consumers of affordable private schooling - core report

8/13/2019 Consumers of Affordable Private Schooling - Core Report

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Consumers of Affordable

Private SchoolsA study of parents in low-income communities inHyderabad, India

November 2010


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This study was funded by Gray Matters Capital and undertaken by BGM Policy Innovations Pvt.

Ltd., herewith known as Policy Innovations. The findings presented in this report are based on the

inferences drawn from the observations given the study objectives and limited research scope.

Policy Innovations is a public policy and social enterprise advisory firm based in India and its

founders can be reached at:

[email protected] [email protected]

Policy Innovations research team: Naveen Mandava, Sandhya Chari, Sharad Baliyan, Aditi Dimri

and Sudarshan Gopalan of Policy Innovations.

From Gray Matters Capital: Sarayu Natarajan, Molly McMahon and Pradeep Sharma
mailto:[email protected]:[email protected]


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Table ofContentsExecutive Summary .......................................................................................................................... 4

What are Affordable Private Schools? ........................................................................................... 11

GMC School Rating tool ................................................................................................................. 15Objectives of the study ...................................................................................................................18

Methodology .................................................................................................................................... 21

APS parents: School shoppers ....................................................................................................... 23

Understanding the consumer ................................................................................................... 24

Pre-admission selection vs. Post-admission review ............................................................... 27

What parameters do parents consider? .................................................................................... 28

Availability of schools ............................................................................................................ 29

Cost of schooling .................................................................................................................... 30

School quality ......................................................................................................................... 34

How do parents select schools? ................................................................................................ 37

Proxies of quality.................................................................................................................... 37

Information sources ............................................................................................................... 39

School visits .............................................................................................................................41

Knowledge gaps of APS consumers .......................................................................................... 42

Affordable Private School Ratings ................................................................................................. 43

What parents say about ratings ................................................................................................ 44

Synthesis of study findings ............................................................................................................ 50

APS consumers: myths and realities .......................................................................................... 51

Parental personas ....................................................................................................................... 54

APS market entry............................................................................................................................ 59

Product development: How to develop for the APS consumer ............................................. 60

Positioning: Why the APS consumer should know you ......................................................... 61

Marketing: How you should reach APS consumers ............................................................... 63

Annexures ....................................................................................Error! Bookmark not defined.


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Executive Summary- 4 -

Executive Summary

Amidst the global initiatives to improve access to education, a new paradigm

has emerged in the schooling system in India Affordable Private Schools (APS).

In a country enjoying robust GDP growth and a consistent increase in disposable

income, APS has enabled a rising number of parents to transition from

beneficiaries of the government school system to consumers of private schooling

services. Private schools, generally associated with higher income communities,

have become accessible to lower and lower-middle income groups as well. Given

the size of these income groups, the market for Affordable Private Schools has

grown rapidly. The education market for the lower 60% of the population, by

income distribution, has been estimated to be worth about $5.2 billion.

With such rapid growth, questions about the quality of schooling imparted

through APS have been raised. While Affordable Private Schools emerged as a

result of unresponsive government schools, quality of APS has yet to be

evaluated. Despite this lack of quality assurance, APS parents are active school

shoppers. Given this, Gray Matters Capital (GMC) has created a rating system toprovide third party information to parents regarding school quality. As a part of

this effort, GMC seeks to understand the consumers of Affordable Private

Schooling APS parents. GMC is a charitable arm of Gray Ghost Ventures. One

of their focus areas is to co-create sustainable business models to increase the

access and quality of education for the poor in India.

In the current study, Affordable Private Schools are defined as self-

sustaining, private, unsubsidized schools with monthly school fees up to `800

($18).

This study has been undertaken in Hyderabad in the state of Andhra

Pradesh. Hyderabad is the sixth largest city in India and has a population of

seven million. Recent empirical evidence shows that children from as much as


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65% of households in low-income areas of Hyderabad attend Affordable Private

Schools. A substantial number of Affordable Private Schools have come up in the

city in recent years, with estimates pegging this number at around 3000.

OBJECTIVES

As a part of their wider strategy on engaging with parents, GMC

commissioned Policy Innovations to conduct an APS parent market research

study focusing on two key questions:

I. What is the consumer behavior of APS parents in choosing privateschools?

II. What is the most meaningful way to engage parents for the purposeof disseminating GMCs School Ratings?

METHODOLOGY

The study was conducted using qualitative Design Research methodology, as

well as quantitative survey techniques. Findings suggested that given the high

degree of engagement required to understand APS parents, qualitative Design

Research methods are better suited for learning about APS consumers.

APS PARENTS SCHOOL SHOPPERS

Contrary to common perception, APS parents are not indifferent when it

comes to making sound and informed decisions for their children. APS parents,like their better-off counterparts, look to education as the key to social mobility

and higher income. As consumers, these parents place a premium on education,

and spend a significant proportion of their total expenditure on education.

Nevertheless, given the lack of third party information, it was observed that APS

parents rely on social networks as their primary sources of information.

Perceptions rooted in social networks build rudimentary local brands for schools.

Parents use these brand perceptions to identify appropriate schools within their

area of consideration. In contrast to the common perception that parents do notgive much importance to differentiating between APS schools, the Policy

Innovations research team observed that parents had well defined perceptions

about every school in their area.


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In choosing schools, APS parents make decisions using certain parameters.

These parameters can be broken into three key areas presented below:

Availability of schoolso

Neighborhood School Density Cost of schooling

o Fee transparencyo Fee flexibility

School qualityo Teacher qualityo Good academicso English and Computerso

School reputation: A local brando Infrastructure

Although measures of school quality are often not immediately discernable,

parents seek to measure schools along each of these parameters. Consequently,

to measure schools along certain lines, parents resort to proxies. These proxies

are often created by parents informally measuring their children in daily

activities. For example, parents sometimes determine whether a child is receiving

good English education by seeing if the child can read news tickers on television.

Thus parents experience a knowledge gap between perceived educational quality,

and actual quality of schooling that their child receives.

Our insights reveal a twofold knowledge gap: lack of access to credible

and accurate information sources, and lack of awareness about other

potential methods of evaluating schools.

PERSONAS

In order to better understand APS parents, our study used Cluster Analysis

to create three representative personas. These personas breathe life into abstract

consumer types, and help us make sense of their behaviors, attitudes, and goals.

Having the personas in mind will make it easier to align goals and develop

services for higher uptake by APS parents. These personas, Drivers, Enablers, and

Passives, help simplify the myriad attributes associated with APS parents. Drivers


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actively seek out high quality education by engaging with social networks, and

considering schools farther away from home with potentially higher fees.

Enablers also aspire to send their children to high quality schools, however are

more constrained in their means to do so. Passives may have high aspirations,

but lack the social networks to gain schooling information. They also lack the

level of child engagement required for them to make sense of that schooling

information. They are the most resource constrained, and often have to choose

the closest, most affordable private school in their locality.

RATINGS

GMCs School Ratings can help parents bridge their knowledge gap, and

support more informed school choices. The study found that despite the fact that

APS parents experienced difficulty in gathering and understanding information

about school quality, they had not envisioned a solution in the form of ratings.

