and adjusting the complexity of educational material," says Dmitry.
Ilya Kurmyshev predicts that most companies in the EdTech industry will focus not only on achieving sustainable growth but also on building a profitable business. This also implies optimizing monetization models and improving the quality of educational products, which will enhance competitiveness in the market.
Developing the B2B segment and continuing education courses for practicing specialists remains a focus for Yandex Praktikum. The marketing strategy will emphasize strengthening loyalty and building long-term relationships with users. Audiences are becoming increasingly critical of marketing promises and are making fewer impulse purchases. Instead, users are taking a more conscious approach to choosing online education products, focusing on key aspects when making decisions.
Pavel Moseykin notes that the EdTech market will gradually shift toward B2B and B2G, which implies an emphasis on developing products for corporate clients and active collaboration with educational institutions. In the B2C segment, consumer patterns are changing. "The era of impulse purchases is over: students are becoming increasingly demanding. It is important for a brand's communications strategy to play a key role, while traditional marketing methods are fading into the background. Before making a choice, people carefully research an educational company's reputation in the professional community, paying attention to reviews and successful cases," he explains. Pavel also highlights key trends that, in his opinion, will continue to develop in the continuing professional education market.
- Adaptation of previous and application of new technologies and approaches. Tools that worked two or three years ago are no longer effective, according to the director of Ultimate Education, so companies need to constantly supplement and adapt their methodological and educational approaches.
- Emphasis on quality. The market is experiencing a significant shift from quantity-driven growth to quality-driven growth. This means EdTech companies are increasingly focusing on developing personalized, effective educational solutions.
In today's oversaturated market, simply developing a high-quality product is not enough. The key is creating a community around a brand that unites people with shared interests and fosters brand loyalty. The future of EdTech, in our opinion, belongs to niche projects that are deeply integrated into the industry. These projects have the potential to transform the industry from within by building strong professional communities, attracting top experts, and developing educational programs that meet real market demands. The CEO of Ultimate Education Holding emphasizes the importance of this approach for achieving success in the educational sector.
One of the key objectives for EdTech companies is expanding their presence in the regions. This not only increases audience reach but also adapts educational products to the specific requirements of the local market. Furthermore, active engagement with businesses plays a key role in creating practice-oriented education, which contributes to improving the quality of training and preparing specialists who meet the modern demands of the labor market. Effective integration of educational programs with business needs will help EdTech companies improve their offerings and increase competitiveness.
Denis Guzeev highlighted key trends in the development of the B2B segment, including the implementation of artificial intelligence in educational processes and the strengthening of GR. These trends play an important role in shaping modern business strategies, helping to optimize training and improve interactions with government agencies. The implementation of AI allows companies to tailor educational programs to individual needs, and the activation of GR helps establish effective communications with key stakeholders.
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Experts in the field of educational technology (EdTech) have identified key trends in the field of continuing professional education (CPE) for 2023. In the context of rapid technological development and changing labor market needs, educational institutions and companies must adapt to new conditions.
Among the main trends, one can note the increasing popularity of online courses and hybrid learning formats, which allow students to gain knowledge in a mode convenient for them. There is also a growing interest in personalized educational programs that take into account the individual needs and goals of students.
Furthermore, the implementation of artificial intelligence and data analytics in educational processes is becoming increasingly relevant. These technologies make it possible to create more effective and adaptive courses, as well as track student progress.
Equally important is the emphasis on developing soft skills, such as critical thinking and communication, which are becoming essential for career success in today's environment.
In 2023, we will also see increased collaboration between educational institutions and employers, facilitating a closer integration of theory and practice. These trends are shaping a new face of continuing professional education, focused on the needs of the modern market.
Some events that happened in 2023 will significantly influence 2024
We conducted a survey among EdTech experts to find out which events of the past year they consider significant signals about possible future changes and new trends that may develop in the EdTech market next year. The data obtained will help better understand the directions in which educational technology will move, as well as identify key aspects worth paying attention to. This study allows us to predict how innovations and changes in the educational environment may influence the development of EdTech in the future.
