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Why universities are spending millions on marketing

  • 9 April 2019
  • By Helen Carasso
Dr Helen Carasso – Copyright University of Oxford

A guest blog kindly contributed by Dr Helen Carasso. She teaches and researches higher education policy in the Department of Education at the University of Oxford. Drawing on her professional experience in university communications, marketing and student recruitment, she has a particular interest in questions relating to fees, funding and marketisation.

When the Guardian reported recently that “Universities are spending millions on marketing to attract students”, there was surprise, followed rapidly by a chorus of disapproval. At first sight, this may seem like a strange thing for institutions to spend their resources on – surely they are educational charities, with the teaching and research as their objectives? Isn’t this just another negative consequence of the increasing marketisation of higher education?

Indeed, the impetus for institutions to promote themselves proactively – including in paid media – has become stronger as the sector has grown and diversified. Applicants no longer necessarily come for the most part from school and home backgrounds with plenty of experience of university education, so they are likely to want, or even need, more input from other sources to help them make an informed choice about where and what to study. So, it is part of the responsibility of members the sector, as emphasised by the CMA in its guidance in 2015 , to give clear and accurate information about what they offer.

But universities find that they are competing to get their messages across in a very noisy environment. Although the clearing house system of recruitment that operates through UCAS has many advantages – for applicants and for institutions – the downside is that everyone is working to the same deadlines. So universities are all trying to reach, often similar, audiences at the same time. That inevitably puts up the cost of advertising space – whether it is posters at bus stops or pop-up ads on social media. It is certainly not unknown for different parts of the same university to end up, unknowingly, bidding against each other to buy prominence on Google search results.

While inefficiencies such as that can occur, a high proportion of the money spent on student recruitment marketing now goes on digital media. If the inquiries this generates are handled through a well-planned relationship management system that follows the progress of an inquirer all the way through, potentially to enrolment, then it is straightforward to evaluate the cost-effectiveness of money spent, and adjust the media plan to improve value for money. The Guardian notes, for example, that the University of Bedfordshire’s spend works out at £432 per enrolled student. That seems pretty good value if you consider that places on a three- or four-year degree programme are ‘perishable’ – if you do not meet your target intake one year, you are highly unlikely to fill the gaps left as that cohort works through the course with students joining them in subsequent years. A financial advisor would no doubt conclude that an investment of £432 to secure an income of £27,750 over three years, is an impressive rate of return in the current financial climate.

The greatest driver for all this marketing spend though is the fact that massification and the uncapping of undergraduate places has coincided with a demographic dip in 18 year olds. Established institutions, often those who are most reliant on undergraduate fee income, have taken advantage of the opportunity to increase places, and new providers have entered the field, regardless of readily-available population statistics. As a result, higher education is no longer a seller’s market, in which institutions select from among a competing pool of applicants, pricing themselves in the ‘currency’ of UCAS tariff; it is now a buyer’s market, in which applicants are being offered incentives to commit to particular institution early in the recruitment cycle, for example with the lure of what is increasingly being referred to critically as a “conditional unconditional offer”, or perhaps a guaranteed room in halls of residence.

This is a time of major change for the sector and we are no doubt in a period of transition, as the OfS has recently highlighted. But until university student number planning processes take more realistic account of the context in which institutions operate, rather than for example being led by simple calculations of the size of intake that is needed to bring in enough fees to balance budgets, it is very possible that the only market mechanism that will operate to rebalance supply and demand will be the failure of some providers.

1 comment

  1. Paul Gibbs says:

    It seems likely that marketing influences the practices of higher education and not just in promotion but in educational provision as well, closing of course to be on an appealing consumer mission. Why then is it then that HESA does not collect data on this, why have they dropped the records of staff involved in institutional marketing and why has OfS not undertaken a value for money exercise. Sure it is more complex than posters and advertising but it is student money being spend and seemingly unaccountability?

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