As years go by, online education is increasingly gaining popularity. Today, more and more people willingly and actively approach the internet to create courses and make money.
Creating and selling online courses is a lucrative business trend that has seen a steady rise over the past few years. You can create a course on almost any topic. All you need is a good internet connection, strong subject knowledge, ample research on competitors and market trends, and a positive attitude towards accepting change. With all the above mentioned in check, you can sell courses online successfully.
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We have all heard that online tutors can make enough money to convert their business from side hustle to a main source of income. But the big question remains, how much money can you make selling your courses online?
Let’s try and answer that for you.
How Much Money Can You Make from Selling Online Courses?
Making money online is a big question when figuring out how to start a coaching business online. This mainly varies from different course creators and subject fields. It also depends on broad factors like your level of knowledge and experience in your chosen field, course prices, audience and engagement.
It is always advisable to depend on a good Learning Management System to start your online teaching business.
According to Mykademy’s internal business data, on average, you can make anywhere from $500 to $50,000 and possibly even more. To accurately estimate this, you should be able to determine the size of your audience for virtual teaching, how efficiently you can convert them into course buyers, and the prices you aim to fix. For example, if your audience size is 1000, and the rate of conversion to buyers is 6% at a price of $165 for your course, it would help you earn an income of $9900.
These rates can be different in different scenarios. Let’s break this down step by step.
1. Set goals
Setting monetary targets and goals will help you in systematically making plans and decisions towards achieving them. Ask yourself why you want to sell courses online. It can be for various reasons:
- To make a passive income
- To make a part-time revenue
- To double your current take-home pay in order to quit your day job
- To live a life of luxury
- To fulfil your passion for teaching online courses to learners without boundaries.
These or any other motivators to start your own online academy can be achieved with hard work, time and perseverance. Write down your goals and keep referring to them while you read on to ensure that your goals are aligned with the calculation of prices and rates.
2. Setting income expectations and targets from course sales
To calculate income expectations and targets, you must first be able to distinguish between your revenue and profit. Though similar when you hear it, revenue and profit have two different meanings in your teaching management system. While revenue is the total income generated by a business, the online teaching platform generates profit after paying off all debts and expenses.
Calculate your revenue and profits using the following formula to get a clearer idea of what income targets you need to set for your virtual classroom software:
To calculate revenue: Audience size x conversion rate x price of your product/ course
Calculating Online Course Revenue
To calculate profit: Revenue – Expenses and debts ( including labour, materials, overhead costs like rent, electricity etc.)
Calculating Online Course Profit
Now let’s look at some of these terms more closely for a better understanding.
If you are looking for a general figure, you can take the number of people on your email list who are visitors to your website every month. If you want a more accurate number, you should calculate audience size from the number of hits on the landing page of your online education platforms each month.
For example: Let’s say you have a blog that gets 100,000 visitors every month. Out of them, 1% end up on your landing page.
100,000 blog visits/month x 0.01 (1%) = 1,000 landing page visits/month
Next, you should determine the conversion rate of those landing page visits into purchases. If ten people purchase your course out of 1,000 landing page visits, your conversion rate is 1%.
1,000 landing page visits/month ÷ 10 purchase = 1%
A 1% conversion rate is relatively low but can give you a good estimate of your baseline. Your conversion rates will depend on your audience, marketing, and messaging on your online tutoring platform.
Price of the product/course:
Price should not be determined by the number of hours the learners have to invest in your course or how much study materials you provide. The cost of your online courses should be determined by the value you provide through each course and the results your students can expect and gain from it.
Another determinant of price can be the amount of time you will spend working with your learner base. The more time you spend higher would be the value of your course. So create courses online with sessions and parts that are highly engaging with your students to increase value.
Expenses can include rent, electricity, advertising, launching, managing expenses, online teaching software and everything else required for running your business.
For example, suppose your online academy incurs average spending of $500 throughout the month. These expenses include internet charges, fees for the usage of software for teaching online, electricity, hosting and marketing.
According to your goals and targets, you can play around with these formulas and try changing audience size and conversion rates, in order to understand the optimum amount you should be earning in a month. With this powerful information and the help of your LMS, you can be guaranteed success.
There are many online education platforms available in the market today. Choose one that meets all your needs. A good LMS platform will provide you with all features and support required for a hassle-free launch and smooth running of your online tutoring business.
The best part of investing in an all-in-one LMS platform is avoiding the majority of the overhead costs. You also don’t have to break your neck worrying about paying employees or purchasing goods offline as you would with the traditional offline education system. The best online teaching platforms will ensure you get timely reports and analytics to ensure ultimate efficiency and success in the process of building your own online academy.
Choose Mykademy and start seeing unbeaten success rates for yourself.
How much does course creators make by selling courses online?
On a study conducted by a prominent market player in the online edtech industry, it was found that 17.9% tutors made up to $25,000, 39.4% made between $25,000 – $50,000, 14.7% made between $50,000 – $75,000 and 27.9% made over $75,000. Therefore it is safe to say that top online academies make a profit between $25,000 – $50,000 since inception.
Can you really make money from online course sales?
The answer is…
Of course, yes!
Creating your own branded online academy can change your life around. Whether you are looking for an additional income or something bigger and better with more purpose, the online edtech industry is waiting with open arms!
Now would be a great time to start thinking about building your own website and mobile application.
Mykademy- The best online teaching platform to earn money! Hurry! Grab your free trial today!