Marketing of Higher Education

In first considering marketing in education we very swiftly articulate general questions such as: “just what makes our school or university different?”, “who exactly are our customers?”, and “how can we compete with other providers?” They are general but of course deceptively simple and even the specification of ‘who is the customer’ requires some consideration. There are actually many definitions of what marketing is, some more general in scope than others and perceptions are constantly being reviewed (Kotler 1997). One example is that marketing is a social process whereby individuals, families, groups and other organisations obtain what they need and want by identifying value, providing it and exchanging it with others (Bradley, 1995). From this emerges a whole cluster of core concepts including needs, wants, demands, markets, products, values and satisfaction, exchange and communication.

What have sometimes been referred to as the traditional and contemporary methods of delivering goods and services might in fact be restated as the public and private approaches to delivery. The former has, in the past, primarily been a one way process with it’s origins deep within the providing institution (or perhaps above it) and directed towards the population at large. Those whose experience is mainly in public sector universities and colleges, will recognise this pattern of product (e.g. degree programmes) being shaped and delivered wholly on the basis of provider perceptions. On the other hand what is increasingly being stressed within the context of the new management style is a concern to address the complex interaction between providers and a range of identified consumer/customer groups. Underpinning decisions bout provision is the effort devoted to capturing relevant information about such customers and potential customers --- their needs, wants, values, perceptions and behaviour. This information is critical for the crafting of marketing strategy, some of the elements of which will be addressed below. Marketing in education is nevertheless receiving increasing attention in the educational management literature, for example see Bakewell and Gibson Sweet (1998) or Joseph and Joseph (1997).

But first let us make some general points about the changing context within which marketing strategy in the education sector is being formulated. Nuttman and Cheong (1997), Ordonez (1997) and many others have indicated that educational systems face a wide array of challenges, including demographic change, economic development and liberalisation, technology and all the facets of globalisation. There are in particular a number of forces shaping the direction of higher education toward an appreciation of the student as a ‘customer’ and consequently for higher education marketing. Probably fundamental to this trend has been the inability, or lack of desire, of governments to continue to fund universities without stringent accountability. Hamilton (1998) said recently that “in a context of declining government per student funding, every private dollar generated by universities is gold”. In both the British and Australian environments, the upgrading of teachers colleges and technology colleges to the status of university has both distorted and confused the meaning of university education and notions of quality. Students now have a much wider range of higher education options in terms of courses, acceptance levels and even duration of programs but at the same time, universities have to account to governments for every student and receive their funding allocations on the basis of the numbers enrolled. The consequence is fierce competition and the need for marketing strategies.

For centuries, universities were institutions that offered education to those who could meet their prescribed entry qualifications. High student demand and scarcity of supply meant that it was a supply-side market: that is, universities had to do very little by way of advertising and promoting their institutions. This situation was supported, of course, by the fact that university education and secondary education was sponsored or provided by governments. It was, in a sense, a monopoly market environment. But with the breakdown of this monopoly and increased availability and variety of education options, the supply-side marketing approach may now appear obsolete. In its place has come a realisation that universities have to tailor their courses and education options to better suit the student-customer. A demand-side approach to university marketing has emerged.

The consequence of the demand-side approach is that presentation materials and marketing encounters are now increasingly focused on the benefits of university education as perceived by the student. Students are no longer led to feel that the university is doing them a favour in accepting them. Quite the reverse, universities now seek out new students by attracting them to the ‘quality’ of education, the ‘recognition’ and ‘standing’ of the degree program, the ‘teacher-student ratios’, and the value added extras such as student life, student support services, exchange programs and security and safety in the university. Above all, of course, universities now find themselves having to defend the employment potential of their degrees as a primary marketing tool. In short, the student-customer is wanting results and in approaching a higher education option asks the fundamental question, ‘what can I get out of it?’ Higher education marketing has to now address this question directly.

In parallel to these national pressures to compete for funding and students, the emergence of a global era has forced universities to compete in the international education marketplace. This involves not only the attraction of international students but the extension of university education options into other countries.

