2016 Predictions and Outcomes

Like in years past, this January we made ten predictions related to the world of international education. Now that the year is almost over, lets revisit these predictions and see how we did!

1 US For-Profit Schools Continue to Internationalize

Our Prediction from January:

2015 proved to be a tough year for US for-profit colleges and universities, which lead to a big push towards international student recruitment into US campuses and the development of new campus locations overseas.  For instance, for-profit giant DeVry Education Group reported total revenue down 4.5% in the third-quarter from the previous year while their international segment reported 10.3% growth.

Devry also reported a 176% new student growth rate in their Brazil division in the third quarter, with total student growth of 76%.With diving revenues and enrollments, and stricter regulations on US soil, US-based for-profit schools will continue their shift towards the international market, with Brazil remaining a primary in-country target despite the ongoing recession in Brazil as students and families are driven to less costly, private domestic education options.

Evaluation of Prediction:

Correct!  2016 has proved to be a tough year on the for-profit industry with large players (like ITT Tech and Corinthian) closing up shop due to government oversight and regulations. While many saw this coming, we predicted many other for-profits would follow in the footsteps of Devry Education and head overseas.

Devry has seen success overseas, especially within Brazil. Devry Education ended their fiscal year on June 30th with Devry Brazil’s revenue up 42.8%. Had the Brazilian Real not declined, revenue increase would have been closer to 57%. In addition, their medical international schools saw a modest 3.8% increase.

Moving on to Apollo Education, owners of the University of Phoenix, according to Greg Cappelli, Chief Executive Officer, “Internationally, despite the impact of Brexit in the UK and other challenges, we continue to grow and now serve over 175,000 students at Apollo Global.”  Apollo Global includes BPP in London (accounting for half of Globals revenue in 2016), Open Colleges, Australia, Career Partner in Germany as well as schools in Mexico, Brazil, Chile, South Africa, India and online schools like Western International University.  While revenues for University of Phoenix shrank by 32% from 2015 to 2016, revenue for Apollo Global grew by 11%.

1(Only) 20,000 More Chinese Students Study in the US

Our Prediction from January:

As the number of Chinese students in the US continues to grow, the percentage growth has been slowing for a variety of factors – read last month’s blog post for an overview. But this year the slowdown will hit the real numbers, which have grown by a low of 29,587 to a high of 41,568 every year for the past six years. There’s been a lot of discussion and analysis about the slowing growth rate, but that slowdown hasn’t yet meant a true drop in the number of net students coming to the US – this year, it will.

Evaluation of Prediction:

Wrong! But not far off, with total growth in raw numbers of 24,507, the lowest increase since the 2008/2009 school year.  According to the 2016 Open Doors Report, the number of Chinese international students in the United States stands at 328,547, up 8.1% from last year’s total of 304,040.  From a percentage standpoint, there are 8 other countries on the list of top 25 sending countries with growth rates higher than China’s.

Our blog post last year looked at China’s economic slowdown and other factors impacting the trend of Chinese students coming to the US, and the analysis still applies. Schools continue to grapple with the fallout of such large numbers from one country – like how to integrate such large numbers of Chinese students, and how to support them properly on all types of issues, from housing, to academics, to mental health. This article in the Wall Street Journal reviews some of the challenges.

1Popularity of ACA Plans Decline

Our Prediction from January:

Now that Affordable Care Act (ACA) group insurance plans have been in the marketplace for a few years, the effects of moving to this style of insurance plan are starting to take shape. Most notably, rates are increasing as insurers come to grips with plans that now have much richer benefits, and therefore higher utilization. With international students exempt from the individual mandate under the ACA, schools are increasingly looking at non-ACA compliant insurance plans as they are often more competitively priced and more appropriately tailored to the needs of international students.

We are also starting to see insurance carriers in the USA, traditionally offering just ACA style plans, now looking to offer non-ACA compliant plans either alongside, or in replacement of ACA plans. As schools become more educated about the differences and benefits of both plan options and do side-by-side comparisons, the popularity of ACA insurance plans will decline over the year.

Evaluation of Prediction:

Correct! Over the course of the last year, we have seen Affordable Care Act compliant insurance plans continue to struggle and decline in the market. As we highlighted in our blog post in June, many of the largest insurers in the USA, like UnitedHealthcare and Aetna, have struggled with the ACA exchanges in general. In international education specifically, we have seen insurers struggling with the richer benefits and higher losses, and in turn we are seeing premiums rocket. As international students are exempt from the ACA for 5 calendar years, there is rising popularity in ACA-exempt plans that are tailored for international student and still offer excellent coverage for students.

