2014 November GrayReports - Student Demand Trends

GRAYREPORTS Demand for Educational Programs

www.GrayAssociates.com

Results through November 2014

617.401.7662 www.GrayAssociates.com 2

GRAY For more information please contact Bob Atkins. Email: [email protected]

Who Is Gray?

GrayData

Completions IPEDS

Employment BLS/O*NET

Placement Rates Gray Research

Industry Inquiries GrayReports

Demographics US Census

Job Postings WANTED Analytics

Students Programs Strategy Locations §  Demographic

priorities §  Geo-priorities §  Market share

§  City selection §  Location selection §  Relocation analysis §  Consolidation

§  Program selection §  Program development §  Curriculum enhancement §  Market reports

§  Business strategy §  Strategy implementation §  Pricing §  Outcome improvement

Advanced Analytics Predictive Models

Geo-Analytics

Clients: Education Institutions and Investors Mission

Help clients do well by doing good



What is GrayReports?

Your access to information on demand and marketing trends in higher education §  Overall industry trends, which we will review today §  For subscribers we offer

─  Customized monthly reports for your specific programs and markets ─  On-Line access to detailed data for specific programs and markets

Over 34 million qualified inquiries January 2012 to the present

Over 650,000 new inquiries in November 2014 Over 185 programs with over 10,000 inquiries

Over 300 cities with over 10,000 inquiries



Key Demand Trends and Observations

1.  Inquiries fell sharply, especially for online programs

2.  Conversions declined for on-line, but on-ground programs are flat or up

3.  There appears to be a “flight to quality:” conversion rates are up. -  Higher-priced inquiries -  More internally-generated inquiries -  More complete inquiries

4.  The market is bifurcating

-  Struggling institutions are dropping fast -  Sustainers are holding their own—or better



Agenda

1.  National Inquiry Trends

2.  Inquiries for On-Line Programs

3.  Inquiries for On-Ground Programs

4.  Internal and External Inquiries

5.  Biggest and Fastest-Growing Programs and Markets

6.  Variations by Segment

7.  Summary



Overall Student Inquiries

For the last five months, inquiries have declining—and the decline is accelerating. §  Year-to-date (through November) inquiry levels are 11% behind 2013. §  However, November inquiries are down 34% year-over-year.

─  September fell 22% ─  October dropped 32%

-34% YOY

-

200,000

400,000

600,000

800,000

1,000,000

1,200,000

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

National Inquiries All Programs and Award Levels 2012 2013 2014



1.  Applications are counted in the month in which the inquiry was received (i.e., an inquiry that is received in January and converts in March will be counted as a January inquiry). Typically, the application rate will rise for at least three months after the month in which the inquiries were received.

3.0%

2.7%

3.1%

2.9%

3.0%

3.4%

3.2%

3.0%

2.7%

2.8%

2.8%

2.9%

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

4.0%


Education Industry Inquiry Conversion Rates 2013 2014

Inquiry to Application: Conversion Rates

The decline in volume may reflect a “flight to quality:” conversion rates are up. §  September and October are ahead of last year—and will further improve as they mature. §  November is off to a strong start.

Immature Months1

2.9%

3.1%

1.5%



Immature Months1

0 5,000

10,000 15,000 20,000 25,000 30,000 35,000 40,000


Education Industry Inquiry Conversions All Programs and Award Levels

2013 2014

Inquiry Conversions

After a 16% drop in August, the number of conversions in the November quarter will fall less than 10%. §  September and October are down 12%, but they will improve a little more as they mature. §  November is already at 50% of last year’s level—it may reach 2013 levels as it matures..




Average Price for Pay-per-Lead Inquiries

Average price for a pay-per-lead (external) inquiry dropped 1% (53¢) in November 2014 §  For the last 3 months, the average price paid for inquires remains 15% higher than 2013 levels. §  Prices seem to have stabilized between $44 and $47, well above 2013’s prices (roughly $40).

$42.13 $42.24 $42.13 $42.87 $41.59

$44.97 $44.67 $44.86 $46.15 $46.44 $45.91

$30

$32

$34

$36

$38

$40

$42

$44

$46

$48

Jan. Feb. Mar. April May June July Aug. Sept. Oct. Nov. Dec.

