My recent interview (in English) on El Punt Avui TV. Talking about how I started out in the language teaching business, some of what’s happened over the past 40 years and what may happen in the future.
How much should a language course cost? Needless to say the answer will depend on all sorts of variables: how long the course lasts; whether it is face-to-face, online, or a mixture of the two; where it takes place (country, region, town/city, location); whether the teacher is professionally qualified; how many students are in the class; whether the course is a standard ‘general’ language course or something more specialised; whether materials are included in the course fee; and so on.
For the sake of argument, let’s assume we’re talking about a general, ten-week semi-intensive course which consists of 100 hours’ face-to-face tuition, given by a professional language teacher in a private language school located in the centre of a mid-size town in the south of Europe, with a maximum of 10 students in the class. How much might a course of this description cost?
An easy response would be to say: ‘as much as a typical student is prepared to pay’. But what’s a typical student? Someone who is paying for her own course or having it paid for her by her company or parents? Someone who desperately needs to take a course to pass an exam? Or someone who is studying for no obvious reason?
Again for the sake of argument, let’s assume our typical student is a young adult who wants to improve her career prospects and her ability to communicate on her travels, but doesn’t have any urgent need to demonstrate her skills and is paying for her own course. How much could she be asked to pay for the course outlined above?
Is there any way of calculating a ‘Goldilocks price’ that is not too cheap (so the school ends up losing income unnecessarily) or too expensive (so that the student is frightened away)? This ‘just right’ price should help the school generate the sort of margin it needs to provide its services now and in the future, while giving the student the sensation that she’s getting good value for money. So what? More than 500 but less than 1,500 euros? That still leaves quite a wide range of possibilities to choose from.
There are dozens of pricing strategies designed to help companies determine the price of their goods or services (see for example http://bit.ly/2owp5Wz). A couple of the most familiar are cost-plus pricing and value-based pricing.
Cost-plus pricing is relatively straightforward: first work out your direct costs (the cost of the teacher, primarily, but also such items such as photocopies for students, course-specific advertising campaigns, etc.) and divide this by the average number of students per group. Let’s assume these direct costs come to 25 euros per hour and the average number of students per group is 5. Direct costs per student hour are therefore 5 euros. Next calculate your overheads or indirect costs (which means everything that isn’t a direct cost, such as your rent, lighting, administrative staff costs, etc.) and divide this by the total number of student hours you have over a given period (could be a month, a term, or a year). Let’s assume this adds another 3 euros to the cost per student hour, making 8 euros in total. Adding a gross margin of 25% will put 2 euros onto the total cost, giving a selling price of 10 euros per hour, or 1,000 euros for the 100-hour course. Sound reasonable?
The answer to this question will most probably be: that depends how much other schools in the same location are charging for a similar course. If a local competitor has lower salary costs and/or lower overheads and/or is happy to work with a lower margin, they could be offering a very similar service for as little as 600 euros. That’s a whopping 40% less.
So should we base our prices on what our competitors are charging? Well, we should certainly know what the going market rate is. But the danger of basing our pricing on what the guys down the road are doing is that it can easily lead to a price war, or a race to the bottom, leaving margins wafer thin or non-existent, and staff feeling underpaid, unappreciated and unhappy.
An alternative to a cost-plus pricing strategy is value-based pricing. This is based on the idea that the client (student) will pay in relation to the value she obtains from the service (course) she is receiving. In the case of a 100-hour language course, the primary value will most commonly be defined in terms of how much progress she has made developing her language learning skills. That can be measured in broad terms by progress tests and/or continuous assessment, but it will probably also involve ensuring our student feels that she’s made significant progress.
Other factors that contribute value will be less obvious but may be just as important: Is she enjoying the course and enjoying interacting with her teacher and the other students? Is the learning environment clean and comfortable? Does the timetable fit easily into her other commitments? Are the reception staff efficient and welcoming? Is the school easy to get to, and/or easy to park near? Does the school offer extra-curricular services and activities such as social events or access to digital study materials outside classroom times?
The value of all these additional factors can also be measured to an extent, but in many instances it could boil down to individual attitudes or preferences. So objectifying all these values can be tricky, never mind attaching a price to them.
