Is educational marketing “dead”?

Just now, affected by the "double reduction" announced on the 24th, there was news that Yuanfudao announced that it would cut all its advertising investment.

Prior to this, advertising in the education industry had already been subject to numerous restrictions. In February this year, CCTV removed advertising content from institutions such as Yuanfudao and Zuoyebang during prime time on CCTV channels, and strengthened the supervision and review of related businesses.

It is reported that in the future all mainstream media, public platforms, offline public environments, schools, etc. will completely ban the placement of educational institution advertisements.

Article 22 of the Opinions on Further Reducing the Burden of Homework and Off-campus Training for Students in Compulsory Education:

Relevant central departments and local party committees and governments at all levels should strengthen the management of off-campus training advertisements to ensure that off-campus training advertisements are not published or broadcast in mainstream media, new media, public places, various billboards in residential areas and online platforms. Commercial advertising activities shall not be carried out in primary and secondary schools and kindergartens, and advertisements shall not be published or published in disguised form using primary and secondary school and kindergarten textbooks, teaching supplementary materials, exercise books, stationery, teaching aids, school uniforms, school buses, etc. All illegal and irregular advertising activities for off-campus training that exaggerate the effectiveness of training, mislead the public's educational concepts, and create parental anxiety will be severely investigated and punished in accordance with the law and regulations.

Educational marketing seems to have reached a dead end. After the "capital operation" chain is completely cut off, where will the education industry go in the future?

01 Is educational marketing dead?

On July 24, when the double reduction policy came out, educational training institutions that were deprived of their financing rights and were subject to strict supervision were busy counting their losses and re-arranging their businesses. Almost all institutions no longer had the leisure to take care of marketing issues. In order to repatriate funds, they began to cut advertising businesses. Advertisements of educational institutions have long disappeared from mainstream platforms.

The sharp reduction in educational advertising in a short period of time has caused a considerable impact on the advertising industry, but for marketing platforms, such a vacuum is only temporary after all and will soon be filled by the marketing needs of other industries. For example, Focus Media stated that other types of customers are growing well. Due to the decrease in online education advertising, the vacant advertising spaces have been filled by customers from other industries, and the overall performance is currently stable.

However, for participants in the education industry, with the implementation of the "double reduction" policy, the education industry's public marketing channels will soon disappear completely. All mainstream media, public platforms, offline public environments, schools, etc. will completely ban the placement of educational institution advertisements.

As we all know, the development of any industry in modern society is inseparable from marketing and promotion. When advertising channels are completely blocked, it means that the company's ability to acquire customers will be greatly reduced. Moreover, for the education industry, the current crisis will go far beyond the disappearance of some tracks, but may be a comprehensive shrinkage of the entire industry.

In fact, the crisis of lack of marketing has already emerged in many education companies, especially for online education without stores. The suspension of advertising means the disappearance of the core channel for attracting new customers. For example, a teacher from Oriental Youbo, a subsidiary of New Oriental Online, said that due to the reduction in advertisements, the overall number of classes is not as good as in previous years, and the length of each full-priced class during the summer vacation has been shortened from 2 hours to 1.5 hours.

After public domain traffic has been completely blocked, how should the education industry conduct marketing? Let's make some simple guesses here.

At present, educational marketing may need to turn to private domain traffic. The simplest method is to operate existing customers through WeChat groups, maintain the original customer base, and then use the influence of WeChat public accounts to publish course information to attract new customers.

For some old and strong schools, this is a good way to acquire customers. On the one hand, they have considerable influence and popularity, and already have quite a large number of customers, so they don’t have to worry about the search volume and subscription volume of the official account. On the other hand, the school’s management and communication between faculty and staff and students and parents will use WeChat groups, and these customers can naturally be converted into the school’s private domain traffic.

But WeChat is still a relatively closed space. If you want to get more traffic, you still have to find a way to reach a larger public platform.

In this case, "soft marketing" seems to be a viable direction. For example, Bilibili, where young people gather in large numbers, has many "knowledge sharing" up-hosts. Whether it is children's education, postgraduate entrance examinations, foreign language examinations, studying abroad, civil service examinations, or legal examinations, you can find many "knowledge posts" sharing experiences on the site. Educational institutions may be able to cooperate with this type of up-master to promote their own courses in the form of "content experience sharing".

