Education - Chinese Students Overseas

Market Overview

Education – Chinese Students Overseas

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China’s Digital Credentials

• At the end of 2013, there were 618 million internet

users in China – the world’s largest internet user

population. The internet penetration rate has now

reached 45.7%.

• There are slightly more male internet users in China

(55.9%) than female (44.1%).

• While nearly three quarters (73.4%) of China’s

internet users are going online via their PCs, more

than two thirds (69.3%) also do so from their mobile

devices.

• China’s students represent 30.2% of China’s online

population.

• The rural areas of China account for 26.5% of the

total internet population, or 156 million internet users.

• China’s online community is expected to exceed 700

million by 2016.

• In recent years, China’s internet population has grown

by approximately 10 million people monthly

(equivalent to half the population of Australia).

1,351,000,000

51% Urban

Total Population

Urban vs. Rural

618,000,000

45.7%

Internet Users

Internet Penetration

1,198,500

88.7%

Mobile Subscribers

Mobile Penetration

798,200,000

59.1%

Tencent QQ Users

Social Network Penetration

Source: US Census, CNNIC, Tencent, Mobithinking

China is the worlds largest online population at 618 million. Astonishingly this only represents

46% of their population, so the potential for continued growth is enormous.

The Chinese Online Population

China

USAUKAustralia

= 50 million online users

The middle classes are expanding beyond the larger cities more rapidly and in greater numbers

than any market has ever witnessed. The number of Middle and Affluent Consumer

HOUSEHOLDS in China will be the same as the US by 2020.

As their wealth increases, the Chinese are increasingly choosing to educate their children

overseas.

1

13

34

61

57

36

12

53

69

66

39

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Household annual disposable income

(USD) thousands

Upper affluent >200

Lower affluent $16 - $31.5

Middle Class $9.5 - $16

Emerging Middle $6 - $9.5

Aspirant $4 - $6

Poor <$4

Households MillionsHouseholds Millions

Source BGS Consultants

Urban household disposable income 2020Urban household disposable income 2010

Growing Wealth

World Education Stats

More than 400,000 Chinese Students studied overseas in 2013. This number was expected to

grow in 2014.

Chinese students going abroad to study represents a fast-growing market; from 120,000 students in

2003 to over 400,000 in 2013. The US, Canada, UK, Australia, and Japan accounted for 75% of

destinations for Chinese students

The Chinese enroll at all levels of education, with the majority seeking higher education degrees.

• Higher education: 61%

• Vocational Education & Training (VET): 9%

• English Language Intensive Courses for Overseas Students (ELICOS): 19%

• Schools: 5%

• Non-award: 5%

The US, Canada, UK, Australia and Japan accounted for 75% of destinations for Chinese students

• USA: 194,000

• Australia: 135,000

• UK: 78,000

• Canada: 20,000

Source: Xinhua

The Decision Makers

Parents are the primary decision makers regarding which school their children will attend.

The decision about which university a student will attend and what they will major in is normally

decided on by their parents. As the Chinese place a high value on education for their children, cost is

rarely the main consideration.

Parents are more likely to consider:

• School rankings (which university your child attends is a serious point of pride in China)

• Curriculum

• Safety of the region

• Residential options

Traditionally, Chinese parents consult with a university agent that represents multiple universities who

will advise on which school would be most appropriate for the student. Most Chinese parents will still

consult with agents today, but they are more likely to carry out the initial research online.

The decision cycle is usually spread over 1-2 years prior to enrollment as the

Chinese spend a significant amount of time researching their options.

Online is increasingly used to gather initial information such as

student visa applications, curriculum details, residential options, fees, and

to make initial inquiries.

Source: Australian Education International; Xinhua

The Importance of Service

The Chinese traditionally favor a very personal service from a known and trusted source when

making significant purchases.

Whether it’s a major holiday, a university, or a bank account, the most successful Chinese businesses

are those that provide hands on, personal service.

This would normally take the form of a bricks and mortar presence and a face-to-face conversation,

although more recently a dedicated account manager via telephone is also common. With regards to

education this traditionally took the form of an education agent.

