Learning management systems started gaining popularity from the moment they showed up two decades ago. The rapid development of tools such as computers and mobile devices has supported its growth, especially with the advent of the high-speed Internet.
However, not all markets have fully adopted the LMS technology due to reasons like low IT infrastructure or lack of organization. Since big economies have started to adopt the cloud-based LMS software tools, the potential for growth is high in the next five years.
We are going to delve a bit deeper into what LMS tools are, what is driving their expansion and what are the estimates of their market scope in the next five years.
What is an LMS?
A learning management system (LMS) is a software application for the administration, documentation, tracking, reporting and delivery of educational courses or training programs.
LMS tools were created for making knowledge-sharing easier. The whole system was created to work across different web-based platforms. The technology has found its way in both education and the business world.
With LMS tools, businesses receive a lot of benefits, as their employees can acquire knowledge without burning a hole in the pocket.
On the education side of things, educational institutes are now in a position to work with students who are thousands of miles away. Plus, the functionality of these platforms makes the learning process easier than ever before.
Types of LMS tools
Like all software tools, LMS also has different variations. The primary difference lies in whether the tool is locally hosted or remotely hosted. Additionally, there are proprietary, open-source and SaaS solutions. The Proprietary software comes at a price and can be remotely or locally hosted.
The open-source one is free but more complicated to manage. Even though free, an open source LMS requires more staff and is not as user-friendly as its SaaS counterpart. This increases the cost for the business, as employees require training to use the software and additional resources are needed for system maintenance. This is a big drawback, as small businesses cannot afford such an LMS tool.
Cloud-based SaaS has been the most appealing in recent years. The reason for this lies in the fact that all of the features are ready to be used. A cloud-based LMS is user-friendly, removing the need for training staff to use it. Furthermore, it comes at a lower cost, allowing small businesses to rely on such tools.
What is driving the LMS growth in 2019
There are various elements that are positively affecting the growth of LMS tools. The primary one is the popularization of SaaS software tools that are primarily cloud-based. This technology alone is greatly improving the rate of adoption of LMS tools.
In recent years, there has been a growing need for collaboration when it comes to eLearning systems. Standalone LMS platforms have given way to integrated systems that allow the learner to access various repositories from a single dashboard. Such modern LMS systems are also largely social and come equipped with tools that let learners engage and discuss lessons with their peers. This serves as an improved pedagogical technique.
While the learning methodologies have largely stayed the same, more training modules today focus on bite-sized resources. Several studies show that incorporating lessons in short chunks of under 15 minutes each enable better retention among learners. There is also a shift towards enhanced LMS tools that come with features like gamification for efficient learning.
In Europe, according to MindWires, adoption of cloud-based LMS is on the rise, currently standing at 12.5%. This change is caused by a variety of features that SaaS tools bring to the table. Let’s take a look at them.
- Ease of use – This is the primary requirement for a software tool to become popular. No one wants to use a complex solution that requires months of training. SaaS LMS tools are extremely user-friendly, as anyone in a company or in an educational institution can learn to use one within a day or two.
For any advanced features, a little bit of additional dedication is required, but nothing more than a couple of days. This user-friendliness is greatly appreciated by businesses that implement LMS tools, as they can start sharing new tutorials, guides and other type of educational information through their organization.
- Cost efficiency – When it comes to costs, businesses become more efficient with SaaS products, as they have more control over the expenditure. Only a decade ago, it was necessary to host LMS tools on your own. This brought additional staff costs, hardware costs and maintenance costs.
Now a service provider is responsible for all of these expenses. An educational institution or a business is only responsible for paying a monthly fee, and all of the maintenance and hosting costs are automatically covered.
- Accessibility – Cloud-based LMS tools are always online. This means that you and your employees or students can access the learning platform anywhere and anytime, which is a great benefit for business owners and training players. Students simply have more flexibility in organizing how they are going to study.
In the business world, employees can finally make use of their commuting time to cover new courses and learn new things about their business role.
- Shareability – All of the content can easily be shared with any registered employee. Additionally, the administrator or LMS manager can handle different access limits for different departments, to create a seamless experience free of any unnecessary distractions.
- Multi-medium support – Cloud LMS tools support text, audio and video formats. This flexibility is a great feature because different mediums are better to use for different types of information.
With the use of text, imagery, audio and video materials, it is possible to easily deliver different information retention techniques, ensuring better employee or student performance.
- Maintenance – All of the system maintenance is the service provider’s responsibility.
- Notification systems – A live notification system is perfect because it makes communication much easier for those who are participating in the learning process.
- Scalability and flexibility – Yet another useful feature that makes it easier for educators and business owners to better manage their e-learning experience. Cloud-based software tools can support an unlimited number of students.
That is a practical solution for those who are planning to grow as much as possible. Additionally, whenever the number of students go down, it is possible to cut the LMS cost by reducing the number of user accounts. This is a great flexibility option that makes it easier to control business costs.
