Stoffer's Soapbox

Marketing Education: Inside out or outside in

There are two extremes as to how market a school, which I'll call "inside out" and "outside in." "Inside out" is to build an incredible reputation, open the doors and select which students you want to come in. "Outside in" is to spend direct marketing dollars to buy Internet leads and reach out to potential students via either inside sales or fields reps. Inside out requires a larger investment in business development and career services while the outside in model requires more investment in upfront marketing and admissions.

A great example of "Inside out" marketing is the Parsons School of Design in New York. In addition to the publicity from Project Runway, Parsons lures students with the opportunity to work with some of the premier design firms in the field. A list of projects on the Parsons website includes designing a new watch for Fossil, designing a line of accessories for Vespa, working with Chanel, Hermes and Saks. This pdf is an impressive summary of the opportunities Parsons gives its students. With these opportunities, students flock to Parsons without a great deal of marketing investment on Parsons part.

The alternative means of drawing in students - the "outside in" model - is via direct marketing and lead gen. A school runs local TV or engages lead vendors for Internet ads, generates "leads" and then calls those leads from a call center. Speed to contact and the skill of the admissions advisor are primary differentiators under this model. From 2000-2005, this market was dynamite for the for-profit early entrants into the online post-secondary education market.

Schools never fall strictly in the camp of "outside in" or "inside out". Even Wharton visits dozens of cities around the world each year to recruit students. But, as the market continues to become more competitive, for-profits can no longer rely too heavily on the "outside in" model. You see this with UOPX buying naming rights to Arizona Stadium, UTI's partnership with Nascar and other industry players increasingly trying to differentiate their brands. A generic IT/business program and a killer direct marketing model is no longer enough, unless it is paired with true brand differentiation.

Slowly, Public Universities are "Getting" Online Education

There was recently a great article in the Chronicle of Higher Ed about UNC's slow but steady approach to building its online education programs. "Called the University of North Carolina Online, or UNC Online, the project takes the current online-education offerings from the system's 16 campuses and centralizes them, with plans to expand the operation into a national program. North Carolina has 90 degree programs online, with 24,000 students enrolled (4,000 out of state). Given population trends, system officials have estimated that they will enroll an additional 80,000 students over the next decade."

As I wrote in my post For-Profit Online Universities: The Path to Brand Differentation, the biggest challenge for-profit providers face today is how to differentiate themselves in the increasingly crowded marketplace for online education. What is clear is that a generic for-profit school simply garnering Internet leads and trying to convert on these will no longer be a viable competitor as traditional schools continue to "catch up" to their for-profit counterparts in online educational offerings. Instead, those for-profit providers who succeed in the long-term will be those who can build enough product differentiation to convince people in the state of North Carolina, for example, to go to their school rather than pay significantly less in-state tuition to attend a University of North Carolina online program.

Benchmarking Lead Conversion

There is a great site, Lead Marketwatch, that tracks conversions in the mortgage industry - a service I wish were available in the education vertical as well. The site allows mortgage companies to benchmark how they are doing versus other buyers of similar leads. The LeadMarketwatch site is brought to us by Bill Rice and his team at Kaleidico, makers of the icoSales lead management software. They aggregate conversion data from icoSales clients - which includes major mortgage companies nationwide. One thing I would like to see is more lead providers - the biggies are here, but it would be great to see all the small to mid size providers as well!

7 Day Application Rate
Lead Provider	Current	Change	Previous
Lending Tree	7.69 %		5.80 %
Loan Web	5.77 %		5.05 %
Lower My Bills	3.30 %		3.30 %
Low.com	3.19 %		2.41 %
Lead Point	0.73 %		0.37 %
Beta Version 0.3

30 Day Application Rate
Lead Provider	Current	Change	Previous
Juicy Leads	20.51 %		19.23 %
Lending Tree	6.45 %		6.16 %
Loan Web	5.13 %		5.28 %
Lower My Bills	4.58 %		4.63 %
Low.com	3.54 %		3.37 %
NexTag	3.26 %		3.26 %
Prospect Zone	2.56 %		1.69 %
Lead Point	1.53 %		1.50 %
LoanApp	0.00 %	-	0.00 %
Beta Version 0.3

