Difficult market trading conditions for the English language teaching sector – exacerbated by significant discounting this summer – was the talk of StudyWorld, the annual workshop organised by English UK for educators to meet with education agencies.
Agencies typically deliver the majority of bookings to UK English language schools and at this regular business event, many agencies also acknowledged a shake-up to normal business patterns because of exchange rate changes making the UK pound significantly more expensive than the euro.
Meanwhile, with language schools increasingly discounting to attract business this summer, an underlying concern about the long-term sustainability of the sector was another hot topic.
A 10-20% decline in enrolments was commonly touted as expected by year-end.
Andras Zarecky at school group, LSI, told The PIE News that he felt his company had not been too badly impacted, but he acknowledged that discounting on an unprecedented level had been occuring. “30-40% off is just normal this summer,” he said. “Buy one [week], get one free offers; and accommodation discounts – that never used to happen.”
“30-40% off is just normal this summer”
At The London School of English, which is well known for its business-targeted offer, Hauke Tallon, managing director, agreed, “The last few months have not been great, especially on the general [courses] side. Anything that has become more commoditised has become a problem for us, it’s actually our premium courses that have done okay.”
Tallon underlined that focusing on premium provision and “adding value is really the way forward for us. There’s no way we could or indeed wish to compete on cost-cutting”.
English UK chief executive Eddie Byers said that demand from Russia and Ukraine, historically key markets for UK ELT, “continues to be badly affected by the security and economic situation there”.
Russian agent Elena Palina of Inter-Air Group also signalled that eurozone markets were winning out at the expense of the UK. “Normally we send five to seven groups to the UK; this year we just sent two,” she told The PIE News. “Malta and Ireland remained strong because of the currency.”
But Palina said there was still a lot of interest in the “academic market” such as those students keen to enrol on a pre-master’s.
Brazil, Japan,and Libya were four main markets singled out by stakeholders as challenging to work with because of exchange rate or other factors.
In Brazil, Tereza Fulfaro, director of CI agency, observed a change in demand had been noted. “Students prefer destinations where the Real values a little bit more,” she explained. “So Canada is very popular and when it’s the case to choose Europe to learn English, Ireland and Malta are growing markets as well.”
Byers also mentioned the “continued tightening of UK visa policy” is also making the UK a less attractive study destination.
“It’s more important now than ever that we at English UK focus our efforts in promoting UK ELT to the world, building on what already works,” he told The PIE News.
“We’re preparing for significant pushes over the next few months in two of our biggest target markets, Brazil and China. We’re working hard to promote the fantastic product that is UK ELT in some exciting new ways and we’ll be closely monitoring the results.”
Schools with good reserves, a diversified geographic intake and good agent relations are bracing themselves to ride out the storm but London in particular is suffering, noted one stakeholder who wished to remain anonymous.
This is because there are so many operators all competing for dwindling business, against a backdrop of unhelpful regulatory change (IELTS test-takers have dropped by 30-50% at centres no longer designated as SELT).
“London will always be popular but it’s such a saturated market,” they said. “And schools that are offering massive commissions and market discounts, we can’t compete with. We just have to keep pushing quality and hopefully that will win out.”
