Download University of Central Lancashire

Price Led Market?
Price Led Marketing?
E: [email protected]
M: 07903 757739
The Consumer’s Price/Cost matrix
More than £ price:
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Financial:
fees
Academic:
entry grade ‘currency’
Indirect:
accommodation/living costs
Discounts/incentives:
scholarships/bursaries
Opportunity Costs
 Work <> Time <> Alternatives
Price (or Value) ‘Bandwidths’
Potential for differential markets to emerge
Pricing 2012
£6k
£9k
£ Pricing Research
4 main Consumer market methods
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Concept Test
Van Westendorp
Brand Price Trade offs
Conjoint analysis
(B2B mainly qual)
Optimal conditions:
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Clear framework/s and reference points
Equilibrium
Tangible sets of features and benefits
Comparability
£ Pricing Research
4 main Consumer market methods
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Concept Test
Van Westendorp
Brand Price Trade offs
Conjoint analysis
(B2B mainly qual)
Optimal conditions:
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Clear framework/s and reference points
Equilibrium
Tangible sets of features and benefits
Comparability
Little real insight to be gained from Pricing Research
Pricing Strategies
Cost
 Cost-plus
 Marginal-cost
 Contribution marginbased
 Absorption pricing
Consumer
 Market-oriented
 Value Based
 Psychological
Channel
 Retail <> Direct/Online
Competitive/Entrepreneurial
 Competitive
 Price leadership
 Target pricing
 Limit pricing
 Predatory
 High-low pricing (ranging)
 Premium
 Decoy
 Penetration
 Creaming or skimming
 Loss leader
 Dynamic
 Price discrimination
£ Pricing outlook now
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Offa deadline for > £6k HEIs by mid April
Fee setting likely to be guided by:
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HEI
 Cost Plus ... Plus, Plus, Plus
 Price leaders <> Followers
 Fear of –ve Price Position
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State
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Politics
Funding
Offa
NSP
et al
£ Pricing 2012 ???
£6k
£9k
£8k
£9k
£ Price Differentials ???
Probably not significant enough for
a Price Oriented Market
£ Price Impacts on Demand
Looking Forward:
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Uni of Leicester:
 Slight but real decline at £7k; Segmentation impacts
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Sutton Trust
 Marked Decline; Lower socio-econ groups more debt averse
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Euro RSCG Heist
 HEPI
Looking Back:
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BIS: from £3k base
 Fees:
+ £1k pa >> - 4.4% demand
 Finance: + £1k pa >> + c. 2.5% demand
Exponential Effect ???
- 1.9% per £1k
- 5% >>> - 20% ??
£ Price Impacts on Demand
MACRO and Segment Variables
£ Price
£ Perceived Total Cost
£ Sponsor/Parent Support
Fundability/Payability/Deferability
Debt Aversion
Perceived Value of a Degree
£ Price Impacts on Demand
MACRO and Segment Variables
£ Price
£ Perceived Total Cost
£ Sponsor/Parent Support
Fundability/Payability/Deferability
Debt Aversion
Perceived Value of a Degree
National <> HEI
Segment cross-mapping
Price <> Value ‘Bandwidths’:
 Demographics
 Attitudes
 Geographic catchments
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Parents/Influencers
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University Brand
Subject area
Course
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Changing as information issued/assimilated
Dig that Data
… and consumer understanding
and attitudes
‘Hoover effect’ ....
‘Hoover effect’:
Premium Brand Preference
When £ price makes little difference ...
‘Premium’ wins (other things =)
‘Value’ Marketing
Aspirant Consumers
HEPI’s
Unmet demand?
‘Echelons’
Hard times coming
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The Demographic Dip
Recession: disposable income; graduate job prospects
Increasing graduate debt > impacts on PG demand
Greater competition for overseas markets
 UK Visa controls
Drives to third leg incomes >>> more competition
 Declining training and R&D budgets
 Decline in charitable donations
ELQs
Govt/HEFCE Funding packages
Confusion
Hard times coming
David Willetts #1:
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Funding for teaching to follow student choices
Assumed average fee of £7,500.
Otherwise further offsets in HEFCE grant
Reconfigurations for ITT and Nursing/Health
Student Visa
REF et al?
Transparency:
Unistats, NSS and TRAC >>>> KIS 17 points
Incl contact time, costs, outcomes
Harder times coming
David Willetts #2:
Public Sector Modernisation (White Paper to follow)
 Most powerful driver of reform: let new providers
(worldwide) into the system
Removal of current barriers:
 Allow alternative providers to access student loans and
grants system
 Allow external degree awarding bodies (BTEC)
 Encourage FEIs/Employer and award body groups
 Protect FEI (franchised?) interests in HE provision
 Review options to freeing up numbers (off the books)
 ‘A price that represents good value’
‘Our ambition is to make this framework
as de-regulatory as we can’
‘It’s the Economy Stupid’
Price
EQ.
