Market Focus: Education -- Learning the Recruitment Ropes

Higher education institutions are finding that there's more to recruitment than perfect SAT scores or glowing recommendations. Rapidly developing trends are forcing schools to make recruitment strategies more efficient, more effective, and more service-oriented. In other words, schools are starting to look a lot more like businesses. Schools are abandoning wide-net recruitment because it's both costly and ineffective. "Sending a postcard in the mail isn't going to cut it anymore and it's expensive," says Nicole Engelbert, a senior analyst at Datamonitor. Rather than trying to attract just any student, schools are narrowing the prospect pool and devoting their limited resources to targeting the right students. That's where CRM comes in--except in this case the "C" stands for constituent . "They're adding not only contact management and email management, but also the capability to handle this info as a business process," says Catherine Burdt, a senior analyst at Eduventures. To survive, schools are taking the core values of CRM--sales, service, and marketing--and replacing "sales" with "recruiting." CRM allows institutions to "segment data, understand patterns of giving, and help allocate [their] resources, manpower, and measure effectiveness," Burdt says. The U.S. education market is facing "competition from all different angles that simply didn't exist 10 to 15 years ago," says Anirban Chakrabarti, vice president of marketing at Intelliworks, a six-year-old provider of marketing software for higher education. The shrinking pool of potential college freshmen is a primary concern: Not only is the number of U.S. high school graduates anticipated to decline by 2010, but the international student pool in the U.S. is diminishing as well. Schools abroad are improving curricula and building their reputations. Chakrabarti says this is especially apparent in the BRICK nations--Brazil, Russia, India, China, and South Korea. "These countries have burgeoning emerging economies that need a lot of training and retooling so [they are] investing a lot on their education at all levels." Another challenge is limited monetary resources. "We've maxed out on what is possible to charge for higher education," Engelbert says. Luckily, technology allows for less costly modes of recruitment. The Facebook generation relies on the Web for information and instant gratification. Engelbert reported in a case study on one school that students "prefer to obtain information about a potential institution through the Internet," and that nearly 24 percent of the freshman class came through the Web site. In contrast, "meetings with admissions representatives, during the expensive travel season, brought only 7.4 percent of the students." The market is also experiencing a shift toward data-driven decision-making. "Schools have to demonstrate results and show accountability," says Sarah Tomashek, marketing manager of the public sector at Chicago-based SPSS, a provider of predictive analytics software and solutions for nearly 40 years. Tomashek adds that schools need to show "that decisions were based on hard data and not just intuition." CRM's predictive analytics, she says, can give actionable insight. In a 2006 study by Eduventures, 61 percent of institutions rated strategic decision support as critical to achieving strategic objectives. But getting students to enroll is only half the battle. The goal is keeping them all the way to graduation and then maintaining strong alumni relationships. Happy alumni are more likely to raise money for the institution, whether via donations or recruitment. But less than 50 percent of students graduate from the first school they attend, Tomashek says. As a result, schools are rapidly recognizing the wide-ranging benefits of CRM applications to help them build a 360-degree view of each student across that individual's lifecycle--from applicant to enrollee to alumnus. Tomashek estimates that a four-year university accrues more than $2,000 annually per enrollee in marketing and recruiting costs. Because of this high investment, schools have to know as much as they can about their students. Once students have matriculated, CRM helps to monitor patterns to pinpoint which individuals are at risk of leaving, even before the student has made the decision. The school can quickly deploy intervention strategies, such as a meeting with an advisor or sponsoring a program of particular interest. After students have graduated, CRM makes reaching out to alumni much more efficient. CRM helps institutions evaluate what kind of alumni they are working with (e.g., a big monetary donor or someone who would just rather help recruit) and thus customize their marketing strategies accordingly. As much as colleges are looking more like companies, the people they're dealing with are lifelong customers, something most businesses can only dream about. "You're building a relationship rather than simply marketing a product," Burdt says of the institutions. "You go with the student from prospect to long after they've graduated." Top 4 Vendors in Education: (Source: Datamonitor)

• Oracle Corp.'s PeopleSoft
• RightNow Technologies
• SunGard
• Talisma