Debunking Persistent Myths About the Higher Education Marketplace
January 28, 2015
Changing needs and marketplaces have created myriad conversations around the question What should we do next? We know that answering this question is not always easy, but persistent myths about the marketplace have made answering it even more difficult than it needs to be.
At the risk of offending or oversimplifying, we want to briefly explore and debunk 13 myths that confound and distract today’s decision makers.
- Myth: As soon as the economy improves everything will return to normal
- Reality: The economy is not the source of many of the problems facing higher education. Rather, the economy has exacerbated problems and issues that have long been in play.
- Myth: The basic pricing model of higher education is sound
- Reality: Skyrocketing student debt, more students defaulting on debt, more students deferring college, and more students seeking lower-cost educational alternatives suggest that the basic pricing model is broken. The too-high cost of going to college is the single biggest challenge facing higher education.
- Myth: There are plenty of traditional-age students to go around
- Reality: Currently, only 20 percent of high school students plan to go to college full time and live in a dorm, and this percentage continues to go down. The elite universities and liberal arts colleges with deep pockets and strong brands will always have an adequate share of these students, but lesser-known and lesser-quality schools will find themselves scrambling even more for students in the future than they are now. If you want to grow larger, someone has to get smaller.
- Myth: There are plenty of adult and online students to go around
- Reality: There are simply too many colleges and universities pursuing these two markets, and the cost of recruiting is up and the margins are down. Over the last couple of years we have also seen a dramatic softening of these markets. There is significant data that suggests these markets are declining in number.
- Myth: To be a credible college, we need to have the same basic programs as our competitors
- Reality: Definitely not. While most colleges need some basic courses to fulfill their education mission, all colleges need a significant number of programs that are compellingly different from their competitors. If more than 70 percent of the programs you offer are offered by your top competitors, then you have missed a significant opportunity.
- Myth: If we offer more programs, we will attract more students
- Reality: The word “more” is one of two words that are bankrupting higher education. The other word is “better.” When resources are constant, increasing the number of programs reduces quality. Most schools don’t need more programs. What they need are fewer, stronger in-demand programs. Mission creep and Carnegie climb have imperiled much of higher education.
- Myth: It is important to be unique
- Reality: Being unique or distinctive is not enough. Neither is having a raft of distinctive competencies. Instead, you must be compelling. In other words, what is it about you that students and donors find indispensable?
- Myth: Being good is good enough
- Reality: Being good is good enough. In fact, most colleges are very good. But being good at something that prospective students find compelling is, well, great. Think blue oceans. (Blue Ocean Strategy: Kim and Mauborgne.) Think “onliest” (Zag: Neumeier).
- Myth: Because we are a private, we can charge more for our online programs
- Reality: In most cases, online students choose a school based on two factors: cost and convenience. Privates that insist on pricing their programs above those of their public school competitors because they believe their programs are of higher quality will meet significant marketplace resistance.
- Myth: To improve retention, all we have to do is fix academic advising
- Reality: Advising is a big part of the retention equation, but a bigger part is a correct match between the institution and the student. Many admissions offices are under enormous pressure to just get the class, and there is sometimes less attention being paid to the idea of student fit. Even as overall enrollments go up (especially when factoring in adult and part-time students), the percentage of students who complete a degree continues to go down.
- Myth: People in the U.S. generally consider college to be a good investment
- Reality: An investment is measured by the relationship between initial cost and return. And while it is clear that people with a college degree have significantly greater earnings than do people without a college degree, it is less clear if more expensive colleges offer better employment prospects and earning potential than less expensive schools. All things considered, students who enter the job market with less debt, or who paid less in tuition, will have a significantly different perspective on whether or not college was a good investment than students who paid more or who have greater debt.
- Myth: The college admission team is responsible for enrolling the class
- Reality: Actually, it takes a village to enroll the class. In most cases, the decision to attend rests on a small set of variables including the visit experience, the major, fit, and net cost after aid. Even the most talented admissions team in the country won’t be successful if your academic programs are not in demand, if you cost too much, or if the campus doesn’t show well.
- Myth: Better marketing will build enrollment
- Reality: Marketing does not create demand. Rather it builds awareness of the programs you have in place. In-demand programs build enrollment, not marketing.