FINDING THE RIGHT STUDENTS: FOUR KEY TRENDS IMPACTING INQUIRY GENERATION

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1 FINDING THE RIGHT STUDENTS: FOUR KEY TRENDS IMPACTING INQUIRY GENERATION INTRODUCTION The lack of stability education marketers have experienced over the last several years has been unprecedented. And while economic and regulatory factors have impacted both their efforts and the sheer volume of enrollments, evolving demographic and consumer behavioral factors are creating challenges, too. Since 2010, our country has experienced an economic roller coaster. While unemployment has sparked some students to go back to school, it has taken a financial toll on others, forcing them into (or back into) the workforce to ensure bills are paid. Coupled with a growing concern over student debt and the general high cost of education, affordability and timing are top-of-mind for prospective students. Education marketers have also seen a tremendous increase in government regulation, dictating how, when and by what means schools can reach out to prospective students. A significant amount of time, money and resources have been redirected toward compliance. Those factors aside, there have been increasing shifts in demographics in terms of who is enrolling in college. It is an ever-changing target market, marked by a modern cultural make-up, technological advances and new expectations. Enrollment marketing is anything but predictable right now. And while we can clearly identify a set of trends we expect to impact lead buying this year, stability isn t one of them. That said, what are the drivers we expect to impact inquiry generation right now, and how can you apply them to your enrollment marketing efforts? In this paper, we ll discuss the ways in which quality, pricing, conversion and attribution are impacting your ability to successfully generate and convert inquiries, and ultimately, optimize the cost of graduation for your institution and the students that you serve.

2 PAGE 2 MARKET OVERVIEW DEMOGRAPHICS The decline in high school graduates since 2009 means we can expect that fewer people will be seeking and enrolling in higher education programs over the next five to ten years. That said, with the lowest number of high school graduates anticipated to hit this year, the number isn t projected to decline any further, but should remain relatively flat for roughly the next decade. Additionally, we are seeing for the first time the Plural Generation, which is made up of nearly 50% of minorities (primarily Hispanics and African Americans). These two groups, in particular, have historically participated less in higher education than Caucasians and other non-hispanic whites. CONSUMER BEHAVIOR The market is witnessing significant behavioral changes, too. As technology continues to consume our everyday lives, prospective students, and specifically the Millennial and Plural Generations, are not only accessing information on the go, but they are also becoming multi-screeners. That is to say that they gather most of their information and spend most of their media time in front of a screen, be it a computer, smart phone, tablet, game console and/or, to a lesser extent, TV. Multi-screening can take place in a sequential manner or a simultaneous manner, and both have implications for your lead generators and marketers, as it is the audience who ultimately dictates how they interact with your brand, not you. Sequential multi-screening means a prospect may begin their research on one screen (or device) and continue it on another. It s all about convenience, as they expect to be able to engage with you and your brand when they want and using the screen they choose. Simultaneous multi-screeners, on the other hand, are splitting their attention across different screens at the same time. They may be watching television while surfing the Internet. The bottom line is that this shift in consumer behavior is allowing prospective students to be even more discriminating, forcing education marketers to re-evaluate not only the way they reach their target market, but also the number and types of channels they use. Additionally, we are beginning to see these generations access most of their from a portable device. Specifically, inquiry generation is being driven by mobile as new generations and behaviors start to dominate. The bottom line is that this shift in consumer behavior is allowing prospective students to be even more discriminating, forcing education marketers to re-evaluate not only the way they reach their target market, but also the number and types of channels they use.

