Packback gained national exposure Friday night, with over8 million viewers in one of the most successful episodes to date of ABC’s “Shark Tank”.
The show’s airing marked a significant event for the higher education publishing industry, as the focal question amongst the sharks was: how will the publishing industry react? I had a chance to answer this question on Friday night, when over 250 people packed the auditorium of Chicago’s 1871 entrepreneurship center for a viewing event followed by a “fireside chat” with Kasey and I. We were asked again, “how is Packback going to work with those traditional publishing companies in a drastically conservative industry?”
The answer was simple: we don’t work with traditional publishing companies, we work with revolutionary learning companies.
I proceeded to tell a story of how my co-founder Kasey and I, as young naive college students, decided it would be perfectly acceptable to cold-call the president of McGraw-Hill Higher Education, Brian Kibby. A few months later, Brian generously took the time to visit with us at Illinois State University. In those two days, he planted the seed of belief in us that would be a key driving force throughout the ensuing two year long journey we’ve been on to found Packback. McGraw-Hill Higher Education made very clear that they weren’t a stodgy old “publishing company”. This was a learning company. It was all uphill from there as we’ve continually established relationships with more and more innovative learning companies in bringing our digital catalogue the students nationwide.
You might be wondering, as did the sharks, how it’s possible that Packback’s digital catalogue has expanded so rapidly to roughly 2,500 titles.
What is Packback’s immediate value-add to a learning company?
We teamed up with the most prestigious market research firm in Chicago, Shapiro & Associates, to launch an initial pilot during Fall ‘13 at Illinois State University, taking a fully research-backed approach to our launch. Our proud early participants were: McGraw-Hill Higher Education, Taylor & Francis Group, and SAGE Publications.
The goal of the pilot was to find out precisely what the revenue, and digital adoption implications of the introduction of Packback would be on our sample set of students. Here’s the methodology we took:
1.) We directly surveyed 681 students, to find out where they were acquiring their textbooks.
- Merely 9% purchased new textbooks
- The rest either purchased or rented used textbooks, or did not acquire the textbook at all.
2.) Introduced Packback as an option to students in 21 broadly selected courses.
3.) Returned midway through the semester to learn more about who was using Packback. We asked, “if Packback was not available, what would you have done?”
- 82% “used textbook”
- Packback reduced the used book market share from what would have been 75% to 55% in just the first semester of launch/adoption
- 12% “would not have purchased anything”
- Packback ensured these students were prepared for their classes and ultimately increased learning outcomes.
- 6% “eTextbook”
- 0% “new textbook”
The result? 58% increase in publisher revenue.
(MORE INFO HERE)
That is the definition of low-hanging fruit. With $5.6 billion of the $8.2 billion higher education textbook market attributed to the used book market, there is perhaps more low-hanging fruit to be gained in this industry than in any other. We purposefully tested with “backlist” products, in which there is an incredible amount of room for revenue growth. In doing so, and seeing the 58% increase in revenue, it became clear that Packback’s immediate value to learning companies is to serve as an engine for maximizing revenue on underperforming titles while organically converting students to digital learners.
The demonstration of this clear value proposition is precisely how we’ve been able to expand our digital catalogue with a range a truly innovative content partners.
Will learning companies get smarter working with Packback?
One of the features we’re most excited about rolling out this summer is Packback’s Q&A community: connecting students across the country in communities geared around their specific textbooks. For the first time ever, this will introduce a feedback-loop for learning companies to improve the effectiveness of their core content.
This is a product feature we started working on directly out of our extensive Shapiro focus groups that honed in on student learning behaviors. We found that the current “paper state” of learning results in a massive collection of lost data points to the content providers, who can’t possibly track the ongoing external activity happening on rich media in conjunction with a student’s usage of the paper textbook. With the “Packback Community”, students across multiple different universities, all in similarly structured courses that use the same textbook, can communicate with each other, and Packback can track the external activity to give feedback on what the actual user behavior is.
