Learning management systems (LMS) come with different pricing models depending on the scale of your business and how much the LMS is used. The growth in online learning since the 2019 pandemic has led to an increase in elearning courses and innovative software to support frontline workers in retail, food service, and many other industries.
The LMS pricing strategy that best suits your business will depend on factors like the number of workers who will be using the system, how often they will use it, and the exact features you need. Online instruction can be a powerful tool for enabling your team and can pay itself back with dividends.
More businesses than ever are turning to learning management systems to centralize and manage employee training. While most elearning software organizes and stores your in-house course materials, leading LMS platforms like Axonify offer additional features like personalized AI-driven mini lessons to reinforce critical knowledge and skills.
Top eLearning Pricing Models
The pricing model that works best for your business depends on many different factors. Ensure you do your research before committing to an LMS to guarantee it will work for you both functionally and financially.
Pay Per Learner (Cloud-Based)
Learners can access cloud-based LMSs from anywhere with an internet connection and don’t need to download any software.
This model is recommended for small businesses or entrepreneurs who are looking for an affordable and convenient way to train their employees. In this system, companies pay according to the number of users that access the elearning courses each month.
For businesses that have a steady number of learners, this can be an effective pricing strategy as your costs will be fairly predictable. However, if your learner base suddenly goes up, your costs will go up as well.
Pay Per Use (Cloud-Based)
“Pay per use” sounds straightforward but can in fact be confusing. That’s because each LMS provider may define “use” differently. For example, while one defines “use” as a module, another provider could consider a course as a “use.”
If you choose this model, it’s important to verify the provider’s definition of a “use” and how this will affect how much you pay. This model could work well for companies that don’t need a wide range of LMS features but have a wide audience base.
The main downside of this model is that it’s difficult to predict how much you’ll be charged each month as the price will change depending on how much your learners interact with your elearning courses.
Pay Per Active Learner (Cloud-Based)
According to this model, your business will only pay for active users of your courses. This means that you don’t pay for anyone who didn’t actively use your online course that month.
This is a cost-effective option for training courses where attendance rates often fluctuate.
Limited Time Licensing (Cloud-Based or Hosted)
For those who prefer paying a flat yearly fee, this may be the best option. The main advantage of this model is the ability to plan for the cost incurred by the LMS. This fee won’t change regardless of how many learners you have, how many modules or courses you create, or how many learners access your elearning courses.
Perpetual Licensing Fee (Self-Hosted)
This is a good option for businesses that wish to own their software outright rather than paying monthly or yearly fees. In this model, the creators of an elearning project will pay a one-off, flat fee that covers all aspects of the software in perpetuity. The organization will also typically host the LMS locally, though some providers may offer to host the LMS at an extra cost.
This model is probably most suited to large organizations with long-term goals and a large learner base.
Free Learning Management Systems
There are also free options that can work well for some businesses. While you may have to possess some technical know-how to master free LMS platforms, they can potentially provide a solution for companies on a tight budget, or for those that wish to remain competitive in their course prices.
Though a free option may seem tempting, keep in mind that support services won’t be available. If you are tech-savvy enough to maintain the system yourself, it may be a good idea. However, if you end up having to hire a specialist to get you started, for troubleshooting, or to maintain the system, a free system may be a false economy.
Things to Take Into Account When Choosing an LMS
There are many questions to consider when choosing a learning management system. Ask yourself the following when researching your options:
Is It User-Friendly?
Most LMS software will be user-friendly, but will also require some know-how to get the most out of it. You will use your LMS every day, so you must be able to use its features with ease.
Does It Have All the Features You Need?
Businesses in different sectors will have different needs. An LMS is an investment for your business, so make sure it’s a wise one.
Does It Have Too Many Features?
The best pricing model for you will be one that gives you the number of features you need, not more. Paying for advanced features you don’t need and won’t use isn’t a wise use of your hard-earned revenue.
Does It Provide Learners With Mobile-Ready Resources?
Many employees may wish to learn on the go. This means your resources should be mobile-friendly to ensure your workers can access your materials anywhere.
What Are the Costs Involved?
When considering an LMS, think carefully about the costs involved. Can your small business afford it, and does the return in terms of improved performance justify the investment?
The Rise of Online Learning
There can be no doubt about the incredible rise in popularity of online learning since the pandemic. In 2022, 26% of people aged 26-74 in Europe reported having done an online course. In some European countries, this is significantly higher, with an incredible 50% in Finland and 42% in Spain participating in online learning.
Seeing as many workers are now familiar with the online learning format, LMSs provide a comfortable and convenient option for upskilling your workforce consistently across all of your locations. A dynamic LMS can motivate your employees to connect regularly and brush up their skills, helping them deliver the best possible customer experience.
Choose the Best LMS for Your Business
Pricing, ease of use, engagement, and results are four things to prioritize when choosing an LMS. An LMS is a substantial investment for your business and needs to be effective in accomplishing your goals.
For small businesses, a cloud-based pay-per-learner LMS may be the most cost-effective option. Large international companies may prefer to pay an annual fee for an unlimited number of learners and uses. Either way, make sure that the LMS you choose is proven to boost performance so that every dollar is a dollar well spent.