3 PAGE 3 MARKET INFLUENCERS Four themes continually come up in our conversations with lead sellers and lead buyers, which are causing schools to rethink inquiry generation. Our experience tells us that: 1. Quality will trump volume 2. Pricing pressure will drive consolidation or abandonment 3. Institutions will work harder to maximize conversion 4. Attribution will be essential to the final analysis 26% QUALITY WILL TRUMP VOLUME While quality over quantity is nothing new to education marketers, we expect to continue to see it positioned at the top of the priority list, especially as schools of all sizes look to optimize their marketing spend and improve their ROI. The key is determining how each school defines quality. For some institutions, a quality inquiry is simply defined as someone who will answer the phone. For others, quality takes into account timing, intent and willingness to engage in a conversation. Lead generators are taking note of this and doing what they can to find the highest quality prospects those who are well into the discovery process, ready to enroll in the next 90 days, interested in an education (not just the job at the end of the education) and willing to participate in a dialog that will lead to a decision. But be aware, an inquiry who is this highly qualified often comes with a premium price tag. OF MARKETERS DON T KNOW WHICH CHANNEL DELIVERS THE BEST LEADS* Another element of quality is transparency. Unfortunately for our industry, lack of visibility into lead sources and messaging caused a huge amount of mistrust among lead generators and lead buyers over the last several years. Today, some have figured out how to work in partnership, but for others, this level of trust simply doesn t exist, therefore creating a role for third-party verification service providers. These third-party providers will continue to play an important role, especially when you consider the Interactive Advertising Bureau s data that says 36% of all Web traffic is considered fake, the product of computers hijacked by viruses and programmed to visit sites. Lastly, when schools define quality, they are often looking for lead channels that are complementary to their own efforts, not competing with their campaigns. For example, early on in the third-party lead generation game, Search Engine Optimization (SEO) and Pay-Per-Click (PPC) were almost the exclusive domains of the lead generators. Although lately, schools are bringing SEO in-house, as newer SEO tactics favor the brand owners, or in this case, the schools themselves. *WebMarketing 123, 2014 State of Digital Marketing Survey

4 PAGE 4 PRICING PRESSURE WILL DRIVE CONSOLIDATION OR ABANDONMENT Pricing pressure in the education space primarily stems from schools putting stricter parameters around the inquiries they purchase. For example, schools are requiring more scrubbing, not simply accepting a blind list of prospects. As more and more schools put pricing pressure on the lead generators, a fine line has been drawn. We are seeing a number of providers react by either diversifying across other verticals, or simply getting out of the education sector altogether. This contraction in the market is influencing a couple of different viewpoints. The more drastic is that demand will ultimately outstrip supply so significantly that those schools who were so aggressive with their inquiry providers will be left with little to no inquiries available to purchase. The other, and slightly more moderate, perspective is that this is a natural market correction that is both long overdue and necessary. The market indeed needs lead providers that use more sophisticated strategies, not luring prospects with overpromised career results, but rather enabling students to move fluidly throughout the enrollment funnel. Vendors and schools alike need to know that prospective students are understanding the information they are given each step of the way and making an educated decision to enroll. What are institutions doing to get in contact with the prospective students? Two trends are gaining momentum and showing positive results: lead nurturing and remarketing. For the schools, it becomes a balancing act. They need to focus more on the lifetime value of the student, and not simply provide their enrollment advisors with a required number of inquiries. The best strategy for schools is to rally around the high-quality vendors and work in partnership with them, ensuring that their enrollment teams have access to high-quality inquiries, while at the same time rewarding the practices of those providers who act ethically and responsibly. INSTITUTIONS WILL WORK HARDER TO MAXIMIZE CONVERSIONS With decreased inquiry volume, it is incumbent on institutions to convert a higher number of quality inquiries to students, and to see those students through to graduation. That said, certain regulations and consumer behaviors are making it harder for institutions to connect with prospects and build lasting relationships. For example, TCPA rules regulate calls to mobile phones, which are the default devices of prospective students everywhere. Schools must now receive specific permission from the student prior to reaching out via cell phone. Additionally, schools must consider that students are less likely to actually answer their phones if they don t know exactly who is calling and why. What are institutions doing to get in contact with the prospective students? Two trends are gaining momentum and showing positive results: lead nurturing and remarketing. In years past, it was much easier to simply buy new data than to chase inquiries who weren t taking or returning phone calls. However, in a lead-scarce environment where lead quality trumps lead volume, marketers are finding that it is much more cost-effective to focus on the leads they already have and remarket to these prospective students using a multi-media approach.

