2016 January GrayReports - Student Demand Trends

GRAYREPORTS
Demand for Higher Education Programs
www.GrayAssociates.com
Results through January of 2016

617.366.2838 www.GrayAssociates.com 2
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GrayReports tracks demand for higher education.
§  Today’s webinar and monthly industry trend reports are free.
§  Paid subscribers receive custom monthly reports for their markets and programs.
§  Paid subscribers also have online access to detailed data for their programs and markets.
Over 44 million qualified inquiries
January 2012 to the present
Over 800,000 new inquiries in January 2016
Over 200 programs with over 10,000 inquiries
Over 300 cities with over 10,000 inquiries

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Agenda
1.  National Inquiry and Conversion Trends
2.  Inquiries and Conversions: Online vs. On-Campus Programs
3.  Views by Program and Segment
4.  Dale Leatherwood – Higher Education Marketing Executive
5.  Summary

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Overall Student Inquiries (All Sources)
To start 2016, overall inquiry volumes for higher education slipped 7%.
§  Inquiries were increasing late last year; January broke this trend.
§  Typically, January has the highest inquiry volume for the year, so the miss was especially large.
-
200,000
400,000
600,000
800,000
1,000,000
1,200,000
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
National Inquiries
All Programs and Award Levels 2014 2015 2016
-7% YOY

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Branded Inquiries: Overall Results
Branded inquiries carried momentum into 2016–up 3% year-over-year.
§  January had the largest inquiry volume since May of 2014.
§  A 3% uptick in January marks the 6th consecutive month of year-over-year growth.
─  The 10th month of year-over-year growth in the last 13 months.
0
50,000
100,000
150,000
200,000
250,000
300,000
National Branded Inquiries
All Programs and Award Levels 2014 2015 2016
3% YoY

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Inquiry to Application: Conversion Rates Combined
Overall, conversion rates have been volatile, but are trending up.
§  Since Q1 2014, quarterly rates have risen as much as 10% and dropped by 5%.
§  Recently, they have trended up over 10%.
85
90
95
100
105
110
115
Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q2 2015 Q3 2015
Conversion Rate Trends
(Indexed to Q1 2014)
Total
Immature
Months1
1.  Applications are counted in the month in which the inquiry was received (i.e., an inquiry that is received in January and converts in March will be
counted as a January inquiry). Typically, the application rate will rise for at least three months after the month in which the inquiries were received.
2.  Total includes unknown source type.
2

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Inquiry to Application: Conversion Rates for Branded Inquiries
Since Q1 2014, branded inquiry conversion rates have fallen 27%: from 9% to 7.5%.
§  Branded inquiries are inquiries that come directly to institutions (school websites and call centers).
§  As schools tried to get more branded inquiries, the quality has fallen.
§  Fortunately, the downward trend ended in Q1 2015.
9.0%
8.2% 8.3% 8.0%
6.7% 6.8%
7.5%
0.00%
1.00%
2.00%
3.00%
4.00%
5.00%
6.00%
7.00%
8.00%
9.00%
10.00%
Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q2 2015 Q3 2015
Branded Conversion Rates by Source

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Inquiry to Application: Conversion Rates for External Inquiries
Fortunately, conversion rates for external inquiries are up 30% from 1.8% to 2.3%.
§  External inquiries are inquiries that are generated by third parties, often referred to as PPI inquiries.
§  Institutions have been turning to higher quality inquiry providers, driving up conversion rates.
§  Schools need admissions channels that can cost-eﬀectively manage “lower-octane” inquiries.
1.8%
1.9%
2.0% 2.1%
1.9%
2.1%
2.3%
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q2 2015 Q3 2015
Conversion Rates by Source
PPI

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Average Price for Pay-per-Lead Inquiries
In January, the price of an external inquiry for higher education rose, but stayed near $45.
§  Before January, the average price was consistently slightly below $45.
§  January’s average price of $45.20 was the highest in over two years.
§  Better inquiries may cost more—and institutions are competing for fewer inquiries.
2014 $41.72 $41.81 $41.70 $42.45 $40.94 $44.23 $44.25 $44.00 $45.34 $45.43 $44.79 $42.18
2015 $43.10 $43.50 $43.70 $43.61 $43.80 $43.63 $45.07 $44.75 $45.24 $44.92 $44.67 $44.75
2016 $45.20
$35
$37
$39
$41
$43
$45
$47
Average Price per Inquiry for PPI
All Programs and Award Levels
Note: PPI means“Pay per Inquiry.” Inquiry price is the average price per inquiry from PPI.

