Introduction
The global e-learning market is predicted to reach $325 billion by 2025. There is a lot of room for profit but also much competition. Understanding how to price your services accurately when determining how much to charge for hourly content development in e-learning is key to staying competitive.
The hourly rate for e-learning content development depends on many different e-learning cost factors, plus the experience level, such as the skills required, complexity of the tasks, location, and market. 🚀
For example, higher rates are often charged for developing strategic solutions, designing complete educational programs, and helping organizations set goals. Rates might be lower for tasks such as developing learning objects for instructional content that is already written. It is necessary to understand these different factors to create a pricing plan that attracts clients.
💲 In this article, we will explore how to create a competitive pricing strategy and the rationale behind e-learning cost factors that should be considered when determining how much hourly e-learning content development costs. Additionally, we will address common questions and problems e-learning developers face when determining their rates, and offer practical solutions for e-learning budget planning and cost estimation to help you set a fair and profitable hourly rate.
👉 Blue Carrot is an e-learning content development agency that can help you save time and maximize the effectiveness of your e-learning development projects. Including high-quality instructional design, media content production, or localization services can increase the value of your offerings and allow you to raise your rates for higher-quality deliverables.
Summary
- Length of the E-Learning Course
- Types of Media and Required Skills
- Content Subject Matter
- Level of Customization and Interactivity
- Years and Type of Experience in E-Learning Content Development
- Delivery Timeline
Factors Influencing Hourly Rates
Many different factors can influence hourly rate calculation for e-learning content creation. From the type and complexity of content to the industry and location of the client, determining your e-learning content development charges per hour is the first step in being able to price the total cost of e-learning development. Consider these six aspects of e-learning based on industry standards when determining your hourly rate and the time required to complete an e-learning development project.
#1 Length of the E-Learning Course
Longer e-learning courses require more content development and are often more complex than short e-learning courses. In longer courses, the content must be scaffolded and different parts of the course must connect back to each other. A 30-minute course can still have some complex content, but an 8-hour course on the same topic will be much more involved. Later in this article, we explain two ways to calculate time estimation for e-learning projects.
#2 Types of Media and Required Skills
For projects that involve media development, the type of media and the tools needed to design them can impact the overall rate. It is important to consider the different media elements and the complexity of how they are created when quoting e-learning content development costs per hour for your services. For example, producing animated videos or shooting live videos takes more resources and requires a higher skill level than generating synthetic AI videos.
E-learning synthetic video example
#3 Content Subject Matter
In the e-learning industry, some content is considered easier to work with than others. For example, designing training on how to use a project management tool may be simpler than designing a course about computer programming. The type of content and level of understanding that is required to develop the e-learning content in collaboration with subject matter experts can influence the hourly rate for e-learning content development.
#4 Level of Customization and Interactivity
Some clients may request more customization and interactive components in their e-learning projects. These projects may require more time and a higher level of skill, which warrants higher e-learning content development rates per hour. The level of customization and interactivity is related to the type of media and skills required for the work.
Example of interactive slides
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#5 Years and Type of Experience in E-Learning Content Development
Designers with more years of experience or expertise in a certain area (like business or medical training) often charge higher e-learning content development rates per hour. Some organizations are looking for more advanced expertise and are willing to pay higher prices. Others will specifically seek out someone with subject-area knowledge. This can be based on the preferences of the company leadership as well as the requirements of the job.
#6 Delivery Timeline
Some clients may need work completed quickly, which can allow you to charge a higher rate for a faster pace of work. This common pricing adjustment is similar to overtime for a rush job that requires you to work more hours each day or focus solely on one project to complete it on time.
Average E-Learning Content Development Rates Per Hour
No matter your location, hourly rate calculation for e-learning content creation will depend on the above factors. They also depend on the market and economy in the client’s and/or your geographic location. In the U.S., standard rates for beginner instructional content developers range from $30-50 per hour while mid-level instructional designers charge between $50-100 per hour. The most advanced in their careers charge $100-150 per hour or more. In Western Europe, average rates are about 15 percent less than in the U.S. In Eastern Europe, they are slightly lower, with the hourly rates for mid-level e-learning developers ranging between $30-55 on average.
Calculate E-Learning Development Costs
Considering the above factors and the rates per hour, as well as your expenses and desired profit margin, you can use the strategies in this section to set reasonably accurate pricing. There is no perfect formula for determining how much to charge for e-learning development, but you can use these guidelines to approach it. We outline two pricing models for calculating e-learning development costs to help ensure you are compensated fairly and your clients get a good return on investment on e-learning projects.
Method 1: Average Rate of Work
The first approach is to take the average number of hours of work for one learning hour developed to calculate the total hours of work. Consider the e-learning cost factors discussed above when estimating the hours of work per learning hour for each project, using the following rates of work as goalposts. Most e-learning courses take 50-700 hours of work (200 on average) per e-learning hour inclusive of all tasks.
📌For instructional design:
- Minimum: 20 hours of work per 1 learning hour – best for simple projects.
- Moderate: 40 hours of work per 1 learning hour – a comfortable pace for most projects
- Maximum: 50 hours of work per 1 learning hour – a greater number of hours for complex projects.