1Death of Mobile Apps vs. Responsive Sites

Our Prediction from January:

“Death” might be an exaggeration, but after the heady rush to code every possible site as a mobile app, the pendulum is swinging back as site developers build better sites with responsive layouts that work just as well on the device as they do on the desktop.  Developing high-quality mobile apps is still an expensive endeavor and each new device released or update to the device operating system forces developers to write fixes and patches.

Contrast that process to building a single site that is responsive to the device used to access the site, and which deploys the correctly sized site and appropriate content. Responsive CSS frameworks like Bootstrap, Foundation and Skeleton have eased the pain involved in building beautiful sites, and by starting the development cycle from the smallest phone screens and working up to the desktop, we can now create sites that look great on every device imaginable.

Evaluation of Prediction:

Wrong! We exaggerated when we said mobile apps would die when compared to developing responsive sites. That never happened. However, better CSS frameworks and javascript libraries lessen the need for both a mobile app and a website. The mobile browsing experience is rapidly improving and as handheld device resolution increases every year, it puts the focus on developing a robust and functional single web presence, as opposed to the current landscape of developing for iOS, Android and the web.

1International Enrollment at Community Colleges Pick up Speed

Our Prediction from January:

After a peak in international enrollment in the 2008/2009 school year (97,000 students), then four years of decline, community colleges have seen a slight uptick in enrollment (4.3%) for the last two years, according to the Open Doors Report.  We think this upward trend will accelerate into 2016 and beyond due to several factors.

The first is that community colleges are increasingly proactive about recruiting international students.  We see more and more community colleges at conferences like NAFSA and ICEF, either expanding or initiating their international recruitment efforts.  Among our own clients, like Tidewater Community College, Community Colleges of Pennsylvania, Valencia College, we see direct evidence of this trend toward increasing commitment to internationalization among community colleges.

Community colleges are also doing a good job forming and marketing their 2+2 programs and partnerships, working with EducationUSA and showing the value and benefits of a community college education.  While this approach is not new, over time international students are beginning to understand the value proposition of a community college.

Evaluation of Prediction:

Correct! Well, mostly. We saw an increase in the total number of international students studying in the US, and community colleges saw a 1.4% increase (to 95,376 international students). This is still a bit below the peak that community colleges saw in the 2008-2009 school year where there were 97,000 international students enrolled at their institutions. However, they are moving in the right direction and if they continue to spread their value proposition of less expensive tuition, smaller class sizes and the ability to transfer into 4-year schools, we expect the number to continue to climb.

1Campus “Hot Topics” are Addressed and Battled

Our Prediction from January:

Topics like sexual assault, mental health, Title IX, and racial discrimination were in the news and engendered a lot of discussion in 2015, but 2016 will be the year that schools make real strides on these touchy topics. Title IX and mental health discussions are everywhere, and schools can no longer hide any dirty laundry. Universities will be ready to drop the veil on any potential areas of improvement, and also armed with the necessary resources to turn any of these areas of weakness into areas of strength. We are part of this trend, as we plan to follow up our Mental Health Awareness video and NAFSA sessions with a similar treatment of sexual assault on campus.

Evaluation of Prediction:

Correct! This year we saw a lot of conversation about hot topics such as Title IX, sexual assault, mental health, etc. More and more attention is being directed at these issues, which is supported by the overwhelming discussion we saw at the NAFSA regional conferences. We presented at nine NAFSA regionals on sexual assault and at five regionals on mental health, and most of these sessions had tremendous turnout. But we also saw many other sessions on similar topics like mental health and Chinese students, sexual assault for study abroad, and more. As the numbers of international students in the US continues to soar, it’s not surprising that we continue to turn more attention to supporting these students across these difficult topics.

1The Use of Commissioned Agents will Continue to Increase in 2016 in the U.S.

Our Prediction from January:

We admit, we predicted this in 2015 as well, but it is kind of a no-brainer with the NACAC decision from a few years past.  We attended ICEF in Miami in December, their largest North American event ever.  They saw an overall increase in attendees by 9% and first timers increase of 22% with 71% of the educators coming from U.S. schools.  We just don’t see the trend in using agents slowing down.  Especially if you take into account that the majority of the competing countries like the U.K. and Australia have been using agents for years, and the vast majority of students from China as an example, use agents to study abroad.

Evaluation of Prediction:

Nailed it! This was an easy one as three years has passed since NACAC begrudgingly gave their members the okay to use commissioned agents in their international recruiting efforts. In a survey earlier this year conducted by Bridge Education and StudentMarketing, 37% of colleges and universities reported using agents to recruit international students, and 34% of those have started using them just in the last three years. In addition to the 37% actively using agents, another 12% indirectly use agents through their bridge or pathway programs.

