2015 may grayreports - student demand trends

GRAYREPORTS Demand for Educational Programs

www.GrayAssociates.com

Results through May 2015

617.401.7662 www.GrayAssociates.com 2

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

Who Is Gray?

GrayData

Completions and Enrollments 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: Higher Educational Institutions and Investors

Program Pricing: Coming in 2015



What is GrayReports?

GrayReports tracks demand trends in higher education. §  Overall industry trend reports are a free monthly service, which includes these webinars. §  Custom reports on trends by market and programs, which we provide to our paid subscribers:

─  Monthly reports for their specific programs and markets ─  On-line access to detailed data for their programs and markets

Over 42 million qualified inquiries January 2012 to the present

Over 930,000 new inquiries in May 2015 Over 185 programs with over 10,000 inquiries

Over 300 cities with over 10,000 inquiries



Key Demand Trends and Observations

1.  May had the worst year-over-year inquiry results of 2015, down 13%.

2.  Year-over-year...

1.  Inquiries for on-line programs reverted back to their decline, down 17%.

2.  Inquiries for on-ground programs weakened further.

3.  Conversion rates for mature months continued to decline.

4.  Average cost per converted inquiry continued to rise.

3.  The largest programs and markets continued to lose inquiry volume.

4.  The market gap has widened: -  Struggling institutions dropped 20%. -  Sustainers were flat.



Agenda

1.  National Inquiry Trends

2.  Inquiries and Conversions: On-Line vs. On-Ground Programs

3.  Views by Program and Segment

4.  Marketing Implications

5.  Summary



Overall Student Inquiries

May demand dropped from April, and was down 13% from year-ago levels. §  January and February were down 12% and 10%, respectively. §  March and April had a narrower gap to prior year. §  May had the worst year-over-year comparison of 2015.

-13% 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 2014 2015



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.

3.4%

3.1%

3.6%

3.5%

3.6%

3.6%

3.8%

3.3%

3.4%

4.0%

3.1%

3.1%

2.9%

2.5%

2.6%

2.4%

1.7%

2.8%

2.5%

1.8%

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

4.0%

4.5%


Education Industry Inquiry Conversion Rates 2014 2015 Average Immature Conversion Rate

Inquiry to Application: Conversion Rates

While mature months have been weak in 2015, more recent conversion activity is stronger. §  January and February inquiries, now mature, converted at substantially lower rates than year-ago levels,

and as compared with the 2014 mature average. §  March, April and May are a little below the 2014 norms for immature months.

Immature Months1

2014 Mature Average: 3.5%



Number of Conversions

Mature conversions have been driven down by lower inquiry levels and conversion rates. §  Conversions in January and February were down 23% or more. §  March and April conversions have the best chance of matching prior year levels owing to their more

comparable year-over-year inquiry levels, and to conversion rates that are currently near the norm for inquiries of that age.


- 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

2014 2015 2013

Immature Months1



Average Price for Pay-per-Lead Inquiries

Unlike the pattern in 2014, the price per converted inquiry continued to creep upwards in May. §  Inquiry prices rose 1% to $44.88 in May 2015. §  In 2014, May prices fell 3% relative to April. §  Through the first 5 months of 2015, inquiry prices were 5% higher on average year-over-year.

$44.01 $44.20 $44.23 $44.49 $44.88

$42.13 $42.24 $42.13 $42.87 $41.59

$44.97 $44.67 $44.86 $46.15 $46.45 $45.94

$43.11

$30

$32

$34

$36

$38

$40

$42

$44

$46

$48


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

2015 2014

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



Average Cost Per Converted Inquiry

Costs per converted inquiry have risen sharply in 2015. §  Costs in 2013 and 2014 were comparable to one another, while 2015 has had a much higher average. §  January’s cost was up 19% from prior year, while February’s was up 30%. §  March, April and May are also trending well above prior year levels.

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2014 $1,253 $1,359 $1,177 $1,230 $1,169 $1,262 $1,178 $1,346 $1,338 $1,153 $1,500 $1,393 2015 $1,497 $1,771 $1,718 $1,874 $2,630 2013 $1,367 $1,521 $1,326 $1,386 $1,376 $1,135 $1,266 $1,322 $1,454 $1,405 $1,379 $1,375

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

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

Immature Months



Agenda





5.  Summary



Inquiries for On-Line Programs Education Industry Inquiries: YOY Percent Change May reverted back to the negative year-over-year variance trend, finishing down 17% year-over-year. §  May and January tied for the worst year-over-year comparison of 2015. §  April is the only month of 2015 whose inquiry levels have been up from 2014.

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000


Inquiries

Inquiries for On-Line Programs All Programs and Award Levels

2014 2015

-17% YOY



Student Inquiry Conversions for On-Line Programs

February conversion levels finished below prior year for the seventh consecutive month. §  January and February 2015 conversions were down 10% from 2014 levels. §  The negative year-over-year gap has narrowed for mature months in 2015 compared with the latter part

of 2014 which saw declines in excess of 20%.


0

2,000

4,000

6,000

8,000

10,000

12,000


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

2014 2015 2013

Immature Months1



Inquiries for On-Ground Programs

May has the worst year-over-year on-ground inquiry comparison of 2015. §  May on-ground inquiry volume, while down only 5% from April, is 23% lower than prior year. §  March has the second worst year-over-year comparison of 2015, down 15%.

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

2014 2015

-23% YOY



Conversions of on-ground inquiries continue to decline. §  Conversion levels plummeted in November and December, and January was down 27% from prior year. §  February 2015, the latest mature month, finished 32% behind 2014. §  While not yet mature, March, April and May are far behind prior year levels.

