Market opportunities in China. Summary of market research on China for the early childhood education sector

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1 Market opportunities in China Summary of market research on China for the early childhood education sector

2 Targeted cities in China Seven locations (eight cities) have been selected as the main targets for the promotion of New Zealand education in China: City Tiers Tier 1 cities: Beijing, Shanghai, Guangzhou Tier 2 cities: Hangzhou, Nanjing, Qingdao, Chengdu/Chongqing Regions North: Beijing, Qingdao East: Shanghai, Hangzhou, Nanjing South: Guangzhou West: Chengdu/Chongqing Market demand The onshore study market Pre-school education is strongly encouraged by the Chinese government. The availability of pre-school education resources remains an issue. The market in China is very promising and growing rapidly Figure 1 Private kindergartens have become a critical player in China s ECE sector million students were enrolled in private kindergartens in 2009 and the growth rate is increasing by 10 per cent year on year. The market is currently not as highly regulated as other sectors and enjoys a higher degree of freedom. The concept of ECE has become increasingly popular in China. More Chinese parents have realised that the ages 0-3 are very important for their child s development. A growing number of infants and young children are attending nappy curriculum i.e. classes specifically designed for this age group. In urban areas, more than 15 per cent of children 1

3 aged between 0 and 3 receive early childhood education. For children aged between 4 and 6 the proportion is 20 per cent. Competition Foreign investment in pre-school education in China is not yet common. There are only four to five Sino-foreign cooperative kindergartens in Beijing and Shanghai. Most of the bilingual kindergartens are solely owned by Chinese without involvement from foreign investors. Opportunities Books and publishing There are opportunities in the publishing of New Zealand children s book series. This area also has strong connections with the development of e-books and digital learning games. I am very optimistic about the cooperation with foreign partners in providing English books to our kindergarten. We are an international school and have strong needs for books published from a global perspective Kindergarten owner Curriculum development and consultancy services There are opportunities for internationally known curriculum systems. New Zealand providers should target the high end pre-school education market such as international and private elite kindergartens. Teacher training There are opportunities for New Zealand providers to train high end pre-school teachers. There is a serious shortage of pre-school teachers resulting in strong demand. Strategy for New Zealand in the Chinese market Leveraging New Zealand s advantages New Zealand is perceived by China to have a high quality ECE system, and highly regarded infant industry. New Zealand should build a strong brand focusing on safe New Zealand, healthy childhood. Given the popularity of New Zealand s infant industry in China, providers could integrate the promotion of pre-schools with the infant industry. This would capitalise on strengths in the milk powder industry, children s clothing and books. Market entry The research recommends: 1. Engaging in additional market research investigation in target markets 2. Focusing on cooperation with private kindergartens in China 3. Providing curriculum services and education products to establish an initial partnership and understanding of the market. New Zealand institutions could then look to establish bilingual kindergartens with existing private kindergartens. 2

4 Target markets Future opportunities are concentrated in tier 1 cities and more developed tier 2 cities. This reflects the migration of young Chinese young adults to developed regions, leading to the concentration of school-aged children in these regions. Pre-school education is an emerging market. Main consumers are educated and skilled people between 25 and 35. Success in tier 1 cities will likely be imitated in tier 2 and 3 cities. The research recommends that New Zealand providers should focus on Beijing, Shanghai and Guangzhou due to: Large urban populations High disposable incomes, with high expenditure on education Rapid development in pre-school education and significant number of pre-school enrolments Being highly internationalised, more open-minded and accepting of international products and services. Further information New Zealand international education providers can request a full copy of this research report by contacting ENZ s Business Development Team. Phone:

