Online Courses/eLearning How Much Does it Cost to Develop an Online Course?

How Much Does it Cost to Develop an Online Course?

If you’re interested in creating an online course, you may be wondering about the costs. Specifically, you might be wondering exactly how much does it cost to develop an online course?

You don’t want to go into creating online training without knowing what the costs are. It’s best when you’re starting any business endeavor that you go in knowing the up-front costs. So it’s a great question to ask.

Here’s another great question …

Why Trust Me?

I recently created a 12 hour video course. This was my third or fourth version of this particular course.

In addition to that course, I’ve created several other courses. These courses covered topics like SEO, creating authority sites, and at least 6 short courses I’ve used as lead magnets.

My online course material is usually video based with screen capture and presentation style videos. My topics are complex, so videos of me talking without a visual are not as helpful as videos with diagrams (at least that’s what I’ve heard from my clients).

I started running a course business in 2001 so I have a lot of experience in the eLearning industry. I don’t have a corporate-sized budget to spend on outsourcing or hiring subject matter experts so I usually do most of the course creation myself.

Let’s Get Into the Details …

Online course development specifically includes the cost to create an online course. That’s why in this article, I won’t cover the costs to host and manage an online course or the costs for different online course platforms. Instead, I’ll just cover the costs for developing the course itself.

Decisions Related to Course Development

The first decision you need to make to begin figuring out the costs is the type of course you’re creating. Will it be multimedia like video with audio, one or the other, or text based?

Video with audio is the most popular format. Most courses consist of videos with a menu to navigate the course. Sometimes there’s supplemental text or links to supplemental materials beneath the video. A lot of online courses are set-up like the image below:

According to research, 78% of people watch online videos every week and 55% view online videos every day. Video is a popular way to consume content.

I’m going to cover the costs for producing a video course because that’s the current trend. If your course will just be text based then you can cut out a lot of these costs.

Next we need to establish how long your online course will be. Some run 45 minutes or even less while others are 12 hours or more in length. We need a standard to help break this down.

An hour is a good starting point. Most complete online courses are at least an hour long. If you’re planning for your course to be 3 hours then you can take the 1 hour time estimate and multiple it out by 3 to give you your approximate costs. So I’ll stick with one hour of video for this case study.

Previous Case Studies State …

I’ve read other articles claiming it costs $10,000 and takes 90 to 240 hours on average to produce one hour of eLearning material.

My estimates are much less than that. I could never produce much more than an hour of video training a year at that rate!  Even if you’re creating the best corporate eLearning video out there it’s probably not going to take you 240 hours or $10,000 to create one hour of video.

Now that we’ve gotten an unrealistic cost/time measurement out of the way, let’s take a look at more reasonable cost estimates.

One-Time Costs vs Time Related Costs

There are a few different types of costs involved in creating online courses. The first set of costs are your one-time costs for software or equipment. You can re-use equipment or sometimes rent equipment to save money. We’ll get into the one-time costs later.

Costs that are more difficult to measure are time related costs. Obviously if you’re paying someone to create your course you need to know how long it will take. That’s because many subject matter experts charge by the hour. If you’re doing it on your own, it’s also nice to know your costs in time. There’s a cost to everything.

So realistically, how long does it take to develop one hour of online learning?

For me, one hour of online video learning will likely be broken down into several videos that make up an hour.  Most of my courses have been on the longer side (around 10 hours of content).  I’d typically consider 1 hour of video a module within a course. Then I’ll usually have a quiz at the end of it.

A quiz doesn’t take long to create. If a quiz doesn’t make sense for your subject matter then you can create an action plan to help your learners work through whatever you’re teaching (recipes for weight loss, etc …).

Videos and quizzes or an action plan make a very complete module. Or if 1 hour is enough for your entire course then you’re done at that point.

How Long to Create an Hour of Video?

Let’s start by going through an estimate of how long it takes to create that one hour of video.

But before we can get to our video time estimate, we need to consider what kind of video we’re going to create.

Will it be a live action, screen recording, or animation style video?

Animation Style Videos

An animation style video where all the animations are painstakingly hand created will likely take the longest. Fortunately, in this day and age there are many options to help you shortcut this. One software you can use to get an animated effect is Powtoon.