As we all know, perceived value can also be heavily influenced by brand recognition and advertising. Car A may be objectively better (more fuel-efficient, more reliable, more spacious, faster …) than car B, but if car B is branded Mercedes or Range Rover (for example) it is likely to command a premium price.
Building brand value is easier said than done. It requires both delivering services that are perceived to be better than average (in some significant way) and communicating these differentiating values clearly and effectively. What’s more both delivery and communication usually need to happen over a prolonged period of time. But if we’re successful at enhancing the perceived value of our brand, the price of our sample course could be closer to 1,500 than to 500 euros. And no-one will complain.
Back in 2007, on my way home from the ICEF workshop in Berlin, I was trying to think of new ways that we could make IH Barcelona stand out from the ever-increasing crowd of private language schools offering Intensive Spanish courses in our fair city. Having spent the previous few days in environmentally conscious Berlin, an idea occurred to me: we could perhaps become the world’s first accredited environmentally friendly language school. This could have three real benefits:
- It could become a useful marketing tool, helping us attract environmentally conscious students from other parts of the world.
- It might help us lower some costs, by cutting back on the amount of paper, water and energy we use.
- It would lessen the impact our activities have on the environment and, as the slogan says, every little helps.
Having spent some time researching options, we eventually decided to go for EMAS which is the European Union’s Eco Management and Audit Scheme. To summarise what this involves:
- We have to publish an Environment Policy which specifies our aims and approach
- We have to set ourselves targets to reduce the consumption of energy, water, paper and so on.
- We have to recycle everything that can be recycled
- We have to ensure that we avoid purchasing products that can be damaging to the environment (e.g. cleaning materials) and replace them with products that are as benign as possible
- We have to keep detailed records of all of the above and undergo two external audits each year.
We almost certainly were the first language school in Spain (if not the world) to achieve EMAS accreditation and we have now been on the register for 8 years.
So have the benefits we anticipated from adopting this policy materialised? Yes and no.
- Our Eco-friendly policy probably hasn’t as much impact as a marketing tool as we originally hoped, although these things are notoriously difficult to gauge. One corporate client once told us that they had chosen us to be their provider as they were also on the EMAS register. But that’s just one case of our environmental policy having tipped the buyer’s decision in our favour. Has this policy influenced other clients in some shape or form? Our surveys suggest it might have, but not to any great extent.
- While we’ve clearly lowered the amount of money we spend on utilities and consumables, we’ve had to spend rather more money than we’ve saved. Primarily because we’ve had to employ a part-time (but extremely enthusiastic) Environment Officer to oversee and manage the whole process. Secondly because the cost of the external audits isn’t exactly cheap.
- The area where the policy has probably been most successful has been on lessening our impact on the environment. We have reduced the amount of energy we use in relation to student numbers consistently, year on year. The same with water and paper. We still have room for improvement – we still can’t persuade all our staff and students to always switch the lights off when they leave a room; and the amount of paper we use still seems excessive to me. But there is definitely a greater awareness of these issues in the school and while there will always be a number of cynics, peer pressure to consider how our behaviour impacts the environment increases each and every year.
So has it all been worth it? On balance I believe it has. We’re not about to stop global warming on our own, but at the very least we’re able to help raise awareness and we’re seriously trying to set a good example.
As our slogan says “The Earth is our International House”.
For more information on EMAS: http://ec.europa.eu/environment/emas/index_en.htm
To see our environment policy: http://www.ihes.com/bcn/medioamb.html
The number of companies offering online language learning is going through something akin to an algal bloom. To borrow another metaphor, this time from the animal kingdom, perhaps it’s time to try to sort the sheep from the goats.
Broadly speaking online providers offer either language learning materials designed for self-study, a tutorial service of some description, or both. Each of these services can be good, bad or undeniably appalling.
So, what makes good self-study content? There are no hard and fast rules, but I think we could agree that there are a number of key criteria:
- Online material should have been written by people who know something about second language acquisition. This is a subject that provokes all sorts of disagreements, but most people in the profession would probably agree that languages are not best learnt simply by heavy doses of grammar translation (for example).
- Material should also be instructive. It other words, it should be as effective as a good teacher at explaining why the language behaves in a certain way. This probably means it should be interactive on various levels; not simply indicating whether an answer is correct or not, but also explaining why.
