Marketing to the World

March 30, 2010

WASHINGTON – Thinking that a trip to a developing country might be a break from the TV commercials, Web ads and billboards that institutions like the University of Phoenix and Devry University use to build their brands and recruit students? Think again.

As administrators from for-profit institutions in more than two dozen countries met here Monday for a discussion on the future of education in the developing world -- sponsored by the World Bank Group’s International Finance Corporation -- they were urged to adopt the same tactics of marketing and customer service that have proved so effective in helping American (or Canadian and Western European) for-profit colleges and universities ratchet up their name recognition, enrollments and bottom lines.

“Marketing is a way of thinking more than a way of doing,” Tom Hayes, vice president and partner at Washington-based higher education marketing firm SimpsonScarborough, told the crowd, which included representatives from Kenya’s Strathmore University, Argentina’s Universidad del Salvador and half a dozen Indian institutions. As of Jan. 31, the IFC had $469 million invested in 62 education projects in 30 countries; many of those projects had representatives in the crowd.

Taking a page or two out of the successful Western for-profit’s playbook, Hayes stressed the importance of market research -- of knowing students’ problems and solving them, whether they are about the time or location of a course, or short-term financial pressures.

Another key, he said, is branding. “A brand, if nothing, else is a promise to your marketplace,” he said. “Since education is a service, in essence, we’re basically marketing something that you can’t touch, you can’t feel, you can’t see.”

Anhanguera Educacional Participacoes has used the very American tactics of aggressive advertising and accommodating customer service to become Brazil’s largest for-profit postsecondary institution. In 2009, its net revenues totaled $904.5 million reals, an increase of close to 40 percent over 2008 revenues. With the acquisition of campuses and the introduction of new programs, enrollment in the fourth quarter of 2009 hovered around 251,000. (Not quite Apollo Group’s 458,600 in the second quarter of its fiscal year 2010, but not too shabby, either.)

Riccardo Scavazza, vice president of operations, said that much of the growth has hinged on the success of marketing to low- and middle-income adults who didn’t have access to postsecondary education before the boom that’s happened in Brazil’s for-profit education market in the last decade. Essentially, Anhanguera and its handful of publicly-held competitors have created a market where there wasn’t one. In 2006, the IFC loaned $12 million to a Brazilian private equity firm to invest in the institution.

Recruiting is a mix of high-tech and low-tech marketing. The company uses internet advertising and e-mail marketing -- as well as personalized and targeted e-mails and text messages – to pique potential students’ interest and keep in touch. Nine of every 10 enrollments come through Anhanguera’s website.

Staff also recruit on the ground level, at high schools and companies, and set up stands in heavily trafficked places like subway stations. “We’re trying to not only convince the student to come to study at Anhanguera,” Scavazza said, “but also to convince the student to come to study at a higher education institution.”

But marketing has been about more than just getting students in the door; it’s also been about branding. One national survey ranked Anhanguera one of the 40 most valuable brands in Brazil. Evidence, he said, that “we are the first household name in Brazil in for-profit education.”

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