Future of Online Education

I read a real visionary piece on the future of online education in a recent Education Signals newsletter. It is a summary of remarks at a recent education conference by Gary Keisling, chairman of Ashworth University, a for-profit backed Sterling Partners. Keisling has 20 years of for-profit education experience and gave a talk titled, "€œNew thinking in for-profit education models to advance cutting edge investment strategies."€ He described the career college of the future, the school he might build today if starting from scratch. Highlights include:

•  Delivery, outcomes and branding of education over the next 20 years will be much more than a simple reflection of old systems and more aggressively influenced by trends in technology and Internet socialization.
• Embracing Web 2.0 principles, including community, low cost, no censorship and individuality enable a new model for education.
•  Internet socialization will be facilitated and encouraged by the school and online and on-ground content will be completely equal and completely blended at the students’ discretion
•  The current system in which the cost of postsecondary education rises rapidly ahead of the pace of inflation, leaving new graduates tens of thousands of dollars in debt would finally collapse on itself and turn the current concept of brand embodied by a paper (?!) diploma, on its head.
•  The generation that grew up with Web 2.0 and MySpace as the norm, will reward models that focus on results-based learning and job attainment over a brand on a diploma.
• The new model will allow flexibility in curriculum design, and even a menu-based curriculum that will offer more choice in course selection.
•  Costs will be radically lower with revenue and profit generated far more through add-on services and third-party relationships (think of UTI’s company-sponsored graduate programs applied to other fields).
•  There are opportunities to focus on underserved niches: Hispanic market, retiring baby boomers and people seeking very strong career placement tools & capabilities
• The school would develop consortiums with other schools to share leads and gain leverage
•  One of the school’s major focuses would be negotiating articulation agreements and speaking out in every possible forum about credit transfer issues.
• Low cost programs will free schools from outmoded regulatory burdens and new arbiters of quality and value will emerge to replace the old systems.
•  One example could be instruction in multiple languages, multiple states, and even multiple countries all currently tightly controlled.

Colleges Must Embrace User-Generated Content

A lot of colleges (especially for-profits) are scared to leverage new media like YouTube, blogging and social networks, out of fear that they do lose some control of their marketing message. A typical administrator's comment is "What if someone writes a slanderous comment or what if a current student or faculty member bashes the school." What they fail to realize is that if their product is of high quality and they have an enthusisastic customer base, there is very little to fear. Check out this video on YouTube, it's a parody of UOPX and pokes fun at the school's marketing, accreditation and student body. What is most interesting to me is not the video but the comments to the video - some are ignorant, but UOPX's supporters present the other side well, giving viewers a very balanced view.  Two sample comments are "I don't believe Randy was referring to UoP's Business Program Accreditation. UOP is Regionally Accredited like most other legitimate schools." and "This is a waste of time, ill-informed, ad hominem attack with no basis in reality. Though I am not in any way affiliated with the organization slandered, it is clear that the makers of this clip lack the basic understanding and integrity necessary in assessing the value of well accredited distance learning programs." Instead of just responding to attacks, schools should start to use web2.0 to their advantage to create buzz, enhance brand value and generate leads organically.

Second Life: Should Colleges Jump on the Bandwagon

Ohio University, Art Institute of Pittsburgh and other schools have recently devoted a large amount of marketing and web development resources to extend their campus to the online virtual world Second Life. Click here to check out Ohio Universities' Second Life "campus". I agree that these efforts certainly do help these schools present themselves as hip or cutting edge. It also allows the schools to reach a base of tech savvy users. The game Second Life has 2 million users, up from 95,000 a year ago. The average age of users, surprisingly, is 33.

The branding benefits of Second Life are clear - but if schools expect to get a wave of new  students solely from marketing via Second Life, I think they are sorely mistaken.For one, there are 2 million users, but how many are "real"? I signed up just to check it out and I have never logged in again - I bet a lot of these users are like me. Secondly, how many users are looking to peruse online schools, given the sheer number of activities one can pursue in Second Life.

