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Established in 1999, UNSW Global is a wholly-owned enterprise of UNSW. The company provides education programs in the non-degree market and seeks to leverage and enhance the UNSW brand in all its activities. UNSW Global has seven business groups however for the purpose of this paper, UNSW Institute of Languages (UNSWIL) will be the centre of the analysis.
UNSWIL utilizes it 42 year history to promote itself as Australia's leading and most comprehensive language training centre. (www.lang.unsw.edu.au). Its objectives include:
* To offer a comprehensive range of quality language education programs and testing services which, by meeting identified market needs, contribute to the profitability of UNSW Global.
* To provide a quality English language preparation pathway for students intending to study at UNSW and UNSW Foundation Studies (UFS).
* To enhance the reputation of UNSW Global and UNSW through it's positioning as a well respected provider of language education programs and testing services.
UNSWIL achieved total revenue of $17.7m in 2008, over 75% of which was derived from international student fees via ELICOS (English Language Intensive Courses for Overseas Students). ELICOS includes: English for Academic Purposes (EAP) which is UNSWIL's core program, providing over 50% of the total revenue for 2008 and 61% in 2009; General English; Professional English and Group Programs, the latter which UNSWIL sees potential for growth. Revenue was $19m in 2009 which was a 35% increase on 2008.
The industry in this analysis is international student recruitment to ELICOS in the Australian university and pathway provider sector. Using Porter's Five Forces (1985) it is evident this is an attractive industry and providers should expect to receive relatively good profits. Profitability can be enhanced by finding opportunities to be less reliant on education agent suppliers and developing direct recruitment channels. The bargaining power of suppliers is moderate to high with a lot of small privately run colleges prepared to pay high commission. Although UNSWIL's Go8 status reduces the bargaining power of suppliers, having a global network of suppliers is a key success factor for providers. The bargaining power of buyers is high however as a Go8 provider, there is a perception that high price equals quality. The threat of substitutes including online, offshore etc is high although not all substitutes can compete on quality, rankings, reputation or location.
UNSWIL differentiates itself on its history, brand and quality. UNSWIL has tended towards a product orientation offering the same suite of products with very little change or customer analysis. However in recent years, there has been a distinct move to a marketing orientation and greater focus on determining the needs of target markets and ensuring customer satisfaction.
Issue 2: The tables below provide analysis of the 5C's,
SWOT analysis of UNSWIL:
- UNSW Brand
- UNSWIL reputation developed over 40 years
- Articulation arrangements with UNSW & UFS (i.e. direct entry pathways)
- Range of courses, including, courses for credit, specialised courses and teacher education
- IELTS test centre.
- Talented, conscientious staff
- Financially viable.
- Degraded courseware and curriculum development capability resulting from lack of investment over a prolonged period.
- Staff over stretched as a result of exponential growth in international numbers since 2007.
- Two separate locations
- Minimal technology enhanced learning and teaching expertise.
- Lack of documented policies, processes and procedures.
- High overheads and constrained industrial arrangements.
- Shared services not always customer focused and not always fully responsive to UNSWIL needs (eg Student Services and Student Support services).
- Pricing too high to attract general English students, consequently there is a lack of diversity.
- Dependence on two nationality groups (China and Saudi Arabia) for 60% of the student population.
- Possible changes to UNSW English entry requirements will require curriculum renewal.
- Development of niche courseware for commercial distribution e.g. university direct entry course materials.
- Development of technology enabled courseware and resources - for Language Teacher Education.
- Teacher in-service training for overseas teachers.
- Proactive development of group and customised programs (i.e. the partner strategy/ ELITE programs).
- Further development of cooperative programs with Study Abroad.
- Growth in sponsored students from a variety of nationalities including Libya and Kuwait.
- relationship with UNSW e.g. losing exclusive direct entry pathway.
- Changes to UNSW English requirements which result in students seeking universities with lower entry requirements.
- Changes in govt policies which impact on the flow of international students to university (e.g. decoupling of migration and education).
- Currency fluctuations
- large private providers (e.g. Navitas)
- Changes to Saudi Arabian scholarship may result in decline in numbers from this key group.
