What next for the learning technologies market – the Trello acquisition has some clues

Some time ago I posted a piece about the problems of the one stop shop. Essentially, I was aiming at the increasingly bloated, feature rich LMS and HR systems which tend to dominate the market. They are ripe for that famous digital business moment – disruption. Disruption by smaller, faster, simpler and cheaper alternatives. Not alternatives for everything they do but for a small number (probably one) of the most valuable needs that their array of product features meet.

The recent acquisition of Trello by Atlassian is a really good case example of this phenomenon. Trello is a fast growing project management tool (over 19 million users from 100 staff – that kind of business). Rooted in the software world it was also marketed at designers, marketers and non-tech project workers who enjoy its clarity of purpose, simplicity and ease of use. It helps them track and share progress. Atlassian’s success was built, initially, on the Jira and Confluence products. They started in a similar place and became a standard of the toolsets used in the software world to manage projects and collaborate on development and documentation. By contrast they are more hard core.

Trello was rapidly eating away at Jira’s luncheon and Atlassian was faced with a choice. Compete, (i.e. build a Trello competitor), ignore Trello and continue to build out Jira with new features or buy it. They chose to buy it. This piece by Mitt Tarasowski is an excellent summary of those options and of the position Atlassian found itself in. It is also a parallel story of the LMS trajectory, I believe and of the risk and opportunity in the learning technology and eLearning markets.

Does this seem familiar: large incumbents with feature rich systems, at high and rising prices, which are becoming increasingly hard to manage for customers and can be a dangerously poor experience for the end user. They manage an array of functions for their customers and as result are increasingly complex. These are often market leading positions to take but they are also ripe for focused competitors who do one thing well.

Some of this activity is visible in the learning technology world. New tools and products are arriving which are focused on certain use cases for learners (or users) and are easy to implement or pilot. Noddlepod, Fuse and Looop are examples of these small(er) or new(er) businesses developing a tool quickly and enabling customers to get up and running with a minimum of fuss. I doubt that these are currently replacing LMS purchases (David Perring will no doubt have a view on this). They don’t need to in order to grow, however. There is an opportunity to target smaller customers for whom the full fat options of the big box LMS is too rich. They can target departmental buyers of larger organisations who like the flexibility and simplicity of not having to do battle with the LMS (and sometimes its owners). In this way they can grow the market as they redefine it.

They can focus on a subset of the features of the traditional providers precisely because many of those features are of little utility. Whisper it but…I suspect that you do not need to be a ‘learning professional’ to use them to help people learn. You may not need a technology budget to buy them –  a project budget may be adequate.  The market will grow but perhaps in a less comfy direction for some.

These products have some common attributes which are vital to their success. They are also difficult for large incumbent providers to match and will sustain their advantage for some time yet:

  • Easy to try – low barriers to pilot and test
  • Easy to scale from a small implementation
  • Little or no customer support requirements
  • Cloud – few infrastructure issues or integration headaches
  • Easy to use – low maintenance and support for users
  • Easy to learn how to use – low introduction cost
  • Have user advocates already often via free versions or other jobs/projects
  • Integrate well with other tools (YouTube, MSFT, Gmail  etc.)
  • Develop features and fix bugs quickly

None of this is to say that the large systems vendors are foolish or have poor vision. They have a market to develop and each other to compete with. These smaller providers are not, yet, troubling the Sales Director. They may also provide a route as an exit for start-up investors. That is a more familiar story for the learning technology world.

I suspect, however, that the market will be redefined by new entrants who can see their way to the end-user whilst finding a new route to the customer.

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