Short on time? Here are the highlights:
- There is a growing trend toward more specialised and targeted English language programmes
- This is both a function of increased competition in the ELT sector and a response to the increasing commoditisation of general language programmes
- It is also a more sustainable and strategic response to persistent price pressure and discounting in the marketplace
- Language centres are now innovating based on new products, niche market segments, new partnerships, and enhanced student services
Schools in the English Language Teaching (ELT) sector are operating in an increasingly competitive environment where the commoditisation of general language programmes has become a real issue. This is driven in part by an increasing share of online bookings and characterised as well by a greater emphasis on price discounting.
A pattern of increasing commoditisation in the ELT sector has been underway for several years now, but beginning in 2015, many language centres have faced additional challenges such as slowing demand from key source markets, and relatedly, increased ELT capacity and investments in English language learning within traditional sending markets.
These disruptive factors have contributed to a marketplace where new approaches are increasingly required to maintain market share and relevancy.
This has been the topic of considerable discussion within the industry of late. And in recent conference presentations, both Michael Carrier, Director Strategic Partnerships with Cambridge English, and Matthew Hird, Sales Director for Oxford International Education Group, have addressed the need for innovation and differentiation in the ELT sector.
Mr Carrier spoke at the Eaquals International Conference that took place in Lisbon in April while Mr Hird presented at the ELT specialisation seminar during ICEF Berlin last fall.
The two seminars underscore both the importance and opportunity for differentiation in ELT provision, often via enhanced service offerings, increased quality, or refreshed branding.
So many ways to be innovative
In previous posts on commoditisation in the ELT sector, we defined the trend as a movement toward undifferentiated competition. That many schools decide to discount prices in such a context is not surprising – offering a lower price those of competitors is indeed a way of differentiating. The problem is, it can turn into a vicious cycle, and indeed, research has shown that prolonged discounting – in any sector – can produce a sustained mindset among consumers of expecting a bargain at all times.
“If you discount, people get used to these kind of prices and it is difficult to push the prices back up,” confirms Mr Hird in a follow-up conversation after his Berlin presentation. “From the perspective of where we have schools now, across the UK, Canada, and US, the level of discounting at the moment in all of those countries is anything from 15% up to 40%.”
Unless you have a distinct advantage as a low-cost provider and have made a deliberate decision to compete on price, that level of discounting is not sustainable.
Rather than competing so much on price, Cambridge English’s Michael Carrier told his audience at the Eaquals International Conference in Lisbon to think in terms of innovation as a means of “futureproofing” language centres against challenging or disruptive market trends. He encouraged the audience to think about innovation as being “about adding value to a product or service.” He noted that English-language schools can chose to innovate in all sorts of ways, including developing:
- New products;
- New market segments;
- New course types;
- New ways of supporting learning;
- New service quality for students;
- New experiences for students;
- New attitudes shaping the delivery of ELT to students.
When approaching the question of innovation, Mr Carrier said, “The most important thing is KYC: Know Your Customer. Anticipate their needs and innovate ahead of the market.” He also encouraged audience members to consider two questions: (1) what is innovative in your school and (2) what areas need more innovation?
He noted that schools could be categorised according to their appetite for innovation, from “Idea-toxic” environments in that make change very difficult to achieve at the one extreme to “Idea-hungry” cultures in which people seek new ideas and make “radical improvements beyond existing limits.”
Mr Carrier offered the audience an alternative to accepting that commoditisation is the operating context in which they must compete, noting that:
“Some brands have moved from the commodity category into experience and emotion. Emotional branding is about appealing to customers’ needs, aspirations and ego to create an emotional bond. Brands can create growth and relevance with consumers by moving from market share to mind share.”
Emotional branding depends in institutional staff researching and brainstorming students’ needs – and then considering how the institution could wow students with exceptional products and/or services aligned with those needs.
Emotional branding also calls for institutions to recognise that students’ experiences begin before they enroll in a language course and do not end when the course is completed, because this longer time-frame expands the time available for establishing an emotional bond with a school. Mr Carrier called on the audience to consider how their schools could improve the student experience (1) before arrival (e.g., pre-departure apps, welcoming and transportation services); (2) during the course (e.g., learning technologies, classroom design, rewards for student progress); and (3) after leaving the school (e.g., follow-on training, alumni engagement).
More than English
In their respective presentations, both Mr Carrier and Mr Hird emphasised the opportunity for schools to think of themselves as providers of more than general language courses. Mr Hird offered some examples of more specialised Oxford International programmes, including:
- Bucksmore Coding, which allows students aged 12–16 to combine English-language learning with learning the fundamentals of software design;
- Homelingua, which provides personalised courses taught in the homes of teachers;
- UIC English Group courses that pair language learning with work experience.
Other examples of “English Plus” groups include those that pair English studies with Business and Finance courses for high school students, customised programmes targeted to specific university faculties (e.g., English and Fashion), and IELTS preparation courses featuring university visits. “If you can create something that is different, something that makes you stand out,” Mr Hird adds, “You can charge a little bit more for it but you are also going to get the business.”
He also advised language centres to consider partnerships – for example with bilingual high schools, universities, or pathway providers – to expand their reach beyond what they could achieve on their own.
Diverse students, different needs
As we wrote about recently, a well-executed niche strategy can be an important differentiator in the sense that focusing on discrete student groups guides schools to tailor programming and experiences and so stand out from what other schools are offering.
Mr Hird noted that for the junior market, school breaks and holidays offer opportunities to deliver special experiences to students via ramped-up programming and competitions in such areas as drama, debate, or song and dance – complete with awards ceremonies and trophies.
For the adult market, marketing and programming according to age groups can be beneficial (e.g., the “Grey Dollar” market (i.e., ageing affluent people); the “Pink Pound”, or LGBTQ, market; or those aged 30+ or 50+.
Though Mr Hird believes there is still an “underlying and consistent demand” for general English courses, he does not expect strong growth in that segment of the market. As a result, he expects that more and more schools will be looking to specialised programmes and niche segments going forward, including “English Plus”, academic preparation, and junior programmes.