Introduction: It was beyond doubt that the year 2020 must be an important time pivot for the education industry. As the COVID-19 spreads since the beginning of this year, education is disrupted globally, but learning cannot be stagnant. In this special year, JMDedu will hold the GET (Global Education Technology) Summit under the theme of “Redefine Learning” to help both Chinese and international EdTech practitioners deep dive into the changes and rebuild confidence.

While what has been significantly changing in China? And where will the opportunities lie in the Chinese education market? In the upcoming weeks leading to the GET 2020 Summit, we will share our insights on how companies and organizations are rapidly adapting to change, as well as explore potential opportunities for further business collaboration.

The previous article discussed education informatization and SaaS providers booming under the OMO trend driven by the COVID-19 pandemic. We mentioned that moving online is not simply copying offline courses and services. Changes in the role of teachers, students’ learning styles, as well as parental participation in education are challenging education companies to rethink their business model, and dual-teacher has become a buzzword.

The dual-teacher model was developed to deal with the unequal distribution of academic resources and was later used as a solution to standardize cram schools’ teaching and research. Moreover, education itself is a service; the dual-teacher model can effectively help the service replicate on a large scale and improve efficiency.

Due to the COVID-19, the dual-teacher model has been widely adopted in large-sized classes during the past few months. And leading education companies are making efforts to enter the areas outside metro cities through the dual-teacher model but meeting lots of challenges. This week, let’s deep dive into the latest dual-teacher practice and figure out its prospect in the Chinese education market. 

Existing dual-teacher products developed by China-based education giants

The pandemic is just like a black swan, leading a traffic flood to the online education market. Vying for more market shares in the low-tier cities, education giants accelerated their layouts through promoting dual-teacher products. Reviewing the growth pace, TAL is the pioneer and has a quite different idea from New Oriental.

TAL’s first dual-teacher attempt happened in 2013, with a live-streaming product named Haibian. Since 2015, TAL’s subsidiary Xueersi started to introduce the dual-teacher model. And in May of this year, TAL released a ToB product, “Future Magic School”, aiming to provide a whole package of solutions, including contents and services for institutions. Meanwhile, TAL Group claimed that the dual-teacher model would be the only approach when its sub-brand Xueersi coming to new cities, whereas New Oriental focuses on self-built offline centers. From its perspective, co-building and acquisitions need a run-in period in management and operation; self-building can be advancing faster. Moreover, Youdao Premium Courses providing dual-teacher live-streaming services, was launched by NetEase in 2014.

Several years later, the after-school tutoring market in metro cities is crowded, and there is still a large space in low-tier cities. Plus, dual-teacher large-sized class has the best profit and financial model in the online education sector; the gross profit rate can reach about 70%. Thus keeping eyes on small towns is inevitable.

We have talked about the intense advertising war among rival companies for K-12 after-school tutoring. The average daily advertising volume of China’s three online education giants with the largest traffic (TAL, Yuanfudao, Zuoyebang) reached 10 million RMB (around 1.5 million USD) last summer. Throughout the first half of this year, online educational institutions' advertising volume will exceed 6 billion amid national distance learning. When grabbing new markets, profit is not the priority that various companies chose strategic losses. However, after the money-burning,  user retention in lower-tier cities is the most important.

The pros and cons of the dual-teacher model when coming to the new markets

According to the data from iiMedia, the K-12 after-school tutoring market scale brought by students in third- and lower-tier cities accounts for 80.3% of the total, the second-tier cities and the first-tier cities accounts for 13.2% and 6.5% respectively. 

iResearch also did a survey, showing that “individual differences in teacher's ability” and “lack of high-quality teachers” have become two biggest pain points for institutions in third- and fourth-tier cities. 

Although dual-teacher class can be the best solution, only half of the interviewees have a certain understanding of this model. There is room for improvement in parents’ awareness of non-local institutions. When the giants came to the new markets where consumers are relatively unfamiliar with their brands, they were fully prepared but not comprehensive.

In detail, dual-teacher class products launched by leading companies did not make adjustments in terms of different regions’ academic and examination conditions due to the low efficiency and high cost of operation. Meanwhile, giants should find a more economical model for consumers in undeveloped areas, such as live-streaming or video courses.

Live-streaming V.S. Video: new trends of dual-teacher service outside metro cities

Live-streaming courses can better achieve the interaction between teachers and students, while video courses with lower costs are relatively affordable for local institutions in the lower-tier cities. Thus, it is still inconclusive which form will work out in less-developed areas at the current stage. 

With the continuous optimization of technologies like interactive videos and artificial intelligence matching, it is worth keeping an eye on whether the video can bring students the same experience and learning effects as live-streaming courses.

Apart from K-12, parents in third- and fourth-tier cities start to pay more attention to competency-based education, but this kind of service usually charges a high price. Although having lower income, parents always want the best for their children, and courses like competency-based English learning and STEAM are becoming a rigid demand.

Therefore, for overseas companies, the opportunity lies in developing a well-interactive online curriculum system that enables parents to participate in or a standardized teaching and research system to cooperate with local offline institutions directly.

But we must be aware that small companies with poor quality of teaching resources and service will gradually be eliminated. It is the last wave for newcomers to tap into the areas outside the metro cities.

In the coming days, we will deep dive into vocational education in China, which was also affected by the coronavirus. Companies providing offline civil services exam preparation were suffering from the national lockdown, and the delayed or even canceled exams. However, accelerated by encouraging policies and the global crisis, we are also witnessing a skyrocketing demand in career development and lifelong learning in the long run.