Marketing concepts and principles

Conduct and exploratory investigation into the application of marketing theory in a specific 'non-commercial' context

Much research has been carried out on the application of marketing in a non-commercial context with work by Dolnicar and Lazarevski (2009) being an example of this. In their article they identified that non-commercial organisations are increasingly beginning to use marketing concepts and principles - which are more commonly applied to commercial organisations - within their organisations in order to achieve their missions. This has been due to a change in the environment in the last few decades in which non-commercial organisations are in, as the non-commercial sector has become increasingly competitive with market pressures typical of commercial organisations coming into play (Dolnicar & Lazarevski, 2009). For example, there is more competition for funding and the need to earn money to fulfil their missions, which has lead to a large number of non-commercial organisations to adopt a marketing orientation to overcome these challenges.

Today, marketing can be seen to play an important role in the lives of non-commercial organisations with researchers largely agreeing that the adoption of a market oriented perspective where marketing begins and ends with the customer (Gonzales et al 2002) as well as the adoption of marketing tools as being important for the survival of non-commercial organisations and over the decades, non-commercial organisations are adopting the marketing strategies of market segmentation, positioning strategies, marketing communications strategies and place strategies. Not only this but non-commercial organisations are also adopting a relationship marketing approach in their attempt at being market orientated. In order to understand this transition from an organisational-centred marketing philosophy to a consumer-centred or market oriented philosophy (Dolnicar & Lazarevski, 2009) this article through an exploratory investigation looks at how the higher educational sector more specifically how universities have adopted a marketing orientation approach more commonly used in commercial contexts by viewing the students as customers. In doing this the topic of educational marketing will be outlined then the changes within the non-commercial sector of universities that have been occurring over the years will be discussed and how this has shaped the use of marketing within the sector by the use of a case study example of the application of marketing within Aberystwyth University in order to demonstrate the current use of marketing within a non-commercial context. The limitations of applying a marketing orientation approach within the higher education sector will then be outlined followed by a conclusion with further research recommendations detailed.

In order to understand the application of marketing within the higher educational sector a definition of educational marketing is required. Definitions of marketing within an educational context can be found as early as 1985 when Kotler and Fox (1985 p6) stated that educational marketing was "the analysis, planning, implementation and control of carefully formulated programs designed to bring about voluntary exchanges of values within a target market to achieve organisational objectives". This approach to educational marketing takes the view of the students as being the products of universities and the employers as the customers, in other words it takes on a more 'product' marketing approach (Hemsley-Brown & Oplatka 2006) by selling the educational system as a product. This way of viewing marketing was developed during a time when a small number of the UK population attended university with only 8% attending in 1965 thus reflecting an elite educational system (Redding 2005). A more recent and relational definition of educational marketing can be shown by Gibbs (2002) who defines educational marketing as being "the mutually beneficial development of informed learning systems within which the development of relationships increase the opportunity of well being and in which a duty of respect is owed and an obligation of fairness assumed". This definition reflects the changes which have occurred since the 1990s in higher education with a movement in the view of the educational system as being seen as a service and the student as the customer of this service thus a movement towards a marketing orientation. For this purpose I will explore the later definition as a way of looking at marketing within universities. In order to do so the development of this view of the marketing of education as a service will now be discussed before looking at the actual applications of marketing within universities.

The higher education sector in the UK has been undergoing a fundamental metamorphosis (Ivy 2001) over the years and can be seen to have been 'transformed from a domesticated, centrally funded non marketised entity to a highly marketed and competitive environment' (Souter and Turner 2002) which has in turn led to the need of educational marketing. This increase in the need for educational marketing has been the result of many changes within the higher education sector which have occurred over the last few decades. Notably there have been changes in policies, government funding, structures and status of higher education, and also changes such as privatisation, diversification, decentralisation, internationalisation and increased competition in the higher education sector (Nicolescu 2009).

The largest driver of this change can be seen as being due to changes in government funding. The number of students attending university between 1979 to1995 doubled to one million and the Blair government announced expansion targets indicating that 50% of the UK population who were aged between eighteen and thirty should have experienced some form of higher education by 2010 and also introduced widening access targets thus changing the nature of the students attending university. This rise in the number of students and expected number of students entering higher education and change in the diversity of students going to university meant that the government could no longer fund university places and led to the government introducing the Education Reform Act 1998. This meant that fewer funds were available to universities leading to institutions competing for funds. As a result higher educational institutions can be seen to be operating in 'much greater competitive environments thus increasing the need to incorporate a greater market orientation into their strategic planning process in order to acquire a competitive advantage over their rivals' (Conway et al 1994).