Screenshot of animated video.

Otherwise you’ll probably need to buy software like Adobe After Effects and add in all the animations yourself. This could add a lot of time to my estimate. Or you may need to pay an animator which is likely very expensive. I’m not an animator so I really don’t know how long animations would take. Maybe we are talking about the $10,000 per hour estimate from above, but why do that when there are other options?

Screen Recording and Screen Capture Videos

Screen recording includes Camtasia style videos where the screen is actually being recorded.

Screenshot of Techsmith screen recording software.For instance if you’re creating a video on how to organize your email inbox, you would record yourself going through how to organize your email inbox.

Screen recording can also be used to create slideshow style presentations where you click through the slides while talking. You essentially give the presentation on your screen and record it while doing so.

Live Action Videos

This is a video where you’re filming live action. Live action could include you in the video, your hands, or you can move objects around and film them as you go.

Screenshot of live action video training.The main point with live action is that it’s not your screen and it’s not an animated video. Instead it’s live objects or an instructor.

You need to consider what kind of video you’re creating for your online course because that impacts your time and costs.

Behind the Scenes Work

There’s a lot of work to do before you ever start recording your video. I’ll cover that here …

Create an Outline First

No matter what kind of video you’re creating, you’ll start with the outline of your course first. I don’t put together hour long videos ever anymore. With trends in microlearning and feedback from clients, it makes more sense to break videos down and limit them to 10 minutes maximum.

One hour of video will hopefully be broken down into videos no longer than 10 minutes. Six or more videos per one hour of training sounds about right.

Based on this you need to break down the topics you’ll cover in each video. One video per topic is best and often that will mean you’ll have even shorter videos. After you’ve decided on your video topics, move onto an outline for each video.

Write Your Script

Even if you’re the best speaker, you may want to write out a script or at least fill in more blanks in your outline. Otherwise it’ll be difficult to give a good presentation.

Make sure to think through your examples. Examples are hard to come up with off the top of your head so including those in your script before-hand will be a big help.

Include areas where a diagram might be nice. Diagrams are really helpful for complex topics. Even simple topics usually benefit from a visual or diagram.

Even if you’re not an artist, you can sketch out diagrams using shapes like squares, triangles, or anything else that makes sense for you.

Polish it Up

It’s smart to polish up your script. If you want, you can read the script like a voice over in your video. Otherwise, depending on your speaking ability, you may be able to speak without a script.

It’s hard to gauge how much content you have per video. If you’ve got 10 minutes for the video, you need between 1,000 and 2,000 words. You can use that as a gauge for how much content you need.

Visual Video Decisions

There are decisions you need to make depending on what type of video you’re creating; live action, screen recording, or animations. I’ve got a few pathways here depending on the type of video you’re creating. What you’re doing here is deciding on the visuals for your videos.

Visuals for Live Action Videos

If you’re creating live action videos then this is the time to figure out your background. Where will you shoot the videos? Do you need any props? Figure all this out.

Imagine how professional your videos will look if you gain access to a nice background like this:

If you put some time and effort into it, you may be able to make that happen versus filming in front of a cluttered desk. Even a brick wall or plain wall will work better than a cluttered desk.

Gathering up the visuals for a live action video is typically pretty easy, but you need to make sure you have them. You might be using a whiteboard, a big piece of paper, or a chalkboard if you’re doing a lecture style video.

Some live action videos work well with no visuals. That includes videos where it’s just you sitting in front of a background. Others may require items. For instance, if you’re showing people how to change the oil in their car, you may need to have a car with an engine out.

Visuals for Screen Capture Videos

With screen capture videos you’ll need to practice going through the steps on your screen. If you’re showing people how to use a special application, then make sure you’re familiar with the exact steps and know how to work through them in the right order.

Presentation Videos and Visuals

Whether screen recording or animation, presentation style videos take the longest. That’s because you need to create a professional presentation before you start recording.

If you’re creating an animated video, figure out who to hire or animation software to use. If you’re doing a slide show, then figure out which software you’ll use to make the slides.

There’s a lot more involved with creating presentation videos. I’ll cover it in detail below …

Steps for Getting Your Visuals Ready

Here are steps for getting the visuals ready for a presentation style video:

Start with a Template

Create the template for your presentation. If you’re using PowerPoint, then download a template or create one yourself.