Inter-related education programs, transfer of credits, joint programs and distance learning, are all features of global education. Added to this is the emergence of the Internet and the unlimited possibilities this offers to global learning options. Not only will universities everywhere come to offer on-line instruction to students on campus, but also off campus. The notion of geo-centric learning, as understood for thousands of years, becomes considerably weaker. In the very near future maybe it will no longer matter where a person lives or studies. People will perhaps no longer travel to the geographical location of the university in order to gain a degree as lectures, tutorials and assignments are communicated through computer services (Bell et all 1997, Wilson & Meadows 1998). So, essentially, education is becoming a border-less commodity and marketing an international exercise.

The Internet and global communication have specific implications for global marketing and this will be an increasingly important aspect of the evolution of university education and the marketing process. While most universities have web sites, these will soon be of much higher quality, interactive and even part of the ‘third-generation’ of communication technology as universities seek to take advantage of advertising opportunities. Perhaps ‘advertising’ is the pertinent term here as all the forces of change bring universities to the point of seeing themselves as now essentially in the education business. Student records and matriculation scores, along with university entry requirements and course options, will form part of the electronic registration system. Global communication networks are growing at an astonishing rate. By the year 2000, the Internet will generate access, network and service revenues in excess of $60 billion a year and China, for example, will have a total central-office switching capacity of 150 million lines and a mobile phone user base of in excess of 18 million (Williamson 1998). By the year 2010, Microsoft has suggested that everyone on Earth between the ages of 25-55 might be able to communicate on the Internet (Reynolds 1996). This projection might, however, be viewed with a measure of scepticism by those who raise concerns over issues of equity in national development.

All of this has consequences for the nature of higher education itself. In the past, the geo-centric model of learning meant that universities tended to recognise degrees only from universities of similar character, particularly of state and national character. But in the context of global learning, universities across the worlds are busily forming international linkages and instituting agreements on the acceptance of other programs and qualifications. A high school student can now qualify to enter into a ‘global’ university from the majority of countries in the world. This trend complements that of universities reshaping their programs and courses to suite student-defined needs and preferences. While these changes may appear to have advantages and disadvantages for the overall quality and substance of education, they lead us to focus on the fundamental issue of redefinition of the higher education process.

Still, higher education and the quality of higher education are not under threat. Indeed, two things are happening at once. First there is a growing demand and, in response, increasing availability and variety of higher education programmes. People want qualifications in all sorts of things and now they can virtually get what they want. Secondly, there is a growing demand for more higher quality education. Within the last two weeks we have read about NUS redesigning its computer science courses to make graduates “more marketable” and targeted at “distinct segments of the IT job market” (Straight Times, 14 July).

The availability of information and education to suit the needs of people in the midst of their work and life experiences give extended meaning to life-long learning. Student-customer demand for new education services, while giving new and extended markets to universities, require universities to undergo a major overhaul to accommodate this new and growing demand. The new student profile will be a mosaic of people with family obligations and full-time jobs trying to increase their qualifications and improve their employment prospects. Because of a variety of needs and because they will come from all over the world, university education will therefore need to be available 24 hours a day (Adam 1997). Effectively, computers and electronic communication will create a more level playing field for people (and institutions) across the world. What is emerging is the online education industry. At the moment, it may lack critical mass but this will change.

As education is being redefined, so is business and even government. It would seem that business and commercial prospects are growing in their dominance of social life, yet business itself is having to come to terms with the power of knowledge and communication. With the changing nature of computer communication toward the visual media, the management of information and image creation and control are dominating forces in their own right. This also has implications for higher education marketing. Image creation through the use of words, images, and appeals, all affect the success of the marketing exercise. The management of information and communications management are going to be fundamental issues for business schools to address in the future.The evolutionary process higher education marketing is becoming more sensitive to new market opportunities as life-time and geographical barriers dissolve, but also more responsive to communication options. Marketing will move toward an emphasis on communication management and image creation. In an era where communication is becoming so important, marketing will be defined as communication management and marketing strategies will seek to bring a discipline to the communication process. “As communications and public perception become increasingly important, so strategic communication must incorporate image management in its scheme.” Strategic-communications is the art of persuasion. It is the marshalling of resources and the formation of ideas to reach a target audience with a designer message. For higher education marketing, the challenges will involve a shift from product centred presentations to communication strategies for reaching designated target student-customer audiences.