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Agenda
1.  National Inquiry Trends
5.  Summary

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Inquiries for Online Programs
Education Industry Inquiries: YOY Percent ChangeMomentum for online programs came to a screeching halt in January–down 5%.
§  September (+20%), October (+45%), and November (+41%) of 2015 were tremendous months for demand for
online education.
§  In 2014 and 2015, January had the largest volume of online inquiries in higher education.
0
50,000
100,000
150,000
200,000
250,000
300,000
350,000
Inquiries
Inquiries for Online Programs
2014 2015 2016
-5% YoY

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Inquiry to Application: Conversion Rates for Online Programs
Conversion rates for inquiries for online programs were a real bright spot.
§  Since Q1 2014, conversion rates for online programs have risen 55%, from 1.9% to 3.0%.
§  In Q3 2015 conversion rates rose 33%, from 2.3% to 3.0%.
1.9%
2.9%
2.7%
2.4%
2.3% 2.3%
3.0%
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
3.50%
Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q2 2015 Q3 2015
Conversion Rate Trends For Online Programs

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Student Inquiry Conversions for Online Programs
October had a whopping 49% more applications, year-over-year, for online programs.
§  This trend will continue.
─  November is already ahead of year-ago levels and will get better.
─  December and January are promising.
1.  Applications are counted in the month in which the inquiry was received (i.e., an inquiry that is received in January and converts in March will be counted as a January inquiry). Typically, the
application rate will rise for at least three months after the month in which the inquiries were received.
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
Inquiry Conversions for Online Programs
2014 2015 2016
Immature Months1
49% YoY

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Inquiries for On-Campus Programs
Student demand for on-campus programs in higher education dropped 14% year-over-year.
§  Inquiries grew in October and November of 2015.
§  December fell 8%.
§  The decline accelerated in January—it was the worst fall since last June.
2012
0
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
450,000
Inquiries
Inquiries for On-Campus Programs
2014 2015 2016
-14% YoY

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Inquiry to Application: Conversion Rates for On-Campus Programs
To make matters worse, conversion rates for on-campus programs remained low.
§  Since Q1 2014 conversion rates for on-campus programs shrank 24%, from 4.2% to 3.2%.
§  They have recently stabilized at 3.2%.
4.2%
4.0%
4.3%
4.5%
3.5%
3.2% 3.2%
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
3.50%
4.00%
4.50%
5.00%
Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q2 2015 Q3 2015
Conversion Rate Trends for On-Campus Programs

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Student Inquiry Conversions for On-Campus Programs
Ugh…Conversions for on-campus academic programs slipped over 50% in October.
§  Falling conversion rates amplified the decline in inquiry volumes.
§  November and December may buck this negative trend.
§  January looks weak, but may recover.
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
20,000
Inquiry Conversions for On-Campus Programs
2014 2015 2016
Immature Months1
-51% YOY

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Overall Student Inquiry Conversions (All Sources)
In October, total student conversions for programs in higher education dropped 16% year-over-year.
§  This trend will not continue.
─  November is already ahead of year-ago levels and will get better.
─  December and January are promising.
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
Total Inquiry Conversions
2014 2015 2016
Immature Months1
-16% YoY