📌For SME:
On average, for subject matter expert (SME) work, plan to add 20 hours of work per 1 learning hour if the project SMEs make material from scratch or 6 hours if they already have content to work with. Typical hourly rates for SMEs range from $75-150 in the U.S.
📌For media development:
One hour of animated video typically starts at 200 hours of work and can go up to 1300 hours. If the videos are created with AI and a synthetic avatar, this can greatly reduce the production time and require 20 hours per e-learning hour. Live shooting requires about 100-200 hours per learning hour but can be more if post-production involves creating animated overlays.
Method 2: Chapman Alliance Level Factors
Another more involved approach is to use the following formulas to guide the process of determining content development costs:
☑️ Hours in Course x Level Factor (Complexity of Course) = Total Hours of Development Time
- Decide whether you are a beginner, intermediate, or advanced e-learning developer, and start your pricing within those hourly ranges. Use this as a basic rule, but also consider the level of experience the client is looking for and work between those ranges. For example, if you are an advanced e-learning developer but the client is looking for intermediate skills, then consider lowering your rate somewhat to be a competitive candidate. Be willing to negotiate if it’s an assignment you particularly want.
- Clients or SMEs will often state the intended length of the course. If the client has not given you this information, you can estimate it based on their requirements. To do this, you can estimate development time using some of these industry standards for the length of slide decks and scripts for the instruction delivery as a starting point:
Slide Decks:
Number of slides ➗ 2.2 slides per minute
Multiply the number of slides by 1.25 if they are text-dense and need to be broken up into additional slides.
Script:
Total word count ➗ 150 words per minute
- Use the Chapman Alliance Level Factors to assist with determining the complexity of the project and the hours required. Level factors estimate an end-to-end development ratio for a project including instructional design and media production. This gives a figure for the total number of minutes or hours of labor required for the number of minutes or hours in the length of the course. Each level of the system indicates how much interactivity the module contains. Level 1 is a simple click-through e-learning course. Level 2 has some interactions like tabs and matching exercises. Level 3, however, has significant interactivity with elaborate animations, branching, and other customized content. Each Level also has a low, average, and high range, accounting for nuances in requirements and on the level such as the amount of media to be produced and the complexity of the material.
As with the first method, take inventory of everything involved in the project to determine the level of interactivity and other details that may increase time, demand, or skills. Then you can come up with an estimated range of hours (for example, between 60-70 hours) based on what you think is involved in the different tasks.
4. Once you know the development ratio, you can estimate development hours by multiplying course length by the development ratio in hours. Along with each of these methods, factor in any costs you will incur for the project, such as software subscriptions or hiring additional freelancers to assist you. Once you have the entire cost calculated, you can better understand the time investment, effort, and skills you must put into the project. Work backward from the calculated cost to determine your hourly rate based on the desired profit, the complexity of the project, and your skill level.
It’s not a science, so while there are ways to calculate and come to a fairly accurate estimation, there is no exact “right” number for any given project or person. Often, giving a client a price range when estimating how much hourly e-learning content development costs is best. Projects can sometimes take more or less time than originally anticipated, so provide some pricing flexibility.
Adjusting Rates Over Time
An e-learning content developer’s rates are not meant to stay static forever. Reassess your hourly rate for e-learning content development every 3-6 months to determine whether you need to adjust them according to market factors and your career advancement. The longer you work in the field, the more your expertise in different areas of the work will improve, which warrants higher rates. Continuing to build your portfolio, develop your skills, and promote your success will document and give credit to your increasing proficiency in the field.
At the same time, the location and economy will determine market rates, which could increase or decrease how much to charge for hourly content development in e-learning. Working with clients in different markets and locations and on different types of projects may also cause your rate with that particular client to fluctuate. Changes in the economy can have varying effects on different industries, such as demand for certain types of skills, and it is a good idea to stay current on market fluctuations. The state of the market can also affect your cost of living, operational expenses, and the rates of third parties you may partner with.
It is important to monitor market fluctuations to maintain a competitive pricing strategy and give yourself fair compensation for your skills. Over time, you can sense how economic changes like inflation might alter demand and plan your budgeting accordingly. Freelance marketplaces like Upwork can be a good place to scout for pricing to see what clients are willing to pay and what other freelancers are charging in the current market. Additionally, you may give long-term clients a lower rate to reward their loyalty for consistently providing you with projects.
How “Blue Carrot” Can Help Your Business
👉Blue Carrot has 10 years of experience in crafting captivating e-learning content. We have worked with over 300 organizations from 30+ countries since 2014, including the United Nations, the University of Southern California, Charite Berlin Medical University, ProQuest, and DNB Bank. Our full-cycle production services include instructional design, curriculum writing, localization, SME partnerships, and media development to help support your e-learning projects. Our mission is to produce e-learning content efficiently at scale while optimizing expenses and streamlining quality. Our experts find solutions for all deadlines and budgets. We encourage you to explore more of our portfolio and services to see how a partnership with Blue Carrot will benefit your e-learning projects.
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