On the other hand, flexibility comes in the form of a high number of competitive companies. One can easily switch an elearning tools without using any education materials.
- Multi-platform support – This is one of the most important features that are making LMS tools most suitable for people, boosting its market scope. Cloud-based LMS tools can be accessed on different types of devices.
With the expansion of the smartphone and tablet market, the scope of LMS tools is automatically expanding, much like it did with the popularisation of computers two decades ago.
- Personalization – Complete learning experience personalization was practically impossible with traditional education. However, with the LMS software tools, it is possible to create this experience and help every student learn at his or her own pace. This is a great way to reach out to thousands of students, ensuring that every single one of them is going to acquire new knowledge at their own pace.
- IT infrastructure – The IT infrastructure is still being developed globally. The better the infrastructure becomes, the more it can be used for LMS software tools.
This is why countries like China, India and countries in Africa are working hard on improving their IT connectivity. The better the global infrastructure becomes, the higher the LMS market scope is going to be.
All these are various elements positively affecting the expansion of LMS market scope. As these tools are extremely useful for all the different types of industries, it is easy to see why the CAGR in the industry is currently sitting at around 20%. Let’s find out how does the future of LMS market looks like in the coming five years.
Bright future ahead for LMS industry
According to Zion Market Research, the future is bright for the LMS industry. Let’s take a look at how they have evaluated the state of the LMS market scope across different continents.
LMS market scope varies greatly across different continents. The reason for this lies in the rate of technological development in different parts of the world. Let’s go over each of them and take a closer look.
North America – North America is the pioneer of LMS technology adoption. Its growth is currently sitting at 4% due to the fact that LMS technology has already been widely adopted, leaving little room for making progress.
The main reason for this lies in the strength of American IT infrastructure, something other continents are noticeably behind on. The infrastructure simply allowed US businesses to adopt LMS technologies earlier, making North America the adoption leader.
The primary drivers of growth in US LMS market scope are increasing numbers of universities that offer online education. Also, the corporate sector is seeing the above-mentioned benefits of LMS tools and has invested a lot in the adoption of this software.
Therefore, the growth of LMS market scope in North America will continue.
South America – Countries on this continent are still in the growth period, as also noted by Ambient Insights. CAGR figures show that developing countries LMS market scope range from 11% up to 28%, depending on the growth rate.
For example, Brazil has lower growth rates due to being the most advanced IT country in the region, but the Dominican Republic CAGR growth of 28% shows that there is a lot of room in that market for LMS to prosper. This is great news for the future of the LMS industry.
Europe – Even though Europe is behind North America, its adoption of LMS is quite high. However, there are differences depending on the region.
West Europe is going to experience less growth, as markets have already adopted this technology. The only change that is going to occur is the shift to the cloud-based LMS tools.
When it comes to Eastern Europe, the situation is quite different. Countries like Slovakia, Ukraine and Russia are currently in expansion, as a number of startups focused on education are propelling the rate of technology adoption.
This means that there is plenty of room for LMS market scope growth in this region.
Asia – Asia had witnessed the highest growth rate for e-Learning in the world at 17.3%. Revenues reached $5.2 billion in 2011 and doubled to $11.5 billion by 2016. Many countries in this region have growth rates above the combined aggregate growth rate of 17.3% and are making consistent efforts on improving IT infrastructure, allowing more businesses and educational institutions to adopt LMS software tools.
Therefore it can be concluded that this part of the world is going to experience the strongest LMS growth in the next few years. Additionally, the government is likely to incentivize businesses to adopt new trends, helping expand the LMS market scope.
Africa – This continent has a high potential of achieving incredible growth, however, it is significantly slowed down due to poor IT infrastructure. Once UNESCO intervenes, a much higher CAGR growth rate is going to occur, as governments and people in Africa are willing to adopt LMS technologies, but are unfortunately currently prevented from doing so. As the IT infrastructure expands, so will the market scope of LMS tools.
Australia – With great Internet infrastructure and a good economy, Australia is in a similar situation to that of North America and Europe. Significant growth is unlikely to occur, as Australian businesses and educational institution have already adopted the LMS technology. It is likely that the shift towards cloud-based tools is going to occur.
WIth these changes on the global market, Zion Market states that CAGR of LMS market scope is going to be 24%. The result in 2022 LMS global market would reach $19.05 billion.
This indicates that the LMS industry is only going to continue growing as it conquers various parts of the world. Statistics like this show that the LMS market in the next five years will grow by leaps and bounds.
Technology has created a wide-array of new markets globally, and the LMS market is no different. It is going to achieve significant growth continuously in the years to come, as a high number of countries will continue to adopt these incredibly useful e-learning tools. As time passes, the LMS market scope is going to be higher because the day isn’t far when more countries will choose online learning.