Can brands still make the cut for students?

Students are one of the groups to be hit hardest by the Government’s spending review, so should this change how brands communicate with them?

Students were singled out by the media this month as one of the groups that the coalition government has looked towards to help it out of the deficit, by proposing to lift student fee caps.

This is potentially counteracted by the loan repayment threshold being lifted from £15,000 to £21,000, which the Government claims would make repaying a higher fee more manageable. The Guardian explains further implications of the spending review towards students here.

Students have traditionally been a way for brands to capture a new group of consumers who will hopefully go on to become valuable customers over a lifetime, if the relationship is begun correctly. But will this change represent a shift in many students’ financial situations, and should it prompt brands to rethink how they market to students?

The answer has yet to reveal itself, but one thing is clear – brands do need to get to know this market better.

Research agency The Lounge has recognised this and has developed a programme of student “Safaris”, the first of which it ran this month, taking brand participants to Surrey University to experience its Freshers Fair and also to nose around a student house to gain firsthand insights into their relationships with brands. Brands such as Samsung, Brown Forman, New Look, O2 and 3M participated, and future Safaris can be developed bespoke at an individual brand’s request.

I caught up with The Lounge director Sara Gil, just after the Safari and she says marketers should take time to understand today’s students to avoid adopting a “back in my uni days…” approach to this market.

Her thoughts on the government fee changes are that higher tuition fees may result in a decline in the overall number of students, but those who do decide to go to will go knowing they won’t have to pay off their tuition fees until afterwards. “Provided they still have the same student maintenance loan (there are no plans currently to change this), they will still have the same day-to-day disposable income and will therefore still be able to service their (brand) tastes in the same way,” she claims.

Ultimately, she says, once students have paid the basics (fees, rent and bills) everything else is for enjoyment, and students will continue to prioritise this. “They seem to have no issue finding money to buy the things they want. They support themselves with combinations of student overdrafts, loans, recently reinstated grants, the bank of mum and dad and according to The Times, for 67% of today’s students, part-time work,” Gil explains.

She adds that currently, students have a relatively high rate of disposable income with the average student spend at £185 per week, according to the NatWest 2010 Student Living Index. Contrary to the stereotype of the skint student, they don’t want to deprive themselves of looking and feeling good.

“As we saw at Surrey, students today don’t dress like ’students’, they will happily spend an average of £120 to £200 a month on clothes. They have the latest technology, latest fashions and go out three or four nights a week. They are as kitted out as someone in a job, and in some cases even more so.”

Brands will therefore continue to have the same opportunities to target students, but as a result of the government spending review, they may be targeting a slightly smaller pool of student consumers, Gil warns.

If this is the case, brands who choose to target this market will find it harder to vie for their attention and will have to look to more innovative ways. Freshers Fairs have been the most obvious way for brands to push their presence on campus, but Gil claims this only works for some brands, and largely, Freshers Fairs are so hectic that students will most likely not take in the brands that are looking to engage with them in this environment.

“Only an hour after they had been at the event, students were struggling to remember any of the 55 brands that were present, and that included major brands such as Virgin Media, Blackberry, Domino’s, Pizza Hut, Barclays, Milkround, Apple and Oxfam, or were confusing brands with their competitors,” Gil recalls.

“This isn’t to say that Freshers Fairs can’t work. You just have to maximise its potential and learn how to capture the right data effectively from the day for future use. What we found shows how essential it is to continue the dialogue, and build the relationship long past this initial meeting.”

She suggests that Facebook can work if done in a way that motivates the audience to engage with the brand online – she notes that many students during the Safari were raving about the vouchers they received from Nando’s via Facebook. Brands can also get involved in student nights and events, as these are the heart of the student social life. But if they are going to conflict with the regular nights out, they need to target the influencers of the student community – in Surrey’s case, the sports clubs – to ensure attendance, as students are very much of the attitude “I’ll go if everyone else is going”.

Another trend brands should be aware of is the digital world of students – gone are the days of the hand-me-down PC, Gil claims. “Many students are starting university with top of the range bits of kit like MacBooks. They have a place at the top of freshers’ lists of things to take to university alongside other ’essentials’ like bedding, cutlery and frozen meals from mum,” she says.

The most important thing for brands to realise is that these high-tech laptops are fast replacing TV as the chosen entertainment medium, with students increasingly defaulting to on-demand viewing – something brands should consider.

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