The recent acquisition of Pathgather, a pioneer in learning experience solutions, by Degreed, a leading content provider founded around the principle of “jailbreaking the degree,” marked an important turning point in the learning experience market.
The coming together of these two visionary companies emphasizes the importance now placed on learner experience, which was once viewed as a “nice to have” bonus of corporate training that came after enrollment numbers, completion rates, time spent and other administrative-focused measurements.
Learning experience platforms, or LXPs, currently comprise a small piece of corporate training spending, about $200 million to $250 million compared with about $5 billion spent on LMSs. However, whereas the LMS market is mature and growing only at a rate of 3 to 4 percent annually, primarily due to product turnovers and corporate growth, the LXP market is projected to grow at a rate of about 150 to 200 percent annually.
LXP market growth is fueled by several factors, the first being learner demand. Employees now have a wealth of resources literally at their fingertips for learning — most of which likely reside outside formal corporate training offerings. Think about how often you turn to Google or YouTube to quickly research a topic. Learners no longer have the patience to wade through online courses to get to the information most relevant to their jobs. They want consumer-like learning experiences with recommendations based on their interests, job roles and career goals. Excellent mobile experiences are a must.
A second driver is the sheer size of the workforce population. There are more than 500 million working professionals in the world and nearly a billion employees overall (factoring in part-time, temporary and side-gig workers). All of them need learning at some point in their job, whether it be for onboarding, compliance or training to use the tools of their trade. So if one considers the potential recurring revenue fees to deliver training to all these people, it is easily a multibillion dollar market.
The third factor is overall disenchantment with traditional LMSs, once viewed as the core of corporate learning. While they vary in their user interfaces, LMSs primarily perform administrative functions such as tracking registrations and course completions, documenting compliance, and managing workflow and training cost allocation. Employees don’t use LMSs that much other than to occasionally launch courses. Additionally, many LMSs are expensive to own and cumbersome to administer. These systems are increasingly viewed as part of the enterprise resource planning ecosystem with IT and HR as their primary users.
Because the LXP market is still in its infancy, it will continue to evolve and likely change shape. As more learning moves to short-form video (microlearning) and more courses are authored by experts and employees, we can expect LXPs to deliver learning straight to work platforms, such as Salesforce.com, Microsoft Teams, Slack and Google G-Suite.
Today, IBM Watson can deliver learning through conversations, and several vendors, such as Filtered and Buttlerfly.ai, specialize in connecting employees with experts to help them learn what they need to know. Skillsoft’s Percipio has a feature called ELSA, the Embedded Learning Synchronized Assistant, that recommends content based on an employee’s web activity, and Degreed offers integrations with Slack.
Additionally, the fast-growing marketplace of on-demand digital adoption tools (WalkMe, EnableNow, EdCast’s GuideMe) is impinging on this space with software that recommends instructional content based on job and learning history and functionality that monitors minute-by-minute activity to guide and help learners along the way.
And certainly, learning offers some of the most exciting uses for AI and conversational systems. I fully expect that the LXP will become the platform for some of the most advanced AI-based innovations.
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