Average Price per Pay-per-Lead Inquiry All Programs and Award Levels

2014 2013

Note: Inquiry price is the average price for pay-per-lead inquiries.



Average Cost Per Converted Inquiry

Costs per conversion seems to be falling in line with 2013 levels of approximately $1,500 §  September and October will be at or below 2013 levels when they mature. §  November appears high now, but is likely to fall in line as it matures.

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC 2013 1,373.56 1,528.45 1,331.70 1,394.16 1,383.94 1,147.34 1,281.60 1,338.82 1,473.66 1,422.98 1,398.36 1,397.91 2014 1,278.89 1,387.73 1,206.07 1,293.11 1,240.11 1,364.14 1,278.17 1,505.71 1,569.80 1,474.78 3,148.43

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500 Cost Per Converted Inquiry All Programs and Award Levels



Agenda







7.  Summary



0 50,000

100,000 150,000 200,000 250,000 300,000 350,000 400,000 450,000


Inquiries

Inquiries for On-Line Programs All Programs and Award Levels

2013

2014

Inquiries for On-Line Programs Education Industry Inquiries: YOY Percent Change November inquiries for on-line programs are 50% below year-ago levels. §  Year to date, 2014 on-line inquiries are 26% behind 2013. §  September, October, and November of 2014 fell to record lows—down 35% since July.

-50% YOY



Student Inquiry Conversions for On-Line Programs

On-line conversions appear to be dropping year-over-year. §  September, October, and November are immature—but are unlikely to reach 2013 conversion volumes.

2012

-

2,000

4,000

6,000

8,000

10,000

12,000


Inquiry Conversions for On-Line Programs All Programs and Award Levels

2013 2014


Immature Months1



Agenda







7.  Summary



Inquiries for On-Ground Programs

November inquiry volumes for on-ground programs only fell 22% year-over-year. §  After a strong start in 2014, inquiry volume for on-ground programs has declined 27% since August. §  November’s decline was slightly better than the 24% year-over-year drop in October.

2012

0 50,000

100,000 150,000 200,000 250,000 300,000 350,000 400,000 450,000 500,000


Inquiries

Inquiries for On-Ground Programs All Programs and Award Levels

2013 2014

-22% YoY



Student Inquiry Conversions for On-Ground Programs

October conversion are already ahead of last year and November is on-track. §  Year-to-date 2014 conversions are slightly ahead of 2013. §  October is well ahead of last year—and will get better as it matures. §  November got off to a healthy start.

2012

0 2,000 4,000 6,000 8,000

10,000 12,000 14,000 16,000 18,000 20,000


Inquiry Conversions for On-Ground Programs All Programs and Award Levels 2013 2014


Immature Months1



Agenda







7.  Summary



-

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

20,000


Conversions of External Inquiries All Programs and Award Levels 2013 2014

Conversions of External Inquiries

Conversions for pay-per-lead (external) inquiries have been weak since August. §  August is now mature—and 22% below 2013. §  September and October are down over 15%, but may still close the gap. §  November is off to a reasonable start.

Immature Months



Conversions of Internal Inquiries

Conversions of internal inquiry are down—but less than10% §  September and October still have a chance of reaching last year’s levels. §  November is off to slow start.

-

5,000

10,000

15,000

20,000

25,000


Conversions of Internal Inquiries All Programs and Award Levels

2013 2014



Agenda







7.  Summary



Largest Programs: November Growth

Four of the five largest programs had over 35% declines in inquiry volume.

§  Health Care Administration was a comparative bright spot—with 0% growth. §  Criminal Justice/Police Science has declined over 70% year-over-year for two months in a row. §  Medical Assisting, Business Administration, and Accounting all dropped over 35%.

