How much does it cost to create an online course in 2017

How much does it cost to create an online course in 2017

More and more learning professionals and educational institutions decide to publish their courses online, to increase value of their curriculum and reach wider learner body worldwide. However, creating an online course differs much from preparing content for face-to-face instruction. Thus said, we prepared a material that might be of use to help course authors understand how much course design stages cost, what are the components of the check — and how to avoid paying extra.

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Member of the Board, Raccoon Gang

Sergiy has 18 years of experience in eLearning and management. Creating educational programs, career paths, online and offline courses he is making the educational world better as a co-founder of RG.

How much does it cost to create an online course in 2017

This article was last updated on the 8th of June, 2017.

We created this estimation based on such parameters:

  • Course design model used is ADDIE — Analysis, Design, Development, Implementation, Evaluation. In this blog post we cover all stages except for Evaluation, as it heavily depends on the specifics of each particular course.

  • Process timeframes are calculated based on our experience and statistics from public sources.

One of such sources is a study published by Robert Defelice and Karl Kapp (Kapp is the author of the instructional design bestselling guide — “The Gamification of eLearning and Instruction”). This study states that 1 hour of eLearning content takes 90-240 hours on average to create. Another source is a research by Chapman Alliance back from 2010, claiming the cost of creating 1 hour of online course content is ~$10,000 on average.

While these sources are reliable, they are a bit outdated. There were lots of shifts in the industry, new authoring tools and LMS’s emerged since then — and we decided to check if these estimates are still valid nowadays. In this blog post, we provide the updated calculations as of April 2017.

Some explanations on the course design stages of ADDIE model and the team roles involved:

  1. Analysis — online course creation should be preceded by a thorough analysis of:

  • current market state (whether there is a demand for the specific course, like in a corporate training segment, or the author should plan an advertising and marketing campaigns to promote the course);

  • competition (the way the other courses in this field are promoted, if any exist);

  • content (whether the content of the future course is already available in a printed or a digital form or should it be developed from scratch).

  1. Design — planning the course content structure applying instructional design best practices.

  2. Development — writing texts, drawing graphs and diagrams, shooting videos, creating tests and quizzes, etc.

  3. Implementation — uploading the course content to the LMS that best suits the author’s needs; QA of the course; pilot run to gather feedback; installing the LMS if need be.

“A” stage: Research and Analytical Expenses

Each course should serve a certain purpose. It should either spread the brand awareness, improve the corporate business culture or simply earn some money. Thus said, certain researches should be completed before beginning the course creation:

  1. Research of the target audience for the course

  2. Research of currently existing alternatives

  3. Exploration of preferable promotion mediums for the course

 Online Course Analysis Costs Calculation

In order to stay brief and informative, we will deliver the remaining data in tables. Minimal hourly rates are mostly taken from Upwork, average rates represent the median budget for hiring a contractor team to do the job, maximal rates are obtained from SalaryExpert and public research results.

Some necessary clarifications:

  1. The author of the course can be a subject matter expert and a lecturer.

  2. We highlighted some rows in yellow. These are the fixed time and budget expenses that are needed for any course of any length.

  3. Calculations of video production costs excluded the rental for equipment and studio.

  4. The more multimedia content is inserted, the longer the video production and editing phase will take, obviously. Our example is calculated for the content interactivity level 1 — simple diagrams and graphs, several tests and quizzes, etc.

 “D stage”: Online Course Design Timeframes and Budget

 Online Course Design Costs Calculation

Important note: If some kind of printed or digital instructional materials are present and can be used as a basis for a course, this helps lower the check and shorten the design time by up to 30%.

“D” stage: Content Development

Online Course Development Costs Calculation

“I” stage: Content Implementation

Online Course Content Implementation Calculation

If the course author wants to launch their own platform for the course, LMS setup costs are added to the check:

Online Course Implementation Costs Calculation

Combining certain roles (like video operator, video editor and director) helps cut the costs There are several more important points:

  1. Combining certain phases (during the design stage, in particular) helps to further reduce time and money investments

  2. Working with teams of contractors, who have established workflow processes and ample experience in instructional design, raises the budget for 20-30% on average (as compared to working with individual freelancers from  Upwork and websites alike), while cutting timeframes almost two-fold in most cases.

Thus said, overall costs of “D,D,I” stages in each particular case can be 25-30% lower than in our tables. Some additional expenses will arise (like updating certain modules or adjusting the course content basing on the students’ feedback following the principles of adaptive learning). However, calculations of these expenses (the “E” stage) are excluded from this article.

Below is the summary of time and money investments for all the roles involved in online course creation process:

Online Course Creation Costs and Estimates Calculation

To sum it up, here is what we can say about online course design and development costs and timeframes, based on our experience and recent research:

  1. 1 hour of ready online course takes 100-160 hours to produce

  2. 1 hour of ready online course costs $7,140-35,550 ($21,345 on average) to produce

 Just for comparison: last October the cost of producing 1 hour of ready online course content was $7,055-$25,550 ($16,300 on average) which means that creating an online course is now approximately 25% more expensive. The reason for such increase is that some of “Top Rated” lecturers and graphic designers on Upwork doubled their hourly rates, so be aware of this situation.

 However, many among the rest of the freelancers offer a worthy alternative to the leaders, so you can still get great services for Design and Development stages. You most likely can find such specialists for a lower price and decrease the overall course creation costs greatly. The next update of these calculations is due this fall. Meanwhile, feel free to use this research for defining the estimates of your online course creation.

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