Not only has the need to compete for funding in both public and private sectors increased the need to gain competitive advantage but also other environmental aspects have also led to this. Technological changes over the years have firstly, caused the development of an increasing number of institutions but these changes have also revolutionised the ways courses are being offered (Binsardi & Ekwulugo 2003) many of which are in competition to the traditional university. For example, the development of distance learning and open universities through the internet has increased competition within the higher educational sector. Also changes in the status of UK universities has occurred due to globalisation of the higher educational sector with a movement away from UK universities being branded as the 'best in the world' because global competition has emerged with many other countries universities coming up with quality education which rivals the UK.

These changes outlined can be seen as the driving forces for marketisation of higher education (Meringe 2006), and have had a large affect on not only how universities operate as there has been a movement away viewing the students as a product of the university to viewing the student as the customer which has in turn led to the increasing use of marketing within universities, it has also changed the ways in which universities market themselves. This increasing view of student as customer has come about because in the UK students are now expected to pay and increasing share of the costs of their tuition therefore there is a tendency of universities to view them as customers as they are paying for their education. This increasing view of the 'students as customers' was illustrated greatly by comments by the Hague who wrote in the institute of economic affairs Hobart papers saying that 'in the higher education market it should be the student who is king' (Lomas 1997) for which in commercial organisations who adopt a market orientation the customer is king thus students becoming customers and the university seen as providing a service to the customers. By viewing the students as customers it gives universities an opportunity to create competitive advantage by differentiating its services to others and enhances a universities ability to attract and retain customers. As noted earlier competition has also increased for students themselves which illustrates that in order to survive many universities have to gain competitive advantage over their rival universities. Therefore many universities have had to formulate competitive strategies which satisfy the needs of these customers (students), in other words universities need to become market orientated (Conway et al 1994). Overall the changes which have been occurring since the 1990s in the educational sector have had a huge impact on the way in which universities operate as now it can be said that universities view the student as the customer of a service which the university supplies, which in turn has had led to universities becoming more marketing oriented in order to satisfy/serve the customers. This has had major impact on the application of marketing within universities which will now be discussed.

In this dynamic, competitive environment the future success of educational establishments rests on their ability to differentiate themselves and build meaningful relationships not only with existing students but with potential students as well

Viewing students as customers provides a competitive advantage for higher education and enhances a colleges ability to attract and retain and serve its customers

To achieve this internal systems need to be maximised to their full potential through the integration and use of CRM which can pull together disseminated pieces of information from all types of databases and sources (King 2005)

In higher education students are the customers some areas that touch the students are the registration process transcript services, careers counselling and academic support services.

Education reform act 1998 bought about a number of radical changes in the structure and funding of the UK higher education institutions as a result they now operate within a much greater competitive context and need therefore to incorporate a greater market orientation into their strategic planning process in order to acquire a competitive advantage over their rivals

Institutions have to compete for funds from both public and private sectors and also compete for potential students. In order to survive competitive strategies had to be formulated which satisfied the needs of potential customers, in other words this sector of higher education needs to become more market oriented.

HE environments in most developing countries have become competitive and institutions have to compete for students in the recruitment markets

Expansion diversification and growing competition have been identified as the overarching forces friving the marketisation of HE

UK where it appears that the students will be paying an increasing percentage of the costs of their education

UK universities have traditionally enjoyed relatively high undergraduate retention and completion rates.

Recent political agendas which have led to an emphasis on widening participation in higher education increased student numbers and a more diverse student population coupled with changed in arrangements relating to student funding, have put the issue of retention more firmly on the agenda. Poor retention rates also have funding implications for institutions.

It is noticeable in the UK that students are expected to pay an increasing share of the costs of their tuition so there is an increasing tendency to refer to students as customers.

The strengthening of competition at institutional, national and international level requires new operating modes through the adoption of more market orientated and business like forms of operation within HEIs

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