Furthermore, the concept of ratings was not familiar to them in any sphere of

life. After finding analogous tools that APS parents could relate to, such as

student report cards, the research team set out to gather data on what APS

parents might find helpful in a rating tool. In order to map action onto this data,

the Policy Innovations research team created a framework: Concept - Content -

Form - Channel(CCFC), to develop a road map for high adoption.

The Conceptrefers to conveying the idea that is the basis of an activity, inthis case, a third-party independent act of comparing schools based on a set of

criteria. The next task is developing the set of parameters used to rate schools

the Content. The Form deals with arriving at the most intuitive way of

presenting the information to a specific target audience. The Channel aspect

delves into the most suitable modes of delivery for reaching the potential users.


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ContentConcept

Channel Form

Information

contained

Idea of the

information

product

Delivery vehicles

for the product

Tangible

presentation of the

information

NEXT STEPS

Learnings from GMC ratings as a case study can be extrapolated for the

larger group of APS service providers. The earlier findings inform three strategicsteps for potential APS market entrants:

Product DevelopmentHow to develop for the APS consumer

PositioningWhy the APS consumer should know you

MarketingHow you should reach APS consumers

These entrants could be service providers, school chains, private investors,

foundations etc. Any market entrant should focus on key aspects of product

development, positioning, and marketing to ensure high demand by parents, and

thereby high adoption rates amongst schools.

Exhibit I The Concept-Content-Form-Channel framework


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How to Develop for the Consumer

Market entrants should be ready to shed assumptions based on otherconsumer environments, and know that APS consumers may not

immediately understand the premise of the product or service beingoffered.

Feature development, resonating with APS parents, is necessary but notsufficient to ensure adoption. Successful adoption will be based on how

those features come together to create a user experience the Form.

Why the APS Consumer should know you

Market entrants to APS parent market must be cognizant of their end-consumer.

APS services operate on a B2B model with schools, but have parents asthe end-consumer. Parents ultimately drive demand and make

decisions about which school services they will consume.

Creating a brand with APS parents will guide parents to activelydemand schools to employ services from particular service providers.

Market

Entrants

Schools Parents

Business to

Business (B2B)

Business to

Consumer (B2C)

Business to End-

Consumer (B2E-C)

Exhibit II Engaging the End-Consumers


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This will drive up the market entrants demand in the overall APS

sector.

How you should reach APS Consumers

Trends are prevalent in the APS parent market. English and computershave become common school characteristics as a result of this

phenomenon.

Market entrants should create trends for APS parents to adopt theirservices.

New school services should aspire to have similar traction, by gainingadoption from better-off individuals in the community.

Market entrants should reach parents through their children aschildren have the ability to pre-approve services for parents.


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What are Affordable Private Schools?


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/What are Affordable Private Schools?- 12 -

The objective of the United Nations Millennium Development Goal for

education is to ensure that all children have access to primary education by

2015. In line with this, a number of government-driven programs have been

launched so that the worlds 1.9 billion children in developing countries

gain access to quality schooling. 1 In the midst of these initiatives, a new

paradigm in K-12 schooling services has has emerged over the past decade

Affordable Private Schools. Private schooling, generally associated with

wealthy and elite communities, has started tapping into the aspirations of

low-income communities in developing countries.

In India, private school markets are developing for the rich and the

poor alike. An interesting statistic showcases the extent of this reach. In the

United States about 5.9 million children (in the 5-18 age group) attendprivate schools.2 By comparison, 13 million children in India (in the

reduced age group of 8-11

years) are in private

schools.3,4 Although the

specific prevalence of private

schooling among the poor

has not been estimated yet,

we do know that a significant number of urban poor send their children to

these schools.

Over 70% of the urban Indian population belongs to the lower and

lower-middle income groups.5With this demographic as a target market,

the Affordable Private Schools sector has experienced rapid growth over the

1UNICEF, Children living in Poverty, http://www.unicef.org/sowc05/english/poverty.html(accessed September 12, 2010)

2

National Center for Education Statistics Fast facts, NCEShttp://nces.ed.gov/fastfacts/display.asp?id=65 (accessed September 12, 2010)

3Based on the figures of 200 million in the age group 6-14, 120 million children enrolled and24% of children aged 8-11 are in private unaided schools

4Desai, S., Dubey, A., Vanneman, R. & Banjeri, R. (2008) Private Schooling in India: A NewEducational Landscape. Brookings-NCAER, India Policy Forum

5Juxt Consult. 'Demographic' & 'Psychographic' profiling of urban Indian consumers bytheir SEC segmentation http://www.slideshare.net/JuxtConsult/snapshot-juxt-indian-urbanites-study-2010 (accessed September 21, 2009).

Affordable Private Schools are

defined as self-sustaining private

unsubsidized schools with monthly

school fees up to ` 800 ($18)


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last two decades.6,7,8 The education market for the lower 60% of the

population, by income distribution, has been estimated to be worth about

$5.2 billion.9This growth and transformation of private schooling has been

made possible only because school entrepreneurs are catering to the most

price-sensitive of consumers.

Affordable Private Schools manifest the quintessential entrepreneurial

trait of providing services in line with consumer demand, and value

addition at every price point. With more parents from lower income groups

willing to pay for what they perceive to be quality schooling services, this

sector has realized a sustainable and scalable model in schooling.

With such rapid growth, questions about the quality of schooling

imparted through Affordable Private Schools have been raised. It has been

observed that there is a great degree of variation in the quality,10,11,12 and

there is also plenty of scope for improvement. This observation should be

understood within the context of a market that caters to parents whose only

choice is between Affordable Private Schools and government schools. The

government schools in India have been associated with high rates of teacher

absenteeism and non-responsiveness to parental demands. For example,

6Around 50% of children in urban India and 20% in rural India go to private schools.Karthik Muralidharan The State and the Market in Education Deliveryhttp://www.schoolchoice.in/scnc2009/ppts/Karthik%20Muralidharan.ppt

7At the rural all-India level, private school enrolment increased from 16.3% in 2005 toaround 21.8% in 2009 a rise of around 34%. Wilima Wadhwahttp://www.livemint.com/2010/01/18203525/Education8217s-big-faceoff.html

8Geeta Gandhi Kingdon in her study mentions that in urban India, 61 per cent of all theincrease in total primary school enrolment in the period 1986-1993 was absorbed byprivate schools Kingdon, G. G. (2005) Private and Public Schooling: The IndianExperience. Paper presented at the Conference, Mobilizing the Private Sector for PublicEducation, Co-sponsored by the World Bank, Kennedy School of Government, HarvardUniversity, October 5-6, 2005

9

Kubzansky, M., Frandano, P., & Karamchandani, A. (2009) Emerging Markets, EmergingModels: Market-Based Solutions to the Challenges of Global Poverty. Monitor Group

10Desai, S., Dubey, A., Vanneman, R. & Banjeri, R. (2008) Private Schooling in India: A NewEducational Landscape. Brookings-NCAER, India Policy Forum

11Tooley J, Dixon P, Shamsan Y, Schagen I. The relative quality and cost-effectiveness ofprivate and public schools for low-income families: a case study in a developing country.School Effectiveness and School Improvement 2010, 21(2), 117-144

12Kingdon, Geeta, 1996a. The quality and efficiency of private and public education: a casestudy of urban India, Oxford Bulletin of Economics and Statistics, 58.1, 57-81


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In a country enjoying robust GDP

growth and consistent increase in

disposable incomes, a rising

number of parents have

transitioned from being

beneficiaries of the publicschooling system to consumers of

private schooling services.

government schools have not met parents demands for English as the

language of instruction (English-medium education, as it is called in local

parlance). In a country enjoying robust GDP growth and a consistent

increase in disposable income, a rising number of parents have transitioned

from being beneficiaries of the government school system to consumers of

private schooling services.

