Monday, March 18, 2013

On Sale! College!

It doesn't work for JC Penney and it doesn't work for colleges, apparently.

As reported by our financial guru recently, my institution has historically had lower tuition rates than our peers, but that we gave lower tuition discounts. This has resulted in less tuition overall to the students nonetheless. It seems that we have had trouble competing with other colleges that charge more, but give more in their financial aid packages to prospective students. So we, like many others, are increasing our tuition rates by about 5%, but increasing our financial aid packages by about 3.5%. Therefore, we are engaging in a very classic marketing ploy used by retailers. We increase the price to give a bigger impression of the magnitude of the "sale". He reports that families and students get excited about their financial aid packages...

The press pillories the increasing cost of higher education, but the situation is more nuanced that it seems. For example, our tuition is going to increase 1.5% overall, but that is not the figure that will be reported. Reports of a 5% increase are more provocative, and therefore will get more press.

For professors like me, who really don't care much about the details of financial aid, it holds the promise that the discounts can be used to compete for more talented students. But I think that most professors are not enthusiastic that universities are forced (?) to engage in these types of  marketing methods. We just want to enjoy teaching good students, we want students from disadvantaged backgrounds to succeed, and we want tuition to reflect the quality of the education students are getting.

No comments:

Post a Comment