Spotlight Seminar: the case for market segmentation

Spotlight Seminar: the case for market segmentation

There is a well-known saying that goes, “an offer that is acceptable for all is perfect for no one”. This is certainly true, and competition is fierce in the world of international higher education. It is estimated that at least 7000 higher education institutions actively recruit international students – and that these students all apply to an average of five institutions each. How can you be at the very top of their list (and not just on it)? The key is market segmentation.

Although somewhat counter-intuitive, if you have the nerve to strategically limit your market to a narrowly defined segment – rather than trying to convince them all – your results will be much more impressive. It also saves resources. After all, why would you want to get 10,000 applications into your admissions office to yield 100 enrolments? Wouldn’t it be better to get 1000 applications that generate the same amount or better? This is exactly why market segmentation is a key strategic activity you need to undertake.

Beyond geography

When we talk and think about markets, we often define them by geographical boundaries. We often hear: “our main markets are in South America” or “the Japanese market is on the rise now”. And although there might be value in defining markets geographically, with the intention of approaching them in different ways and with different offers, there is no reason why we should limit ourselves to this mind-set.

There are numerous ways in which a market can be defined, but let’s start with a general definition of what a market segment is and why it is useful. A market segment is a subset of all potential international students that share some common characteristics for whom you could adapt your offer. There are a couple of key things to note in this definition:

  1. Market segmentation is used to adapt your offer to suit a certain type of student; it isn’t about adapting your recruitment activities. Sure, recruitment and communication activities follow, but at the core, this is about developing an offer that satisfies a particular group of students.
  2. We are looking for a set of characteristics that define our preferred students, not just their nationality.
  3. These characteristics should be useful when defining our offer. Characteristics such as age and nationality on their own tend to be less useful for these purposes.

Potential segments

Career goals
Prospective students can be grouped based on their motives for studying. Education is not the end goal, their future career is. Some students want to get a job after graduation, some want to embark upon a research career, while others want to start their own businesses. Research-oriented students need scholarships, so if that’s your segment you need to figure out how to provide that. Job-oriented students want internships as a key ingredient of your offer. The exact needs and wants of your particular market segment should be clearly defined in your value proposition. How you can provide this while staying within budget (or being profitable) should be an integral part of your business model.

Extracurricular activities
In the USA, for instance, it is common to tailor offerings to elite athletes. To be able to cater to such populations, scholarships and adapted lecture schedules that facilitate training should be part of your offer.

Academic ability
Maybe you want to focus on the students who are at top in their class. Maybe you’re looking to give the struggling students an opportunity. The first group would surely appreciate very individual study plans to reach their peak. The second would probably be looking for a foundation year to sharpen general skills such as language, scientific writing and critical thinking.

Where to start

We don’t always have much control over the courses, scholarships and other academic aspects on offer at our higher education institutions. Our job is often simply to recruit. Yet if you take a closer look at what you currently have on offer and the types of students you tend to get, it might give you some insights into other things you could suggest to your institution. This is far easier if you can back it up with a clear definition of your market segment and an analysis of what it values. Over time, you can optimise your offer for a particular segment of the five million students who go abroad for a degree every year.

Joachim is Chair of the EAIE Expert Community Marketing and Recruitment and project manager at Uppsala University, Sweden.

Are you interested in learning more about this important topic? Join the upcoming EAIE Spotlight Seminar ‘International marketing strategy: find your market niche and climb to the top’, taking place 27–28 March in Amsterdam. We will explore tools, techniques and inspiration for crafting a better marketing strategy and taking your efforts to the next level!