Move Onto the Diagrams

Create the diagrams that you’ll include in your video.

I start with the diagrams so they’re the main focus of my PowerPoint otherwise it’s too easy to rely on bullet points. Including diagrams or other visuals will help you put together a better presentation.

Put the Slide Show Together

Once you have your template and diagrams finish up your slides. Be sure to include the diagrams.

At this point you have the script ready plus all your visuals.

Voice Over vs Live Action Audio

Depending on what type of video you’re doing, once your visuals are ready you need to record your audio …

Recording Voice Over Audio

If you’re doing a screen capture or animation style video you need to record the audio. It will come off better if you do it separately.

If you need to, read from your script to create your voice over. If you choose this method, it’s best if you add some inflection. Don’t just sit and read, and make sure you’re not speaking in a monotone voice.

Once you’ve got the audio recorded, you need to edit it.

From there you need to record yourself either running through the screen capture or displaying your slide show. That’s your video material.

Finally, you’ll add the audio and video together and edit that to make sure it’s the way you want it to sound and look.

Recording Live Action Audio (and Video)

Obviously if you’re doing a live video, you’ll typically record both the audio and video all at once. So you can save some time with live action videos.

With live action, you’ll likely need to spend time practicing what you’re going to say (unless you have a teleprompter) and do. In most cases, practicing may take longer, but once you’re ready to record the video you won’t have all the slide shows to create or have to match the audio and video up at the end. You also don’t need a script as you can write an outline and depending on your speaking skills record your video from that. As long as practicing doesn’t take too long you can create a live action video much faster than a presentation video.

Once your live action video is recorded you may need to edit it. I’ve seen videos where the video was recorded all the way through in one take. If your speaking skills are good enough to do an entire video in one take then that’s awesome. It will make for a nice conversational video. Even a short 5 to 10 minute video on a very specific topic can be very powerful.

Otherwise if you have to edit your video that’s OK too. Essentially, you’ll fade out the part right before the error or pause it and then fade in the new section. I’ve seen many videos like this and it works OK if the pause is in a natural place (like after a pause in a sentence).

I’ve seen other videos where the fades were constant and just about everywhere. That can be very distracting for your viewer. Practice more before you start recording and you may not have to do as much editing.

Time Estimates for Online Course Development

Here’s the time estimate for each step of the online course development process:

Outline and Script Creation:

No matter which type of video you’re creating, you’ll start with the outline and script creation first.

Table for how long to outline and create online course script.

I estimate it will take 3 to 10 hours to script out 1 hour of video depending on the level of detail you’re including and your expertise of the subject matter.

Live Action vs Presentation Video Recording

For this estimate, choose whether you’re doing a live action or a presentation style video. You’ll only use the hours for one or the other, not both.

Live Action Estimates

I’ll go through the live action estimates first:

Table for course development visuals and getting ready to do video.

Presentation Video Estimates

I cover the estimates for a presentation-style video here:

Course development table estimating time to put together a presentation.

Finishing Up Your Video

This final table shows time estimates for editing and rendering your video (which is typically accomplished with software). At this point your video is ready to upload.

Here’s the time estimates for this step:

Table of course development editing estimates.

Total Time Spent for 1 Hour of Production

Here are the totals from the tables above:

Table with the estimate for how long it takes to create the video.

That’s a lot of hours for one hour of video!

Estimate Considerations

As you can see, live takes less time to do. The time can vary based on the amount of practicing you do and how many breaks you need between takes. Of course, if you’re recording yourself giving a slideshow presentation, you need to create that presentation and record it live. So that will take even longer!

The thing is, these estimates are just for one hour. But if your course is several hours long, you’ll see the number per hour go down.

If you go in ready you could probably do several hours worth of video over a day or two. That’s with a lot of preparation; script writing and practice, and all your visuals gathered up (if you have any) prior to the day(s) of recording.

With presentation videos, you can get your presentation template ready and then re-use it for all your videos.

The point is, if you’re doing 10 hours of video total then multiplying this out by 10 probably won’t be accurate. At the very least, use the small number because you’ll get faster as you go (especially if you do it all at once).

