The Price of College!
In the college admission industry pricing is a pivotal component for families making their decisions. Challenges are faced by both small private liberal arts schools and large public universities. Private institutions have very high price tags, but give generous amounts of financial aid. Public institutions on the other hand have low tuition rates, but give very little financial aid.
Private institutions face more challenges than public schools in terms of the customer. For many prospective students and their families they tend to take a lot of stock in the sticker price of the college. Many will just be turned off by the high sticker price of private schools, and not even look into the generous scholarships many institutions offer. This can result in small private schools being looked over by many families.
One issue that I think plagues private institutions is the fact that their company objectives tend to be more customer oriented. This means that these companies target a market segment of consumers who highly value a particular product benefit and set prices relatively high. Liberal arts institutions use this almost exclusively. These institutions proudly sell the benefits of a liberal arts education, which resonates very well with alumni of the institutions and others who attended similar schools. This messaging however is not very effective to prospective students' parents who may have attended public institutions. At worse they may take the messaging as an insult toward their education. To a lesser extent the message will not resonate with them as well and could result in a lack or loss of consumer interest and engagement.
I think that going into the future in the competitive market that is higher education liberal arts institutions may be better served by no longer being customer oriented and potentially switching to a competitor oriented objective. This would mean that these institutions would attempt to discourage more competitors from entering the market by setting prices very low. Possibly liberal arts institutions could do this by removing their generous financial aid packages and essentially subsidize their tuition, thus lowering their sticker price. This may allow them to compete with the pricing of larger public institutions and allow them to re-brand themselves toward families that do not have a much experience with a liberal arts education. Although radical, this may be a course of action liberal arts institutions should at least explore to work toward a prosperous future.
Private institutions face more challenges than public schools in terms of the customer. For many prospective students and their families they tend to take a lot of stock in the sticker price of the college. Many will just be turned off by the high sticker price of private schools, and not even look into the generous scholarships many institutions offer. This can result in small private schools being looked over by many families.
One issue that I think plagues private institutions is the fact that their company objectives tend to be more customer oriented. This means that these companies target a market segment of consumers who highly value a particular product benefit and set prices relatively high. Liberal arts institutions use this almost exclusively. These institutions proudly sell the benefits of a liberal arts education, which resonates very well with alumni of the institutions and others who attended similar schools. This messaging however is not very effective to prospective students' parents who may have attended public institutions. At worse they may take the messaging as an insult toward their education. To a lesser extent the message will not resonate with them as well and could result in a lack or loss of consumer interest and engagement.
I think that going into the future in the competitive market that is higher education liberal arts institutions may be better served by no longer being customer oriented and potentially switching to a competitor oriented objective. This would mean that these institutions would attempt to discourage more competitors from entering the market by setting prices very low. Possibly liberal arts institutions could do this by removing their generous financial aid packages and essentially subsidize their tuition, thus lowering their sticker price. This may allow them to compete with the pricing of larger public institutions and allow them to re-brand themselves toward families that do not have a much experience with a liberal arts education. Although radical, this may be a course of action liberal arts institutions should at least explore to work toward a prosperous future.
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