With the pandemic led disruption in the higher education sector, universities are having to recalibrate their marketing strategy and positioning. With the rebound set to take longer than a couple of years, there is a growing sense that things will need to change for new and somewhat different market conditions.
“Our data highlights that 30% of Australian universities have not changed their international tuition fees since 2020 and there are big questions on how to effectively create a pricing strategy to support the recruitment of international students in 2023,” Keri Ramirez, managing director of Studymove, a leading Australia-based education consultancy specialising in key data insights, highlighted.
“The market conditions have changed radically over the last two to three years in the higher education space,” Ramirez noted while speaking at a recent webinar.
One of the market indicators that has picked up after the lull of the last couple of years, is the number of visas applications lodged by prospective international students, which is 12% more than in 2018 and around a 4% drop on 2019.
In terms of the number of visas granted, the numbers from 2022 fall behind. As of now in 2022, the number of visas granted is lower by 12% compared to 2018 and 18% compared to 2019. That said, the 2022 numbers are much better than those reached during the pandemic in 2020 and 2021.
“Both in terms of visas lodged and visas granted, we are seeing that things are remarkably improving from the pandemic years and we are getting close to pre-pandemic levels. That’s a really good indicator for where we are heading,” Ramirez highlighted.
Another market indicator is the student commencement numbers — there is ground being made up in this regard as well from pre-pandemic levels.
“There is a recovery on the way and commencement numbers are showing just that.
“We are projecting that this year, in Australian universities, we might end up with 141,000 student commencements”
“We are projecting that this year, in Australian universities, we might end up with 141,000 student commencements, which is much better than those in 2020 and 2021, but much less than the 2019 figure of 177,000. But, the recovery is on,” Ramirez noted.
Studymove has changed its market outlook assessment from ‘cautiously optimistic’ from the start of 2022 to ‘optimistic’ now, due to the recovery that the market has witnessed.
As institutions have been quite conservative in increasing their fees during the two years of the pandemic, Ramirez reckons that a more ‘optimistic’ outlook can help bring positivity in the overall market sentiment, with universities feeling more assured in increasing their fees in 2023.
Different markets across the world have had their own distinct scenarios unfold during the pandemic and Ramirez’s advice to institutions is that they should make a strategy that is fit for purpose for them.
The should be driven by “consideration of their own key markets and their own unique situations”, rather than just following what other universities are doing.
“You have to customise your marketing mix and the pricing to target the audience that is right for you,” Ramirez noted.
It has become that much more important to keep “an eye on what strategy your competitors are adopting”, Ramirez cautioned. Lastly, university rankings have a large bearing on how fees are set up.
“As such there is a very high correlation between the fees and the rankings of universities,” Ramirez highlighted.
“We are having a very high correlation [between the two], in 2022 in particular.
“So, for example ANU is ranked much higher, than say, the Charles Sturt University and has a higher fee than the latter. This correlation speaks for itself across institutions,” he mentioned.
“We know from student surveys that reputations and perception of quality matter and the correlation with the fee is quite evident as well.”
“Reputations and perception of quality matter and the correlation with the fee is quite evident as well”
Ramirez highlighted that the key takeaway for institutions from Studymove’s analysis is that, despite the disruption of the pandemic, the correlation between university rankings and international student fees, remained strong throughout the last few years.
Studymove’s research has revealed that the correlation also varies significantly between disciplines.
“Most of the management and science related programs have a high correlation, while those programs in which students are looking for a professional certification, for example nursing and education [teaching], have a lower correlation between the institution’s ranking and the fee it is charging its international students.
“We have found additionally, that employability rankings also have a strong correlation with the international student fee,” Ramirez highlighted.
Ramirez says that with market conditions becoming stronger and the recovery well and truly on its way, he expects that “almost each and every university will increase their fee in 2023/24”.
“Pricing in 2023 will be particularly important, as institutions would like to make up the losses incurred during the pandemic.”