This method can not only achieve marketing communication within the public platform, but also achieve relatively deep planting of grass. It may be particularly effective for consumers, especially those in the field of adult education.

Because the time cost of self-study for adults is very high, most students hope to find the course that suits them best to avoid wasting time and energy. Through real-person recommendations and detailed content sharing, adults' interest in schools and courses can be greatly increased, and the marketing effect may be better than large-scale marketing methods.

Although educational institutions are not allowed to publish advertisements in schools, if they can achieve in-depth cooperation with schools through educational services, they may also be able to promote their own institutions by selling educational services.

In short, after the education industry has undergone this major reform, due to the withdrawal of capital and policy prohibitions, the previous "overwhelming" marketing scene will never appear again. But afterwards, companies still have to find ways to tap into new marketing growth points, develop new ways of playing, and promote market awareness of their own brands.

02 Out-of-control “education capital”

So why is the "double reduction policy" so powerful this time? Ultimately, it is due to chaotic and uncontrolled capital operations.

If we look back, we will find that the country began to pay attention to the standardized management of off-campus training institutions as early as three years ago. In 2018, the Ministry of Education, together with other departments, issued several recommendations and regulations, requiring strict investigation of the qualifications of educational institutions, curbing all kinds of false advertising, illegal enrollment and teaching beyond the syllabus; in 2019, it announced several long-term governance measures for off-campus education issues.

It can be said that the state has given off-campus education and training institutions a considerable buffer period, attempting to gradually regulate the healthy development of the market environment through policy guidance. Unfortunately, the relevant industries did not make timely adjustments within these three years.

Especially after last year's epidemic, offline education has been struggling and the competitive pressure has become increasingly heavy. At the same time, online education has experienced a blowout, making the competition among major educational institutions gradually become fierce. The entire market has become increasingly crazy and chaotic with the intervention of excessive capital.

On the one hand, in order to seize customers and expand production capacity, institutions have tried every possible means, launching zero-yuan or nine-yuan courses to attract users regardless of cost, completely disregarding the school's carrying capacity. This has caused a shortage of teacher and course resources. For example, the teacher-student ratio at institutions such as New Oriental has even reached 417:1, and the teaching quality cannot be guaranteed at all.

If there are not enough teachers, we can only make up the numbers through false propaganda. In June this year, the State Administration for Market Regulation punished 13 off-campus training institutions including New Oriental and Xueersi for fabricating teacher qualifications and resumes, exaggerating training results, and exaggerating institutional strength.

Among them, the so-called "985, 211 famous teachers" promoted by Blue Sky Education actually only accounted for 15% of its teaching staff; and among the 103 teachers in New Oriental's "Famous Teacher Style" column, the actual teaching experience of 76 teachers did not match the publicity, and the proportion of false propaganda reached 73.8%. If this is the case even for the industry leader, the level of chaos in the entire market is alarming.

On the other hand, the anxiety caused by this vicious competition has not only swept the capital and enterprises themselves, but also transmitted the pressure to ordinary consumers through marketing and promotion. A certain teaching institution even put up a slogan like "If you come, I will educate your children. If you don't come, I will train your children's competitors", selling anxiety among parents.

Such social atmosphere has directly caused the educational ecology, which was not healthy to begin with, to become deformed. Recently, the issue of "chicken baby" has been constantly on the top of the hot searches on Weibo. From a primary school student in Nantong, Jiangsu doing College English Test Band 4 and 6, to a mother in Ningbo forcing her child to study through "self-abuse", this kind of education that forces growth by forcing seedlings to grow too fast has appeared more and more frequently in the public eye. Considering the damage caused to children's physical, mental and spiritual health, the government must also intervene.

In short, in order to regulate the market and protect the rights and interests of children, the government's regulation of extracurricular training institutions will only become more stringent. De-capitalization and de-commercialization have become a foregone conclusion and it is difficult to turn things around.

03 After the Capital Failure

It seems that in the two trading days of July 23 and 26, we observed that the market value of listed education companies evaporated by at least 200 billion yuan.