1PHP 7 Hits the Scene

Our Prediction from January:

Early benchmark tests indicate that PHP 7 is twice as fast and uses just half the memory of version 5.6.  In developer speak, this is a RBD (Really Big Deal).  To the rest of us, it means websites can be much faster, and much cheaper.

Although many companies and webmasters skipped the upgrade to PHP 6, as there wasn’t a clear enough benefit to all of the update work, we think that same analysis will push people to adopt PHP 7. Costs of RAM and more CPU cores are the main factors in pushing up the price of your monthly hosting bill.  PHP 7 (should) help reduce both of those requirements and many companies will be able to reduce the cost of hosting without any negative impact on the speed of the server.  Even if you don’t save money by reducing your server capacity, your site’s visitors will enjoy the speed boost and Google will ratchet up your site rank.  Win-win.

Evaluation of Prediction:

Correct! PHP 7 hit the scene this year and the promises of faster code execution times and reduced memory requirements have all come true. Doing the actual upgrade was straightforward, we tested it across our development servers until we had each of the steps condensed into an action plan. Some small code changes were needed, but overall, it was a very easy upgrade. The long-promised PHP JIT (Just In Time) Compiler didn’t appear in the 7.1 release, so we’ll need to wait a little bit longer for the next performance boost. It’s still too soon to judge how widely adopted the new version will become, but early indications are very promising. According to W3Techs, 2.1% of the sites surveyed which run on PHP are now using version 7, which is up from their reported < .1% which were utilizing version 7 at this time last year.

1Dependent Insurance is Hard to Come by in 2016

Our Prediction from January:

Dependent insurance coverage has come into the spotlight in 2015, and we expect this trend to gather pace into 2016. Coverage for dependents has always been expensive on insurance plans, but now with ACA plans requiring full maternity, wellness and pre-existing condition coverage, many school insurance plans are suffering from much higher utilization in these areas and therefore higher premiums at renewal.

As insurers look to reduce their risk, dependent coverage is usually the first to go on these plans. So dependents are left to look for their own coverage, which is not always easy.  In some cases, the available options for dependents require the primary student to enroll as well, and many individual student plans have also removed dependent coverage – so dependents are left to purchase either a stand-alone major medical plan or a standard travel medical insurance plan.

Evaluation of Prediction:

Correct! Dependent insurance is still very hard to come by for many families who are accompanying a parent or spouse studying in the USA. Dependents are expensive for insurers to cover, particularly under Affordable Care Act plans which cannot exclude benefits like maternity and wellness expenses, benefits that many dependents use regularly. The solution for many carriers has been to remove dependent coverage entirely from their school insurance plans, leaving many dependents relying on short-term or travel plans. Read more on this topic along with international insurance trends and best practices.

 

1More Colleges and Universities Adopt Instagram

Our Prediction from January:

As the attention span of the world continues to shorten it’s no wonder that Instagram reached 400 million users in 2015 (and is estimated to reach 106.2 million by 2018) – in just a split second you’re able to receive an update on those you follow without having to read a single word (with the exception of a few #CleverHashtags). Despite this social platform having the means to appeal to the masses, data continues to support that more traditional means of communication like email and phone calls prove to be more effective in reaching students. However, since 90% of Instagram users are under the age of 35 and 75% are outside the US, in 2016 more colleges and universities (especially international student offices) will jump on the Instagram bandwagon as the social platform continues to grow amongst their target market.

Evaluation of Prediction:

We were half-right on this one. Although Instagram was not able to confirm the exact number of colleges and universities that adopted their platform this year (#bummer), it’s become more difficult than ever to find an institution that’s not on Instagram. Additionally, institutions that have had an account for a few years are no longer just “on” Instagram, schools are implementing intentional brand awareness and recruitment efforts on Instagram and other social media platforms. Since 75% of Instagram users live outside the US, it makes sense that institutions use Instagram as a resource when trying to boost international enrollment. However, what we have not seen is an increase in Instagram accounts specifically created for international student offices. Many institutions use their general school account and in some cases a general admission services account.

Do you need Insta-piration on how you can use Instagram for recruitment at your institution? Check out the admission services Instagram accounts for University of Michigan, Arizona State, Boston University or Purdue University.

 

 

 

This entry was posted in Affordable Care Act, Chinese students, International Education, International Education Marketing, International Student Insurance, International Student Lead Generation, International Student Recruitment, Newsletter, Online marketing, Social Media Marketing, Technical Talk and tagged . Bookmark the permalink.

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