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Agenda
5.  Summary

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The Big 5 Programs: January Growth
Health Care Administration dropped from the Big 5 Programs for student demand.
§  Three of the Big 5 Programs grew when compared to year-ago levels.
§  After massive year-over-year declines in 2015, Criminal Justice regained some ground.
§  Growth in Registered Nursing has slowed–but is still up nearly 20%.
97%
-78%
-8%
-15% -16%
19% 19%
9%
-26%
-34%
-100%
-80%
-60%
-40%
-20%
0%
20%
40%
60%
80%
100%
120%
Registered Nursing/
Registered Nurse
Criminal Justice/Police
Science
Business Administration and
Management
Medical/Clinical Assistant Administrative Assistant and
Secretarial Science
Five Largest Programs Since January 2012
Year-over-Year Change in January Inquiries
2015 YoY % Change 2016 YoY % Change

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77%
-3%
-21%
12%
-9%
173% 169%
151%
132%
90%
-50%
0%
50%
100%
150%
200%
Health Information
Administration
Educational Leadership and
Administration
Music Liberal Arts and Sciences Special Education and
Teaching
The Fast 5
The Fast 5 Programs: The Higher Education Programs with the Fastest Inquiry Growth
Demand doubled for the Fast 5 academic programs in higher education.
§  Health Information Administration joined the list–and grabbed the top spot.
─  Special Education and Teaching is also new to the list in January of 2015.
§  Medical Insurance Coding Specialist and Registered Nursing fell oﬀ the Fast 5.
1.  Includes only the top 75 programs (ranked on total inquiry volume since January 2012). Minimum of 1,000 inquiries in 2014.
New New

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Finding the Sweet Spot
The best market for a program has strong student demand and employment, with limited
competition.
Student Demand
Completions: Unit Volume
Inquiry Growth: Unit Growth
Industry Inquiries
Inquiry Growth: % Change
Completions: Unit Growth
Employment
Placement Rates
Wages
Job Growth
Job Openings
Jobs per Graduate
Competitive Intensity
Completions per Capita
Competitor Mix
(e.g., Public vs. For-Profit)
Number of Competitors
Cost per Inquiry

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Top Scoring Markets: Health Information/Medical Records Administration (51.0706)
For HIM, some markets are better than others, so we rated hundreds of markets to find the winners.
§  Akron appears to have the best combination of demand, employment, and limited competition.

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Market Scorecard: Akron, OH and Health Information/Medical Records Administration
We also provide detailed scorecards by program and market.

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Student Inquiries: The Big 5 Cities
Big Cities were hit hard in January.
§  All the Big 5 Cities dropped at least 18%.
§  With a 38% year-over-year drop, Chicago had the largest decline (several more schools closed).
-9%
-2%
-8%
-16%
-12%
-18%
-26%
-29%
-36%
-38%-40%
-30%
-20%
-10%
0%
10%
Philadelphia, PA New York, NY Atlanta, GA Los Angeles, CA Chicago, IL
Top Five Cities for Inquiries Since January 2012
2015 YoY % Change2 2016 YoY % Change
Note: The market for each city is defined as a 15-mile radius around the population center of its CBSA.

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The Fast 5 Cities for All Inquiries
New Orleans, a Fast 5 member since September of 2015, was the fastest-growing city in higher
education.
§  Orlando and Nashville replaced Seattle and Boston in the Fast 5 cities.
§  Three of the Fast 5 cities grew 23% or more.
1. Includes only the top 75 cities by inquiry volume since January 2012. Data includes a 15-mile radius from the center of the CBSA.
-32%
0%
-4%
-44%
-22%
29%
25% 23%
15%
8%
-50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
New Orleans, LA Orlando, FL Wichita, KS Minneapolis, MN Nashville, TN
Five Fastest-Growing Cities for All Inquiries

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-29%
-19%
-7%
-3%
2%
8%
12%
21%
41%
55%
-30% -20% -10% 0% 10% 20% 30% 40% 50% 60%
Unknown Degree
Associate's
Campus
External
Certificate
Online
Branded
Bachelor's
Doctorate
Master's
Year-over-Year Percentage Change in Inquiries
2014/2015 vs. 2015/2016 (November – January)
Inquiry Volumes by Category – Trailing 3 Months
Growth for branded inquiries and online academic programs is slowing–up 29% and 27% last
month.
§  Higher-level degrees continued to dominate inquiry volume categories.
§  For the quarter, on-campus programs were only down 7%.

