Before online English appeared, many education and training companies in China started as “small workshops,” or invested little capital to start business. Looking back on the development of children's English training for more than 20 years, we can see a clear development path. Before 2000, the number of children learning English in China was very limited. As English became popular in elementary school, children's English training institutions began to spring up.
In the early days, the market was mainly small and medium-sized training institutions, with a limited number of trainees and insignificant brand effects. But after a period of development, after accumulating certain brand advantages through word of mouth, local leading brands began to appear. After the strong brand of education and training became prominent, in order to seize market share, education and training institutions also adopted the marketing skills of running schools like McDonald's and successively launched "chain operation" models across the country. They began to get out of geographical restrictions and expand outward. Developed to now, most of the offline children's English training market has been occupied by several companies on the head, such as New Oriental's Bubble Kids English, Ruisi English, EF Children's English, and Pearl River Delta's Treeboy English.
With the drive of the Internet model, the need for English learning, and the promotion of capital, the online children's English circuit has basically formed giant companies such as 51Talk, VIPKID, DaDa, vipJr, and Randy Children's English. In order to cope with the impact of the industry, what kind of countermeasures did offline English take? So, next, we will compare the development process and countermeasures of the three major brands of bubble children English, Ruisi English and EF children, and provide a valuable reference for practitioners.
Bubble children push science education
Bubble Children is a brand of children's education and training under the New Oriental Group (New Oriental EDU.N). The teaching target is children of appropriate age in kindergartens and elementary schools.
1.One-stop training for bubble children's general education
Founded in 2002, Bubbling Children is committed to providing English training services for children aged 3 to 13; in 2008, Bubbling Children Education expanded its training subjects to English, math, language, music, etc. Courses in bubble children's English quality education include: baby picture book reading, Cambridge children's English, new concepts, etc .; exam-oriented education courses include: double excellent courses and short-term special courses in winter and summer vacation. In addition, relying on New Oriental's strong brand and resources, it also provides children with summer summer camps, winter vacation winter camps, and overseas study tours.
2. Positioning the pro-people route
In the development process, when facing the brands that focus on high-end American education, such as EF and Ruisi, Bubble Children emphasized their positioning as "high-end brands in the eyes of middle-income families" and gathered at more affordable prices and quality services. A wider user base. In 2010, the Palm Bubble App was launched to form a closed loop of online and offline teaching.
Up to now, Bubbling Children has set up more than 700 learning centers in 60 large and medium-sized cities across the country, with more than 6,000 first-line teachers. As of FY2018, the number of children enrolled in the bubble reached 2.42 million (+ 39%), with revenue of US $ 475 million (+ 51%) and approximately 2.939 billion yuan, of which English accounted for approximately 50%, corresponding to 1.5 billion.
Ruisi English layout early childhood education launched Can Talk
Founded in 2007, REDU.O was acquired by Bain Capital in 2013. On October 20, 2017, Ruisi was listed on the NASDAQ Stock Exchange in the United States, and its brand name was officially renamed from Ruisi English to Ruisi English in February 2019.
It is understood that at present, Ruisi Education is planning to launch self-developed STEAM products and invest in some campuses in advance. Rise English introduces the concepts of American kindergarten and American elementary school. The core courses include Rise start, Rise on and Rise up. Revenue in 2018 was 1.272 billion (+ 31%) and net profit was 143 million.
As of 2018, the company has 380 campuses (76 self-operated learning centers and 304 affiliated learning centers), covering 80 cities across the country; the number of students has reached 73,000. Ruisi adopts the direct-operated + franchise model. Most of the direct-operated stores are located in first-tier cities, especially in urban centers. The transportation is convenient, and second- and third-tier cities are selected for franchise stores.
Ruisi English launched its own online one-to-one product Can Talk in 2017 to meet users' online learning needs. Can Talk relies on the Ruisi subject English teaching system, which mainly focuses on 6-9 years old oral interactive courses. Teachers also use European and American foreign teachers.
At the same time, Ruisi also plans product development through investment actions in the capital market. In July this year, Ruisi announced the investment in the early education brand "NYC New York International Children's Club", formally strategically laid out the early education market, expanded the entrance of new students, and extended the product tentacles to 0-3 years old, thus opening up the one-stop quality of 0-18 years old Educational services.
EF children's online and offline synchronization, self-developed Mentor
EF Kids is a children's brand of EF Education. It is the largest supplier of English language training for Chinese youths. It is the leading brand of offline children's English. EF Children's English uses different teaching materials and teaching methods for young children of different ages, and is taught in English winter and summer camps. At the same time, it also uses online + offline immersion teaching, synchronizes the knowledge learned in the classroom through the EFParents application and EFSTUDENT, and develops its own word learning tool Mentor.
As of 2018, the company covers 70 cities and has more than 250 campuses (direct + franchise). According to public information, the market share of first-tier cities in 2016 was about 9%, and the corresponding revenue was estimated to be about 1.2 billion, and the estimated revenue in 2018 was about 1.6-1.8 billion.
In addition, the online + offline immersion teaching also includes Aibei and Reebok. Among them, Reed English, a good English brand, released version 2.0 of its products as early as 2016 to build a cloud learning platform. , Equipped with online practice evaluation system, foreign teachers interactive live lessons and other online service modules, synchronous learning and lesson practice. Aibei also matches ABIE Online. It can be seen that traditional children's English education institutions have fought the Internet one after another, and they want to form complementary formats with offline education institutions to grab 100 billion market shares.
Regarding offline training institutions, as far as policies are concerned, as early as 2018, the regulatory authorities have overhauled extra-curricular tutoring and training institutions. Increased requirements for school places have increased the cost of renting institutions' venues, all teachers with teacher qualification certificates have increased manpower costs, and tuition fees not to be charged for more than three months have created cash flow pressure on the organization's operations, all three of which will increase the current operation of training institutions cost.
In terms of consumer demand, according to data from the Ministry of Education, the national average level of junior high school enrollment is 57% (2017), and even first-tier cities such as Shanghai are only around 60%, which means nearly 40% Of junior high school graduates cannot be promoted to ordinary high schools and can only be diverted to secondary technical schools (18%) or drop out of school. The inability to enter high school is almost unacceptable for current Chinese families, so parents represented by first- and second-tier cities have spread the competition for higher education from high school to junior high school and even elementary school.
In terms of market, according to Frost & Sullivan's statistics, the youth English training circuit (3-18 years old) has a market size of about 105 billion in 2017, corresponding to a compound growth rate of 19% in the past 5 years from 2012 to 2017, and is expected to reach 2021. The market size is close to 240 billion. In the children's English market, although the test direction occupies the mainstream, the proportion of English quality is gradually increasing. From a national perspective, the top three suppliers of the Chinese youth English training market are EF Children, Bubble Children and Ruisi English, which together account for 3.6% of the market share. This shows that there are still many opportunities in this market. For offline English training institutions, in the future, they can rely on their offline traffic to sink the market and expand their business to respond to market changes.