Growth Markets for Independent Schools

Your school’s critical growth-marketing shouldn’t merely be based on what has worked before, or what looks or feels right. It’s important to take a strategic approach that considers independent data to identify feasible target markets. In this edited summary of her presentation at the recent ISMA conference, Keryn House offers a targeted approach to attracting new markets for independent schools.

Two seas. One dead. One alive.

During a trip to Israel earlier this year, I was struck by the contrast between two seas just a few hours’ drive apart – the Dead Sea and Sea of Galilee. It made me think of how we in strategic marketing often talk about ‘growing the pie’ rather than ‘splitting the pie’. But in this case, the two seas gave me a new analogy for growth markets.

Think about it, is your school in the sea that’s shrinking, with no life and your survival under threat (Dead Sea)? Or are you in a sea where there’s life, community, and meaning (Sea of Galilee)?

As school marketers, we can often feel like we’re swimming in the Dead Sea:

  • The constant worry about trying to keep up the numbers,
  • The dried-up waiting lists for admissions,
  • Open Days that were previously held annually being replaced by multiple experiential events that don’t achieve the expected results,
  • Digital demands with new role expectations without capacity or training,
  • Increasing pressures on families to change schools owing to macro issues.

In many cases it feels as if the entire sea is drying up, making us feel frustrated and desperate. I see this response in my work as a consultant and trainer to independent schools, and it’s why research-based marketing strategy is important, as it allows you to think about where and how to find the type of sea that sustains life and offers growth.

Define existing and new target markets

Take a few minutes to write down four or five potential target markets for expanding your school. Describe them in terms of a generalised profile of your school’s ideal customers/scholars – in marketing we call these personas or avatars. The best personas are developed using market research and real data gathered from internal and external sources.

Remember not all personas fall into growth markets. For example, families that are loyal to the school need to be retained, while some traditional segments may be in decline. This is why we need a portfolio of personas, each requiring a different strategic approach.

Context is key in marketing strategy

One of the dangers of navigating to the desired sea is a tendency to grab hold of what we think we know and base the school’s future on misguided information. This type of groupthink occurs when a group of individuals reach consensus without critical reasoning or evaluation of the consequences or alternatives.

Groupthink often occurs in management teams when there is a common desire not to rock the boat. This is why independent research and debate based on real data is important. Part of this research needs to consider consumer and educational trends.

Be a trend spotter

School-going families are essentially consumers, which is why we need to consider consumer trends. Marketing has become much more important in schools because we live in a buyers’ market where the consumer holds the power, even more so in a recessionary market. Today’s consumer is largely informed, empowered, and has high expectations.

Monitoring education trends helps us to understand the context of growth markets for independent schools. Four points arising from a survey and discussions with school marketers are:

  1. Where are the babies? There are currently large gaps in the pre-primary phase of independent schools.
  2. The impact of semigration and emigration on independent schools.
  3. Relationships between schools and other organisations have become important for sustainability. They can bring efficiencies, economies of scale, brand awareness, innovation, collaboration, and shared resources.
  4. ‘Marketer overwhelm’ is real. School marketing teams are struggling with role overload and there is no time for strategic work.

Blue ocean strategy to develop new growth markets for independent schools

The Blue Ocean Strategy Concept

Blue Ocean Strategy is a marketing model introduced in 2007, that forces us to think differently about competition and innovation. It is based on the simultaneous pursuit of differentiation and low cost to open up new market spaces and create new demand.

Three growth-market ideas

Growth involves more risk than retention. Although high risk is known to offer potentially high return, risk needs to be managed. A healthy risk balance is good for sustainability. These three growth market ideas range in their degree of risk, from niche markets at low risk, to shifting markets at medium risk and offshore markets at high risk.

Niche markets

You are probably already targeting niche markets at your school. These tend to be less risky but are limited in size and growth potential. They require a focused approach, based on a deep understanding of a specific market segment and unique differentiators of your school that resonate with that persona. Niche markets succeed when your persona sees the benefits of how your school can solve their unique problems. By having a portfolio of personas, you can manage your approach to these niches (promote, retain, build) and optimise your marketing efforts.

Shifting markets

Markets are shifting globally and locally. These shifts may be demographic, behavioural, psychographic, geographic, economic, environmental, health, etc. Examples include semigration due to remote work trends, or KwaZulu-Natal’s devastating social unrest and floods, driving behaviour changes. Opportunities usually emerge from the data around these kinds of shifts.