- Material should also cover as many aspects of the languages as possible. Not just grammar and vocabulary, but all the skills, pronunciation, colloquial language use, etc.
- Crucially, online material should be interesting, relevant and motivating. In short it should be fun. If the material is dull, students will quickly switch back to YouTube (it only takes a couple of clicks).
- User interfaces should be both attractive and intuitive to use; you shouldn’t need a course in order to be able to do the course.
- The materials should be accessible on different devices: PCs, laptops, tablets, phablets and quite possibly mobile phones, although small screen sizes can limit the sort of activity that’s feasible. Students should also be able to use the browser or operating system of their choice.
- Stating the obvious, but the programming the makes the material interactive needs to be glitch-free, on all devices and with all browsers.
- Students’ work should register on a Learner Management System or e-learning platform so their progress can be tracked and time spent studying recorded.
- Students should be invited to give feedback about their study materials and encouraged to make suggestions for improvements.
- Last but not least, online material shouldn’t include content that is designed primarily as a marketing tool and has little or no pedagogical value. For example, progress tests that are designed fool students into thinking they’re making more progress than they are; or voice recognition graphics that delude students into thinking their pronunciation is accurate to 72%. Voice recognition software is getting better and will become useful at some point, but we’re not there yet. The same could be said of adaptive learning software.
What about the tutorial service? The key criteria here are these:
- Are the tutors proficient speakers of the language themselves? No, this doesn’t necessarily mean “native speakers” but a B1 level simply isn’t enough.
- Is the provider employing fully qualified professional language teachers or are they happy to contract students or retirees looking for a little extra income?
- Have the tutors been trained to teach online? It is different enough from classroom teaching to warrant some form of training.
- Crucially, are the tutors working out of a 24/7 call centre, or are students assigned their own tutor to work with? Knowing their students obviously helps teachers focus their tutorials on their students’ needs and also helps them anticipate any difficulties they may have. Not knowing who you’re going to be talking to makes everything a lot harder for both teacher and student.
Predictably enough there tends to be a direct and clear relation between quality and price (see graph). Professional language tutors cost money, as does well developed self-study material. As a rule of thumb, if it’s cheap (or perhaps even free), it might be useful, but it’s likely to disappoint. If you are able to afford the higher end products (top right-hand corner of the graph) you’re likely to make more progress.
Of course a similar argument could be made for traditional, classroom based teaching.
The EFL industry in Spain enjoyed a mini boom during the early years of the global economic crisis as many adult students rushed to improve their English language skills, either to get themselves back into the job market, or else in an attempt to hang on the job they had. As we reached the new decade, the boom slowed down and then started to tail-off. But no-one expected the sudden and significant drop in adult student numbers that hit the industry at the start of the current academic year.
The drop wasn’t school, city, or even region specific; it was the same story all over Spain. And the numbers were eye-watering. Depending who you talk to (and/or who you believe) adult student numbers fell by between 10-20%. Enough to make any school owner or manager wince.
What happened? Where did all these students go? Well, as is normally the case, there is no one, simple answer. There has been a slight upturn in in-company teaching, so it may be that some students, who were previously paying for their own courses in our schools, are now studying in their company (if they’re fortunate to have a job in the first place; Spanish unemployment is still well over 20%.)
The standard of English teaching in main-stream education is also getting better, slowly, so it may be that there are more school leavers who have achieved a basic level of communicative competence.
Some adult students – especially the younger ones – may also have decided to switch from a traditional, bricks and mortar language school to a Web-based classroom.
My own theory is that it’s the free movement of labour in the European Union which is having the greatest effect on our market. In other words, as there so few jobs available in Spain, hundreds of thousands of young adults – many of whom may previously have been our students – have simply upped sticks and gone abroad to find work.
A recent survey conducted in the UK indicates that migrants from Spain rose to 137,000 in 2015 (up from 63,000 in 2011). Most of them are probably working in relatively unskilled jobs in hotels, bars and restaurants, but at least they’re working – and they’re improving their English language skills as they go.
A similar number probably emigrated to other countries in the north of Europe and another significant number emigrated to Latin America. Add up all these emigrants and we could be looking at a total of well over 300,000 migrants – just in 2015.