Analysis of remaining 4C's: customers, competitors, collaborators & context
Issue 3: How does your firm collect information about the 5C's?
UNSWIL uses a range of secondary source data (MM 2010, Unit 4 including industry reports from Australian Education International (AEI), AusTrade, English Australia, Department of Immigration (DIMIA), IDP etc. In addition we use our own application and enrolment reports, agent performance reports etc.
a. How does UNSWIL learn about what customers want? Local market intelligence is important and is gathered from our offices in Thailand, Vietnam and Hong Kong as ELICOS markets and India and Singapore to a lesser extent. Our Regional Recruitment Managers (RRMs) who are responsible for a number of territories and education agents are also a source of market intelligence both in terms of what customer's want and competitor information. Other vehicles include evaluations of all classes – teachers, course content etc; customer satisfaction surveys with the most recent conducted in September 2009 on student support and admissions services. Each term (9 terms per year) we review enrolment figures against previous years, agent performance etc
b. How does UNSWIL learn about which competitors pose a threat? The RRMs develop an annual Regional Strategy for each territory they manage. This includes competitor and industry analysis. UNSW Global also owns an education agency which provides real insights into competitor activity, pricing, products and commission rates. UNSW Global conducts an annual commission review which requires market research although this is not always easy to maintain. External market researchers have been engaged over the last few years.
c. How does UNSWIL learn about how the context of business is changing? This industry is influenced by a series of external forces that we are required to monitor these include government regulation under DIMIA, ESOS and NEAS, economic, health, University policy and other factors. This industry is volatile and an amendment to DIAC visa assessment levels for example, can change a market such as India overnight.
d. What role collaborators play in the process? Collaborators are critical especially for UNSWIL whose target market is non English speaking and therefore is reliant on their ability to provide a bridge between UNSWIL and our customers. Agents, institutional partners are critical to our success.
Issue 4: Segmentation, Targeting & Positioning
Total Market: Market data obtained from English Australia shows that in 2008 ELICOS enrolment numbers in Australia were, 162,114. NSW accounted for 38% of all enrolments. Top 10 source countries in 2008 in order: China, South Korea, Japan, India, Brazil, Thailand, Vietnam, Saudi Arabia (SA), Taiwan and Columbia. UNSWIL top 10 source countries reflect the industry trend except for India which is a VET sector market.
It is important to note that the buyers are frequently not the users and could include sponsoring bodies, institutions and education agents. SA is a good example of this, entering the top 10 source country in 2008 with the launch of the King Abdullah Scholarship Program (KASP) by the SA government.
Segment Dimensions: On one level, UNSWIL's segments are homogenous (MM, 2010 Unit 5), that is, the customer needs are similar: belonging to a similar demographic, they need to be relatively intelligent to gain admission to UNSW, fairly affluent as obtaining a student visa requires evidence that they can pay UNSWIL's premium price. However, there is some degree a difference (heterogenous between), because of the diversity of the international student market, the geographic segmentation, language and the channels by which students are recruited, i.e. education agents, sponsoring authorities, institutional partners etc. Whilst the marketing message is the consistent, the marketing collateral needs to be translated for specific markets and managed according to buyer / customer need. For instance an education agent receives a commission for each student recruited; whilst a sponsoring authority may require an institution to bid for places, or guarantee certain services for students as required by the sponsoring authority. Whilst an agent requires training and commission incentives to direct students to UNSWIL, a sponsoring body is more concerned with rankings and educational outcomes. Segmentation for UNSWIL is therefore priori, as the variables to classify customers are clearly defined by language, location, customer affluence and suppliers within that market.
Brand recognition / Value
Very important to sponsoring bodies –there is possibility that KASP will only be offered at Go8 Australian universities
UNSW has strong international brand recognition, as a result of Colombo Plan & offices located across region for 15 yrs.
Very important particularly for those on a student visa vs. holiday or visitor visa. In this sector this applies more so to Chinese students than Korea or Japan who are generally visitor or working holiday visa holders.
Slowly developing via use of student diversity incentives
Less so as government funded
Fairly price sensitive especially Thailand, Vietnam. If working holiday / visitor would seek out cheaper provider.
