Today we had a guest lecture by the founder of Tutorvista Mr. K. Ganesh. Tutorvista recently acquired by Pearson group (Mr K. Ganesh & Meena Ganesh has sold 59% of their stake to Pearson Group for Rs 577 Crores) is a pioneer in online tutoring (personal 1 to 1 tutoring via web)connecting students and teachers using their online platform providing quality tutoring at affordable price. The business model of tutorvista, the challenges faced by Ganesh and the way they overcome the challenges is a fascinating story.
Tutor vista charges a flat rate of $100 per month across any subjects against offline tutoring solutions by firms like Sylvan offering at $300 – $400 for 6 hours program in USA. Ganesh says the offline highly priced tutoring can only meet the needs of a smaller section of market which is basically Affordable Rich + academically Poor Student (intersection) whereas his online low cost tutoring would be of interest to anyone who is keen to improve their academics. The whole idea behind pricing at a fixed $100 across any subjects for unlimited number of hours is to give peace of mind to parents and make it as part of their monthly budget.
One of the primary challenge in implementing this $100 per month unlimited scheme is to avoid misuse where a person paying $100 sells to 10 other people for $20 each by sharing his online login and password. Some of the mechanism implemented by Tutorvista to handle this is very interesting
- The system does a basic IP Address check to see whether it is misused. Couple of IPs (home, school) used interchangeably is acceptable but a wide range of IPs used to access Tutorvista using the same ID is a good indication of misuse
- To verify whether it is the same student, they also record the teaching and verify the consistency in the kinds of questions asked by students across multiple online sessions he is taking ( A student asking an advanced question in session 2 against a basic question in session 4 of the same topic is contradictory)
- A fair use policy agreement which protects tutorvista from anyone misusing the buffet flexibility offered by them
The next major challenge is hiring qualified teachers. Tutor vista does the entire process of hiring and managing teachers through their online platforms and looks like many of the teachers haven’t been met by tutorvista team face to face even once. The online platform provides flexibility
- To conduct online test to qualify the basic knowledge of teachers in a given subject
- Online tests to ascertain potential teacher’s communication and interactivity skills
- If they pass the above they are subjected ~ 60 hours of online training on US accent, culture, using the online platform to deliver the training etc
- After the training the teacher has to go clear the certification exams to become a qualified tutorvista teacher
- Teachers have to opt for either full time or ½ day dedicated programs only. They don’t accept part-time teachers as Ganesh doubts their sincerity in handling the same
- Once accepted teachers are rated online on every class they conduct by the students to access their performance
- Depending on their performance level, appropriate expert coaching is provided to help them to improve in areas they lack
- It also provides an excellent online collaboration platform whereby teachers can interact with each other leveraging their past experience to handle tough students / their queries
Those are some of the ways and means to handle the Supply side of the business
On the demand side, Ganesh says one of the key challenges they faced while they started is all about acquiring customers as they are the first Indian B2C company entering the foreign markets (Infosys, Wipro etc are more B2B companies). The way they managed this problem is to hire a team of 36 people to bid for more than 1,000,000 keywords in internet search engines like Google on daily basis to position tutorvista at the top spot to ensure maximum click-through and conversion ratio. During tough initial months he says they have spent more than 5 Crores in advertisement to attract revenue of only 50 lakhs.
Ganesh feels they key success factor / differentiator is the strength of online platform. He illustrated this with a fantastic example.
Let us assume on Sunday morning 3 AM IST there is scheduled class between a student in Cincinnati and a teacher in Tirupathi, India. Obviously it is a very early morning in India and anything can go wrong like teacher falling sick, internet breakdown, power failure etc hampering the scheduled class. Their online platform handles this situation in an efficient manger
- Platform checks whether at 2:55 AM the teacher has logged in
- If the teacher hasn’t logged in, it immediately sends a SMS alerting the teacher about the class
- If the teacher hasn’t login till 2:57, an automate phone call goes to teachers landline / mobile number to alert him
- If still no response, the system automatically identifies the next qualified teacher among the pool of more than 3000 teachers who can handle the subject
- Once the system finds the next available and qualified teacher, the system passes the complete history of the student to the new teacher including last class handled, the open questions to be resolved etc so that the new teacher is fully prepared to handle the student
- The new teacher would be online in next couple of minutes to handle the planned session with the student
- The student is informed about the change in teacher and he has an option to either reschedule it or continue with the new teacher
- When the above all happens automatic by the platform, a 24 X 7 control room tries to reach the originally planned teacher for next few hours continuously
- If they are not able to reach all classes scheduled to be handled by that teacher are assigned to equivalent well qualified teacher
- If the above repeats with the same teacher for more than three times, teacher is disqualified
Similarly due to the unlimited buffet model, there could be problems with the students too where students doesn’t show up for the scheduled classes whereas the teacher is available as the students can request for any number of classes for $100 they pay per month. In those cases, Ganesh handles it in an interesting manger
- Students are awarded points if they attend the scheduled classes promptly where the points can be reimbursed for future subscription
- Student’s parents are intimated about the no show by student
- Punctual students are provided facility to schedule the classes in less than a week whereas for non punctual ones a minimal lead time of 4 weeks. The above are to drive positive student behaviour
- Apart from above tutorvista also provides 2 streams of tutoring. Scheduled session and unscheduled ones (Connect now). If a student doesn’t appear, then the teacher is assigned to unscheduled ones thereby effectively utilizing the teachers time and at the same time improving the customer satisfaction
- Also they used to overbook for the same teacher like airline ticketing to handle no-shows on basis of historical data and handle it the no-shows in same manner as airlines
Thus in net though the business model as such looks like easily imitable, Ganesh and team has built a solid platform to build a strong barrier for others competitors to easily enter and replicate the success. Now with Pearson tie-up, they have much wider reach like every Pearson published book has advertisement and one touch connect option to get hooked to tutorvista.
In net it was a wonderful guest lecture by K Ganesh highlighting the role of operational excellence as a key differentiating factor for a successful e-business model connecting thousands of teachers and students online every day.