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Inquiry Volumes by Channel - Trailing 3 Months
For the most part, branded inquiry channels outperform external inquiries.
§  Social Media continues to be the preferred channel for prospective students in higher education.
§  Branded PPC – Inbound Calls dropped to 53% from 188% last month.
-68%
-23%
-14%
-3%
-2%
-2%
2%
20%
22%
26%
38%
44%
53%
347%
-100% -50% 0% 50% 100% 150% 200% 250% 300% 350% 400%
Branded: Display
External: Affiliate - PPC
Branded: Referral
External: Affiliate
External: PPL
Branded: Offline Media
Branded: PPC
Branded: Interactive
Branded: Website
Branded: Email
Branded: Organic
Branded: PPC - Inbound Call
Branded: All Other Branded
Branded: Social Media
Year-over-Year Percentage Change in Inquiries by Channel
All Programs and Award Levels (November – January)

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Agenda
5.  Summary

Dale Leatherwood
Ø 18 years in Training and Higher Ed
Ø Executive Leadership at Three
Institutions
Ø Higher Ed Marketing, Enrollment,
Education and Administrative
Ø Higher Ed Consulting on Marketing,
Strategy and Distance Learning

What Now?
Over the Next Month
Ø  Get specific to your situation
•  Understand the dynamics of your geographies
•  How does this relate to your target (career level, age, demographics, etc)?
•  What resources are available (or more importantly NOT available within your
institution?
Ø  Understand the balance of info
•  What is the ratio of student demand, employer demand, employer need and
industry dynamics per market?
Ø  Gather Stakeholders to provide context
•  Get the perspectives of external and internal SMEs and departments on the
information for balance and context

What Now?
Over the Next Quarter
Ø  Engage with your Program Advisors
•  Use the data to determine who should be in the advisory group
•  What detail and direction can they provide relative to the data?
Ø  Re-rank and revise your current Portfolio
•  Revise curriculum, add/edit concentrations, drop programs
Ø  Develop and Execute roll-out plan for new Portfolio
•  Coordinate all internal and external stakeholders in a formal plan of
action
•  Develop specific targets for both inflows AND outcomes

What Now?
Over the Next Year
Ø  Implement new Program strategy
•  Coordinate program updates with rollouts
•  Track, measure and learn from EACH step in the process
Ø  Parallel marketing/PR strategy to industry
•  Market to the outcomes
•  Engage with Program Advisors on multiple levels
Ø  Stay ahead of the Curve
•  Don’t play catch up with new programs
•  Understand the macro-trends of education and industry

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Agenda
5.  Summary

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Key Demand Trends and Observations
January generally underperformed.
§  Inquiry volumes fell 7%.
─  Branded up 3%
─  Online down 5%
─  On-campus down 14%
§  Conversions are trending up (but not for on-campus).
─  Online up 49% in October
§  Prices are up slightly month-over-month to $45.
§  Large programs are starting to grow.
§  Higher degree levels continue to outperform.
§  Better data and systems are now available to support your decisions.
─  Where to focus your marketing—by program and market
─  What programs to Stop, Start, Sustain or Grow.
§  What Now: “Use it or lose it?”

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Questions and Contacts
Please feel free to contact:
Bob Atkins
CEO
Gray Associates, Inc.
Bob.Atkins@GrayAssociates.com
@Gray_Associates
617.366.2836
Please feel free to contact:
Dale Leatherwood
linkedin.com/in/daleleatherwood
DLeather@yahoo.com
@EduSavvy
205.837.4892

GRAY
Upcoming Gray Associates’ Webinars
Please join us next month!
March Webinar
(February Results)
Thursday, March 24th at 2:00 PM EDT

2016 January GrayReports - Student Demand Trends

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