Duolingo: Teaching Languages to the Masses

Name: Duolingo: Teaching Languages to the Masses (English version)
SKU: 323016

Moon, Youngme

Product #:323016

Supplier:Harvard Business School

Discipline:Marketing

Setting:2022

Details:Case (PDF) • 21 pages • 2022-07-11 (Rev: 2023-02-28)

Subjects:

Customer relationship management Customer retention Growth strategy Innovation Inventions Marketing Marketing strategy Customer experience Corporate strategy Sales and marketing Sales and marketing Marketing

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At the time the case is written, Duolingo is the most popular language learning service in the world. The company has more than 40 million monthly active users, and the company's total annual revenue has reached $250 million a year. Still, the sustainability of the business appears uncertain. Critical questions involve the company's approach to monetization, as well as the robustness of its customer growth model. For now, the company's bet on gamification as a mechanism to fuel user engagement appears to be working, but it is also creating tensions involving everything from the company's stated purpose to the company's revenue generation model.

Learning Objectives

This case can be taught at multiple levels. It is appropriate for undergraduate and first-year business school courses; it is also appropriate for advanced and executive education courses. In addition, the case can be adapted for use across several disciplines: marketing, strategy, or entrepreneurship. Duolingo is the world's most popular way to learn languages. The Duolingo app has been downloaded more than half a billion times across the globe and more than 40 million learners use the app on a monthly basis. The purpose of the Duolingo case is to explore several different drivers of customer retention, including product-driven delight (Duolingo prides itself on its joyful, user-friendly learning platform), gamification tactics to drive engagement (Duolingo has borrowed a number of engagement tactics from the world of gaming), and paid subscriptions to lock-in users. It forces students to consider a number of conflicting tensions: (1) between what is best for customer acquisition vs what is best for customer retention; and (2) between what is best for monetization vs. what is best for the user experience. It does so in the context of a competitive landscape that has become increasingly crowded, with dozens of venture-financed upstarts flooding the Google Play and Apple App Stores with their own language learning apps. These competitors are applying pressure in all manner of ways: by undercutting on price, by innovating on features and services, and by experimenting with vastly different business and operating models. The case discussion is complicated by the fact that the CEO and co-founder of Duolingo, Luis von Ahn, is an intensely-passionate leader with staunch views on the dangers of over-monetization. His mission-driven approach to business comes from a deeply personal place, and is manifest in his commitment to delivering high-quality language education to as many people around the world as possible, at a price point of zero.