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

2014 2015 2013

Immature Months1

Student Inquiry Conversions for On-Ground Programs




0

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

2014 2015 2013

Conversions of External Inquiries

Conversions of external inquiries are also declining at accelerated rates. §  Conversions of external inquiries were down16% year-over-year in December. §  Conversions of external inquiries in January and February were down by more than 30%. §  March and April conversions appear unlikely to match prior year levels, and May is off to a slow start.

Immature Months



Conversions of Internal Inquiries

The year-over-year gap in internal inquiry conversions was much broader in February than in January. §  Conversions of internal inquiries were down 13% year-over-year in January. §  February witnessed a 22% decline from prior year. §  March, April and May are likely to mature below last year.

-

5,000

10,000

15,000

20,000

25,000


Conversions of Internal Inquiries All Programs and Award Levels

2014 2015 2013

Immature Months



Agenda





5.  Summary



Largest Programs: May Growth

Only two of the five largest programs grew year-over-year in May. §  Registered Nursing inquiry volumes grew 67%. §  Business Admin inquiry volumes grew a modest 2%. §  Health Care Admin, which grew in April, was flat in May, while Medical Assistant fell 19%. §  Criminal Justice remained the biggest loser, with a 65% drop.

14%

-7%

-39%

3%

-21%

67%

2% 0%

-19%

-65% -80%

-60%

-40%

-20%

0%

20%

40%

60%

80%

Registered Nursing/Registered Nurse

Business Administration and Management

Health/Health Care Administration/Management

Medical/Clinical Assistant Criminal Justice/Police Science

Year-over-Year Change in May Inquiries Five Largest Programs

2014 YoY % Change 2015 YoY % Change



Top 5 Fastest-Growing Programs in May

The four fastest-growing programs are new to the list in May. §  Curriculum and Instruction was the fastest-growing program, followed by Education Leadership and

Administration. §  Two of the five programs saw growth of 100% or more. §  All five programs grew by at least 67%.

-55% -65%

93%

3% 14%

290%

100% 74% 70% 67%

-80%

20%

120%

220%

320%

420%

520%

Curriculum and Instruction. Educational Leadership and Administration, General.

Health Information/Medical Records Administration/

Administrator.

Psychology, General. Registered Nursing/Registered Nurse.

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


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



Largest Cities for Inquiries

May inquiries were down by 10% or more across all of the top cities. §  Only Atlanta saw a decline that did not exceed 10%. §  Three of the five cities declined by more than 20%. §  Chicago replaced Los Angeles as the worst-performing market, down 29%.

2%

-3% -7%

10% 13%

-10% -14%

-23% -27%

-29% -30%

-20%

-10%

0%

10%

20%

Atlanta New York Philadelphia Los Angeles Chicago

Year-over-Year Change in May 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

Three of the five fast-growing cities are new to the list in May. §  Oklahoma City was once again the fastest-growing city in May. §  Wichita, KS was second. §  Augusta, GA, Greenville, SC and Miami, FL, all new additions, each had 6% inquiry growth in May.

5%

-8%

13%

5%

-8%

33%

25%

6% 6% 6%

-25%

-15%

-5%

5%

15%

25%

35%

45%

55%

Oklahoma City, OK Wichita, KS Augusta, GA Greenville, SC Miami, FL

Year-over-Year Change in May Inquiries 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.



Sustainers vs. Strugglers: Inquiry Volume

The gap between Strugglers and Sustainers widened substantially in May.

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

0%

-3% -13% -16%

-31% -44% -46%

-27%

47% 44%

28%

10% 9% 7%

-6% -13%

-7% -7% -11% -9%

-50%

-30%

-10%

10%

30%

50%


Sustainers vs. Strugglers Year-over-Year Change in Inquiry Volumes 2014

-15% -11% -8%

-4%

-20%

-6% -8%

0% -1%

0%

-30%

-20%

-10%

0%

10%


Year-over-Year Change in Inquiry Volumes 2015

Strugglers

Sustainers



Inquiry Volumes by Category

Doctoral and Master’s inquiries were by far the best performing categories in the period. §  Internal, Bachelor’s and Unknown Modality inquiries also saw positive growth. §  Ground, Associate’s, and External inquiries were among the categories which fell the farthest.

38% 27%

15% 7%

2% -7%

-11% -13%

-14% -17%

-23%

-25% -15% -5% 5% 15% 25% 35% 45%

Doctorate Master's Internal Unknown Modality Bachelor's Online Certificate External Associate's Ground Unknown Degree

Year-over-Year Percentage Change in Inquiries 2014 vs. 2015 (March – May)

Monthly Average

!



Agenda





5.  Summary



Key Findings

§  The mix of inquiries is shifting to :

-  Internal

-  Healthy schools (Sustainers)

-  Higher degree levels

-  Smaller cities in the mid-west and south-east.

§  There are tremendous variations by city, program, and modality. -  Three of the five fastest-growing cities are new to the list in May.

-  Four of the five fastest-growing programs joined the list this month.

-  Inquiry counts for large cities are shrinking, while they are growing for smaller mid-western and south-eastern cities.

§  You need a custom view that reflects the markets in which you compete.

§  You could know if you are winning or losing the battle for share. -  Adapt your strategy to the market situation

-  Correctly assess company and management performance



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Please join us next month!

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Wednesday, July 22nd at 1:00 p.m. Eastern Time



Questions and Contacts

Today’s Presenter: Steve Probst

Partner, Gray Associates

Please feel free to contact: Bob Atkins

CEO Gray Associates, Inc.

[email protected]

617-366-2836

2015 may grayreports - student demand trends

Education

online programs

bob atkins

educational programs

ground programs

specific programs

largest programs

national inquiries

qualified inquiries