On a recent trip to Oxford I met a young Spanish guy, working in a hotel, who had previously been a student at our school in Barcelona. He’s a typical example. Will he ever move back to Spain, I asked him? Perhaps, in the future, he said, but only if the situation in Spain changes and he can find a decent job. His new fluency in English, learnt by living and working in Oxford, might just help him with that.
So where does that leave Spanish language schools? Will adult students come back to our schools in the same numbers as before? Probably not. But that doesn’t mean we have to give up on this market. If adult students won’t come to us, we can use the Internet to take our services to them. Even those living and working abroad.
In February this year Mark Zuckerberg came to Barcelona and announced to the world’s media that Virtual Reality (VR) is “the new platform”. What he seemed to be saying is that VR will soon become the dominant technology in a number of areas such as gaming, entertainment and yes, even education.
Cynics would argue that Zuckerberg is desperate to build up VR as his company, Facebook, reputedly shelled out something like USD 2 billion to purchase Oculus, a manufacturer of high-end VR headsets. Getting any sort of return on an investment of that size will take some doing.
But let’s think about how VR might impact the language teaching industry. Will it be another passing craze that shoots skywards before it loses momentum and tumbles back to earth? Or is it a technology that could offer real and lasting value to language learners worldwide?
The principle of VR is very simple: you put on a headset which surrounds your field of vision and you’re transported to a 360⁰ virtual world that someone has created. Headsets vary in price from the 600 USD of an Oculus Rift – which comes complete with built in headphones and mic, as well as a number of other features – to the 15 dollars that Google charge for their cardboard mask designed to work with a smart phone. Needless to say the experience is enhanced by the high-end headsets.
The virtual worlds that users experience can be anything at all. It could involve skiing down a mountain, exploring underwater caverns, walking with dinosaurs, or travelling through space. The only limit is the imagination of the programmers – and the content development money and tools at their disposal.
Interaction is essentially at two levels:
- With other users (e.g. with friends, classmates or teachers)
- With autonomous, computer-generated characters (or creatures) that inhabit the virtual world
The potential for education seems obvious. Imagine how much more interesting it would be to visit the Tower of London (for example) in a virtual world and hear about its colourful history from a virtual Yeoman Warder, than it would be to read about it in a text book or watch a video on a website? And if the virtual Yeoman Warder could understand and respond to questions in a convincing and natural way …
The potential for language practice also seems clear. On a simple level, teachers could take their students to a virtual world and have them find information or ask questions about the place they are visiting, or engage in any number of role play activities. On a more sophisticated level, which involves combining speech recognition technology with artificial intelligence (AI), autonomous, virtual characters could engage students in any number of language practice activities. Want to practice interviewing for a job? The interview panel is through this door. Want to play the part of a detective in a whodunnit thriller set in the 1930s? Walk this way, Mac.
I wouldn’t expect our language students to spend all or even most of their time visiting virtual worlds. But it certainly seems as though VR’s educative potential could see it outlast the technology’s novelty factor.
Maybe Mark was right.
For information on Oculus Rift and Google Cardboard, click the links below.
As avid readers of this blog will know, I’m responsible for a company called Net Languages that has been developing and delivering Web-based language courses for over 18 years. During this time we’ve established ourselves as a reputable company that knows what it’s doing and delivers an effective and reliable service.
One of our sales representatives recently suggested that it would make it easier for him to compete with some of the many new-comers to our market if our courses were accredited by a reputable university – preferably from an English speaking country. He’s probably right. We all know that the word ‘university’ has almost magical properties.
That said, I honestly doubt there is a single university out there that knows as much about second language acquisition and how to deliver effective Web-based language courses as we do. So if we decide we need ‘accreditation’ what we’re really talking about is a straightforward commercial arrangement i.e. paying for the respectability that the word ‘university’ conveys.
As most universities are struggling to make ends meet, it shouldn’t be too difficult to find one interested in the idea of charging us a fee to add their seal of approval to our courses – even if they don’t know too much about it.
Organisations like the British Council, the Instituto Cervantes, EAQUALS, or International House provide meaningful accreditation to bricks and mortar language schools, as most (if not all) of these organisations do know what they’re doing. They perform rigorous inspection visits, evaluate schools’ performance and help raise standards. But the field of Web-based language teaching is rather less well catered for.
Perhaps I should start an independent accreditation scheme for Web-based language courses. But I’ll probably just go and find a university.