2014 february grayreports - student semand trends

GRAYREPORTS Demand for Educational Programs

www.GrayAssociates.com

Results through February 2014

617.401.7662 www.GrayAssociates.com 2

GRAYFor more information please contact Bob Atkins.

Email: [email protected]

Contents

1. About Gray and GrayReports

2. National Overview of Inquiry Volumes

3. Trends by City and Program

4. Example of Local Analysis: Greater Miami

5. Question and Answer




Background: Who Is Gray?

Gray offers cutting-edge data and analysis on post-secondary education markets.

GrayReports

Completions

Employment

GrayData

Placement Rates

Industry Inqs & Apps

Demographics

BLS/ONET

Business Strategy

Location Selection

Program Portfolio Strategy

Marketing Strategy and Pricing

Gray Research

Job Postings

IPEDS

US Census WANTED Analytics

Public Sources Public Sources Gray Resources




Background: What is GrayReports?

Over 30 million qualified inquiries

January 2012 to the present

~1.0 million new inquiries per month

149 programs with over 10,000 inquiries

257 cities with over 10,000 inquiries




Education Industry Inquiry Growth

In 2013, year-over-year inquiries fell sharply from 2012. Fortunately, 2014 is off to a better start.

In 2013, year-over-year education industry inquiries fell 10%, from 15.1 million to 13.5 million.

In February and year-to-date, inquiries are only 2.9% lower than 2013.

2012

0.00

0.20

0.40

0.60

0.80

1.00

1.20

1.40

1.60

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

Inquiries (Millions)

Education Industry Inquiries All Programs and All Award Levels

2012

2013

2014




Background: Validity

GrayReports is highly consistent with Google trends and other sources on demand for education.

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50

100

150

200

250

300

-

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

90,000

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

Google1 GrayReports

Inquiries

GrayData

Google

Google Search Trends vs. GrayReports Inquiries Medical Assisting

(January 2012 to October 2013)

1. Google Trends: “Interest over Time”

Correlation: 92.7%




GrayReports: Validity

GrayReports is consistent with quarterly new enrollments for publicly-held education institutions.

50

60

70

80

90

100

Spring2012

Summer2012

Fall2012

Winter2013

Spring2013

Summer2013

Fall2013

Public Company “A”

50

60

70

80

90

100

Spring2012

Summer2012

Fall2012

Winter2013

Spring2013

Summer2013

Fall2013

Public Company “B”

50

60

70

80

90

100

Spring2012

Summer2012

Fall2012

Winter2013

Spring2013

Summer2013

Fall2013

Public Company “C”

New Enrollment Analysis1

67%

92%

70%

84%

69% 69%

0%

20%

40%

60%

80%

100%

Company A Company B Company C

R-Squared Values for Regressions

Predicted Quarterly Starts

Predicted Q/Q % Change

1. 100 = Highest number of new enrollments for each company.




0%

10%

20%

30%

40%

50%

60%

70%


Percent On-line

On-line Share of Inquiries All Programs and All Award Levels

2012

2013

2014

On-line Inquiry Share

Education Industry Inquiries: YOY Percent Change On-line programs are losing share.

In 2012, inquiries for on-line programs averaged 52% share.

In 2013, they lost 4 share points—averaging only 48% share.

2014 is off to a rocky start for on-line with only 47% share in January and 44% in February.




Inquiries for On-Ground Programs

The share gained by on-ground programs offset most of the decline in industry inquiries.

In 2013, inquiries for on-ground only declined 3%.

They are up in 2014—by a healthy 6.7%.

February was especially strong, inquiries for on-ground programs rose 9%.

2012

0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

900,000


Inquiries

Inquiries for On-Ground Programs All Education Programs and Award Levels

2012

2013

2014




2.7

%

2.3

%

2.3

%

2.4

%

2.5

%

2.6

%

2.5

% 2

.9%

2.6

%

2.5

%

2.1

%

2.3

%

2.8

%

2.6

%

2.9

%

2.7

%

2.8

% 3

.3%

3.1

%

3.0

%

2.7

%

2.8

%

2.6

%

2.5

%

2.3

%

1.2

%

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%


Applic

ation R

ate

Education Industry Application Rates 2012 2013 2014

Application Rates

Immature Months

Through November 2013, application rates averaged 2.87%, up from 2.52% in 2012.

December is ahead of 2012, and will get better as a few more December inquiries convert in 2014.

Overall, the 14% increase in applications may have offset the 10% decline in inquiries.

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.




Average Price Per Inquiry

In 2013, the price per inquiry rose by $1.85 or 4.5%. In February it reached a record high of $44.13.