In the current study, Affordable

Private Schools are defined as self-

sustaining, private, unsubsidized

schools with monthly school fees up

to `800 ($18). These schools are

interchangeably referred to as APSor private schools in this report.

This study has been undertaken

in Hyderabad. Hyderabad, in the

state of Andhra Pradesh, is the sixth

largest city in India and has a population of seven million. 13One in three

residents of Hyderabad belongs to the urban poor.14 Recent empirical

evidence shows that children from as many as 65% of households in low-

income areas of Hyderabad attend Affordable Private Schools. 15 A

substantial number of Affordable Private Schools have come up in the city

in recent years, with estimates pegging this number at around 3000.16The

study sheds light on consumers experiencing the emerging APS

phenomenon an everyday reality for millions of households in India.

13

http://www.hudahyd.org/ (accessed September 21, 2010)14City Development Plan Chapter 5 Urban Povertyhttp://www.ghmc.gov.in/downloads/cdpdefault.asp

15 Tooley, James, and Dixon, Pauline (2005) Private education is good for the poor: A studyof private schools serving the poor in low-income countries, Washington DC: CatoInstitute.

16 Affordable Private Schools in Hyderabad. http://openideo.com/open/how-might-we-increase-the-availability-of-affordable-learning-tools-educational-for-children-in-the-developing-world/gallery/aps-info.pdf Accessed on September 20 2010


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GMC School Rating tool


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GMC School Rating tool- 16 -

The development of quality assessment measures has not matched the

pace of the rapidly growing APS sector. This new sector lacks a healthy

flow of information that is crucial to a budding ecosystem. For example,

schools are judged by Grade 10 exam (similar to high school graduation

exams or standardized tests) pass rates, rather than by understanding

learning levels throughout a childs education. Schools also have limited

financial systems and do not regularly report their data. As a result of this

information asymmetry, the market lacks industry standards, scope for

comparison, and aggregate sector information. Gray Matters Capital (GMC)

has thus undertaken development of a school rating system to make

information more easily available and the schools operations more

transparent.

GMC is a charitable arm of Gray Ghost Ventures, a social investment

company that seeks to invest in visionary people, with an emphasis on

microfinance and education. GMC uses philanthropic capital to research

and co-create initiatives with partners in developing countries to build

sustainable, replicable business models, for the benefit of underserved

populations. One of GMCs focus areas is to increase the access and quality

of primary and secondary education for the poor in India.

Rating tools in other sectors allow consumers to compare options

across certain standard metrics. School rating is no different; it aims to give

parents an opportunity to be more informed consumers of school services.

GMC School Rating has the potential to align ecosystem stakeholders

around common standards. The GMC School Rating tool objectively

examines five key areas:

I. Governance and StrategyII. Learning Environment

III. Student Academic AchievementIV. Parent EngagementV. Financial System & Performance


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GMC School Rating tool- 17 -

In each of the five key areas, the tool uses select information from a

variety of sources. The evaluation of Governance, Parent Engagement, and

Financial Systems rely on pre-selected criteria, and use group discussions or

in-depth interviews. Evaluation of Student Achievement and Learning

Environment rely on assessments of students and teachers.

The GMC School Rating tool will allow APS consumers to compare the

quality of one school to that of other schools or industry benchmarks. APS

Consumers can also use it to better understand the performance of

individual schools. GMC will present the information in a non-threatening

comparative framework that highlights effective practices through a

benchmarking process. The most compelling performance benchmark

would be the school itself; to compare a school against itself over timewould allow for measuring continuous progress. The design and

implementation of GMCs rating system will take into account APS

consumers and will be guided by research on how they select schools.


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Objectives of the study


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Objectives of the study- 19 -

There have been very few studies which have looked at how low-

income parents choose schools for their children. There have been even

fewer attempts to enable APS parents to make better schooling decisions inthe presence of options.

As a part of its wider strategy on engaging with parents, GMC

commissioned Policy Innovations to conduct an APS parent market

research study focusing on two key questions:

I. What is the consumer behavior of APS parents inchoosing private schools?

II. What is the most meaningful way to engageparents for the purpose of disseminating GMCs

School Ratings?

Based on the scope of these key questions, five areas were outlined to

direct the analyses for the qualitative and quantitative phases.

A.What are the socio-economic backgrounds of APS parents?B. How do APS parents choose between school offerings?C. How do APS parents measure learning outcomes of their

children?

D. How do APS parents engage with their childrens education?E. What is the most meaningful way to use a school rating to

engage APS parents?


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Objectives of the study- 20 -

Information on APS parents and GMC School Ratings is presented in

the following five sections:

Section heading Content

MethodologyPresents the methodology used

for learning about APS consumers

APS parents: School shoppers

Describes how the APS parent

acts as an active consumer while

choosing schooling services for

his or her children

Affordable Private School RatingsDiscusses APS parents reactions

to GMCs School Rating

Synthesis of study findingsPresents the synthesis of learnings

on APS parents

APS market entry

Articulates the next steps that a

market entrant should take to

engage APS parents

For the study, an APS child was defined on the basis of an annual

school fee expenditure of up to `9,600 per year ($216) per child. There are

also private aided schools in India that operate under private management

with government aid but, we have not classified them as APSs in this study.


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Methodology


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Methodology- 22 -

There are a variety of methods to study and understand consumers,

ranging from case studies to field trials. In this study the research team has

used both Design Research methods and traditional market surveys. The

methodology used to study APS parents has to consider the biases of

parents attempting to meet social expectations (perhaps by trying to appearconcerned about a childs education). For example, APS parents do not

want to be perceived as fee driven, even if the reality is that their schooling

decisions are based on affordability. In addition, education as a

consumption service in the APS segment is unique because of the

emotional value that parents attach to it.

The Policy Innovations research team found that Design Research

methods were the most appropriate to understand APS parents. While

traditional surveys could be used, they were extremely limited in their

ability to capture the depth and breadth of the APS parent market.

Researching APS parents requires a high degree of engagement and

behavior observation, which basic interviews and survey questionnaires are

not able to achieve. Survey questionnaires can provide high level factual

information, but only Design Research can tap into behaviors, attitudes,

and goals.

Of the wide variety of Design Research tools, the following wereemployed: contextual interviews, proxy experiences, and personas. Design

Research has the added advantage of including methods that enable the

introduction of a prototype into an environment and gauging reactions to

it. These methods proved very useful for learning about parental reaction to

school ratings. Personas were developed on the basis of insights from

Design Research. Quantitative methods of Cluster Analysis were used to

validate the personas.

We chose Design Research and Cluster Analysis, based on their fit with

and relevance to the scope of the project. The methodology for the study is

described in full in Annexure I. The report also seeks to stimulate debate

around the methodologies used to study APS consumers, and aims to

inspire future application of enriched frameworks to map APS consumer

behavior.