Price sensitive - working holiday would seek out cheaper provider as focus is on fun. Agent commission higher in this market – competitors pay.
Pathway to UNSW degree, place to bring family whilst studying. Quality reputation.
Pathway to UFS and UNSW degree, student diversity, UNSW reputation, quality.
Pathway to UNSW degree, Beach location, student diversity, UNSW reputation, quality.
Preferred distribution channel
Sponsoring authorities direct with UNSWIL
Education agents – China, Indonesia;
Institutional partners direct with UNSWIL – particularly Japan, Korea and Thailand;
Sponsoring bodies – Vietnam;
Self applicants: working holiday visa holders
Self applicants: working holiday visa holders
Av no of student weeks
Middle East: 23.7
Asia Pacific: 11.8 (China accounted for 28% and Korea 23%)
Central & Sth Am: 15.0
Segment Attractiveness: Bohm, Davis, Meares and Pearce (2002) undertook a major study based on detailed data from 130 source countries exploring forecasts for the demand for international education based on four key factors: income per capita; population; location tertiary education participation; and propensity of tertiary students to study abroad. They predict that Asia will dominate the global demand representing 70% by 2025 with demand for Australian education set to increase 9 fold from 2000 – 20025, representing an increase in Australia's share from 3% to 8% in 2025.
Since that study was undertaken, the Middle East (ME) has emerged as a new market with a surge in government scholarships initially from SA and more recently from Libya and Kuwait, therefore the competency that has been built through the management of KASP should help in securing a share of these new markets.
Determine positioning: Priced as a premium product, it is vital that UNSWIL is seen as a prestige, quality provider possessing the brand attributes of a Go8 institution. Its competitive advantage must leverage its position as the best language pathway to UNSW, increasing the likelihood for student success. With the closure of small language colleges gaining media attention, UNSWIL must utilise its 40 year history to for promotion as a trusted, reliable institution. It must provide exceptional customer service, quality teaching (all are Masters qualified) and student experience to reflect its pricing. Its location on the UNSW campus near Sydney's beaches must be emphasised as part of the marketing mix.
Issue 5: Using Ansoff's growth matrix, it is evident that UNSWIL is pursuing market penetration in existing markets; product development with its Elite programs whose prime target is UNSW exchange partners; and market development in new market segments such as government sponsorship schemes in ME.
Whilst UNSWIL's is moving towards a marketing orientation, I am not confident that its marketing mix truly reflects the customer needs and experience. For example a formal customer satisfaction survey of 116 students was conducted in September 2009. Whilst the results were positive, I have concerns about the survey and doubt the results. Firstly it was conducted internally yet asked for a critical evaluation of our student services, potentially causing some recipients to restrain their response. My major concern however is with the structure which was that of a likert scale but with one key flaw - the response options were Agree, Mildly Agree, Mildly Disagree, Strongly Agree. The positioning of Strongly Agree after Mildly Disagree concerns me. The response to Strongly Agree was 25%, and I wonder if recipients thought they were ticking strongly disagree which should logically sit after Mildly Disagree. It should also be noted that the survey was in English - not the first language of our customers.
The move towards achieving a marketing orientation is the right direction for UNSWIL. Historically their marketing collateral was not customer focused. UNSWIL's website was dense with words, a huge problem when target customers are non-English speakers. There was little awareness of the 5C's, with marketing collateral only available in English except for Japanese because one agent had volunteered to translate it. There was no real segmentation and targeting strategy in place and the only channel was education agents. This meant that any agent that recruited a student was appointed to represent UNSWIL and in 2007 UNSWIL had approximately 2,000 education agents representing it globally. It did not differentiate between those that performed and those that did not. As a result of market analysis, a survey of education agents conducted by an external market research company in 2007, and ongoing evaluation of agent performance, UNSWIL now has 195 agents representing it in key markets globally. These agents can be trained and supported by the recruitment team however; there is still the challenge of managing agent performance because of limitations with our existing databases and the lack of any CRM. Over the last four years UNSW Global has been undertaking a major IT project with the aim of having one consolidated student agent management database for all our education programs. This means very little money has gone into supporting our current infrastructure and detailed reports on conversion rates; and customer and supplier information cannot be easily obtained. In the absence of such information one strategy to continue to learn more about customers was to introduce student focus groups. Focusing on one target segment each month, our recruitment team invites a group of students to lunch and conducts some informal focus groups to learn more about that segment. This is proving very interesting for example we had noticed an increase in students from Myanmar which is a market we do not recruit from directly, on meeting with students we discovered that the source country was actually Singapore with many undertaking secondary studies in Singapore. This information has enabled us to develop strategies to target this group more effectively and incorporate this segment within our Singapore strategy.