Here’s where it gets interesting:
Today’s college student naturally holds an overwhelmingly strong preference for the physical format, based on years of mastering of a methodology for “test preparation”. However, “exploratory learning” is a whole different concept. When a student reads the book, they almost always reach a point of heightened interest in a concept outlined by the content providers. Unfortunately, the textbook must cover a ton of ground and obviously can’t go into full depth for each concept. This is where the exploratory learning comes into play- a student uses the textbook as a “jumping point”, and navigates straight to Google for a deep dive on the topic. From here, students utilize a collection of free articles, TED/Khan Academy videos, and even hop into online learning portals.
Packback’s Q&A communities are rich learning environments that enable and harness the exploratory learning phenomena among students.
From these communities, Packback has the potential to report back to our partner content providers; sharing invaluable insight into the actual user behavior in and around the content they’ve invested so heavily into doing a phenomenal job preparing.
What about the future, and adaptive learning tech?
This is where things get really fun, and the white boards that line the Packback offices start to run out of space. So really, what about adaptive learning technology? We’re on the verge of a landscape-altering revolution in which today’s advanced technologies can be applied directly to the improvement of student learning comprehension. There are truly great products being developed. The question is: how do you properly present them in a way that encourages truly organic student demand?
Directing the textbook sales rep to educate the professor on platform and adaptive tech benefits is certainly one necessary step to take. If the professor buys in, there is presumably 100% sell-through to the classroom. But let’s be honest, how many long-tenured professors are really going to alter their long-standing teaching methods? Given what we’ve seen thus far, not quite enough for professor adoption to keep up with the swift pace of technological advances. Much as the students have mastered a learned method of test preparation, so too does the professor have a learned method for course conduction.
However, learning companies are developing increasingly affordable learning products, and the students are notably willing to pay a little extra for guaranteed results. Here’s what’s on our minds at Packback:
Packback as a portal to introduce next-gen learning tech products.
Once a student is on the digital format (incentivized of course by a $5 daily rental), the Packback e-Reader will be tracking their activity within the text. A “learning behavior” algorithm can thus be formed, taking in a combination of data inputs. From there, we can pinpoint the exact point in time when a student is struggling to master a concept. Using several factors, we’ll actually have a good idea of whether this student is preparing for a test. Let’s say it’s 10:00pm, and our indicators are telling us that Joey Student is preparing for an exam and stuck around a given concept. His propensity to try a next-gen learning tech product is astronomically higher in this situation than at the beginning of a semester. Packback has the ability to say, “take a deep breath. We know you’re stressed. Why don’t you try one of these products, which have been specially built by the content-providing learning company to help you master this concept?” Packback then presents the student with a value-adding product.
THAT is how organic conversion happens, and the opportunity to provide a bridge to the future of learning is exactly what keeps our creative minds reeling 14 hours a day at the Packback offices.
Let’s expand upon learning’s newfound “sexiness”
So what does Packback’s airing of “Shark Tank” mean for the industry? It means there’s an unprecedented window suddenly smashed opened for the major players in this evolving industry to align directly with a national wave of student excitement. As culture shifts, so do it’s influencers. In today’s day in age, “intelligent” is the new “cool”. Whereas in the nineties, everyone wanted to “be like Mike” (Jordan), more and more kids are growing up wanting to “be like Zuck” and other iconic thought leaders upon whose intelligence glory is being thrown. Ashton Kutcher, an icon among youths, recently went viral with a brief speech at the Teen Choice Awards, in which he stated that “The sexiest thing in the world is being really really smart”. That’s powerful.
On Friday night, proof of the youth’s evolving culture was reiterated as social media channels across the nation lit up with waves of excitement about Packback. The learning companies are paving the way to make it possible for more and more students to reach that prestigious level of “sexiness”. Packback is providing the bridge to that future, and students nationwide have proven to be nothing short of ecstatic about it. We’re honored to be playing in our part in the educational revolution that is spreading across the country.
Who’s ready to join?