StudyTravel Magazine: Chinese agency market profiled, growing optimism for year ahead

Chinese agents are becoming more optimistic for the year ahead and are relatively relaxed about the impact of Covid, as research shows that 1,672 agencies are currently active across Tier 1-4 cities and differing rates of programme and destination portfolios.

Jul 2, 2022 StudyTravel Magazine

The fourth China Agent Market Update by research company Bonard is based on government statistics and records, screening of a sample size of 9,772 companies and 45,000 phone calls, as well as in-depth interviews with agencies and a qualitative survey of 300 students.

Active agencies: The authors found that 1,672 agencies across 47 cities were active with a verifiable online presence.

While most agencies are headquartered in Tier 1 cities, there is an increasing presence of companies in New Tier 1 cities, the research found.

Among Tier 1 cities, Beijing had 167 active agencies, while Shanghai had 140 and 110 were active in Guangzhou. The authors noted that lockdowns in Shanghai may have affected the sample size of that city.

map1The map of active Chinese agencies in the research. Source – Bonard.

However, the new Tier 1 cities of Nanjing (142) and Xi’an (138) also featured in the top five, and Wuhan (97), Zhengzhou (94), Chengdu (84) and Chongqing (79) were also prominent.

The four Tier 1 cities have more than 5,000 enterprises with study abroad licenses issued by the Administration for Industry and Commerce, although only 2,646 are considered relevant. Of these, 19 per cent are operating as usual, 41 per cent are out of contact, and 40 per cent are not currently operating in the sector.

Among new Tier 1 cities, Nanjing had the highest ratio operating as normal (35 per cent), followed by Xi’an (32), but the average across the nine cities was 20 per cent.

Destinations promoted: In three of the four Tier 1 cities, the UK was the most commonly promoted destination, followed by the USA, Australia and Canada.

The USA was the most commonly promoted destination for New Tier 1-based agencies (63 per cent), followed by the UK (56), Australia (53), Canada (45) and Japan (36).

Programmes offered: For programme type, at least 94 per cent of agencies in each of the Tier 1 cities promoted higher education. Those in Guangzhou were the most likely to promote K-12 (59), followed by Shenzhen (50), Shanghai (46) and Beijing (44).

Guangzhou-based agents were also the most likely to promote short-term overseas courses (48), followed by Beijing (40), Shenzhen (30) and Shanghai (24).

New Tier 1 cities were often more likely to offer short-term programmes, the analysis found, with 68 per cent in Zhengzhou, 58 per cent in Qingdao and 43 per cent in Xi’an offering these courses.

For K-12, 54 per cent of Zhengzhou agencies were promoting, followed by Chongqing (41) and Chengdu (38). Overall, 29 per cent of New Tier 1 agencies were promoting secondary courses overseas.

Agency experience: Of the 429 active agencies in Tier 1 cities, 55 per cent were established between 2016 and 2019, the authors said. Beijing has the most established sector with a median start date of 2015 and 12 agencies established prior to 2020. In contrast, the median for agencies in Shenzhen was 2019, and only 13 companies there were established before 2015.

graph12Programme types offered by agencies in New Tier 1 cities. Source – China Agent Market Update 2022, Bonard.

Of 228 active agencies contacted in Tier 2-4 cities, 41 per cent were operating as normal. Only one of these was still promoting short-term programmes, and the UK and Australia were the most commonly promoted destinations.

Business optimism: In a series of in-depth interviews with agencies on the impact of the pandemic, seven per cent said it had not affected business at all, 27 per cent said that it slightly influenced operations, and 53 per cent said it had moderately impacted on business. Only 13 per cent believed that it had significantly influenced their business.

Feelings were mixed on whether business had improved in the current year. Forty per cent said that the market was better in 2022 than in 2021, while an equal proportion said that it was worse.

Looking ahead, 40 per cent said they were optimistic for 2023. While only seven per cent said they were pessimistic.

Student survey: A survey of 300 students found that North America was the most popular intended destination for university study, while the UK/Ireland was most popular for secondary study. The reputation of the institution (72 per cent) was considered the most important factor, followed by employment rate of graduates (66).

Recommendations for schools: On advice for educators, 73 per cent recommended improved promotion of programmes in China, 67 per cent urged regular agent training, and 60 per cent suggested increased commissions. Having Chinese speaking staff and materials were also commonly cited.

Igor Skibickij, COO of Bonard, said during a webinar presentation of the findings that it was not a time to retreat from the market, and warned educators not to underestimate the role of agencies in the market.

The authors urged that institutions should not return to pre-Covid strategies and should cultivate positive messages, engage in multi-channel recruitment, explore the market and adapt programmes to market circumstances.

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