UNSWIL has started to target the right customers, with the launch of Elite programs (customised group programs for institutional partners) in 2010. For many years UNSWIL has received groups of students from universities in Asia, however they did not actively seek these partners nor did they actively try to generate repeat business and gather customer feedback. They were a perfect target group as they frequently stayed for up to 25 weeks, no commission was payable to an agent and the potential for repeat business was high. This is a excellent example of how better monitoring the 5C's could have positioned UNSWIL as the leader in this market segment however, University of Queensland's English language college took this position by developing a clear targeted strategy with a strong customer orientation, providing 30% of its total revenue from this segment.
The table below provides some recent analysis of competitors by customer segment and campuses. Whilst Navitas is not covering all segments they have
campuses offshore, therefore competing better on price, minimizing the disruption to customers in terms of relocation etc. With UNSW's decision to be an on-campus provider following the closure of UNSW Singapore, this is feature where UNSWIL cannot compete and is at risk.
Another example of our weaknesses around actively maintaining a customer orientation is student diversity, a distinct point of differentiation in the English Language sector. At the same time, price is a major factor in buyer behaviour. UNSWIL's current positioning as the exclusive provider of direct entry English for UNSW has enabled it to achieve a premium price position (price increased by 13% in 2009 and a further 1.2% in 2010). However, UNSWIL pricing makes it unattractive for certain markets and market segments, particularly visitor and working holiday visa holders. Consequently, achieving a diverse nationality mix is highly constrained and UNSWIL is vulnerable as a result of its dependence on two major markets (China and SA). Whilst we attempted to address this with the development of a Student Diversity scheme that offered commission incentives to nominated education agents based; there may be alternative opportunities. For instance, reducing the price of General English programs that target working holiday and visitor visa holders could be an option that does not impact UNSWIL's positioning within the EAP customer, however further research would be required.
Whilst there has been improvement in gathering data on the 5'Cs it is still an area that needs continuous development and a coordinated approach across the company. Areas requiring further research include competitor analysis - surveying students that do not commence at UNSWIL and choose a competitor; conducting research on buyers and influencers as well as users etc.
Brand is important to UNSWIL as its core international student business is derived from the demand for UNSW and UFS. Current pricing makes it difficult to complete in the General English segment, and therefore it is very important to utilise the UNSW brand in the EAP segment.
UNSW Institute of Languages: www.lang.unsw.edu.au (Accessed 26 April 2010)
AGSM, Marketing Management (Intensive) course notes, 2010 Session 1.
Bohm, Davis, Meares and Pearce (2002), Global Student Mobility 2025, Forecasts of the Global Demand for International Higher Education, IDP Education Australia, September 2002 www.aiec.idp.com/PDF/Bohm_2025Media_p.pdf (Accessed 25 April 2010)
Porter, M. E., 1985 The Competitive Advantage: Creating and Sustaining Superior Performance. N.Y.: Free Press.
English Australia Survey of Major ELICOS Regional Markets in 2008, English Australia, June 2009 www.englishaustralia.com.au (Accessed 26 April 2010)
Marketing Management (Intensive) 2010, Liddy KORNER, Individual Assignment
 Department of Immigration and Citizenship
 Education Services for Overseas Students (ESOS) Act 2000: http://aei.gov.au/AEI/ESOS/ESOSLegislation/default.htm
 National English Language Teaching Accreditation Scheme: www.neas.org.au
 The Department of Immigration and Citizenship
 English Australia: www.englishaustralia.com.au
 Vocational Education & Training