If we cannot shape up, foreign students will ship out

It's official. British universities' are complacent in their attitude towards the recruitment of overseas students, according to a highly critical report commissioned by the British Council. As a result, we risk being left behind in a lucrative international market which brings £600m annually to this country in tuition fees and millions more in spending on food and accommodation.

Universities in the United Kingdom are naive about how the quality of our higher education system is seen abroad, says the report from Professor Colin Gilligan, a marketing expert from Sheffield Hallam University. We have a less professional approach than the good universities in the US and we underestimate the threat from the competition in Australia and North America.

"Although there are undoubtedly some pockets of good practice, these are very much in a minority and are less common than in some of our competitor countries," he argues. "If this is to be changed, there is a need for a far more strategic approach to market development, higher levels of investment, staff training and a shift from the product-focused ethos that dominates institutions to a far stronger customer-focused and market-oriented approach."

Based on visits to Hong Kong, Taiwan and Japan and to UK colleges and universities, the report, "Realising our Potential", is deeply embarrassing to the Government. Last year the Prime Minister announced a big push to attract more overseas students to Britain, setting a target of 75,000 more students in further and higher education by 2005. And earlier this year, the higher education minister, Baroness Blackstone, launched her campaign to rebrand British education in the global marketplace under the slogan "The Best You Can Be". But the Gilligan report shows we have a long way to go. It lists 47 ways in which the UK is falling down, from an absence of real vision to poor co-ordination between the international office and the rest of the institution, to poor use of websites. Student inquiries are treated with a lack of urgency, and the follow-up of inquiries is patchy.

One of the problems is the length of time it takes universities to reply to applications - sometimes as long as three or four months. The best universities follow up an inquiry from an overseas student after three weeks, according to Dr Iain Bride, the director of international relations at the University of Manchester Institute of Science and Technology. They look after their customers in the knowledge that the students are paying from £6,000 for an undergraduate arts course to £17,000 a year for a medical degree. They send overseas students information about accommodation, they meet them at the airport and hold graduation ceremonies overseas so parents can attend.

"They make it so easy that the students want to come to Britain," says Dr Bride. "That is good marketing behaviour. Very few universities do all of those things."

Although one can argue that the British position in world educational markets is strong, one can also argue that this is deceptive. Competition is becoming far more intensive and customers more discriminating and less wedded to traditional patterns of buying.

Moreover, Australians are adopting a far more aggressive and sophisticated approach to marketing, particularly in South-East Asia. In Taiwan, for example, the Australians see their natural market as 23-25 per cent. Currently, they have 11 per cent. The Australians process applications more quickly than we do, according to Dr Bride, because they have a less bureaucratic system. "We are losing out. I believe students are going to Australia partly because it's so easy."

Traditionally, British universities have seen overseas students as a milch cow. Because higher education has been a state-run system in the UK with virtually no private universities and until recently no tuition fees, the customer has been neglected. Now all that is having to change. Where overseas students are concerned, it needs to change quickly.

Clive Saville, who runs the United Kingdom Overseas Students' Association, says: "Universities have to learn that marketing is about the quality of the whole product, not just about recruitment."

That means universities need to pay attention to alumni relations, helping students with English, pricing policies, scholarships, making their institutions more attractive, the quality of teaching and different learning styles.