Advantages and disadvantages of online tutoring from a business perspective

Technology has improved significantly over the last 20 years to the point where it is now quite easy and cost effective to provide online tutoring services. While many freelance tutors and tutoring companies see this as a welcome change in the industry, it also poses many threats to existing businesses. Many articles discuss the pros and cons of online tutoring from the student’s perspective; This article will explore this topic from the perspective of the business of tutoring.

Advantage

The availability of technology for online tutoring is more advantageous for new tutors or tutoring companies that are not yet established in the market. Online tutoring requires low start-up costs, opens the tutor to a much larger market, and offers more flexibility for scheduling. Let’s take a look at each of these advantages one at a time:

Lower barriers to entry

Although many freelance tutors also have low start-up costs, if you are a tutoring business and decide to go the online route, you can avoid many of the costs associated with starting a traditional tutoring business. Traditional businesses often require an office for administration or mentoring, marketing through local media, driving to meetings with potential clients, etc. Online tutoring companies do not require an office other than a home office and they definitely do not require a building to teach students. Online marketing is lower cost and can be more directly targeted than traditional marketing, and talking to customers can be done online or over the phone. These low startup costs make it much easier for new businesses to get started online.

largest market

Traditional tutoring businesses are constrained by geography – they cannot profitably serve students outside of their geographic area due to time constraints related to transportation and the cost of transportation. For this reason, tutoring companies have much smaller markets and can only enter new markets by adding new locations. Online tutoring companies do not face this limitation. They can reach anyone with an internet connection and the only real limitation is language. For this reason, many people prefer to start an online tutoring company so that they can reach a much larger market. This can be a very good strategy if your company teaches a highly specialized subject that would not have enough people locally to support the business.

Tutoring companies can also hire tutors from a much wider area and may be more successful in finding high-quality teachers in the subjects they offer.

flexibility

Online tutoring companies have more flexibility as they can choose to teach students in different time zones. Tutors who are only available to teach in the late afternoon can easily teach students from a later time zone where it is in the afternoon. This makes it easy for freelance tutors to fit their tutoring into your personal or work schedule.

Lower operating costs

The ongoing operating costs of running an online tutoring business are also lower than traditional tutoring. Some of the eliminated costs come in the form of building leases, telephone, transportation, and marketing. Online tutors can do everything from home, they can use free or low-cost online phones like Skype to communicate, and they don’t have to spend money driving to the tutoring office or clients’ homes.

Disadvantages

Many of the advantages of online tutoring can also pose challenges for tutoring businesses. We’ll look at the downsides below, one at a time.

Lower barriers to entry

Low barriers to entry make online tutoring attractive to tutoring startups, but for incumbents this is a negative as it makes it easier for startups to enter the market and compete with them. Ultimately, this leads to more price competition and lower profit margins.

Competition from other markets and other countries

Online tutoring overcomes the geographical barrier, which is also a disadvantage for existing tutoring companies. This means that instead of facing competition only from tutoring companies in their immediate market, they now face competition from tutors in other parts of the country and other countries in general. Many online tutors are from countries like India where the cost of living is much lower. They can teach American students online and charge a fee that is still much lower than standard fees in the United States, but still well above the fee they would earn for tutoring in their own country.

Technological limitations of students.

While most people have a personal computer at home and Internet access, many students who need tutoring don’t have the technology to take online tutoring. In addition to a computer, a high-speed internet connection is ideal, a headset and microphone are needed to talk to the tutor, and hardware such as a writing board may be required depending on the topic. This means that if your company wants to provide only online tutoring, there will be a lot of students you won’t be able to reach.

Effectiveness

While online tutoring can be effective, there are certain subjects where face-to-face communication and explaining concepts on a piece of paper are more effective than online communication. It can also be more difficult to keep students engaged when tutoring online, which can have a negative effect on student progress.

Online tutoring creates both opportunities and challenges for tutoring companies. By understanding and evaluating these challenges, mentoring companies will be better prepared to respond to them and adapt their business strategies to the changes the industry brings.