There is a growing trend however for research prior to a big decision to be carried out online. In

particular in the under 40 age groups, customers are more likely to conduct their research online and

form their own decisions. (McKinsey – Mapping China’s Middle Class 2013)

Final decisions still often require a more personal approach. Education advertisers need to consider

how they can compete at a service level.

Within CSI we have seen our education clients go the extra mile with online chat applications, and

dedicated Chinese phone numbers to give potential students the high service levels they require.

Consider providing substantial research on the site and keep an

eye on your consumer feedback across Chinese social media.

Timing of Education Campaigns

The Chinese school year starts in September, following the USA timing. In line with this, the

application process for overseas schools tends to occur between April and July each year with the

majority of campaign budgets being spent in May and June.

At other times of the year, overseas schools tend to maintain a minimal presence on Baidu which

allows for the long term planning and online research that Chinese parents tend to undertake. A brand

focused campaign in the off-peak seasons ensures their schools remain top of mind for Chinese

parents.

The Education research process starts as early as 2 years in advance. There is a need for an

on-going presence on the platform to accommodate this trend.

Target Audience Profile

Suki Lui, 18, University Student

• Educated at a private girls school in

Shenzhen where she received excellent

grades.

• Would love to study law but is also interested

in economics.

• While she has travelled internationally, this

will be her first time away without her parents.

• Her family values her education above all else

and has saved and invested for years to

enable her to study overseas.

• Her parents want peace of mind while she is

overseas and to know that she is financially

and academically looked after.

• Ultimately it is her parents who will make the

decisions about her course of study,

residence, and choice of major.

• She enjoys coffee, live music, and staying in

contact with her friends back home via social

media.

Her Parents Want: To learn as much as

possible about prospective universities, their

rankings, and the residential options

available. Focus on prestige of the school

and safety of the accommodation.

She Wants: To see the curriculum details,

reviews from other Chinese students,

understanding of the campus community.

Equal focus on the academic and social

aspects.

Education – Chinese Students Overseas

Initial Staged Roll-out Opportunities

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Initial Roll Out Suggestions

Research into potential universities often starts 2 years prior to high school graduation. Due to the long

tail nature of Chinese research into educational facilities, we recommend that a small campaign is

maintained throughout the year. This allows parents to consistently find your site and review relevant

details.

During the peak application and research period, we then recommend increasing campaign spend

levels to reflect the competitive nature of the industry at this time of the year.

It is not unusual for our education clients to have to cut their campaigns short during the peak season

as their quota for Chinese applicants is quickly reached. When this occurs, we advise clients to reduce

their spend down to the non-peak season levels.

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General Strategy

Initial Roll Out Suggestions

Focusing on brand keywords and selective use of generic keywords such as “study overseas” and

“{insert country name} universities”. Keep in mind that 77% of searches on Baidu are for brand terms

in this sector.

We can assist in providing a full keyword proposal including volume estimates.

All keywords need to be in Simplified Chinese with some double up in English such as the university

name as savvy students / parents will be familiar with the English translation. If targeting online sites in

HK or Taiwan, include Traditional Chinese translations.

For new brands in the market or schools who are not well-known globally, we recommend

supplementing a SEM campaign with a banner campaign on Baidu’s content network.

Banners allow your audience a chance see your brand and get a better idea of what you offer.

It’s the fastest way to build brand equity in China at a reasonable price.

(Average CPC is just 0.20 USD)

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Recommendations For SEM

Target banners by:

• Keywords as per SEM campaign

• Sector e.g. on education websites or market

vertical websites such as investment, youth

or music

• Geotarget (Predominantly in the tier 1 cities

(Shanghai, Beijing, Shenzhen, and

Guangzhou). In addition, Hangzhou has the

third highest percentage of HNWIs after

Beijing and Shanghai)

• Demographics – keep this broad as the site

needs to attract both potential students and

their parents

See http://wm123.baidu.com/ for more details of

how banners work on the Baidu platform

Retarget banners by:

• Everyone who visited your website

• Searched for an education or university

keyword (using a broader list than your

current keywords – can include banned

keywords like “best” or “most profitable”

• Clicked on one of your banners

• Searched for a competitor keyword

• Visited an education related site

Initial Roll Out Suggestions

Recommendations For Banners – Baidu’s Content Network

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Peak Season April - July

Initial Roll Out Suggestions

We recommend an long term campaign to take advantage of the long tail (2-year) research

phase for this sector. A lower spend maintenance campaign for most of the year with a bigger

campaign during peak season.

