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Higher Education Market Segmentation

Chapter · January 2016

DOI: 10.1007/978-94-017-9553-1_33-1

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Jane Hemsley-Brown
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Hemsley-Brown, J., (2017) Higher Education Segmentation, in Jung Cheol, Shin, Pedro, Teixeira, (Eds) Encyclopaedia of
International Higher Education Systems and Institutions, Dordrecht: Springer Netherlands

Higher Education Market Segmentation

Jane Hemsley-Brown

Market segmentation is a well-established approach to dividing a potential market into

distinct and separate and clusters of consumers with shared characteristics, needs and
values, (Schiffman, Kanuk, & Hansen, 2008). This strategic approach to marketing is built on
market research and marketing knowledge, which shows that customers can be divided into
groups using a combination of characteristics, behavior, their decisions and the way they
make choices (Hemsley-Brown & Oplatka, 2015). At the heart of market segmentation is
the view that consumers in different segments have different characteristics, values and
preferences, and on this basis often behave differently when making a purchase decision,
therefore marketing communications can be targeted with their preferences in mind and
the product or service can be designed or even customized based on their needs.

In the higher education sector, however, despite the existence of different market segments
(for example, defined by age or mode of study) market segmentation is not well established
in the literature, although there is evidence of widespread use of market segmentation in
terms of the marketing of programs by universities worldwide. There are, however, some
concerns about market segmentation in HE; overt market segmentation can result in unfair
practices and inequitable access to higher education when marketers analyze student
decision-making based on socio-economic, religious, or ethnic groups (Hemsley-Brown &
Oplatka, 2015). For example there is a high commitment in some countries towards
promoting widening participation – seeking to encourage those from less advantaged
groups to attend university, and particularly the top universities. Therefore, segments
which are defined in terms of (high) social class, (high) income, and a long held tradition of
participating in HE, for example, could be considered inappropriate, even though in a
business setting this type of segmentation is more commonplace. Market segmentation is
typically based on four key variables, and it is largely demographic and psychographic
segmentation where marketers face the most challenges in terms of equality and fairness.
Hemsley-Brown, J., (2017) Higher Education Segmentation, in Jung Cheol, Shin, Pedro, Teixeira, (Eds) Encyclopaedia of
International Higher Education Systems and Institutions, Dordrecht: Springer Netherlands

The basis of market segmentation

The grouping variables used for segmentation, are well-established and authors tend to
agree on the four key variables which are: geographic, demographic, behavioral and
psychographic (Kotler & Armstrong, 2003).

Geographic segmentation
Geographic segmentation is an approach to dividing the market into segments based on
location, on the basis that people who originate from the same country, region or local area
have the same needs, so some extent, and in the case of some local businesses, customers
might be expected to come from a narrow geographical area (Hemsley-Brown & Oplatka,
2015). Geographical segmentation in higher education marketing is particularly pertinent
for some groups of prospective students, who might, for example, wish to remain close to
home to study. Local students to any university can be a specific target market based on
their proximity to the university campus, and these students often differ in other respects
because of this – for example, their behavior in terms of engagement with non-study
activities might also vary compared with those to travel further from their family home and
live on campus.

Segments of target students are frequently divided into segments based on their home
countries, because international students travelling to the West, for example, often share
some characteristics in common: their expectations or key reasons for studying overseas.
Students from different countries around the world sometimes show similar characteristics
in other respects such as the subject they wish to study (such as Engineering or Business)
the approaches they use to choose institutions (e.g. the use of recruiting agents) and the
types of programmes they favour e.g. full time post graduate programs.

Demographic segmentation
Demographic characteristics include sex, age, income, and (prior) education and are widely
used as the basis for market segmentation. There are well-established dissimilarities
among age groups, for example, under-19 year olds and mature students (the over-25s)
have very different needs and characteristics (Oplatka & Tevel, 2006). Although
male/female is not generally used specifically for segmentation by many institutions there
are inevitably differences by gender in relation to choice of discipline (for example:
Hemsley-Brown, J., (2017) Higher Education Segmentation, in Jung Cheol, Shin, Pedro, Teixeira, (Eds) Encyclopaedia of
International Higher Education Systems and Institutions, Dordrecht: Springer Netherlands

engineering and nursing are male and female dominated, respectively). Combined with
differences in segments based on gender are age and socio-economic grouping. A segment
for nursing might, for example include a large number of female students, who live and
work locally, some of whom are mature students. Whereas, perhaps, a segment for
engineering, which might be predominantly male, could include a high proportion of under
19 year old students, many of whom are from overseas. These segments are distinct and
different and require different approaches to marketing and recruitment by the university.
Nonetheless, in a university setting, there are frequently marketing initiatives to attract, for
example, more females to study engineering. These objectives to widen the traditional
segments, however, also need segmentation methods to identify the new segments’
characteristics to help to target the proposed marketing efforts. In this way, a segmentation
approach can support efforts to widen participation and encourage non-traditional students
to join programs.

