Market intelligence for international student recruitment from ICEF
21st Jun 2016

Going deep: The power of a niche strategy

The more competitive and mature an industry is, the more creative and thoughtful its players must be in their strategies to maintain or grow market share. We are at that stage in international education. Right now, there are a lot of fish in the international student sea, but there are also more nets being cast, and many schools are having to work harder to keep their enrolments and revenues healthy. Institutions are sharpening their competitive strategies as a result and one option available to every provider is to adopt a more targeted approach with a focus on one or more niche markets. A well-executed niche strategy can help:

  • Attract quality students who are well-fitted to the institution or school;
  • Influence operations to match students’ needs;
  • Reinforce a more sustainable competitive position.

What is a niche?

Niche marketing is based on the reality that no business can be all things to all people. BusinessDictionary.com defines a market niche like this: "A small but profitable segment of a market suitable for focussed attention by a marketer," and explains that:

"Market niches do not exist by themselves, but are created by identifying needs or wants that are not being addressed by competitors, and by offering products that satisfy them."

We reported earlier this year on a real-life example of a market niche: Brazilian students interested in pursuing professionally-oriented English-language courses (e.g., English for Engineering, English for Business) rather than general English studies. Stressed by the troubles of their economy and less certain job prospects, a growing segment of Brazilian students want to ensure the English they acquire serves a purpose: getting or keeping a job. Language schools responding to this market demand might develop and promote new, specialised English courses. They might offer early-bird discounts to respond to Brazilian students’ cost-consciousness. They might even create a series of free introductory webinars for prospective students in Brazil to demonstrate what the school brand stands for and what students can look forward to if they continue their studies abroad. This example reflects some of the basic aspects of any niche strategy:

  • Focus on a customer group and be as specific as possible;
  • Refine your offering for that group: take away the things that they don’t want or need and add new features or services that they will value.

By identifying a niche – then adjusting programming, operations, and promotions accordingly – a school can differentiate itself from competitors and claim new market share and/or improved margins in the process.

Tips for creating a sustainable niche

As we noted earlier, a good niche strategy is grounded in a specific customer group, and there are a number of ways through which you can identify promising target segments. For example:

  • Think about the characteristics of current students and recent alumni. What were they looking for when they were researching schools and programmes – and how did they come to discover your school? What do students and alumni think your school does best? Take careful note of observations that recur, and make a note of what isn’t being mentioned. If it isn’t being mentioned, is likely not a competitive differentiator for your school.
  • Pay attention to the trends being covered in market intelligence publications. Are there any that are relevant to your markets and programmes? The following examples illustrate how such research could inform a niche market strategy:

Japanese and Korean students are becoming increasingly interested in the Philippines for more affordable English-language training;

In the past decade, the percentage of American students studying abroad for eight weeks or less during the academic year has nearly doubled;

There is growing interest in Vietnam for vocational programmes and a fall-off in demand for higher education degrees.

  • Talk to your partners overseas: agents, schools, other stakeholders. Get their insights on where market demand is going and look for opportunities to match that shifting demand to your strengths.

There is a trend in niche marketing to be more and more specific in your segment focus, but keep in mind too that you can define a niche in ways that cut across conventional parameters of age or geography. A recent item from Harvard Business Review points out: "When you are in an industry where the firms are more homogeneous than the customers, it should be possible to define a subgroup whose needs are alike, which may well cut across traditional demographics. Focusing on that particular group often enables a new way to compete because the firms that try to be everything to everyone will inevitably be imperfect in their offering." Remember as well that niche marketing works when it identifies needs that are not being met by the competition. And when you identify the segment you aim to serve, make sure you do it better – or using a different angle – than anyone else in the space. As hotel executive Michael Levie said to Harvard Business Review, "I think that when you decide on a niche market, what you decide on what you want to be doing, do that extremely well and don’t do other things. [Other hotels in] the industry create hotels that mid-week should be good for a business traveler. On the weekends it should [also] be good for a group or a wedding party, or for family travel. Good luck! It ain’t happening. [You can’t] create a boat that has an engine, is a row boat, and a sailboat all in one. Decide who you want to be and be very good at it!" Once you have identified the niche you will pursue, the next step is to refine your offering. For each niche you are interested in, put yourself in the shoes of the student and answer the questions: “What do I want? What can I afford? What must a school do for me if I am to value my experience of studying there? What’s the best way of reaching me and engaging me?” The answers to these questions will help inform pricing, programming, and marketing strategies for the market segment you have in mind. And as always, the key to the success of a niche strategy – or any competitive strategy for that matter – is that the student experience matches your marketing promises. So take care to ensure programmes, facilities, and other factors affecting student experience are ready and well-aligned with your target niche before you start recruiting. Once these are in place, craft targeted promotional materials. Avoid jargon and go right to the heart of why your school is the best choice for your ideal students.

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