Let us now move on from these broader issues to some more practical aspects of marketing itself. Marketing strategy has a number of distinct components, conventionally referred to as the five “P’s” (the actual number of P’s varies according to the text!) and each has to be considered as we determine how to proceed in higher education: Product strategy, Place or distribution strategy, Pricing, Promotion, and People. Several of these are now discussed.

Product Strategy

The first point to make here is that we are, in higher education, generally talking about the marketing of products which are services rather than goods and these have, in the past, been said to display certain features, such as their relative intangibility and their variability. They also involve an overlap between the processes of provisions and consumption and so cannot be produced for stock. In each case, we might, on further examination, query these perceptions in the light of current trends in education.

The economic and social environment of Asia has driven the emergence of an impressive array of educational products (programmes of teaching, research, consultancy and others). Product strategy requires us to examine and take specific decisions even on individual programmes and assess how they are meeting specific needs. Groups of closely related programmes, perhaps offered by the same departments/faculties or offered to the same target audiences, constitute the product lines. These in turn make up the overall set of programmes offered by a particular institution which is the product mix. Some form of harmony or coherence needs to exist even at this broad level and this is very unlikely to emerge naturally from the bottom-up, but will have to be guided by top management. The product mix is critical as it will strongly shape the image of the whole institution in the eyes of the consumer and the public at large, although exceptions to this probably exist, e.g. where the frame of a particular department or programme is so marked that it actually enhances the image of all around it through a ‘halo’ effect. The relative balance between teaching, research and other activities in an institution’s product mix is a fundamental decision and may be a complex function of customer demand, management perceptions, patterns of institutional funding and other factors.

The most fundamental question to ask about a particular product is “what is its essence or core?” i.e. what exactly is the customer seeking? What precise need is being satisfied? As indicated above, many institutions now market programmes by identifying benefits (such as graduate employability) and not simply features (such as staff-student ratios and physical resources). Once the core is defined, then features, styling, quality, presentation and branding each have to be considered.

Product life cycles have been extensively debated in the literature but we would like here to comment only on the issue of evolution or decline of product/programmes. Especially in changing times, it is essential that institutional mechanisms (and a willingness) exist to change or even remove programmes to reflect external circumstances. This will not necessarily be easy given the existence of strong internal vested interests in maintaining the status quo. It has been suggested that “an institution’s marketing strength lies in the real quality of educational programmes” (Topor, 1997), but most of us at some stage have probably speculated that certain older institutions may nowadays be trading on brand names and reputations that were built up in the past rather than on current, real programme quality. In today’s increasingly competitive and indeed transparent market, however, success will not be sustained for long without genuinely strong programmes.

Distribution Strategy

The question being raised here include “how do we make our programmes accessible to our target customers? What alternative channels are available and which can we use? What level and quality of service should be available in different locations?” For higher education this translates into questions about the location and design of campuses and even the number and distribution of campuses. Programme delivery has to be considered … where do students study to complete their programme? On one or more campuses? At home? At work? All of these? What resources and materials have to be made available for each of these options? The location recently of Monash University services near KL to enable Malaysian students to complete their (Monash) degrees close to home, is just one example of such a strategic decision being made. Of course, if an institution has been created from several distinct predecessors, as is often the case, then the existence of several campuses is likely to reflect the pre-existing distribution of physical and human resources and may not actually have a marketing rationale at all. Where possible, the environment in which a campus is located is used in promotions to attract students, in addition to images of the education process itself. Brochures (or web-pages) featuring what amount to tourist, cultural, entertainment or sporting attractions are not uncommon. As outlined elsewhere in this paper, the processes of globalisation and demand from mature, working customers and from employers have already brought about a sea change in the way that programmes are offered in many countries and raise question marks over our previous notions on the importance of the campus (as we now understand it), over the functioning of university libraries and over the nature of the work of academic staff on campus. Developments in IT and communications are powerful tools which can be used to create a wide array of distribution options for educational institutions … if only we choose to use them.