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April to July is the most competitive time of the year

for the education sector, thus the need for a larger

budget.

This is in response to the peak period during which

students / parents search and make their final

decision on schools for the coming academic year.

Given that 77% of searches for this sector are on

brand terms – this must be a key area of

development for all Education advertisers.

Total Cost $20K USD per month

40% on SEM ($8K)

60% on Banners ($12K)

Duration 4 months per year

Non-Peak Season August - March

The aim of this campaign is to ensure that parents /

students are able to find your brand throughout the

year. Keeping in mind that parents start their

research 2 years in advance, its important to

maintain a minimal campaign throughout the year.

Disappearing from Baidu altogether during the non

peak season will have a detrimental impact on the

brand. We have had instances of parents calling

Baidu to enquire if a particular brand was “a real

school” as they could no longer find it on the

platform and as a result were disinclined to trust it.

Total Cost $5K USD per month

80% on SEM ($4K)

20% on Banners ($1K)

Duration 8 months per year

Summary and Next Steps

As a next step we would recommend sending us your current keywords (that you currently use on

other platforms). The CSI team will then translate and volume check your keywords. They won’t all be

appropriate for the Chinese market, but it’s a good place to start. Alternatively we can create a

keyword proposal for you from scratch, based on what we know works well in the China market.

In addition we need to start the account opening process. The process is very quick and we can have

you live within 1 week of receiving all of your documentation.

To start the process we require the following documents from you:

• A copy of your company registration certificate

• Signed copy of the Baidu contract

• A screenshot of your homepage (that clearly shows the URL)

• Signed copy of the V Qualification certificate (declaring your website

to be the official site for your brand)

• You can open your Baidu account online through our portal

which will collate all of your account information and provide

a filled in set of documents to be signed and returned to us.

You can find the portal at: http://signup.chinasearchint.com/

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How China Search International can help

China Search International / NTENT

Overview

CSI is Baidu’s International Partner, not an agency.

CSI has partnered with NTENT to work with US

companies/brands and their agencies to guide them

through the complex Baidu process.

As a result all services (including translations,

volume checking, account opening and training) are

completely free.

In fact – the only charge you or your clients will ever

see is a 2.5% processing fee to cover banking and

foreign exchange fees. In essence CSI/NTENT are

paid by Baidu to sell Baidu.

The result is that we’re well positioned to help

clients launch on Baidu in the most cost effective

and hassle-free way.

Some of our more well known clients

Baidu’s International Partner. Our clients are predominantly international companies looking to capitalise on opportunities in China.

Our Free Services

• Translation of all documents for submission

to Baidu

• Facilitation of the account opening process

• Development of custom keyword lists as

required

• Translation and volume checking of

keywords

• Provision and / or translation of ad copy

• Loading of keywords into the client’s Baidu

account ready for launch

• Bid Management API application on the

client’s behalf

• Full training on how to manage accounts on

Baidu (use of the Baidu console)

• Issuing of invoices in the client’s preferred

currency and transferring of funds into the

client’s Baidu account.

• Full training on how to manage accounts on

Baidu (use of the Baidu console)

• Provision of research decks on relevant

sectors and updates in the Chinese market

• Pitch Support (provision of keyword

proposals, research, and recommendations)

CSI / NTENT’s role is to help International companies launch on Baidu.

Getting in Touch

Should you have additional questions,

please don’t hesitate to get in touch:

Kevin J. Carney

VP, Agency Partnerships & Strategic Accounts

KCarney@ntent.com

(646) 561-8643

www.baiduint.com