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APS parents: School shoppers


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/APS parents: School shoppers- 24 -

Understanding the consumer

APS parents, the consumers of Affordable Private Schools, are members

of the working class. They are, for instance, domestic workers, auto-

rickshaw drivers, cab drivers, plumbers, salespeople at retail malls, bank

tellers, electricians, and cooks at dhabas (local restaurants). In short, they

are the masses of India aspiring for greater social mobility.

APS parents live in

tightly knit

communities. These

social networks areformed because their

members live in the

same neighborhood, or

belong to the same

caste or village, or

share the same

occupation. These neighborhoods, locally called mohallas, are extended

living spaces beyond the four walls of their residents homes. Theirhouseholds frequently share commodities, meals, water sources, appliances,

and the like. The social capital in these communities is usually life

experience; the richer an individuals life experience, and the greater his or

her maturity, the more his or her opinions count in the peer group.

In a society where social hierarchies and stratifications are very

apparent and difficult to breach, parents look at education as the key to

enabling inter-generational social mobility, and providing their children

with a better life. The top three categories of expenditure for APS

households are, thus, food/groceries, living space expenses, and childrens

education (see Exhibit III). A snapshot of data about APS parents is

presented inExhibit IV.


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40%

5%

20%

13% 5%4%

7%

2%

4%

13%

Food/ Grocery

Clothing/garments

House rent and electricity andwater

Education of children

Festivals and entertainment andleisure

Exhibit IV A snapshot of APS parents

80%of mothers are housewives

Only 50%of parents admittedto having any savings; their average

yearly savings were `6144 ($137)compared to an average annual

expenditure of about `61859 ($1375)

70%ofhouseholds have 4 or

5 members

At least 90%of householdshave electricity, a toilet, a gas stove,and cable TV

About 95%of parents had someform of access to a mobile phone

Exhibit III Detailed household expenditure across categories


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Given their socioeconomic backgrounds, APS parents are often

portrayed as illiterate, ignorant, and indifferent, especially in the context of

making sound and informed decisions for their children. Some of thestereotypes that we noted at the beginning of the study were:

Parents from low-income communities do not send theirchildren to private schools

Parents from low-income communities do not prioritizeexpenditure on education

APS parents are not highly engaged in their childs education APS parents are only concerned about primary schooling and

employability in the short-term

Parents in low-income communities are not active consumers ofprivate schooling

Most low-income parents choose any school as long as they canafford the fees and do not differentiate on various parameters of

school quality

Parents are not looking for information on school quality Parents will not be able to comprehend or act upon packaged

information about school quality

The APS Parent Study began with these perceptions and assumptions.

Mapping the motivations and behaviors of APS parents led to an

understanding of their decision-making process in choosing or shopping

for suitable schools.


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Selection

Ask peers for

information onaffordableschools in theneighborhood

Get moreinformationabout theseschools

Shortlistschools basedon informationavailable (fees,

commute, etc)

Admission

Visit 1or 2 of

the top schoolsshortlisted Negotiate fees Enroll child in

school

Review

Assess child's

progress Be alert to

problems withschool quality

Compare withpeer groupdecisions

Pre-admission selection vs.

Post-admission review

In pursuit of desired schooling outcomes, parents engage in the

following broad stages of decision-making to choose a school.

Parents apply differing parameters when choosing a new school versus

when evaluating the performance of a current school. For example, while

selecting a school, the main parameters may be: peer endorsement of the

school, one-time admission charges, and Grade 10 (standardized test)

results. However, when a child is already enrolled in a particular school,

parents may give more importance to observed learning assessments, such

as the ability to speak English, take initiative in completing homework, andobtain good marks. They also consider the costs of switching to another

school. In addition, a parents opinion of school performance appears to be

tied in with perceived teacher quality.

Exhibit V Three stage school assessment process


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Variations in the decision making process occur because of differing

attitudes, education levels, income characteristics, and other contextual

factors. Despite this, there are in general a few key parameters that drive

the school shopping process. These parameters have been highlighted

based on their prevalence and intensity among APS households.

What parameters do parents consider?

As consumers, APS parents have well-defined expectations from

schools. Depending on their preferences, parents look to schools to

inculcate communication skills and discipline-related traits and/or provide

high value addition in terms of overall employability. The major

expectations for children attending school are listed below:

Improved cognitive abilities Better command over non-native language, especially English Self-discipline School graduation or completion of high school Monetizable skills

To better understand these expectations, APS parents were asked open-

ended questions about parameters they used to select the schools their

children currently attend. Specific features like Teaching quality, as well

as more composite parameters like Good academics, received the

maximum positive responses.

The way parents evaluate schools is akin to the way consumers evaluate

services. APS consumers use three key parameters to drive their selection of

schools:

1. Availability of schools2. Cost of schooling3. School quality


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11%

35%

38%

47%

53%

64%

76%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

Fee flexibility

Infrastructure

Reputation

Proximity

English & Computer subjects

Good academics

Teacher quality

Percentage of PS parents

Pmeoshamn

Availability of schools

Neighborhood school density

The choice an APS parent makes is influenced by the density of schools

in the neighborhood. Parents aspirations motivate them to stretch their

wallets in spending on transportation to school. This enables their child toaccess a good education, in their view. Proof of this is seen in the peri-urban

areas of Hyderabad which have a low density of Affordable Private Schools.

In these areas, parents often choose to send their children further away to

schools by bus, a relatively expensive form of transportation. Conversely, in

areas with a higher density of private schools, parents choose from schools

within a 1 km radius and an average travel time of 10 minutes. A variety of

neighborhood factors affect the choice of a school. For example, if getting to

a school requires crossing a road with heavy traffic, that school will not beconsidered, given the danger to children. Parents who are highly concerned

about schooling are insistent on sending their children to a better area with

a school they perceive to be good, even if the school is further away from

home.

Exhibit VI Top parameters for school assessment


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3,6924,024

6,250

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

Kindergarten Primary Secondary

A

ansh

nR

Grade level

Cost of schooling

APS parents are extremely price-sensitive consumers. They consider

schools across a spectrum varying from extreme affordability to feature

richness. Parents who choose the former, desire the lowest cost private

school, whereas parents choosing the latter display an aspiration for the

most suitable among various Affordable Private Schools. In terms of

schooling services, they associate higher school fees with higher academic

quality. During the process of school selection, one of the first filters used

to shortlist schools in the neighborhood is the cost of schooling. Once

parents are comfortable with a particular price band, and have identified

schools that fall within it, they proceed to assess those schools across other

parameters. As presented in Exhibit VII, the price band is dependent on,

among other things, the grade level their child is joining.

Exhibit VII School fees vary considerably with Grade level


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8913

1698

1447572

7145

1767

3429

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000

SchoolMonthly

fees

Sundries(Textbooks

etc.)

Term fees Exam fees Totalschool fees

Privatetuition

Privateschooling

expenditure

R

Education expenditure category

Fee transparency

Parents frequently express their concerns about the opacity of different

categories of fees charged by schools. Schools are perceived to be seldom

transparent in communication of fees other than the basic monthly school

fees. Some schools mandate that certain items (e.g. school belts) must be

purchased by the parents. The school may have a monopoly on supplying

these items (e.g. a curriculum book supplied only by the school), thereby

enabling it to charge higher prices for them.