$38.0

$39.0

$40.0

$41.0

$42.0

$43.0

$44.0

$45.0

Avg.

PP

I

Inquiry Prices Average and YoY Change

All Programs and Award Levels

2014 2012 2013

$0.61

$2.17 $2.45

$1.82

$2.78

$1.53

$2.08

$2.49

$1.97

$1.49

$0.41 $0.60

$0.00

$0.50

$1.00

$1.50

$2.00

$2.50

$3.00


Change in A

vg.

PP

I

Average YoY Change

$43.84 $44.13




Average Cost Per Application

Despite the rising price per inquiry, cost per application is declining.

November came in at $1,621 — over $300 lower than 2012.

December 2013 cost is already below 2012 and will fall further as more inquirers apply.

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC

2012 $1,520 $1,761 $1,727 $1,710 $1,659 $1,573 $1,625 $1,392 $1,597 $1,690 $1,990 $1,851

2013 $1,542 $1,596 $1,484 $1,565 $1,563 $1,288 $1,379 $1,448 $1,598 $1,556 $1,621 $1,720

0

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1,000

1,500

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2,500

Ave

rage

Price

Pe

r A

pp

lica

tio

n

Not Fully Mature




Fastest-Growing Cities in February

All of the fastest-growing cities1 met or exceeded last year’s inquiry volumes.

San Diego, CA was the fastest-growing market, up 60% from February 2013.

All five cities experienced double-digit growth.

-23% -20% -18% -27% -12%

60% 42% 24% 17% 12%

-30%

-20%

-10%

0%

10%

20%

30%

40%

50%

60%

70%

San Diego, CA Phoenix, AZ Virginia Beach, VA Riverside, CA Houston, TX

Industry Inquiries Top 5 Highest Growth Markets – February 2014

2013 YoY % Change 2014 YoY % Change

1. Includes only cities with over 5,000 inquiries for all programs in February 2014. Data includes a 15-mile radius from the center of the CBSA.




Largest Cities: February Growth

Only two of the largest markets saw year-over-year growth in February.

Los Angeles and Philadelphia both grew 6%.

New York and Chicago slowed their declines to 5% and 6% respectively.

Atlanta continued a 7% decline.

-12%

-22%

-11%

-18%

-7%

6% 6%

-5% -6% -7%

-25%

-20%

-15%

-10%

-5%

0%

5%

10%

Philadelphia, PA Los Angeles, CA New York, NY Chicago, IL Atlanta, GA

Industry Inquiries 5 Largest Markets – February 2014


1. Includes only programs with over 5,000 inquiries for all award levels nationally.




Fastest Growing Programs in February

The five fastest-growing programs1 all grew over 50% year-over-year in February.

Liberal Arts and Sciences continued impressive gains, after posting a 33% gain in the prior February.

Accounting and Business Management grew 119% after a soft 2013.

33%

-3% -12%

-11%

-30%

164%

119% 113% 113%

62%

-50%

0%

50%

100%

150%

200%

Liberal Arts and Sciences Accounting andBusiness/Management

Electrical, Electronic andCommunications

EngineeringTechnology/Technician

Web Page,Digital/Multimedia andInformation Resources

Design

ComputerProgramming/Programmer

Industry Inquiries Top 5 Programs – February 2014


1. Includes only programs with more than 5,000 inquiries in the month of February 2014.




Largest Programs, February Growth

Several of the largest programs suffered major downswings in inquiry volumes.

Accounting dropped a surprising 19%.

CJ and Health Administration also fell sharply, on top of substantial declines in February 2013.

Fortunately, Business Administration and Medical Assisting managed to hold their own.

6% 7%

-12%

-24%

-11%

-19%

0%

-22%

-16%

-1%

-30%

-25%

-20%

-15%

-10%

-5%

0%

5%

10%

Accounting. Business Administration andManagement, General.

Criminal Justice/PoliceScience.

Health/Health CareAdministration/Management.

Medical/Clinical Assistant.

Five Largest Programs February Inquiries: Year over Year Change





“Miami Plus 30” Business Programs

Market

Greater Miami, including the entire area within 30 miles of the

population-weighted center of the CBSA1

Programs

CIP 52: Business, Management, Marketing, and Related

Support Services

Award Levels: All

5 Miles

1. Core-Based Statistical Area: Miami, Fort Lauderdale, West Palm Beach Florida




Miami: Inquiry Growth

Starting in May 2013, Miami inquiries fell sharply, but they have bounced back..

The market bottomed in September at 3,000 inquiries—down 36% from 2012.

By November, 2013 inquiries were close to 2012 levels.

This February, inquiries increased 11% year-over-year.