5 Appendix 1 Promotion channels are diversifying Channels used by foreign providers in China are continuing to diversify. Study tours, social media, alumni and industry networks are increasingly complementing the more traditional channels of education agents, education fairs and mainstream media. Popular promotion channels: Promotion events: education fairs, study tours and showcases Education agencies: overseas study agencies, education associations, education institutions Traditional media: newspapers, television, broadcast New media: internet and mobile Interpersonal networks: alumni and industry associations. How do Chinese students obtain information on studying abroad? 1. Education agencies / organisations 2. Current school 3. Domestic websites of education institutions and study abroad organisations 4. Websites of overseas schools 5. Promotion events of overseas schools 6. Recommendations from relatives and friends 7. Recommendations from teachers Education agents Education agents remain the most important players in China s international education market. While the number of students completing their own international applications is increasing, and individual schools and universities are increasingly influencing study abroad decisions, agencies remain the most popular source for Chinese applicants to obtain the latest international education information. Agencies are increasingly providing a one-stop-service to clients, including providing or offering: career advice study tours to other countries during summer and winter breaks training courses to help students meet language and academic requirements services to support students daily life overseas, including through overseas representative offices. The China Ministry of Education has registered 448 education agencies (as at August 2012), though the number of unregistered agencies is believed to be over ten times as large as the registered number. Aoji, JJL, EIC, Shinyway and Vision Overseas/New Oriental are among the largest education agencies. 4

6 Promotional events Education exhibitions, study tours and study showcases are popular ways to promote international education options to students and parents. Education fairs Education fairs remain the most common way of promoting international education. The number of fairs is proliferating across Tier 1, 2 and 3 cities, organised by government, local governments and companies. However both overseas institutions and students are questioning the effectiveness of the fairs. Institutions are concerned about the value of the events given both cost and time commitments. Attending students and parents report receiving an oversupply of non-material information. Key fairs: International education exhibition tour organised by the Chinese Service Centre for Scholarly Exchange covers Beijing, Shanghai, Guangzhou, Hefei, Xi an, Fuzhou and Shenyang. China education expo organised by China Education Association for International Exchange covers Beijing, Shanghai, Xi an, Chengdu and Wuhan. EIC Education Fair organised by EIC, The World s Elite Advisory Fair organised by IDP and Overseas Examination and Study Fair organised by Shinyway are some of China s leading commercial fairs, covering up to 25 main centres. Institution seminars Institutional seminars (also known as discussion groups ) bring prospective students and institutions together to share information on studying at particular institutions. Seminars are usually organised in partnership with particular agencies. Showcases Showcases involve simulated classrooms that demonstrate overseas study environments. These are opportunities to target potential students who want to gain in-depth knowledge about further studies. For example, the University of Surrey UK cooperated with a Shanghai-based education agency to offer prospective students an introductory lecture on An introduction to corporate financial management and financial markets. Study tours Study tours involve prospective parents and students travelling to a country or region to gain an insight into possible study destinations. These tours offer students and parents an opportunity to try before they buy, and incorporate social activities alongside institution visits. Study tours are becoming increasingly popular; New Oriental / Overseas Vision will offer 142 study tours in the second half of 2013 alone. 5

7 Media channels Traditional media remains an effective channel to target adults, whereas new media has become the preferred means of information for younger generations who seek fast, effective and customised information. A range of new media platforms are being used to promote international education options to potential Chinese students, such as QQ.com, 163.com, Sina.com.cn, Sohu.com, Taisha.org, Chasedream.com, Skykiwi.com, Tycool.com, Weibo, RenRen, Douban Group and Wechat. Interpersonal networks are becoming increasingly important in China as a channel for international education promotion. Foreign institutions are utilising hometown, alumni and business associations ever more effectively to increase their profiles. 6

8 Appendix 2 Background This research was commissioned by Education New Zealand to identify potential opportunities and possible approaches to building a strong New Zealand presence in China and the main targeted cities. Methodology In order to gain a thorough understanding of the Chinese overseas study market for New Zealand the following information sources were utilised: Questionnaire survey. Comprehensive quantitative survey involving 2,573 samples with a focus on the targeted cities. In depth interviews. Twenty-four interviews with overseas study agencies across the eight targeted cities. Thirty-seven interviews with prospective students/parent and eight interviews with New Zealand alumni. Research on authoritative/official reports. Reports included the Chinese government s National Plan for Medium and Long Term Education Reform and Development ( ), as well as reports from the China Service Centre for Scholarly Exchange (CSCSE) and 21 st Education Research institution. 7

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