As seen inExhibit VIII,school monthly fees make up only about 48 %

of the total payment made to the school for a single childs education. Since

schools have differing fee categories, this percentage will vary across

schools. There can also be wide variation in this percentage depending on

the degree of concession afforded to parents, the discount(s) provided to a

single household sending more than one child to the same school.

Exhibit VIII School monthly fees make up a portion of thetotal fees


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Apart from the periodic payment that needs to be made to the schools,

almost all schools require a donationamount at the time of admission. The

donationamount is a mandatory one-time payment for the admission of a

child into a given school. This was observed to be a common practice across

private schools, but it may differ from area to area. The average donation

amount was observed to be about `2613, which is a significant portion of

average monthly household expenditure (`5476) and average monthly

household savings (`512). Therefore, this donationamount is a significant

switching cost.

The fee categories that parents might have to spend on to send their

child to school include:

Base fee (APS families, especially those from the lower incomegroups, complained that this fee is charged even for the two

summer months during which the school is closed)

Donation / one-time admission fee Term fee or exam fee (either usually charged three times a year) Annual fee Sundry fees (uniform and books can often only be purchased

through the school)

Transport costs and facilities fee (for computer lab, library, etc)Some schools have started announcing an all-inclusivepackage to the

parents, but this was a nascent trend at the time of this study.

Fee flexibility

The majority of APS households run on a short budget window with

irregular income. In addition, household cash flows may be restricted as a

result of economic shocks (such as illness and the resultant expensive

treatment required). Considering that APS parents stretch themselves more

for education (Exhibit IX), these economic shocks often tend to have a

direct impact on education. This acutely affects their ability to pay fees

monthly, as is often mandated by schools. APS parents expect empathy and


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45%41%

7%

5%

6% 20%

9%

13%11%

12%5%

4%17%

5%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Typical Urban Indianhousehold

(Source: Max-NCAERstudy, 2008)

Typical APS Indianhousehold

Pnaosoddampeorpvsuv

Others

Healthcare

Transportation and leisure

Education

Housing & utilities

Apparel

Food & Beverages

flexibility from schools with regard to fee payment. They develop negative

views about schools that are inflexible or tight in this regard. During the

study, parents often spoke about schools that would punish children or

send children back home if fees were not paid in time.

Parents, therefore, enquire about schools in their neighborhood that

charge monthly fees within their budget, the flexibility of these schools with

regard to their fee payment schedule, and the extra costs they would have

to bear in addition to the monthly fees.

Exhibit IX APS parents assign a larger share of theirexpenditure to education


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School quality

Teacher quality

For most APS parents, a school is best understood through its teachers.Parents interact with schools through meeting with teachers, and they

indirectly measure teachers through their childs learning levels. Parents

expect teachers to be qualified, sensitive, authoritative, articulate, and

vouched for by students.

As a result, parents often seek to learn about the quality of teachers.

Considering that parents are not as literate as the teachers, they are unable

to assess teachers through direct interaction. In fact, parents often feel

intimidated by teachers, a feeling that is sometimes fostered by teachers

themselves. Therefore, APS parents gain information about teachers

through their children, and other students in their social network.

School owners recognize the importance of teacher quality, and view

teachers as a schools primary asset. Nevertheless, schools tend to cut costs

when it comes to hiring good teachers better teachers require higher

salaries. Schools that do not invest in retaining their teachers or in teacher

qualifications develop a negative reputation over time. This leads to highteacher turnover rates, which implies teacher absence, and little ability to

build strong student-teacher relationships.

Low teacher quality and high teacher turnover are factors that may lead

parents to decide to exit a particular school.

Good academics

Good academics is the core of parental desire in school quality. Themore educated the parent, the more parameters he or she would use to

holistically understand academic quality. In discussing this holistic quality,

parents often use the word good. For APS parents, academicsis comprised

of both discipline and subject study. Parents expect the school to impart


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certain habits of self discipline and initiative in completing homework, as

well as enable academic achievement. While academic achievement is often

taken for granted as a parameter in school choice, it is worth a special

mention here because one of the perceptions of APS parents is that they

may not have a strong focus on academic achievement. Parents citing this

as a driver of school selection, shows a mental shift from being satisfied

with basic school enrollment, to seeking academic achievement within a

particular school. Parents have no real means of assessing this, and use

proxies instead.

English and computer subjects

APS parents view English communication and computer skill

acquisition as a direct contributor to future income. Many parents

specifically cited computer facilities and English medium instruction as

determinants of school selection. In fact, they see English and computer

literacy as a springboard for economic and social mobility. They also

mentioned that the presence of computer facilities and computer teaching

contributed positively to the school brand image.

School reputation as a local brand

In contrast to the common perception that parents do not give much

importance to differentiating between APS schools, the research team

observed that parents had well-defined ideas on the image of every school

in their area. Schools had a particular reputation in their immediate

neighborhood. Schools could possess various kinds of reputations: good for

academics; discipline maintained well; cost-effective. Interactions with

social networks confirm these perceptions, and solidify reputations.

Perceptions rooted in social networks build rudimentary local brands forschools.


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Perceptions rooted in

social networks build

rudimentary local brands

for schools.

The reputation of the school owner

(also known as school correspondent or

the principal) is one of the key parameters

driving school brand. The owners are

local brands in themselves, and are

gauged in terms of the following:

Qualified or experienced School leaders are expected to be relatively well-qualified and have

substantial teaching experience, either in another school or as a

private tuition teacher.

Empathetic towards parents Parents expect APS leaders toempathize with them and understand their constraints, as most of

these leaders belong to the same community and are aware of the

circumstances in which these parents bring up their children.

Strict disciplinarian The cultivation of self-discipline in a child isone of the most important expectations of APS parents from

private schooling. A school leader who is justifiably strict with their

children is appreciated. Having said that, we observed that parents

frown upon anybody from schools (principal or teachers)

administering corporal punishment. Also, parents expect the

school to be proactive in acting on and giving feedback about a

childs absenteeism.

Trustworthy School leaders are expected to have good moralcharacter and be reliable. Mothers with girl children were

especially concerned about this parameter for safety reasons.


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Infrastructure

Parents show a preference to send their children to schools that convey

a sense of stability through fixed infrastructure, the bigger the better.

Parents often speak of big schools with a degree of respect. Often, the more

crowded the school, the more popular it is deemed to be, notwithstanding a

low teacher-student ratio. Computer infrastructure on school premises

(either for teaching or staff purposes) is also seen as a symbol of

sophistication, and a step towards fulfilling aspirations.

Schools using rented premises convey instability and therefore, this

contributes to a negative image. Parents mentioned that instances of such

schools shutting down resulted in high switching costs, as transferring their

children to a different school involves admission fees, new school uniforms,

and donationscharges.

How do parents select schools?

Having understood what parameters parents use to make decisions, we

aim to understand how they assess schools along those parameters.

Proxies of quality

Performance along certain parameters can be seen directly, such as

fees, proximity to home, and computer facilities in a school. Other

parameters, however, are more difficult to assess. Parents have a difficult

time directly perceiving teaching quality, spoken English, computer skills,

and good academics. In order to understand how schools measure along

these lines, parents use proxies that indicate performance. Often, the


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behavior of the child at home permits parents to make certain inferences

about what is happening at school.