-12%

9% 7% 4%

-12% 0%

-38%

-51%

-63%

-79% -90% -80% -70% -60% -50% -40% -30% -20% -10%

0% 10% 20%

Health Care Admin/Management

Medical Assisting Business Admin and Management

Accounting Criminal Justice/Police Science

Year-over-year Change in November Inquiries Five Largest Programs

2013 YoY % Change 2014 YoY % Change



Top 5 Fastest-Growing Programs in November

Game and Interactive Media Design joins the five fastest growing programs in November. §  Welding Tech continues to be the fastest growing program with 429% year-over-year growth.

-9%

29%

576%

69%

153%

429%

206%

89% 36%

2%

-100%

0%

100%

200%

300%

400%

500%

600%

700%

Welding Tech Electrical, Electronic, and Comm. Tech

Health Information/Medical Records Admin

Web Page, Digital/ Multimedia Design

Game and Interactive Media Design

Year-over-Year Change in November Inquiries Five Fastest-Growing Programs


1.  Includes only the top 75 programs (based on inquiry volume since January 2012)



Largest Cities for Inquiries

Inquiries in the largest cities all fell about 30%

-17%

13%

-18%

1%

-4%

-27% -29% -33% -34%

-39% -40%

-30%

-20%

-10%

0%

10%

20%

Los Angeles New York Chicago Philadelphia Atlanta

Year-over-Year Change in November Inquiries Top Five Cities for Inquiries


Note: The market for each city is defined as a 15-mile radius around the population center of its CBSA.



Fastest-Growing Cities for All Inquiries

Four of the five “fastest growing cities” declined in November.

§  San Diego, CA is the only city where inquiry volumes were positive. §  Phoenix, AZ moved ahead of San Antonio and Fresno to become the second-fastest growing city. §  The California market continues to be relatively healthy

35%

-7%

4% 5%

-11%

1%

-13% -18%

-22% -23% -30%

-20%

-10%

0%

10%

20%

30%

40%

San Diego, CA Phoenix, AZ San Antonio, TX Fresno, CA Riverside, CA

Year-over-Year Change in November Inquiries Top Five Fastest-Growing Cities for All Inquiries


1. Includes only the top 75 cities by inquiry volume since January 2012. Data includes a 15-mile radius from the center of the CBSA.



Agenda







7.  Summary



Sustainers vs. Strugglers: Inquiry Volume

Strugglers declined 46% year-over year in November, Sustainers only fell 10%.

-12% -15% -15% -12%

0%

-3% -13% -16%

-31%

-44% -46%

47% 44%

28%

10% 9% 7%

-6% -13%

-7% -7% -10%

-60%

-40%

-20%

0%

20%

40%

60%

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov

Sustainers vs. Strugglers Year-over-Year Change in Inquiry Volumes

Sustainers

Strugglers



Decline in Inquiry Volumes by Category

Inquiry declines are especially high for incomplete inquiries, Online, Associates, and External (PPI). §  Incomplete inquiries fell sharply, potentially indicating a “flight to quality”

-  Inquiries that did not specify a degree level fell 45% -  Inquires that did not have a preferred modality (on-ground vs. on-line) fell 28%

§  Graduate degrees are outperforming other categories

-11% -13%

-15% -16%

-19% -23%

-28% -33%

-39% -42%

-45%

-50% -40% -30% -20% -10% 0%

Master's Doctorate

Internal Certificate

Ground Bachelor's

Unknown Modality External

Associate's Online

Unknown Degree

Year-over-Year Percentage Change in Inquiries 2013 vs. 2014 (September – November)

% Change



Agenda

1.  Introduction







8.  Summary



Key Findings

§  The mix of inquiries is shifting to higher quality sources, on-ground, and healthy schools.

§  As a result, conversion rates are up

-  On-ground conversions remain healthy

-  On-line conversion rate improvement could not offset the decline in inquiry volume

§  There are tremendous variations by city, program, and modality—you need a custom view that reflects the markets in which you compete.



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Questions and Contacts

Please feel free to contact: Bob Atkins

CEO Gray Associates, Inc.

[email protected]

617-401-7662

Today’s Presenter: Bob Atkins, Partner at Gray Associates

2014 November GrayReports - Student Demand Trends

Education

Transcript of 2014 November GrayReports - Student Demand Trends