Chegg, founded in 2006, is an American education technology company based in Santa Clara, California. It provides homework help, digital and physical textbook rentals, textbooks, online tutoring, and other student services.
Chegg’s mission is to improve learning and learning outcomes by putting students first. Chegg supports life-long learners worldwide, starting with their academic journey and extending through their careers.
The Chegg platform provides products and services to support learners with their academic course materials and their career and personal skills development.
What does Chegg do? How does Chegg make money?
Chegg made $767 Million in 2022. Chegg’s service and product offerings fall into two categories:
Subscription Services
Chegg Study Pack: Chegg Study Pack is a premium subscription bundle including Chegg Study, Chegg Writing, and Chegg Math services, described further below. Chegg Study Pack creates an integrated platform of connected academic support services with millions of pieces of educational learning content and enhanced features, such as concept video walkthroughs, flashcards, and practice tests, that are ever-changing and evolving to increase Chegg’s value proposition to students.
Chegg Study: Chegg Study subscription service helps students master challenging concepts on their own through “Expert Questions and Answers” and “Textbook Solutions.” Chegg’s Expert Questions and Answers service allows students to ask questions on its website and receive detailed explanations from subject matter experts.
For high-demand print textbooks and eTextbooks, Chegg offers Textbook Solutions, which are step-by-step explanations to help students learn how to solve the questions at the end of each chapter in their textbooks.
Chegg Writing: Chegg Writing subscription service consists of a premium paid subscription service providing students with a suite of tools, including plagiarism detection scans, grammar and writing fluency checking, expert personalized writing feedback, and premium citation generation. Students can create citations from over 7,000 citation styles, including MLA, APA, and The Chicago Manual of Style.
Chegg Math: Chegg Math subscription service, including Mathway, helps students understand math by providing a step-by-step math problem solver and calculator that help students instantly receive guided instructional explanations to understand better the why and how for each step within a range of math topics.
Busuu: Busuu language learning platform offers a comprehensive solution through a combination of self-paced lessons, live classes with expert tutors, and the ability to learn and practice with members of the Busuu language learning community.
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Subscription Services revenues were 88%, 79%, and 71% of net revenues during the years ended December 31, 2022, 2021, and 2020, respectively.
Skills and Other
Skills: Skills-based learning service offers professional courses along with networking, interviewing, and career services and is offered directly through Chegg’s website, through partners that connect employers with top learning providers to provide employees with upskilling opportunities, and directly to large employers committed to investing in their workforce skills training needs.
Udemy Business Model: A marketplace of vibrant knowledge
Advertising Services: Chegg works with leading brands and programmatic partners to deliver advertising across Chegg’s platforms.
Other: Chegg provides other educational offerings to help students with their coursework.
Skills and Other revenues were 12%, 21%, and 29% of net revenues during the years ended December 31, 2022, 2021, and 2020, respectively.
How does Chegg work?
Technology and Platform Integration
Chegg’s technology is designed to create a learning platform that will continue to enable its growth at scale. Chegg employs technological innovations whenever possible to increase efficiency and scale in its business.
For example, Chegg’s products and services utilize various artificial intelligence (AI) technologies, such as large language models, generative AI, and a symbolic math solver engine.
Chegg’s products and services rely upon and leverage the information underlying its “Student Graph” and “Content Graph Technology.” The key elements of Chegg’s technology platform are:
- Personalization and Merchandising Technology: Chegg creates a personalized experience for each student throughout its learning platform, building awareness of its multiple services and connecting them with opportunities through third-party partners and brands—this personalization and customization results from Chegg’s Student Graph and its search technology.
- Infrastructure and Applications: Chegg’s technology resides at major cloud-hosting providers globally. Chegg’s architecture consists primarily of front-end applications, back-end services, operational databases, and reporting subsystems. Chegg uses industry-standard logging and monitoring tools to ensure uptime. The architecture is also designed to allow for expansion into new international markets.
- Mobile Solutions: Chegg’s mobile apps are built as hybrid applications leveraging the Chegg application programming interface (API). Taking advantage of capabilities unique to the mobile platform, Chegg offers some functionality on mobile that is not available on its website.
- Programmatic Advertising: Chegg’s programmatic advertising technology combines a deep understanding of programmatic technology trends with data science, engineering, and machine learning. The result is an online advertising platform that maximizes the value of the digital impressions Chegg serves.
- Data Sourcing and Content Graph Technology: Not all information relevant to students on Chegg’s platform is available by service, product, list, or user input. Therefore, Chegg has developed proprietary technologies to collect disparate, distributed data sets.
Sales and Marketing strategy of Chegg
Students: Chegg’s direct-to-consumer marketing strategy focuses on brand and performance marketing. Brand marketing increases awareness of the Chegg brand and its services, while performance marketing drives traffic to its site.
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The strength of Chegg’s content flywheel drives significant organic traffic to Chegg. Chegg’s lifecycle marketing focuses on increasing activation, engagement, and retention. Chegg’s utilizes three types of email marketing campaigns: onboarding programs to drive activation and retention, personalized cross-sell campaigns to deepen engagement, and promotional campaigns to drive sales and interest.
Brands: Chegg secures contracts with brands through direct sales by its field sales organization, which sells brand advertising services to large brand advertisers seeking to reach and engage college and high school students. This team has field salespeople and marketing support.