Parents use two key proxies to assess child learning (seeExhibit X). The

first focuses on behavioral manifestations, such as discipline, the degree of

self-motivation in completing homework, and cleanliness demonstrated by

Exhibit X Proxies for school selection parameter

Parameters for

gauging schools

Ability to

gaugeProxies used

Fee flexibility Yes -

Infrastructure Yes -

Reputation Yes -

Close to home Yes -

English +

ComputersPartially

Read advertisements or posters out loud Read tickers on TV Recite English lessons /poems, Proficient in general knowledge

Good academics No

Degree of self-motivation to do homework Cleanliness demonstrated by child Child academic achievement Tangible items: homework, school diaries

and progress reports

Teaching quality No

Childrens opinions Teacher qualifications and experience Sensitive to child Authoritative disciplines child Articulate knows how to communicate

in English

Teacher turnover Teacher training Childs academic achievement


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40/65


shirker. To corroborate their own childs opinion of specific aspects, they

question other students who attend the same school. This provides them

with a composite image of the schools quality. In fact, when we spoke to

parents beyond the APS community, we found that parents in the middle

and higher income categories also exhibit the same behavior. All parents

rely significantly on feedback about schools from students.

The only other significant source of information is the school itself.

Schools disseminate information in the community through brochures, and

teachers who are sent out across the neighborhood to talk to parents about

the advantages their school offers.

Information Source Overall %age

Neighborhood students and their parents 90.73

Teachers canvassing 30.94

Information brochure of schools 23.62

Poster/Pamphlet /Graphic formats 17.34

Teachers/ principals they know 15.7

Newspaper 11.51

Meeting teachers/ principal by visiting each schools 9.27

Television 8.82

Radio 0.45

Exhibit XI Social networks are the main info source


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School visits

The key indicators of the extent of school shopping undertaken by APS

parents are: the number of schools they consider, and how many they

actually visit prior to admission.

Parents consider schools for admission when they fulfill their

preliminary short-listing requirements. These are, generally, distance to the

school and fee range. For schools which are short-listed, parents try to

obtain more information on factors such as reputation of the school, quality

of academics, and teacher quality. School visits are used to assess the

infrastructure in the school and negotiate the fee amount and payment

terms with the principal. It is observed that about 80% of parents (see

Exhibit XII)visit only one school, indicating that a vast majority of parents

have already made their choice by the time they visit schools.

Exhibit XII School visits are at low levels

Schools

considered

Schools visited

1 2 3 4 5 6

1 59% 0 0 0 0 0

2 14% 4% 0 0 0 0

3 5% 5% 1% 0 0 0

4 1% 6% 1% 1% 0 0

5 1% 2% 1% 1% 1% 0

6 0% 1% 0 1% 1% 1%


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Knowledge gaps of APS consumers

Our insights reveal a twofold knowledge gap: lack of access to

credible and accurate information sources, and lack of awareness

about other potential methods of evaluating schools.

Parents primary sources of information, social networks and children,

are biased and unscientific in assessing school quality. Also, the information

they receive is a weak proxy of the school quality measures. Nevertheless,

children remain the main window of insight into the happenings at school,

and therefore, the most important medium to assess a schools quality.

Currently parents are accustomed to, and even satisfied with the

information they receive, because they are unable to conceptualize any

other option. They make school choices with the existing knowledge

gaps and accept these gaps as a feature of their lives.


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Affordable Private School Ratings


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Affordable Private School Ratings- 44 -

GMCs School Ratings can help parents bridge their knowledge gap and

support more informed school choices. As mentioned earlier, parents have

to resort to proxies for certain measures of school quality - 'Computers +

English,' 'Good Academics,' and 'Teaching Quality.' Ratings will provide

valuable information on these parameters so that APS consumers no longer

have to rely on proxies alone. The provision of information also allows for

parents to turn to established measures of school quality, and use

benchmarks to compare school performance.

GMCs School Ratings crystallize a demand for quality education,

thereby creating a signaling effect to schools. This tight feedback loop will

potentially create better accountability of Affordable Private Schools to

parents, their paying customers.

What parents say about ratings

APS consumers were unfamiliar with the idea of a rating tool. Only the

usage of appropriate metaphors helped them understand the concept of the

tool, and revealed strong opinions on what they would value in school

ratings.

In the initial stages of the study, parents were interviewed about school

ratings. Because there is no equivalent of a rating model in any sphere of

their lives, the idea and the explanation of the tool did not resonate with

them. The concept of a third-party source of independent information to

enable comparison between products or services does not exist in their

mind-space.

Due to a lack of response, the metaphor of a school report card was

used to explain the concept of School Ratings. The research team explained

that the school report card was equivalent to a student report card, but

instead of comparing students to each other, it would compare schools.

This metaphor allowed APS parents to understand the idea of school ratings


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ContentConcept

Channel Form

Information

contained

Idea of the

information

product

Delivery vehicles

for the product

Tangible

presentation of

the information

and allowed a few key parameters to emerge as priority areas for parents

with regard to a school rating tool.

The challenges in developing a school rating product are two-fold: first,

create a pioneering product and second, introduce the concept of theproduct to the target audience. The research team created a framework:

Concept - Content - Form - Channel (CCFC), to develop a road map for high

adoption.

The Conceptrefers to conveying the idea that is the basis of an activity,

in this case, a third-party independent act of comparing schools based on a

set of criteria. The next task is developing the set of parameters used to rate

schools the Content. The Form deals with arriving at the most intuitive

way of presenting the information to a specific target audience. The

Channel aspect delves into the most suitable modes of delivery for

reaching the potential users.

Exhibit XIII The Concept-Content-Form-Channel


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The concept of school rating

In this study, we used the metaphor of school report card to convey the

Conceptof the School Rating tool.

When introducing school ratings, parents argued that there is no valueto a rating system that would compare any two schools, as the school with

higher fees is bound to have higher quality. This feedback led to

modification such that schools in a neighborhood would be compared

within a price-band.

A majority of the parents (85%) mentioned that it would be helpful to

have a school report card.

Desired content in the rating tool

The Content part of the rating tool can be derived on the basis of the

parameters discussed in a previous section.

APS parents particularly find value with regard to three parameters of a

school: the quality of academics (38%), performance of teachers and their

teaching quality (31%) and the nature of school facilities (30%).

Parents tend to ask for information that they are unable to currently

assess. Information on factors such as teacher quality and student strength

cannot be gauged by parents using their current abilities or networks.

Therefore, they see the potential for third party information on these

parameters.

Ways to disseminate the ratings

GMC attempts the challenging task of introducing the new concept of

sharing local school information on a large scale. This information must be

disseminated through a channel such that it reaches every APS parent. To

understand what channels parents would be receptive to, the study asked


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2125

2934

42

7074 73

0

10

20

30

40

5060

70

80

PnaoApnmuperp

Preferred sources of information to get SRC

APS consumers how they would most prefer to access the ratings (see

Exhibit XIV. Unlike other rating systems which are commonly accessed

through the web or via SMS, school ratings will have to be disseminated

through alternative methods. APS parents cited private tuitions, stationery

shops, and school registration forms as preferable channels for receiving

third-party rating information.

The cost of disseminating the rating information varies based on the

channel. If the ratings are to be scalable, costs may eventually have to be

shared by the parent. The study asked if parents would be willing to pay for

ratings, and more than 96% of parents expressed a willingness to pay.

