Chegg is an online learning platform specializing in textbook rentals, tutoring services, and other student services. Founded in 2005, it has since become one of the most successful education companies in the US. From its humble beginnings as a textbook rental business to its current status as a $10 billion public company, how did Chegg achieve such staggering success? The answer lies in two key models that allowed it to outpace its competitors. These are the GLEe model and DHM model for success.
The GLEe Model for Success
The GLEe (Growth-Engagement-Monetization) model is a framework that Chegg used to prioritize their resources for maximum efficiency and effectiveness. Through this approach, they were able to focus on high impact activities that would drive growth, engagement, and monetization with customers. With this model, they identified which activities had the most potential for growth, engagement, or monetization and allocated resources accordingly. For example, they prioritized low price rentals over fast access through their digital “Read While You Wait” eTextbook feature because they knew that low prices would help attract more customers. Additionally, they focused on creating a 21 day return policy so customers could easily try out products before committing to them long term.
The DHM Model for Success
In addition to the GLEe model for success, Chegg also employed the DHM (Data-Hypothesis-Metrics) model when making operational decisions. This process involves collecting data related to customer usage and behavior; forming hypotheses based on said data; then testing those hypotheses using metrics like user engagement or revenue generated from new product launches. Through this process of rigorous experimentation and iteration, Chegg was able to create a rolling 4 Quarter Product Roadmap that gave clarity swimlanes fit into their overall vision of becoming the leading online learning platform in America.
Conclusion:
Chegg’s success can be attributed to two key models – the GLEe model and DHM model – which have enabled them to prioritize resources for maximum efficiency and effectiveness while delighting customers with features like low price rentals & fast access through their digital “Read While You Wait” eTextbook feature & 21 day return policy as well as aligning against growth > engagement > monetization priority list for greater success at Chegg . By understanding how Unit Economics worked within their business model & implementing an effective Growth-Engagement-Monetization (GEM) Approach , Chegg was able to reach its current market cap of $10B by 2013 . Aspiring entrepreneurs can look towards these strategies employed by Chegg when looking at ways to differentiate themselves from their competitors in order to achieve growth & financial success .