Pricing Strategy

This refers to both the explicit and hidden prices the customers has to pay. How are price objectives set and what objectives are selected? Is maximisation of profit, market size or cost recovery going to shape pricing decisions? These objectives are not always consistent. Some examples of levels of cost recovery are to be found in Bray (1997). The next stage is to select a pricing strategy. Should this be one based mainly on costs, or in demand, or alternatively on what the competition is doing?

This is perhaps one of the most problematical fields of marketing strategy for evolving public institutions to address. Having previously been the providers of education, at low or even no direct cost to many of their students and operating on the basis of virtually 100% government funding, administrative traditions are having to be adjusted dramatically. This adjustment is not always freely undertaken but can be conditioned strongly by the ‘not-so-hidden’ hand of governments which, for example, seek to control prices (e.g. Malaysia) or retain a measure of control over human and other resources (e.g. Brunei Darussalam).

If prices are to be set as a function of demand, then the whole demand function must be analysed in a coherent way and prices related to other variables such as income patterns, preferences and the availability of substitutes in the prevailing market. This is not an easy task even for a purely local analysis, but as an institutions broaden their scope and catchments internationally, it becomes an even more complex task. Students everywhere are demanding more choice, better value for money, greater relevance to their lives and the world of employment and higher quality, while at the same time remaining conscious of issues of institutional status or prestige (Fender 1997). In smaller countries and institutions, programme choices are inevitably much more limited. Smaller populations mean there is not a critical mass of local students to support many kinds of course and the only opinion is to look overseas, if finances are available. We feel that, for some kind of course, this can lead to serious compromises in quality and relevance.

Promotion Strategy

Whatever the quality of a programme, it is of little value if people do not get to hear about it. Communications have to be designed to convey appropriate messages to prospective customers, to others in the external environment such as the press and government, to internal constituencies such as Board/Council members and to professional and other employees within. The tools available to do this have never been more varied, but cost-effectiveness will undoubtedly be a primary concern and makes choice of the medium of communication and of timing an important task. It is appropriate to emphasise the enormous opportunities of the Internet in this respect. For a business example of success, consider the on-line bookseller Amazon.com which was founded in 1994. Three years afterwards it was the USA’s 3rd biggest bookseller. Just as in other industries, Internet promotions in education provides a special opportunity for smaller players to compete more strongly with the big established organisations which, previously, were the only ones able to afford communication with a mass audience. As with other aspects of marketing, research is a key feature to ensure that necessary targeting of promotions is achieved and audience knowledge and behaviour subsequently assessed.

People

Trend towards managerialism to more entrepreneurial organisations and to markets, mean that a reconsideration of human resource issues is necessary. The marketing mix and the character of an institution require and are reflective of the involvement of senior managers (whether thy occupy nominally academic or administrative posts is not important). What is essential is firstly that such managers possess the experience to understand the broader picture and are secondly able to communicate their vision to all within their institution so that all can help to convey that vision outside. In larger and more diverse institutions, moulding this coherent vision will be far more difficult and considerable differences in perception can exist.

In the recruitment and promotion of academic staff, it has traditionally been the case that research and scholarship plays a dominant role and even teaching is relegated to a secondary status. In the new organisational environment of higher education a whole new set of skills are now at a premium which were not previously part of he academic curriculum vita. They include, for example entrepreneurship, communications and information technology, financial management, contracts management, and of course, all aspects of marketing. In addition, previous experience as a practitioner as well as teacher-researcher is increasingly being valued especially, one might note, by students. Programme complexity and the range of skills and experience that are now expected mean that staff comfortable and effective in a ‘team’ environment are, overall, of much greater long-term value than the brilliant but eccentric loner, so often in the past a characterised part of campus life. The new qualities are becoming essential not just at the central institutional level but right down to the Faculty and even programme level. Administrations are also not free of the pressure of change. People, for so long attuned to working in highly controlled bureaucracies with roles and responsibilities closely defined, are now having to operate in the less certain waters of devolved authority and managerial discretion. How can our organisations ensure they are equipped with the necessary range of human resources to cope and compete effectively? Is the boundary between ‘academic’ and ‘administrative’ really so clear-cut in the modern, flexible institution? Gordon (1997) discussed the preparation and development of academics in tertiary education with respect to heir multiple roles and the special challenges they face.

