What Is Duolino?
Duolingo is an incredibly popular website and “freemium” application designed to help users learn a new language.
More than 80 courses are offered across 37 different languages.
How Do They Make Money?
According to an article published by Forbes Magazine in February, 2014, “Duolingo’s primary way to make money right now is through its web browser version, though 4 out of 5 users are playing on their phones. The company makes money by crowd-sourcing pieces of translation done by its students and selling them to companies like CNN and BuzzFeed.”
Duolingo’s app utilizes what’s known as a “freemium” pricing strategy.
What Is A Freemium Pricing Strategy?
Under a “freemium” pricing strategy a digital service, such as a game, application, or other media, can be accessed by any user free of charge. Other features, services, and virtual or physical goods can be purchased through the application for additional fees.
While this business strategy has been around since the 1980s, it has been used more often after the advent of mobile phones and tablets. It is often called “free-to-play” in the video game industry, where certain features or bonuses withing a game are only available to paying customers.
Other Ways Duolingo Makes Money
“There are two parts to our revenue model,” Duolingo creator Luis Von Ahn wrote in an article on Quora. “First, we make money by selling translations to companies like CNN and Buzzfeed. So, for example, they write their news in English, and send it to us. We then give it to our students, who in order to practice their English skills, help translate this news to their native language. Then we give the student translations back to e.g. CNN and they pay us for having translated them.”
“The second and most important part is our new app, the Duolingo Test Center,” Von Ahn continued. “We’re now giving everyone the chance to prove that they have language skills without having to pay the $250 normally charged by the existing proficiency tests such as the TOEFL or the IELTS. Our tests will cost $20 (it’s free now, in Beta), and will help our educational app stay afloat.”