Volume
‘Value’ Marketing ???
New Market Conditions
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Supply and Demand NOT in equilibrium
NOT ‘filling places’/containing demand
Mission NOT caretaking the public purse
Away from managing budgets
Need to Survive and Thrive
Attract/Optimise Demand to Capacity
Differentiate through VALUE &/or PRICE
Generate PROFITS
Towards Investment and Return
Operational <> Cultural
Marketing Fitness
Market Fitness
Marketing Fitness
Maximise (Current) Position and Proposition
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Brand Position
Benefits and Features
Values
Service
Bursaries/Scholarships/Offa/NSP et al
‘Investigate the Product until it reveals its Truth’
Optimise and Integrate Channel Effectiveness:
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Advertising
PR/Comms
Key literature
Web site <> e-marketing/comms <> e-service
Conversion <> Admissions <> CRM
Schools Liaison <> Widening Participation
Marketing Fitness
Portfolio Review and Development
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International
Part-time
Market Research
Business Stream Development
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International
Part-time
Postgraduate
Third Stream: Alumni and Fundraising; B2B
Competitors and Positions
Identification and Analysis
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Data Analysis
 UCAS, HESA/Heidi
 Brit. Council
 Et al
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Published benchmarks
 League Tables
 Other/specific published comparators, guides etc
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Positioning
 Aggregation of messaging/inputs for consumer perceptions
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Specific Competitor Analysis
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Product/s
Services/Resources
Position/s and Proposition/s
Features and Benefits
Perceptions Research
Competition <> Comparison <> Competitiveness
From intangible to more tangible ‘value’?
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Partnerships/collaborations
Endorsement/s
Sponsorship
‘Business’ engagement
Adding value to student cvs
Admin Service
Pastoral ‘service’ (the student life >> affinity)
Academic Service
Quality underpinnings/evidences
Mode: student attendance ‘efficiency’
Perceived Value of a Degree
Satisfaction
Preference
Marketing Function Fitness
Corporate/Business
Requirements
and Support:
Support/Partner
Functions:
Engaged and supporting
appropriate Marketing
needs
M&C Functions/Svcs
Relate to Clients and
Markets/Audiences
Clear Delivery of Objectives,
Strategies and Plans
Mission, Corp. Strategy/Plan
VC and SMT
Authority & Policy as required
Marketing:
Leadership
Analysis
Objectives
Strategy
Operations
Systems
Internal Clients:
Corporate
Faculty
Departments
Prof Services
Markets and
Audiences:
External
Internal
But largely:
More effectively doing what we’re already doing
... or ... doing what we should be doing!
Market Fitness
Corporate/Business
Requirements
and Support:
Support/Partner
Functions:
Engaged and supporting
appropriate Marketing
needs
Mission, Corp. Strategy/Plan
VC and SMT
Authority & Policy as required
The Change
Agenda
Internal Clients:
Corporate
Faculty
Departments
Prof Services
Marketing:
M&C Functions/Svcs
Relate to Clients and
Markets/Audiences
Clear Delivery of Objectives,
Strategies and Plans
Leadership
Analysis
Objectives
Strategy
Operations
Systems
Markets and
Audiences:
External
Internal
Market Fitness
Product MUST be on the agenda
Innovation
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Portfolio relevance
Content
Quality <> Evidenced Credentials
Mode
Duration
Service
Cost >>> Price
Value
Benefit from increased empathy ??
‘Echelon’ Strategies/Tactics
Defend
Defend
Hoover
tactics
Hoover
tactics
Extend
Innovate
Correlations to
Change/Innovation ?
Brand Preference
Competitive
In XXX conditions
and YYY circumstances,
I would prefer to have that brand’s product
over the others that are available.
Composite Position/Strategy
Lead Proposition
Brand Substance
Delivery
through
Delivery
through
Delivery
through
Delivery
through
Theme
or
activity
Theme
or
activity
Theme
or
activity
Theme
or
activity
Common Features/Benefits
Foundation in Operations
A time to Drive Change
Kotter’s first two steps:
1. Establish a Sense of Urgency
 Research the Market
 Analyse the Competition
 Identify and discuss (potential) crises and opportunities
2. Create a Coalition
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Powerful and Influential group that leads
Work as a team
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>>> vision, empowerment, early wins, consolidation
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Brand Delivery
EXTERNAL
Product and Service
INTERNAL
Iterative and Parallel development
Shared Beliefs and Goals
READERS
WRITERS
Shared Beliefs and Goals
STUDENTS
Metroville University
LECTURERS and
Prof. SERVICES
Buckingham; BPP; Open; Birkbeck
Good Marketing delivers in the
Hard Times
What you did yesterday has put you
where you are today
What you do today, needs to put you
where you want to be tomorrow
Selling ... and adding value ... for today
... as a component of ...
Marketing for tomorrow
Price Led Market?
Price Led Marketing?
E: [email protected]
M: 07903 757739