Soaring High – EdTech Market to Soon Touch $ 600 Billion?

edtech

The global EdTech market will see a growth of 15.52% CAGR from 2021 to 2027. The education sector has had a significant impact due to the digital ecosystem in the past. Technology has been at the forefront to drive the educational categories which serve primary, higher education, and training. 

A recent research report forecasts the growth rate to be more than 137% during 2021-27. Which are the segments to look for, and what does it mean for the investors?

The Market Forecast

In 2021, the value of the EdTech market was $ 254.80 billion. Research data suggests that this figure will touch $ 605.40 billion by 2027. Such a mammoth market size is driving fresh investments in this sector. Investors are eyeing a share of the pie with the help of the prime movers in this space.

Augmented reality (AR) and artificial intelligence (AI) are the advanced technologies that will drive the Global EdTech space. It is also the prime reason propelling most investors to pledge their money in the Global EdTech market.

The Major Trends

There is an increased focus of the vendors to indulge in innovative learning and teaching methods to tap the fragmented market. The market will observe an increased demand for customized e-learning based modules.

Gamification in the learning process will get more traction by K-12 and higher education and help engage the end-users.

The absence of quality trainers in adequate numbers is a concern. It is more so in countries like Indonesia, China, and India. There is a significantly higher number of learners in these countries but a shortage of qualified teaching staff. Such a scenario presents an opportunity for the new platforms to increase their reach.

A space that is fast catching attention is skill development. The specific focus by the governments in this area is driving the demand for e-learning modules with instructor-led models. Long-term business competitiveness is on the card of most countries through these programs. Most of these programs help improve productivity and upgrade the workforce’s skills.

The Market Segmentation

The EdTech space has a wide array of offerings and is broadly segmented by: 

EdTech Type 

The global EdTech market has various types, like Hardware, Software, and Technology-Enabled Services. 40% of the revenue in the sector comes from hardware sales. 

The software segment will grow steadily at a CAGR of 14.91% during the forecast period. Rapid technological advancements will drive the third segment.

EdTech Sector 

The highest revenue will come from the K-12 segment. The key drivers for this segment are the high disposable income of families and ease of internet access. Smartphones are also a crucial growth driver for the sector.

The youth population will drive growth, backed by parents spending on their children’s supplementary education. Online education will aid the distance learning programs and thus propelling higher growth.

EdTech End-User 

45% revenue contribution of the global EdTech market comes from the individual learner segment. Since it generates the highest revenue, EdTech services provide a wide array of choices for enthusiastic learners.

The higher involvement of the students scouting for alternative ways to pick up skills encourages many EdTech entrepreneurs. Platforms like sweetstudy.com provide students with options to seek online tutoring from professionals. Such aids complement the student’s learning curve.

The institution segment will also see rapid growth during this period. Parents’ growing disposable income and increased competitiveness among students are helping to forge strong collaborations between EdTech players and reputed universities.

EdTech Geographical Sphere 

The increasing GDP and enormous population of APAC are driving the global EdTech market. Increased penetration of smartphones and rapid urbanization will influence the market in APAC. Consumers opting for convenient life and investing in innovative products will drive change.

North American industry gets influenced by higher ownership of smart devices, good digital infrastructure, and learned educators. However, the demand in this market is highly influenced by the US. A feasible alternative for regular classroom teaching like Coursera is a vital driver.

The Players

The prominent players in this market are Unacademy, Udemy, Byju’s, Duolingo, Coursera, 2U Inc, Chegg inc, Blackboard Inc, BoxLight. There is a rapid acquisition spree primarily led by these big players in the market.

Most players are eyeing the lucrative K-12 market. However, there is a significant demand for skill development spaces like coding, music, or mathematics.

Global EdTech is fast changing its dynamics, and the players are putting it all in to get a larger share of the pie. Although there is an acquisition spree, only time will say who will tap it better.