To a certain extent, for capital, this feast of "education investment" has come to an end in this mess. But in any case, the industry itself has not collapsed completely, the market demand for the education industry is still real, and people who are deeply trapped in it can only find ways to save themselves.

We must first clarify the scope of the "double reduction" regulations before we can evaluate the current overall status of the industry.

This policy is mainly aimed at early childhood education and subject education in compulsory education. In terms of early childhood education, it is strictly prohibited for early childhood teachers to teach primary school subject courses in advance, and areas such as intellectual tutoring and enlightenment have also been stopped. As for teaching aids for compulsory education, the regulations have strict provisions on teaching content and teaching time. Neither can teaching go beyond the syllabus nor conduct supplementary training on holidays. It can be said that the development upper limit of this field has been basically locked, and it will be difficult to have breakthroughs in business and performance in the future.

But apart from this, there are no restrictions on high school education, adult education, and children's quality education (music, physical education, and art). On the one hand, this means that companies that originally had an advantage in the field of high school education will have significant advantages in the industry; on the other hand, it means that the entire industry will shift to these limited tracks, and competition will become more intense.

Before and after the introduction of the double reduction policy, some companies have begun to actively seek transformation.

The first step is to merge some disappeared or reduced tracks, especially the preschool education and early childhood education parts, into the general teaching aids or quality education fields. For example, some employees of Zebra AI will be transferred to Yuanfudao, Gaotu Classroom has also cut the Xiaozao Enlightenment business line, and Zhangmen Education has merged its children's business unit and AI business unit.

Secondly, actively develop and layout the track of children's quality education. For example, "Leapfrog English" under TAL Education Group was renamed "Leapfrog", focusing on quality products such as English drama, eloquence, aesthetic education, and calligraphy; New Oriental's official website began recruiting art and calligraphy personnel in various branches since early June; XueDa Education began to offer programming courses for primary school students.

Adult education is also a hot spot for development. In early July, New Oriental launched the adult education brand "Qingzhou", which includes three sub-brands: Qingzhou Postgraduate Entrance Examination Helper, Qingzhou Full Score Examination and Qingzhou Study Abroad, covering the three areas of postgraduate entrance examination, language training and studying abroad. In the future, it will also enter the field of vocational education.

Gaotu Classroom also established the adult education brand "Gaotu Online" at the end of May, planning to create a curriculum system including postgraduate entrance examinations, English, accounting, civil service examinations, teaching qualifications, studying abroad, management, and minor languages.

Another hot spot for development is the educational technology industry. As the policy on after-school tutoring during the compulsory education stage is tightened, the pressure on teachers in public schools to tutor students will inevitably increase, which will in turn increase the pressure on parents to tutor their students. Therefore, the demand from schools and parents for smart learning, AI-assisted tools, and educational services may increase.

Under this circumstance, some companies have begun to lay out the educational technology industry. For example, Yuanfudao recently announced the launch of "Pumpkin Science", a scenario-based STEAM science education product that includes deep application of AI intelligent voice functions.

In addition, the educational service industry is also a future development focus, which mainly includes two aspects. The first is the after-school care service for primary and secondary schools. Recently, New Oriental launched the "Bixin After-school Growth Center" to provide after-school services for primary school students on weekdays. Students are required to complete their homework independently and then receive tutoring from teachers. However, when the after-school care system of public primary and secondary schools is developed and improved in the future, this track may face great competitive pressure.

Secondly, as many provinces have begun to abolish the division between arts and science and instead adopt a subject elective system, students have to consider the choice of university majors after entering high school and need to understand the application requirements of relevant majors. Therefore, planning and guidance services for high school students have emerged. For example, "Bai Nian Yingcai", a subsidiary of Doshin Education, has begun to provide new college entrance examination business with "career planning and further education services for middle school students" as its core.

04 Conclusion

As of press time, it is reported that the Hubei Anti-Pornography and Anti-Illegal Publications Office has joined the task of cracking down on off-campus training institutions, and the state's management of educational institutions may become increasingly strict. Although the overall industry has suffered a severe blow, I believe that a more orderly market will definitely bring a better experience to practitioners and consumers in this industry.

After the market returns to stability, how to open up the situation and expand the market under the new policy environment will be an issue that every education enterprise must face.

Author: Lily Ji

Source: Morketing