The CEO of Skillbox emphasized the importance of creating platforms for dialogue between formal institutions, businesses, and government agencies. He predicts that this trend will continue in 2024, expecting the emergence of new platforms for the exchange of ideas and solutions. He pays special attention to the fact that both the state and private companies are capable of demonstrating significant results, which emphasizes the need for cooperation between them.
Pavel Moseykin noted the importance of the creation of the Association of Digital Innovations in Education (RACI), which unites key players in the EdTech field. This association will become a platform for exchanging experiences and introducing modern technologies into the educational process, which will improve the quality of education and adapt it to the needs of modern society.
Denis Guzeev recalled the proposal voiced in June regarding the introduction of certification for online courses. This innovation could increase trust in educational platforms and improve the quality of knowledge provided. Certification will allow users to choose courses based on their reliability and relevance, which, in turn, will contribute to the development of online education.
The initiative is aimed at solving known problems in online education, but its implementation raises many questions. In particular, the main obstacle is defining the criteria by which the quality of online courses will be assessed, as well as the evaluation process itself. If a course doesn't meet the new standards, but still delivers positive results for students, such as promoting employment or helping them master the stated skills, the question arises: can such a course be considered of poor quality?
In 2023, Valentina Kurenkova, GR Director of the educational platform Netology, identified a number of important events that could impact the market next year. These events could change educational trends, influence demand for online courses, and shape new requirements for educational programs. Analyzing these factors will help better prepare for changes and adapt to new conditions in the education market.
- The initiation of a scandalous fraud case against Ayaz Shabutdinov. The state will need to strengthen control over the issuance of educational licenses and the content of contracts, Valentina believes. Therefore, it has become necessary to clearly distinguish between the concepts of "training" and "information and consulting services." The task of the RATsIO association, founded in 2023, is precisely to propose wording for subsequent regulations.
Bills allowing students to receive refunds for online courses do not address the issue of educational service quality. If students can cancel a course at any time and receive a full refund, this will reduce their motivation to study. If they are unwilling to study or fail the final exam, they will be able to claim poor service quality and demand a refund. Valentina Kurenkova notes that such changes will force companies to strive to please students, which will lead to a decline in the quality of education. As a result, this could contribute to the production of unqualified specialists, which is contrary to state education policy. Ensuring the quality of educational services should remain a priority for all participants.
- Strengthening oversight of advertising. Valentina noted that changes to the advertising law have become increasingly frequent: they have affected the labeling, content, and language of advertising materials. The main goal is to increase transparency. That is, when viewing any information, a person must recognize it as advertising and understand all its terms. This obviously also affects the education sector, emphasizes the GR Director of the educational platform Netologiya.
- Tighter controls over the collection of personal data. According to a bill recently introduced in the State Duma, companies that have the ability to collect personal data may face increased scrutiny and the threat of fines for leaks and misuse. The state may transfer the processing of personal data to state-owned platforms, and require external organizations to receive limited access for specific purposes. Therefore, companies now need to more closely monitor changes in this area.
- The state's focus on secondary vocational education. The emergence of online vocational education programs, updated professional standards, a stronger focus on employment, and stable funding for the federal "Professionalism" project—all of this, according to Valentina, confirms that the government's attention to secondary vocational education is growing.
Artificial intelligence technologies in education await regulation, according to Valentina Kurenkova. She argues that the implementation of AI in educational processes requires clear norms and standards to ensure safety and effectiveness. Regulation will help avoid potential risks associated with the use of AI in education and ensure the protection of the rights of students and teachers. It is important to create conditions for the harmonious integration of technologies into the educational environment so that they contribute to the development of critical thinking and creativity in students.
There are two main scenarios for the development of artificial intelligence in education. In the first scenario, the use of AI technologies will be strictly regulated, which will limit their implementation in the creation and use of educational products, as well as in image generation systems and chatbots. In the second scenario, artificial intelligence will become a common element of the educational process, its use will become entrenched in the education market, and over time, will become an integral part of learning. This will open up new opportunities for students and teachers, improving the quality of education and making it more accessible and personalized.
The main developments in education are associated with increased government oversight and active government participation in educational processes. This influence manifests itself in various forms, including the development of new standards, programs, and initiatives aimed at improving the quality of education. Increased government oversight can contribute to more effective management of educational institutions and ensure equal access to educational resources.