Vertical Market: Education

What a difference a year makes. The education market, which in 2001 was CRM's fastest-growing sector, took a sharp turn for the worse last year, becoming CRM's leading decliner. According to a recent AMR Research report, CRM spending in the education market abruptly fell 47 percent, from $195 million in 2001 to $104 million in 2002. "From a qualitative standpoint it's a hard hit," says David O'Brien, a research director at AMR Research. The education market fell even harder than the aerospace and defense market, which, plagued by terrorism fears, dropped from $137 million in 2001 to $82 million in 2002, representing a 40 percent fall off. The education sector encompasses elementary and secondary schools, colleges and universities, and vocational schools. According to O'Brien, state-funded schools weighed heavily on the sector as they fell victim to slashed budgets. "You have to make the distinction between public and private schools. State funding to schools is down significantly, so do you delay an IT project or lay off staff?" O'Brien asks. Yet private schools, not dependent on state contributions, are still moving forward with CRM projects as competition mounts. Students are applying to more universities now than they did 10 years ago, which is largely due to the information available to them on the Web. "Students are shopping around the Internet to find out more information on prospective schools and the best financial aid packages," says Dr. Tom Bohannon, assistant vice president for information management and testing services at Texas' Baylor University. And schools are getting more aggressive at recruiting good students with digital and paper marketing campaigns, he adds. Last year Baylor launched an initiative called Baylor 2012, a 10-year program designed to bring the state's oldest school, founded in 1845, to Ivy League status. The initiative aims to attract the best and brightest incoming freshmen, with at least a 1,200 SAT score, by the year 2012. The school doesn't have far to go, as its latest incoming freshmen already average 1,180. To achieve its goal Baylor selected SAS's Enterprise Miner solution to reveal trends, explain known outcomes, and predict future outcomes. Prior to SAS Enterprise Minor, Baylor had been mailing expensive color brochures to 80,000 prospective students. To attract the top-performing students, using SAS Enterprise Miner Baylor segmented the list by academic performance and sent the expensive color brochures to only those students that scored in the top 70 percent of the 80,000 students. Those who scored in the bottom 30 percent are sent a simple card to be filled out for more information. If the students sent the card back, they were given a higher rating as a prospective student. By using SAS Enterprise Miner, Baylor can identify students that are likely to drop out by looking at various attrition indicators, such as the school's distance from a student's home, or the academic index the student entered with. Additionally, Baylor aims to use the predictive modeling capabilities in SAS Enterprise Miner to determine the best potential donors for fund-raising efforts. Connecting to the Contact Center What is your most important issue today? 32% Increasing customer satisfaction 30% Reducing costs 16% Streamlining contact center operations 12% Gathering market intelligence 8% Integrating your contact center systems What types of contact do you currently handle in your contact center? 33% Phone only 33% Phone, email 33% Phone, email, Web chat Source: Aspect Communications/SAP/CRM magazine Web seminar "Maximizing Customer Value"