While there is a wide range of amounts parents are willing to pay from `5

to `150 the average amount is `30.

Exhibit XIV Existing channels are preferred sources for SRC


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4.043.29

14.95

6.88

22.87

27.8

16.14

4.04

>= Rs100 Rs 51 - < Rs100 Rs 41 - Rs 50 Rs 31 - Rs 40

Rs 21 - Rs 30 Rs 11 - Rs 20


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Text-based content will not be useful as most APS parents arebarely literate.

o Parents noted that they primarily use their phones forvoice features as they are unable to read SMSs.

Sign-based content may be used but symbols adopted mustbe relevant to the parental mental model and the cultural

context.

o Symbols, colors, and often have religious, political, andsocial connotations. Inadequate testing and research in

this area risks alienating segments of APS consumers,

and hindering mass adoption.

No single common language is used across Hyderabad.o A number of colloquial words are used to ascribe

certain qualities to schools. SeeExhibit XVI

Exhibit XVI APS qualifiers in local parlance


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Synthesis of study findings


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Synthesis of study findings- 51 -

This study began with certain perceptions about APS parents. They

were commonly described as apathetic, ignorant, and lacking aspiration. As

the study progressed, these perceptions were slowly revealed to be myths.

In contrast, APS consumers were found to be driven, discriminating, and

active in school shopping.

There are various dimensions along which to categorize APS

consumers. They vary on the basis of aspirations, constraints, and desire for

school features. In order to make all these facets actionable, we developed

three personas Drivers, Enablers, and Passives - to represent APS parents.

We can put ourselves in a personas shoes to understand their perspectives

on private schools and school ratings.

In engaging with parents, GMC should use a twofold strategy:

First, understand the consumer. Getting inside the mind ofthe consumer through the personas is the best way to learn

about their needs and, more importantly, aspirations. The

market segments that these personas represent are crucial to

creating customized messaging that will result in adoption of

school ratings.

Second, GMC has to develop a credible brand so that itbecomes a household name for its pioneering efforts in rating

school.

APS consumers: myths and realities

Before grouping APS parents into their personas, we make note of

common traits among APS consumers. These dispel the prevalent

perceptions of APS parents.


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Low-income communities do not send their children to privateschools

About 45% of APS parents belong to lower-income groups, alongwith 29% from middle-income groups and 26% from higher-

income groups.

Low-income communities will not prioritize expenditure oneducation

On an average, households in urban India spend about 9% oftheir total expenditure on education. APS parents (who

responded to questions on educational expenditure) spend an

average of 13%, reflecting their aspirations.

APS parents are not much engaged in their childs educationMost parents (90%) do engage actively with their children, with

varying frequencies.

APS parents are only concerned about primary schooling andemployability in the short-term

APS consumers value schooling, higher education, and skilldevelopment. Completion of schooling is a clear desire and

priority. However, this depends on income constraints and

parental perceptions about the ability of the child. With an

emphasis on schooling, parents are keen on skills that enhance

employability. They also seek to save for their childrens higher

education.

Parents in low-income communities are not active consumersof private schooling

APS parents associate each school in their neighborhood with aparticular image and reputation. They compare these

characteristics along with fees and teaching quality within their

social networks. Thus, they view themselves as consumers, and

understand the idea of choice.

Most low-income parents choose any school as long as theycan afford the fees and do not differentiate on various

parameters of schooling quality


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APS parents behave as active

consumers and are well aware

about their choices

APS parents face social expectations that influence their opinions and

actions. In qualitative conversations, parents mentioned low levels of

attendance at PTA meetings, and claimed that fee amounts were a key

parameter in school selection. In quantitative research, by contrast, parents

reported relatively high PTA attendance, and did not cite fees as a strong

parameter in choosing a school. This difference arises because parents want

to project an image that they are meeting social expectations regarding

education. Such social expectations should inform GMCs parent

engagement strategy.

APS parents behave as activeconsumers and are well aware of

their choices. If they were not

active consumers, the

introduction of a rating tool would

APS consumers discriminate to varying degrees with regard toprices. There is a segment for which price is the key parameter;

parents in this segment expect fee flexibility. There is also a

section of APS parents for whom price is a necessary but not

determining factor.

Parents are not looking for information about school qualityAPS parents rely on students as sources of school information.

Since parents are often not able to directly gauge teacher or

school quality, they assess these through children. While there

are biases inherent to this method, parents do trust children as

reliable and credible sources of information.

APS parents do not depend on independent third party sourcesfor price and other features of the schooling service, but

frequently use immediate social networks to inform their

decisions. Most parents use their social networks to bring the list

of considered schools down to a final one or two. In the absence

of social networks, we find that parents do consider and visit

more schools.


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Personas breathe life into

abstract consumer

segments, and help us make

sense of their behaviors,

attitudes, and goals

require a huge change in mind-set regarding the ability to exercise choice.

Given APS parents behave as consumers and not passive beneficiaries, GMC

does not have to change mindsets in order to encourage rating adoption

instead it has to engage in a process of education about the rating tool. We

recommend an awareness building phase for APS parents that will bring

about awareness of the rating tool, additional parameters for assessing

school quality, and how the tool can be used.

Parental personas

GMC can develop an effective actionable engagement strategy withparents through the usage of personas. Personas put a face on to

user/market research in a way that turns data and observations [from market

research] into usable knowledge17.The majority of the APS parents can be

grouped within three distinct personas: Drivers, Enablers and Passives.

In order to bring these personas to life, a representative character was

chosen for each. Venkat is a Passive; Anjum, an Enabler; and Ravi, a Driver.

These personas breathe life into abstract consumers, and help us make

sense of their behaviors, attitudes, and goals. Seeing the world through the

eyes of a persona makes it easier to sense

what features of a school rating would

resonate with them, and what actions they

might take to incorporate school rating

into their lives. They also help us simulate

parental reactions at different stages of

adoption of the school rating product. For

example, we can ask a question like

17Mulder, S., Yaar, Z.: The User Is Always Right: A Practical Guide to Creating andUsing Personas for the Web. Page 14. New Riders Press: 2005.


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Would Anjum use this? in thinking about feature development. Having the

personas in mind will make it easier to align goals and develop services for

higher uptake by APS parents.

Each of the personas enables us to capture insights related to the needs,aspirations, and behaviors of groups of APS parents. In particular, Drivers

'drive' their children to better schools. They have access to strong social

networks, and are the least monetarily constrained. They are relatively well

educated Driver fathers generally have studied up to Grade 10 and work in

non-manual labor jobs, while Driver mothers often have some schooling.

They value education in a holistic way. They expect schools to provide

English and computer literacy, and to also have good teachers and overall

good academics. They are willing to travel outside their immediate area forthe sake of a better school.

Enablers exhibit many of the same qualities as Drivers, but to a lesser

degree. They are motivated to engage with their children and push them

into good schools - 'enable' them - but often lack the means. On average,

they too have had some schooling; however they are more likely to have

studied up to Grade 5 or Grade 8. They are somewhat financially

constrained and do not venture long distances away for school. They too

have strong social networks which they use to gather information about

schools.

