Changing Perceptions of Your Institution's Value
The fourth and final installment of The Maguire Network pricing and value article series
Over the past three installments of the series, we’ve discussed three key components of pricing and value: the unique value proposition, the power of student price sensitivity, and your institution’s “value fingerprint.” But, what does it take to change perceptions of institutional value?
Read the first three articles in the series:
“What’s Your Value Proposition?
You Have One, Right?”
"Make Your Best Offers:
The Power of Price Sensitivity"
"Finding Your Value Fingerprint:
Assessing Value Across the Student Lifecycle"
Marketing professionals often rely on the “Four P’s of Marketing,” from E. Jerome McCarthy’s 1960 marketing classic Basic Marketing. In times like these, there is great value in returning to the basics as a conceptual framework of a value enhancement implementation strategy. McCarthy said that marketing decisions fall into four broad categories: Product, Price, Promotion and Place. For colleges and universities to use these ideas to increase perceived value, we add a fifth essential ‘P’ to the equation – People.
People: Target Students and Families Who Value What Your Institution Offers
Enrollment professionals are constantly challenged to identify and communicate with multiple constituencies simultaneously – high school students, parents, guidance counselors, enrolled students, and graduates – each with different motivations and needs. Understanding what motivates each constituency is critical to enrolling and retaining students through graduation and beyond. Asking key questions will focus your institutional marketing efforts:
- Who is the target market for your institution?
- What are your institution’s primary, secondary and tertiary markets? How do value perceptions differ in different regions?
- What are your potential customers’ priorities and how do they relate to value perceptions?
- Which desirable student subgroups have different priorities or preferences than your market as a whole?
Product: Strengthen the Quality Side of the Value Equation
Institutions that are considered a “good value” meet the needs and expectations of students and their families at a reasonable and justifiable cost. The key to stimulating interest and increasing families’ willingness to pay to attend your institution is translating market research into action. Do your educational offerings fully satisfy the needs of students and parents? How can you improve them?
Here are five steps to address prospective students’ educational priorities and expectations:
- Focus on student needs that your institution either does not meet or is not perceived to meet. The former is a product development issue, and the latter is a communications issue. Redirect resources from features or services that students rate low in importance to ones they rate as more important.
- Communicate return on investment. Higher education is an investment in the future. Tangible evidence of the value, even the marketability, of your institution’s diploma should be communicated through compelling statistics and case studies.
- Exceed the expectations of incoming students starting with the very first contact. Students and families make judgments based not only on what they have read, but also on the staff and faculty members with whom they interact. Focus on exceptional customer service and not just improving productivity.
- Make sure to focus outside the classroom as well as inside – both programmatically and through marketing. Value is connected to student life as well as academics. More attention paid to social activities and attention to personal growth, whether these activities take place on or off campus, will help bring the academic community to life for prospective students.
- Continually assess and strengthen your educational offerings. Value enhancement and service innovation is an ongoing process. Pay attention to what’s missing from your existing offerings and assess whether you should address the gap or focus on what you are already doing well. Doing more is often not the best action.
Place: Develop Delivery Systems that Drive Value
Does your institution provide students value-enhanced learning environments? Depending on your target audience and their priorities, opportunities to enhance value may be found in offering students multiple delivery systems and experiences that go beyond the traditional campus walls such as:
- Online or distance learning options. While it’s no small task or organizational commitment to offer education through electronic channels, the technology has now been built and tested that allows institutions of various sizes and missions to offer a new educational experience. Sub-markets among both traditional and non-traditional students are drawn to the benefits of convenience and flexibility associated with the most common online education models. Online education can provide students increased access to desirable courses or programs that may currently be limited in their geographic draw.
- Study abroad. With increased focus on the global economy and the need to compete effectively in a multi-national context, opportunities that extend student learning beyond America’s borders are increasingly desirable to students.
- Cross-college/university opportunities. Cross-registration agreements with other local colleges give students more academic and extracurricular options. These additional opportunities and expanded resources often enhance student value perceptions.
- Alumni mentorship programs. Alumni mentors can provide personal support and knowledgeable academic and career advice outside the classroom. Students can be matched with alums that share similar academic or career aspirations, personal interests, or hobbies. Additionally, matching students with successful alumni is another way to emphasize that an education at your institution is a good investment.
Price: Develop Pricing Strategies That Match the Value Students Receive
Do you provide prospective students and parents the best “bang for the buck” in their college choice? For long term viability, you must be proactive and strategic in your pricing decisions, including:
- Market net cost assertively and in detail early in the search process. Inquirers are already thinking about cost and for many, cost can be a significant barrier to application. Students and their family need to know early on if your institution is affordable – how financial aid works and how much typical families receive.
- Align financial aid discounting strategies with institutional priorities. When constructed effectively, financial aid models can align the perceived value of an institution with the right mix of students’ expectations of net cost. Additionally, families often weigh heavily the makeup of financial aid offers, particularly in terms of the amount of grant award relative to loans and work study assistance.
- Monitor your institution’s financial indicators relative to your competitive set. Benchmarking competition sets, both real and “aspirational,” on a number of financial metrics – including tuition and fees, room and board, percent receiving need-based financial aid, percent receiving merit aid, discount rate, etc. – is essential for institutional pricing decisions.
Promotion: Develop Marketing Systems that Communicate Value
Do your promotional efforts include clear and compelling messages that are targeted – via appropriate channels – to specific audience segments and with supporting facts? Both school- and student-based promotional activities should be a part of any value enhancement strategy, such as:
- Determine your core messages. Through market research, develop consistent, credible, coordinated, and compelling messages that best convey the strengths and value of your institution. Roll these messages out strategically throughout the enrollment cycle. Messages to students and families at the beginning of the college search when they are trying to narrow their options down to a short list of application options should be different from those presented to them at the end of the search when they look at net price to determine where they will enroll.
- Counteract misperceptions in the marketplace. It is critical to counter any public misconception that you encounter as they can undermine positive progress in image and value enhancement.
- Monitor the effectiveness of all marketing initiatives. Track promotional methods' effectiveness by measuring the outcomes they produce. In order to know which value promotion methods are most effective, use test groups, check progress toward your goals, and refine your strategies accordingly.
The Clarifying Value of Crises
There is at least one silver lining to the current economic challenge. Tough times remind us that that necessity really is the mother of invention. Crises often provide a galvanizing force through which institutions will excel by honing their missions, competitive strategies, and entrepreneurial instincts to work even smarter. With responsive, well-crafted strategies, the present economic challenges can be used as an impetus to enhance quality and value perceptions among increasingly price-sensitive and value-oriented students and parents. If you articulate clearly what is distinctive about your institution, advance that message consistently and clearly, and continue to assess the marketplace’s perceptions and preferences, you will position your institution for near-term stability as well as successful long-term viability.
Read the first three articles in the Maguire Network value series:
"What’s Your Value Proposition? You Have One, Right?" from the May 2008 issue
"Make Your Best Offers: The Power of Price Sensitivity" from the July 2008 issue.
"Finding Your Value Fingerprint: Assessing Value Across the Student Lifecycle" from the September 2008 issue.