For the 12 hours worth of video I recently created I averaged on the low-end of the estimate. That means it took me about 13 hours to produce one hour of video. So it probably took around 156 hours to produce all that video.

Costs to Produce the Video

To figure out your time costs to produce one hour of video training, you need to consider what you’re worth or what a subject matter expert in your field is worth. A subject matter expert will need to write the script, at least have input on the visuals, and probably do the recording. You could then do the editing.

For instance, if the costs are $100 an hour, then you are looking at needing them for 10.5 hours (you can do the 2.5 hours of editing). That means you’ll need to spend around $1,050 on the low end of a presentation-style video.

If you value your time at $20/hour then it will run you about $260 per one hour of produced video.

Supplemental Material

As explained above, I suggest creating an add-on to go along with the video. This takes extra time, but it will greatly enhance the value of your course. You can include a quiz (even 12 questions covering 1 hour of video will work). Quizzes or assessments make the most sense when you’re covering a difficult educational concept. For each module in my course, I created a short quiz.

If you’re covering something like weight loss, beauty, exercise, or a concept where it doesn’t make sense to offer quizzes then consider offering PDF’s that fit the topic. Create an action guide, list of recipe, cheat sheet, or whatever else makes sense.

This supplemental content is usually very easy to create once you’ve created the video. I estimate it might take between 2 to 5 hours to create supplemental material for each hour of video training. It really doesn’t cost anything to create it other than your time. PDF files are free and easy to make and most online learning platforms will already allow you to add in at least basic quizzes.

Again, this is for 1 hour of training. If you’re going to produce 3 hours of video for your course then you need to multiply this out by 3. It may not get much faster as you increase the number. For instance, if it takes you 5 hours to create your supplemental material the first time it may take close to that the next time.

If you’re creating the supplemental material then realize that your time is valuable so it’s smart to have an estimate of how long it’ll take. If you’re paying someone then keep the 2 to 5 hour estimates in mind.

Time Estimates for 1 Hour of Video and Supplemental Material

Here’s the total time estimate for both the video training and the supplemental material production:

Table of hourly estimates to put together one hour of video + supplemental material.
Use this to help you figure out the time it will take you and estimate the costs involved.

Costs For One-Time Physical Equipment

Now here’s where everyone will start incurring costs unless you already have all this equipment.

First of all, you need a computer, but it doesn’t need to be anything super fancy.

Hopefully you already have access to a computer (a desktop or laptop will work). There’s so much variety in computer costs that it’s hard to estimate. Most people already have a computer (or access to one) so I’ll leave this out of the costs. If you need to purchase one then you’ll have to add it to my estimates.

Here’s a breakdown of the physical equipment you might not have yet. I’ll break it down by video style …

Equipment You’ll Need For Presentation Style Videos

With presentation style videos which include PowerPoint presentations, slide shows and animation style videos, you’ll need to add a voice over to your visuals. In order to do this you need a decent voice over set-up.

Typical voice over equipment includes a microphone, pre-amplifier, microphone stand, and audio mixer. My home recording studio package runs around $500 minus the costs of the computer.

You can definitely cut a little out of those costs and get closer to $300 for a decent voice over microphone set-up. There are premium options for each component so you could easily spend thousands of dollars if you want the top equipment.

Course development table for one-time physical equipment costs for presentation style videos.

Equipment You’ll Need for Live Action Videos

If you’re producing live action video then you’ll need a different set of equipment. If you already have a smartphone it is possible to use the camera on that phone with no further equipment.

Another option is to purchase the voice over equipment above and buy a cheap webcam to make your videos.

Finally, if you want to create live action videos that look even better you’ll need lighting, a video recorder, a tripod, and often a lapel pin mount style microphone called a lavalier microphone. This type of video studio set-up can be expensive. It’s also possible to rent the equipment if you pay for help from a videographer.

With live action videos, you may also need a background and props. It is possible to rent out a video studio or create your own with all the equipment set-up in front of a green screen like shown below:

The background can include an office atmosphere which might mean renting out an office. If you’re thinking about renting an office, you might want to look into Wework.com where you can pay a reasonable monthly fee or even potentially rent out a conference room for a day or two. Obviously, this can go way up depending on what you need.