Passives are those who are motivated to send their children to good

schools, but are passive about engaging with their children. They are the

most monetarily constrained and often have had no schooling at all. Since

they are usually migrants shifting to Hyderabad from other parts of

Andhra Pradesh - they lack cohesive social networks. They may have strong

aspirations, and get information about schools in different ways. Inparticular, they visit more schools in person than Drivers and Enablers

because they lack social networks to provide them with information about

schools.


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Name: Ravi

Persona : Driver

I have to send my child to school by bus because

none of the schools in my area have good academics.

Ravi and Anu have been living in Hyderabad all their lives. They

live in the Old City, where she is a beautician, and he is a factory

supervisor. Together, they typically earn about `7500 per month,

and each month they spend approximately `1050 on education

related expenses. Education related spending constitutes nearly14% of their total expenditure. Anu studied up to Grade 10, and

Ravi, up to Grade 12. They have high aspirations for their

children, Ajay and Veena. They are also regularly asked for advice

about private schools in the neighborhood.

Ravis Personal Statistics:Occupation: Factory Supervisor /BeauticianPlace of Origin:HyderabadHousehold: 4 members in total

School Decision Mentality:Aspirations:HighDegree of Constraint: LowEngagement with Social Network:HighNumber of Schools Considered: LowNumber of Schools Visited:LowMost Important SchoolCharacteristics:Good academics, good staff members

Ravis School shopping characteristics:

Priority parameters: Good academics & Good staff members Above all, Ravi wants the best school possible, whether it is in his immediate locality

or not

Regular discussions with neighborhood parents and children Meet with teachers to gain information about schools They become information sources themselves after seeking out this information Consider and visit one school has decided upon the school through social networks

Ravis School Rating Traction:

Would find a school rating card somewhat helpful Would look for schools academic quality, teacher performance and exam results Would be willing to pay around `31 for the card


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Name: Anjum

Persona : Enabler

Why should my child lose a year of schooling due to

my inability to pay fees in time?

Anjum and her husband Aftab are natives of Hyderabad. They stay

in an urban area; she is a housewife, and he runs a small grocery

shop. Aftab typically earns about`

6500 per month, and each monththey spend approximately `780 on education-related expenses.

Education-related spending constitutes nearly 13% of their total

expenditure. Anjum studied up to Grade 5, and her husband studied

up to Grade 8. Despite not having higher education levels

themselves, they have high aspirations for their daughter, Noor.

Anjums Personal Statistics:

Occupations: Housewife / Shop Owner

Place of Origin:Hyderabad

Household: 6 members in total

School Decision Mentality:

Aspirations:High

Degree of Constraint: Medium

Engagement with Social Network:

Medium-High

Number of Schools Considered: Low

Number of Schools Visited:LowMost Important School

Characteristics: Good academics,

English, computer facilities

Anjums School shopping characteristics:

Priority parameters: Good academics, Computer facilities & English medium Above all, Anjum will look for the best school in her neighborhood. She is unlikely to

consider options beyond what her social circle chooses.

Relies heavily on her social network for information

Considered one school, and consequently, visited one school prior to admissionAnjums School Rating Traction:

Would find a school rating card somewhat helpful Would value information on whether the school is good for academics Would be willing to pay around `25 for the card


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Name: Venkat

Persona : Passive

I dont have any education, but I would like to admit

my child into a nearby English Medium school

Venkat and his family migrated to Hyderabad a few years ago from

Ponduru, a town in rural Andhra Pradesh. His wife does not work

outside the home, so he supports his family singlehandedly through hiswork as a chai wallah(tea stall worker). Venkat typically earns about

`5500 per month, and each month he spends over `550 on education

related expenses. These expenses make up 11% of his total expenditure.

While he and his wife received no formal schooling, they aspire to send

their 8-year-old son, Rajesh, to a private school.

Venkats Personal Statistics:Occupation: Chai Wallah (tea stall

worker)Place of Origin:PonduruHousehold: 7 members in total

School Decision Mentality:Aspirations:MediumDegree of Constraint: HighEngagement with Social Network: LowNumber of Schools Considered: High

Number of Schools Visited:HighMost Important SchoolCharacteristics: Teaching quality,reputation, English medium,

Venkats School shopping characteristics:

Priority parameters: English medium instruction, School reputation & Proximity Above all, Venkat wants an English medium private school that he can afford and is

close to his home

His preferred school features are not related to more holistic measures of schoolenvironment and facilities.

Considered three schools and personally visited two before making his final selectionVenkats School Rating Traction:

Would find a school rating card helpful Would value information on school facilities and discipline Would be willing to pay around `20 for the card


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APS market entry


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APS market entry- 60 -

The market for Affordable Private Schools, while informal, may be

defined as a sector in itself. Given the demand exhibited earlier in this

report, market entrants should have an informed strategy regarding the

ways to tap into this market.

The earlier findings inform three strategic steps for potential APS

market entrants:

Product DevelopmentHow to develop for the APS consumer

PositioningWhy the APS consumer should know you

MarketingHow you should reach APS consumers

These entrants could be service providers, school chains, private

investors, foundations etc. Any market entrant should focus on key relevant

aspects of product development, positioning, and marketing to ensure high

demand by parents, and thereby high adoption rates amongst schools.

Product development:How to develop for the APS consumer

Market entrants should be ready to shed assumptions based on other

consumer environments. After testing the rating tool, we found that APS

parents did not understand that there could be an objective independent

comparison of products or services. Market entrants should note that their

service offerings may encounter a similar lack of familiarity in the market.Entrants should test whether APS parents understand the concept behind

the particular product or service when embarking on product development.


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The Formshould

intuitively communicate

what the product provides,

without need for

additional explanation

Market entrants must develop features that resonate with APS

consumers. Feature development, however, is necessary but not sufficient

to ensure adoption. Successful adoption will be based on how those featurescome together to create an intuitive user experience.

Service prototyping, based on Design

Research methodology, should be used to

engineer the user experience the Form

(see page 48). Market entrants should

develop several prototypes of their product

or service, and conduct tests to determine

what will achieve success with this set of

consumers. The Form should intuitively communicate what the product

provides, without need for additional explanation.

The Form of the product needs to ride on the appropriate Channel for

maximizing the coverage of the market. After initial testing, the study

found that APS parents have unique ways of accessing information. In

particular, SMS and other one-to-many channels are not a key means of

information delivery for APS parents (see page 46). Existing channels ofinformation may find higher traction, and one may have to discover

unconventional and non-formal channels to reach APS parents.

Positioning:

Why the APS consumer should know you

Education service providers, intending to enter the APS market, should

be cognizant of their end-consumers - APS parents. These parents, along

with their children, are the final consumers of education services. Although

service providers operate on a business to business (B2B) model with


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schools, it is paramount that they make themselves known to their end-

consumers (B2E-C). Traction with parents is essential for driving demand

for their specific services. This strategy, is similar to the one adopted by

Intel Corporation for the Intel inside campaign.

Through increased awareness of service provider brands, parents will

begin to demand particular services (and service providers) from schools.

Evidence of parameters used for school selection suggests that parents are

likely to demand education services that operate along parameters they

value (seeExhibit VI).

GMC in particular, has the opportunity to respond to one of the three

dimensions along which parents choose schools. As mentioned, parents

look at availability, cost, and quality in school selection. GMC has the

potential to engage w

consumers of affordable private schooling - core report

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