2012

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1,000

2,000

3,000

4,000

5,000

6,000


Inquiries

Miami Inquiries for Business Management All Programs and All Award Levels

2012

2013

2014




1.0

%

1.1

%

0.7

%

1.1

%

0.9

%

0.9

%

0.8

%

1.5

%

1.0

%

1.4

%

0.9

%

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%

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%

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%

1.9

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2.0

%

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%

1.5

%

2.1

%

1.3

% 1.6

%

1.7

%

2.1

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1.8

%

1.3

%

0.7

%

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%


Applic

ation R

ate

Miami Application Rates All Programs and Award Levels

2012 2013 2014

Miami: Application Rates

In Miami, application rates are well below the national average, but they rose 60% in 2013.

Miami application rates range from 0.7% to 2.1%, well below the 2013 national average of 2.87%.

Rates are improving fast: 2013’s were up 60% year-over-year, 2014 is off to a strong start.

1. Applications are counted in the month in which the inquiry is received (i.e., an inquiry that is received in January and converts in March is 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.

Immature Months




Miami: Average Price Per Inquiry

Price rose sharply in Miami for Business inquiries--February prices jumped over $5.00.

$47.00

$45.74

$36.0

$38.0

$40.0

$42.0

$44.0

$46.0

$48.0

Avg.

PP

I

Average Price Per Inquiry and YoY Change All Programs and Award Levels

2014 2012 2013

$3.21

$1.53 $1.33

-$0.36

$5.24 $4.85 $4.55

$3.40

$1.80 $2.43

$4.30

$5.38

-$1.00

$0.00

$1.00

$2.00

$3.00

$4.00

$5.00

$6.00

Ma

rch

April

Ma

y

June

July

Augu

st

Septe

mb

er

Octo

be

r

No

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mbe

r

De

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mbe

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Janu

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Feb

ruary

Change in A

vg.

PP

I

Average YoY Change


GRAYMiami: Visualizing Opportunity

In Miami, there are two demand hotspots (blue shaded areas).

1. West of Fort Lauderdale

2. Near Opa Locka, running south to Miami

Competition (3) is clustered south of Miami.

To better visualize opportunity, we make a few assumptions:

Inquiries are a good indicator of demand

Larger institutions are tougher competitors

Distance matters:

The closer an inquiry the greater its value

The closer a competitor the greater its impact

2

1

3


GRAYMax Distance Adjusted Demand Index (Max DADI)

We use a simple demand index—Max DADI:

Inquiries from each tract

Weighted by distance to every other tract

This visualization highlights areas that are closest to the most

demand—in this case, just north of Opa Locka.

Max DADI


GRAYMax Distance Adjusted Competitive Index (Max DACI)

For competition, we use a similar process

Bigger competitors get higher weights

Closer competitors get higher weights

In this visualization, we see two competitive peaks:

1. West and North of Davie, where there are two

very large competitors.

2. Near Hialeah, where there are three local

competitors and many more a few miles south.

1

2


GRAYOpportunity Visualization

There is an underserved area north of Miami and on the coast.

1. Pompano Beach has the Max Net Opportunity Index (NOI)

2. The coast reaches 70% or higher of the Max NOI

3. Inland, competition drives NOI down to 30% or lower

For clients, we would adjust NOI to reflect the client’s specific

distance factor and their ability to take share.

Some institutions can take share directly from

large competitors. They can cost-effectively

target low NOI, high-demand areas near

the competition.

Weaker schools need to target areas like

Pompano, where NOI is high.

1

2

3

3




Takeaways

1. The industry is emerging from a long downturn.

+ The decline in inquiry volume appears to be ending

+ Application rates are rising

+/- On-ground is up; on-line is down

- Price per Inquiry is rising

+ Inquiry quality and application rates are improving

+ Cost per application is flat to down

+/- Results vary widely by market and program




Takeaways

You need GrayReports for your campuses and programs.

1. To determine if you are winning or losing the battle for share

- As a company

- By campus

- By program

2. To evaluate the performance of Marketing Agencies

- Are they rising and falling with the tide?

- Or, are they helping you take share in a tough market?

3. To make better decisions:

- How much you need to spend to sustain or take share

- Where to spend and win




Questions and Contacts

Please feel free to contact me:

Bob Atkins

CEO

Gray Associates, Inc.

[email protected]

617-401-7662

For the presentation or a recording of the

session, please visit:

GrayAssociates.com

http://www.gray.biz/?page_id=624

2014 february grayreports - student semand trends

Education

new inquiries

qualified inquiries

bob atkins

yearoveryear inquiries

validity grayreports

grayreports demand

google trends

education institutions