Conclusions

The process of change required to cope in the new environment involves far more than simple changes in terminology (e.g. students redefined as customers). “Convincing and credible change needs to reach into the core of the organisation, affecting structure, systems, processes and perhaps above all the outlook and attitude of those providing and managing the services” (Christy & Brown, 1996). Meeting the demands of internationalisation effectively (Nuttman 1997) may be beyond the resources of individual institutions and may necessitate pursuit of co-operative rather than purely competitive strategies (Green and Gerber 1996, Prystay 1996). While examples of movement in this direction are increasingly in evidence, tangible results are more limited and much more could probably be achieved between Asian university partners through means that save resources on both sides, such as more comprehensive student exchange schemes. Both larger and smaller institutions could participate according to their relative strengths in particular academic areas or even because of other factors such as their physical location. The latter remains of importance to some disciplines regardless of advances in I.T. and communications. Placing more stress on serious collaborations within the SE Asian region, rather than relying only on twinning and other arrangements with institutions in other regions, would probably both reduce costs and improve efficiency and quality of programme delivery.

Such stress on internationalism and on commercialism poses problems when the university is expected to also play a role in encouraging interest in local society and culture. The commercial opportunities of certain disciplines are very limited relative to business and technology. Are cross-subsidies or other solutions used to overcome the problem or is purely commercial path chosen instead which would tend to reduce the size of such programmes drastically? On observer (and participant) in the process of change in British higher education remarked that higher education there had been “too busy chasing Nobel Prizes, instead of giving industry and the community the service they really need” (Authers, 1994). Whether or not we agree with this view, it amply illustrates the dilemmas faced in answering the questions posed earlier in this paper .. “what is our business?” … “what needs are we attempting to meet?”, there is no escape from confronting the problem directly as it is the only such institution in the country. Extending consideration of co-operative strategies, Bray (1997) discussed the newer relationship evolving between public and private institutions but pointedly remarked that these might be perceived either as symbolic or parasitic relationships.

With the increasing focus in education on responding to the demands of those with the ability to pay and increasing stress on the 3 E’s of economy, efficiency and effectiveness, it is perhaps sad that the fourth ‘E’ for equity has gone out of fashion. (Bray, 1997; Paquette, 1998). Alvin Toffler has suggested that the changes that are taking place are so immense that they are actually creating a new civilization. While the agricultural era was replaced by the dominance of industrialisation, so now the world is witnessing the emergence of the information age. The flow and management of information now define the world economy. The flow of money is preceded and controlled by the flow and management of information. Toffler (1994) asserts that what is happening is nothing short of global revolution. A quantum leap in social intelligence. He says “… we are the final generation of an old civilization and the first generation of a new one.”

Addressing this issue, Drucker (1996) points out that the transformation of organisations and business is not confined to the West. This is not a ‘Western’ change of civilization, but, he suggests, the emergence of a world civilization. He agrees with Toffler that knowledge and management of knowledge is the fuel for the emergence of a new-world era. In this new world, knowledge replaces money as wealth. When property was the symbol of wealth in the agricultural era, and money was the symbol of wealth in the industrial era, so now knowledge is the symbol of wealth in the information era. Accordingly, wealth and poverty are redefined as the poor are not those who have no money but those who have knowledge. The ‘have nots’ are redefined as the ‘know nots’. This, of course, has tremendous implications for education, information management and government initiatives in building information and human infrastructure.

Finally, for those working in higher education and who are searching for an answer to the question “what is our business?’ perhaps we should look to the mission statements of our respective institutions. But assessment goes much further if we compare our statement with those of others and see if it really distinguishes our institution and it’s aims. Success in the market is based, in the end, on differences rather than similarities between alternative providers.

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