Behavioral segmentation
Behavioral factors are also central to market segmentation and these include the way
consumers use the product, how much they consume and the rate of consumption. In the
case of higher education consumption, this could include whether students are part-time or
full-time, the type of programs they follow (short courses or full award-bearing programs)
because their behavior in the market is likely to differ based on these behavioral factors.
Many students in mid-career choose to study part-time, for example, due to additional
responsibilities, such as child-care, or part-time employment and their behavior in the
market is different, for example, from under-19 year old students applying for full time
programs (Oplatka & Tevel, 2006).

Psychographic segmentation
Schiffman et al., (2008) point out that segmentation based on psychographics has its origins
in the field of psychology and incorporates the measurement of opinions, beliefs and
attitudes. Psychographic segmentation usually also covers socio-cultural variables: life-
cycle, socio-economic grouping, and socio-economic status. In higher education research
there is a strong research tradition of examining the influence of socio-economic factors on
the choice of university (Hemsley-Brown & Oplatka, 2015), particularly in relation to
Hemsley-Brown, J., (2017) Higher Education Segmentation, in Jung Cheol, Shin, Pedro, Teixeira, (Eds) Encyclopaedia of
International Higher Education Systems and Institutions, Dordrecht: Springer Netherlands

prestige institutions where lower socio-economic groups have more limited access
compared with high socio-economic groups (Hemsley-Brown, 2015). Social class status is
linked to family income therefore, the term socio-economic-status (SES) is often used in
studies of higher education choice (Hemsley-Brown & Oplatka, 2015). Much of this research
has been carried out in the UK and in South Africa where social class divisions are a great
concern, and findings repeatedly reveal significant differences in the choices made by
students from low SES groups, (and non-white racial groups) who are less likely to apply to,
or to attend the prestige institutions (Hemsley-Brown & Oplatka, 2015).

Ethical issues of market segmentation

Market segmentation in higher education whilst presenting marketing professionals with a
challenge in terms of fairness, equity and ethics – also offers a way forward for targeting the
students who are less likely to choose to enter higher education, as well as those for whom
higher education is taken for granted. The widening participation student group is also a
target market based on their characteristics, values and preferences and therefore they are
surely a segment (or several related segments) in their own right. Widening participation
segments – that is those who are less likely to enter HE, or less likely to choose a top
university – have common characteristics and can be targeted with appropriate and
imaginative marketing communications – albeit different communications from the
methods used for more traditional students. The offering in universities might also need to
change to meet the requirements and needs of these segments – but the concept of market
segmentation does provide a basis for marketing to these more elusive groups.

There remains a measure of ethical disquiet about higher education market segmentation –
some still have concerns about prioritizing specific types of prospective students above
others in a marketing campaign, particularly based on social class, age, gender or ethnicity
when equality of access is so central to the ethos of many universities. It is easy to view this
approach as unethical when without segmentation the message seems to be “all are
welcome”. Without market segmentation, however, universities are most likely to engage
with their traditional markets, leaving the more difficult markets, e.g. the socially
disadvantaged, and people of color – for other institutions.
 Hemsley-Brown, J., (2017) Higher Education Segmentation, in Jung Cheol, Shin, Pedro, Teixeira, (Eds) Encyclopaedia of
International Higher Education Systems and Institutions, Dordrecht: Springer Netherlands

References

Hemsley-Brown J, and Oplatka I. 2015. Higher Education Consumer Choice. London:

Palgrave.

Hemsley-Brown J. 2015. Getting into a Russell Group university: high scores and private
schooling. British Educational Research Journal 41 (3): 398-422.

Hemsley-Brown J, and Oplatka I. 2015. University choice: what do we know, what don't we
know and what do we still need to find out? International Journal of Educational
Management 29 (3): 254-274.

Kotler P, and Armstrong G. 2003. Principles of Marketing. New York: Prentice Hall.

Oplatka I, and Tevel T. 2006. Liberation and revitalization: The choice and meaning of higher
education among Israeli female students in midlife. Adult Education Quarterly 57 (1):
62-84.

Schiffman L, Kanuk LL, and Hansen H. 2008. Consumer Behaviour: A European Outlook. New
Jersey: Prentice Hall.

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