Here are the estimates for the equipment costs:

Course development table with one-time equipment for live action videos.

Presentation vs Live Action Video Equipment Costs

I’ve put all the information together for you here. You can choose from presentation or live action equipment costs and decide whether you want to be on the low-end, mid-range, or high-end of the budget.

Table with equipment costs for live action and presentation videos.

Again, there are options to spend very little money. A USB microphone will save you some money if you’re doing voice over presentations as you won’t have to buy much else.

Alternately, using your smartphone to create videos will save you a ton of money if you’re doing live action videos. However, you’ll still need to purchase lighting if you’re planning on recording indoors.

Or you can get premium equipment and spend thousands of dollars for your recording studio. Equipment costs have a big range based on your goals.

One-Time Costs for Software

In addition to the physical equipment, you’ll need software. Once again, it’s different whether you’re doing presentation style videos or live action videos which I’ll cover below.

Presentation Software You’ll Need

If you’re planning on creating a slideshow then you can use PowerPoint. There are a ton of PowerPoint alternatives out there if you want something different. PowerPoint comes with several other Microsoft Office applications for about $150. You may even already have PowerPoint.

Since PowerPoint is mostly a blank slate with unlimited possibilities, you may need to purchase a PowerPoint template to go with it.

I like simple PowerPoint presentations so what I’ll do is make my own template which is really not that hard. Flip through some good PowerPoint slide shows on Slideshare and get ideas from them.

The time to create your slide show template was calculated into the time estimates above, but you can instead purchase a pre-made template. You could find a free template or pay hundreds of dollars to buy a premium template or even pay to have one created especially for you.

I can’t go through every PowerPoint option here, but Prezi is another very popular choice.

Screenshot of a Prezi example.You can get Prezi for as little as $20/month and cancel when you’re done making your slide show. It’s very affordable.

If you’d rather make animation style videos then you can use an application like Powtoon. Powtoon is currently $200 a month for the premium version with unlimited exports. You can cancel that once you’ve created your videos so you don’t have to pay that forever.

Screen Recording Software You’ll Need

In addition to the software you’re using to create your video, you may also need screen recording software. Camtasia is the most popular screen recording software around. They even have a 30 day trial. It’s about $250 for Camtasia.

You may find you need audio recording software too. Audacity is free and you can use it to record and edit your voice over audio file.

For live action video editing you could use Filmora which is very affordable at a $60 one-time fee. Obviously there’s much better video editing software out there so you can easily spend hundreds of dollars for software with more features. You may find you want special effects even in a live action video and need Adobe After Effects. This is completely optional, but is fairly inexpensive if you purchase Adobe’s single app plan which runs about $30/month.

I combined PowerPoint with Camtasia to create my latest online course. The total for these two pieces of software runs around $400. I used free audio recording software to record and edit my audio files. Here are the estimates for your software costs:

Course development table for software costs.

Additional One-Time Costs

Your Video Intro

Video intros will give your video training a more polished look. You can get an inexpensive video intro from Fiverr. If you already have a logo then you just give that to a designer and they’ll make a cool intro out of it. You can also add music to your intro or special sound effects and it’ll add to the professionalism of your course videos.

Getting a video intro created is more than worth the money you’ll spend. You only need one intro for all the videos in your course. If you don’t want to use Fiverr and have access to an animator then you can definitely go that route and spend more.

I spent $50 on my video intro from Fiverr, but you can get them for under $25.

Images You May Need to Purchase or Have Created

If you need any images or graphics you can get them from iStock or Envato. Even $100 will get you a lot of images or graphics. I spent about that amount on icons for my PowerPoint slides.

For my last project I was able to make PowerPoint diagrams with the PowerPoint shapes tool. I had to create them by hand, but I didn’t spend any additional money on them (the time was factored in the above estimates).

Cost Estimates for Your Intro and Images

Here is the range in cost estimates for your video intro and images:

Screenshot of additional costs for video production.

Review of Costs for 1 Hour of Online Course Development

Here’s a review of all the costs to create 1 hour of video training.

Time to Create Video:

Table with the estimate for how long it takes to create the video.

Video Training + Supplement:

Table of hourly estimates to put together one hour of video + supplemental material.