This is a medium-risk growth market because your school has already established its traditional market, and now seeks new segments. This usually requires some change in marketing, such as product enhancements, new promotional ideas, new pricing or payment systems, and different people and processes to secure and retain the new market.

Offshore markets

As the riskiest of the three growth markets, offshore market growth has exponential potential. These markets require good planning to avoid wasteful expenditure and frustration, often damaging the school brand and causing repercussions that may be difficult to repair.

The different segments here include Southern Africa, Africa, other continents, and digital markets. Each requires a different strategic approach. Because of the cost and extent of the resources involved, it’s best done in collaboration with alumni, parents, donors, NGOs, and others. Many of our independent schools are already established in offshore markets, but there is room for growth.

Other countries are actively marketing to South African and African families to attend their independent schools on other continents. The cost comparison is significant. South Africa has its challenges, but we also have many excellent schools. Shouldn’t Africa be educating Africa?

How to choose your school’s growth markets

Step 1: First ask who you serve

Every growth market is built from existing market presence. It’s harder to break into a new market than it is to service and grow your current market. Your school’s reputation, community, and tried-and-tested offering will help launch you into a new market.

We need to make sure we are looking after our existing internal and external communities first. But we also need to seek growth markets.

Step 2: Always build on your strengths

The strongest growth strategy is an offensive one, using your strengths to take hold of opportunities. Strengths are internal to your school. They can be controlled, and they are the current reality. Opportunities are external to your school. They cannot be completely controlled, but they are positive, can lead to growth, and exist in the future.

Independent research is best for identifying the strengths and opportunities, weaknesses and threats. This is because it’s difficult to identify them from an inside perspective. Parents are also unlikely to share their thoughts unless it is anonymously, because they worry that it may affect their how their children are treated.

Step 3: Build a multi-layer USP

Unique selling propositions (USP) reflect the competitive market positioning of the school. A USP should be based on an analysis of the target markets and those items that distinguish the school in the eyes of the target market. This is what makes you stand out. You cannot be everything to everyone. “Strategy is choosing what not to do,” says Professor Michael Porter.

In crafting your USP, bring soft and hard aspects into the mix. For example, facilities such as an aquatics centre or hockey AstroTurf is not enough to form a compelling USP. Dig deeper into aspects of ethos, culture, behaviours, values, heritage and so on. Test and retest using market research.

Step 4: Use Ansoff’s growth matrix

One of the most effective tools for choosing growth markets is Ansoff ’s Growth Matrix. The four quadrants reflect market and product changes, along with the associated risk and reward.

Existing market/existing product is called market penetration, and is the lowest risk. In this case, you get more customers to buy a product you already offer, or existing customers to buy more of your products. To do this, a school may need to promote more, improve products or services, adjust payment terms, or add more value.

Existing market/new product is called product development, and is a medium risk growth strategy. This may be the case of shifting markets, where you change the product to become more relevant and attractive to existing families. For example, adding products related to neurodiversity or learning gaps.

Existing product/new market is called market development, and tends to be a medium-high risk strategy. This could be where offshore markets are pursued. A school may find that there are alumni of the school abroad and decide to build on those relationships to actively grow this market through promotional events and incountry visits.

New market/new product is called diversification, and this is a high-risk growth strategy. The product may not be a completely new product, but it has not been sold in this new market before and would require some adjustments.

What needs to be in place?

When working on growth markets, the school’s executive leadership will need to be involved in the effort. Remember marketing strategy is a part of the overall school strategy. And research-based marketing strategy will inform and add value to the strategic direction of the school.

Markets have changed and buyers are far more powerful than ever before. This is why it is essential for marketers to have a voice in the strategic decisions of independent schools, including pricing and product. Structures need to formally include marketing on an executive level.

Raising the profile of the school marketer has already started on a sector-wide level:

  • ISASA has established a relationship with MASA (Marketing Association of South Africa) to accredit the training courses offered on school marketing, enabling school marketers to gain points once they have a designated professional status,
  • ISASA has published a book, A Guide to Effective School Marketing, and regularly includes marketing articles in its magazine,
  • At the Strategic Marketing breakaway on Day 2 of the ISMA Conference 2023, school marketers expressed a range of views and ideas of what is stopping them from being effective in their roles. These issues were documented for further engagement, training, interventions and discussion through ISMA and ISASA.