5 PAGE 5 To quote the Pew Research Center, Encouraging Millennials to interact with your brand across multiple platforms will allow you to collect data and better understand how to interact with this always connected generation. is one component of a multimedia approach. Yet blasting mass s to your database is not the way to go. s need to provide context they need to be personalized, enticing and relevant to the recipient. Pew also tells us that Millennials tend to consume almost exclusively on their smartphones. s, as well as the landing pages they direct students to, also need to be optimized for mobile devices. Another channel is direct mail, but remember, just as can t appear as spam, direct mail can t come across as junk mail. It, too, needs to be personalized, enticing and relevant to the recipient. Evidence has shown that incorporating direct mail into lead nurturing campaigns can lift contact rates 10-20%. In fact, we saw one recent campaign report a 53% lift in starts compared to the control campaign because the school used a multimedia approach that included , direct mail and social media. Direct mail can also be incredibly effective when used in a remarketing campaign. Remarketing direct mail response rates can be % higher than prospecting rates. We have also seen conversion rates for remarketing direct mail range from 20 30% higher than first-time prospects. Ultimately, many inquiries you receive through third-party lead generation channels are simply too early in the discovery process to go from shopper to buyer. You therefore have to work harder to transition them from prospect to student. Ultimately, many of the inquiries that you receive through third party lead generation channels are simply too early in the discovery process to go from shopper to buyer. You therefore have to work harder to transition them from prospect to student. Using a multimedia remarketing strategy to reignite conversations can be a very cost-effective use of your marketing dollars. ATTRIBUTION IS ESSENTIAL TO THE FINAL ANALYSIS Half the money I spend on advertising is wasted; the trouble is I don t know which half. John Wannamaker, Retail Giant and Marketing Pioneer While it s been nearly a century since Wannamaker uttered those words, marketers today still struggle to know exactly which campaigns are the most effective, and which are a waste of money. Yet with new attribution technologies and strategies, you now can trace every touchpoint along the inquiry funnel so that you can better understand which channels and campaigns have the biggest impact. Attribution gets away from the mentality of last click wins. As we measure the impact of each channel the prospective student encounters along the way, we begin to understand the influencers that lead them to the inquiry form. Attribution allows you to understand which campaigns resonate with your target market, as well as how the various channels work together.

6 PAGE 6 For example, you can track search results when a direct mail campaign is running and see the lift in search. Or, you can see the immediate impact of offline media such as radio, outdoor and TV on your online inquiry volume. But that s not all. You can also benefit from attribution strategies with third-party-generated inquiries. When these providers promote your brand, the lift you get in your own organic channels is measurable. For example, if you think of a prospective student conducting research using multiple online databases, they might come across your brand and not only start to recognize it, but remember it. Then, down the road, that prospect thinks back to his or her research, types your school into a Google search, lands on your website and fills out your form when the time is right to finally inquire. This is a great example of various channels working collaboratively. As schools move more and more dollars into branded channels, they need to remember that CPL channels can not only provide inquiries that they might not be able to generate on their own, but they also contribute to the inquiries schools get from their own websites. So how well does attribution work? In a recent test, we concluded that 44% of transactions originated with display ads, and 37% of transactions finished with brand search, both of which are important components of a school s media mix. We have also discovered that some 60% of direct mail inquiries now come through other sources, such as search and direct-to-site visits. OTHER 10% 30% TRADITIONAL RESPONSE DEVICES: BRC, TFN, URL By collecting data as prospective students visit your websites and respond to your offline and digital marketing, including direct mail, banner advertisements, campaigns and search listings, you ll know exactly where to allocate their marketing dollars. Don t forget to consider the impact of purchased leads on your overall position in the marketplace when allocating budgets, too. SEARCH & WEB 60% CONCLUSION As education marketers continue to experience uncertain economic times, increasing government regulations and ongoing demographic shifts, not to mention consolidation and attrition within the schools and vendors themselves, it becomes harder and harder to follow your inquiry-generation strategies and find your target students. That said, they are out there, and dedication to quality, visibility and fair pricing, along with strategies such as remarketing and attribution, can help you find your ideal candidates nurturing them, building meaningful relationships with them, enrolling them, retaining them, teaching them and, ultimately, helping them succeed.