If your costs are $50/hour then on the low-end your costs are $575. If you take the highest estimate then your costs are $1,975. Again, these are your cost estimates for 1 hour of video.

Now let’s move onto the one-time costs …

Physical Equipment Costs

As you can see from the table below, there’s a minimum spend of $300 on equipment for presentation videos or $50 for live action videos (if you already have a smartphone with a good video camera in it). The mid-range costs go up to $500 for presentation videos and $1,200 for live action video equipment.

You can definitely spend thousands of dollars if you want premium equipment. If you’re planning on making a lot of course videos, then it can be worth it to get better equipment.

Table with equipment costs for live action and presentation videos.

Software Costs

You will likely need to spend $400 on software especially if you’re creating slide show presentations or even just screen recordings. It’s possible to spend less with cheaper software or monthly software you cancel after you no longer need it.

You can easily spend thousands of dollars as shown in the table below if you want access to the best software.

Course development table for software costs.

Additional Costs

You can spend as little as $25 for additional costs like a video intro. I put the mid-range estimate at $150 if you need graphics and images. Again, you can spend up to thousands of dollars for additional items to enhance your videos.

Screenshot of additional costs for video production.

Total Costs to Develop an Hour Long Online Course

All these one-time costs are added up in the next table:

Table of course development one-time costs.

The mid-range one-time cost estimates for presentation videos is $1,050 while the mid-range one-time costs for live action videos is $1,750. The nice thing is once you have all the equipment, software, and extras, you can re-use them. Whether you’re producing 1 hour or 12 hours of video all of this can be considered a one-time cost.

The time estimates are included here:

Table of hourly estimates to put together one hour of video + supplemental material.Let’s multiply those estimates out by $50/hour to find the estimated cost in time for 1 hour of online training. This table shows the low-end and high-end using $50/hour as the cost.

Low end and high end costs for course development.

Low-end time costs for presentation videos are $750 while low-end costs for live action videos are $575. High-end time costs for presentation videos are $1,975 while high-end estimates for live action videos are $1,550. Again this is all using $50/hour. Depending on how much you pay per hour those numbers can go up or down.

Here’s the lowdown with time costs and one-time costs totaled up. For this table, I took the low- and high-end of the time estimated costs and the mid-range one-time costs (equipment, software, and additional costs).

Table for costs in time and one-time costs for one hour of online training.As you can see there’s a big range. On the low-end, you’ll spend around $1,800 for one hour of presentation video. On the high-end, you’ll spend around $3,025. Live action is more expensive with the low-end coming in around $2,325 and the high-end at $3,300 per one hour of video training.

There’s no way to do this without a range since different video types will always result in the need for a different set of equipment and even different time estimates.

Conclusion

As you can see from the tables above, I’ve estimated that one hour of video plus the supplemental material will take between 11.5 and 39.5 hours to create. Either way if you’ve got a 40 hour work week then you should definitely be able to get at least 1 hour of video training created in that time period.

In addition, depending on how you value your time (or what you’re paying a subject matter expert), there’s a big range in cost estimates.

The mid-range one-time costs estimates go from $1,050 for presentation videos to $1,750 for live action videos. Fortunately, with one-time costs, you can pay for the equipment and software once and then create 10 hours of online course video or even years worth of different courses. The one-time costs will definitely pay for themselves over time.

You can spend less or much, much more depending on the equipment you purchase, the software you use, and the additional expenses for images or graphic design.

When I multiplied my time estimates out by $50/hour also adding in the one-time costs there’s a range from $1,800 on the low end to $3,300 on the high end. Again that’s for 1 hour of online course development.

I hope this breakdown helps you see the costs involved in online course development and helps you customize these figures based on your own situation.

Online Course Platform Costs

Once you have your content, you’ll need your online learning platform selected and there’s a cost for that too. So course development costs are not the only costs you’ll have. You may wind up using a cloud LMS like Teachable or Thinkific or hosting your own platform with a WordPress LMS plugin like LearnDash or LifterLMS. Marketing your online course also has additional costs.

Keep track of your time spent and your one-time costs to gauge what the online course development costs are for you. If you’ve got any estimates to compare with mine, please let us know in the comments below.

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