A Chilean educational industry example

December 2012

By:Martin Meister

Marketing Plan for an“Online Educational Support System”

Value Proposition The company will offer the owners experience and knowledge administrating educational

institutes, to ensure that customers will focus on adding new clients, courses and programs, generating academic and business improvements which will impact their bottom line. The product will be a high technology workflow online platform that will make the clients´ life easier, leaving all the OTEC´s operational stuff to the company.

The message is: “While you go for new businesses opportunities, new clients or academic improvements,

we will help you take care of the operational and administrative processes with quality, ensuring reliability, security and information opportunity.”

“You will operate your business from any part of the world, 24 hours a day.” We will help you with the documentation´s maintenance and storage to ensure quality

norm qualification and certification”.

Business Vision

Customers Profile Universities, Professional Institutes and Technical Training Centers that offer formation,

educational and training services for individual workers and companies in Chile. They are the Technical Training Agencies (Chilean OTECs). They are accredited and authorized by the government to provide courses and training

programs whose cost can be charged against the companies´ annual taxes expenditures. OTECs have to accomplish all the rules emanated by the ISO Quality Norms that involves

administration, logistics, infrastructure and staffing of the training activities, including the potential students’ requirements.

Customers Characteristics

Customers NeedsWe have to distinguish that finally the target market consists in the OTEC´s owners or managers that have the focus on the growth of their business, and sometimes only in their survival.

With this in mind, mainly their needs are: Not waste much time administrating and operating the particularities of an OTEC. Have time to go for new clients, new products or academic improvements. Ensure the quality and continuity of their processes; to operate they have to maintain the

Norm certification. Operate in the simplest, friendliest and intuitive way as possible; remember that in almost

all the cases the user is a secretary or an administrative employee. Ubiquity, every partaker connected from any place. Reliability, security and opportunity of the data and information. Documentation storage and maintenance ready for inspection or certification.

Customers Characteristics

Industry Overview

2% 4%20%

44%

31%

OTEC´s size distribution according to sales level, 2008

Large

Medium

Small

Micro

Without sales

Source: SSI.cl & Sence.cl

Changes Between 2005-2010

Description 2005 2010 DiffInvestments (MM USD) 172 237 38%Companies trained 48.131 22.405 -53%Courses 165.047 172.119 4%Training hours 20.021.617 27.711.298 38%Participants 893.964 1.452.011 62%100% tax exemption 81% 82% 1%Hours/course 22 19 -15%Participant/course 5 8 56%Courses/company 3 8 124%

Source: Chilean Job and Training National Service (Sence.cl), 2012

2,478 institutions 67% concentrated in the capital Santiago 5% are Large & Medium OTECs Large & Medium OTECs have the 45% of

the students Micro and Small OTECs have in between

3 & 4 employees

Total OTEC´s sales from tax exemption reached 237 million dollars in 2010

38% of Market growth (2005/2010) 22,000 companies trained 172,000 courses given 1,5 million participants 28 million training hours

Industry Overview

New Entrants Training educational industry lacks of professionalism, but Could attract big and established service providers. Vertical integration of OTECs and OTIC broker agencies.

Substitutes High inertia level of customers, having own “spreadsheets”

management systems. ERP Software providers .

Five Forces Analysis Model

Description Impact

Bargaining Power of Buyers MID-LOW

Bargaining Power of Supliers LOW

Existing Industrial Rivalry LOW

Threat from New Entrants HIGH

Threat from Substitutes HIGHSource: Porter´s 5 forces from Mindtools.com

SWOT Analysis

Strengths

• Owners experience and knowledge of the educational industry• Marketing, sales & process design experience, IT development savvy• Product proved in the 5th OTEC of the market

Weaknesses

• Company is new to the market, competitor have more than 6 years• Lack of legal and general Norms knowledge, like certification or firm creation• Lack of technology backwards for hosting client´s information

Opportunities

• Increasing Demand of OTEC´s quality improvements• Low competition with few companies, not from de educational industry• The government and companies are requesting more quality training programs

Threats

• Market concentration trends (OTECs and companies)• High inertia level, OTECs have their own management systems• Distrust in web bases software, some fear in cloud computing

Marketing Channels & Mix

Drive visits to the website

Perform periodical seminars &

meetings for prospect customers

Make sales visits & networking efforts

The Marketing Plan will be built on the basis of three principal columns

1.- Direct Sales & Networking Efforts

• Sales efforts will be performed by two of the owners & a recruited salesperson• Web based presentations with digital information, online demos and system access • Networking will be a key for success, with attendance to seminars, association events, government meeting, etc.• The primary objective will be large and medium OTECs• To support visits, there will be merchandising and folders with printed factsheets

Marketing Channels & Mix

2.- Webpage Development

• Webpage will be integrated with the online product• Professional look with multimedia and social media capabilities• Informative site, where customers will access white papers, demos, digital manuals, catalogs and

brochures• Ability to capture prospects´ data through online application forms, capacity to manage subscribers

3.- Online Marketing Efforts

• The main objective will be to drive visits to the website and promote the periodical Informative Seminars• Massive external e-mail marketing• Segmented emails directed to OTEC´s owners, managers and employees• Banner advertising in related sites like online magazines, supplier and trade portals• Strong activity in social network sites like LinkedIn affinity groups• Google Adwords (key word tools and banner advertising).

Marketing Channels & Mix

4.- Informative Seminars

• Perform periodical seminars, chats and meeting for prospects and customers• Topics will be related with the OTEC´s interests , besides showing the benefits of the online coordinator

system• The owners and some guests will be the speakers

5.- Business Partnerships

• Partner with an educational industry supplier, an eLearning content developer. We have the same customers, and we can make joint sales efforts and share some costs

• The other partnership will be made with some Training Agency Broker (OTIC), they are very interested in improving the OTEC quality

• We can perform some seminars in the OTIC´s installations

Marketing Channels & Mix

6.- Sales Literature & Logo Design

• Because of cost implications, the start-up will not make brochures , instead will use folders with professional fact sheets and important information

• All the necessary information will be available for download on the website, prior subscription• The company will use a Marketing Agency to develop a logo and an initial image

Marketing Budget

Marketing Mix Unit Cost (USD)

Quantity Total (USD)

Direct Sales Force 850,0 6 5.100Merchandising 3,0 500 1.500Image and Logo Design 1.000,0 1 1.000Seminar costs 200,0 12 2.400Webpage Develop 3.500,0 1 3.500E-mail Marketing 100,0 25 2.500Banner Advertising 1.000,0 3 3.000Google Adwords Keyword Tool 1,0 3.000 3.000Google Adwords Banner Ad 1,0 3.000 3.000Total Cost 25.000

Source: From different quotations and self construction, 2012

Marketing Channels & Mix

End