What Second Life should be is a nice addition to a holistic new media marketing strategy. Potential students should be given the opportunity to interact with a school via their communications channel of choice. This medium could be by subscribing to student and faculty blogs or podcasts, interacting with students on a social network for that school, visiting the school's Second Life Campus or more traditional approaches like taking a physical or virtual campus tour or reading online student/faculty profiles.

My Work Unveiled: Launching New Online Design Programs

I can finally share with readers one of several high impact projects I am working on. My employer, Career Education, announced on its earnings call the coming launch of online delivery of programs at its IADT design schools. I believe delivering quality design programs online is an underserved niche and I have headed up efforts to craft an operating model - primarily in marketing and admissions - that is unique in for-profit education. As we launch the website, announce programs and open up admissions over the next several months, I will be excited to share our efforts with all of you.

Noel-Levitz Study: Student Expectations for University Websites

Two or three years ago, for-profit education providers viewed their marketing website with one end goal in mind - to provide as little information as possible and drive a student to fill out a lead form. A new piece of research confirms that any university that sticks to this strategy will be uncompetitive in the marketplace.

Education industry market research firm Noel-Levitz recently published three studies on what incoming college students expect from university websites. Not surprisingly, these students want to learn about school options by hearing about and interacting with students and faculty.  These students use social networking, chat and web2.0 services as part of their everyday lives, so it is no surprise these are exactly the activities they want to be available on a recruiting website. Below, I have highlighted some of the top activities students said they would like to complete on college Web sites:

• Complete a financial aid estimator form (88%)
• Exchange instant messages with an admissions counselor or student worker (72%)
• Read profiles of faculty (64%)
• Read a blog written by a member of the faculty (64%)
• Read profiles of current students (63%)
• Read a blog written by a current student (63%)
• View a virtual tour (63%)
• E-mail current students from the site (61%)

NY Times Expose on University of Phoenix: Shades of Yellow Journalism?

The NY Times had a front page story on Sunday about the University of Phoenix titled "Troubles Grow for a University Built on Profits." The story questions the quality of UOPX's education on three fronts: graduation rates, use of full time faculty and faculty quality. The paper misses the mark each time.

Graduation Rates: Is 16% Too Low to Justify Continued Accreditation

UOPX's target market is the adult learner - admissions are open, students can go to school part time, the average age is in the low 30s, a typical student has already dropped out of college, and students are often the first in their family to ever attempt to go to college. So UOPX students have the deck stacked against them - each one of these factors increases likelihood of dropping. I challenge the critics of UOPX's graduation rate to build a regression model to forecast graduation rate based on the variables I listed above. I am willing to venture that UOPX's graduation rate does not stray from what you'd expect given the demographics and socio-economic background of its student body. In fact, I used Education Trust data to look at two public schools with open admissions and a high percentage of students with Pell Grants (indicating low income). Troy State has a graduation rate of 8.3% and Southern U. at New Orleans has a 9.2% graduation rate - so why is the for-profit school the one getting all the scrutiny.

Use of Full Time Faculty

The article states that "About 95 percent of instructors are part-time, according to federal statistics, compared with an average of 47 percent across all universities. Most have full-time day jobs." At Wharton, some of my best instructors were adjuncts who worked full time in industry. I do not understand how full time faculty leads to higher educational quality.

Faculty Quality

I attended two fantastic institutions - University of Michigan and Wharton - and in both cases, I had several professors who were awful. Overall student satisfaction with teaching quality is what was most important - not a teacher in a single course. So I cringe when the NY Times shares one-off anecdotes to express teacher quality rather than systematically surveying a statistically significant sample of students. The following paragraph is absolutely unacceptable as you could find an example of this at any school on the planet: "Robert Wancha, 42, a former National Guard commander who is pursuing a bachelor’s degree in information technology at the university’s Detroit campus, said that in a computer course last fall his instructor, Christopher G. Stanglewicz, had boasted that he had a doctorate but did little teaching, instead assigning students to work in learning teams while he toyed with his computer."

Conclusion

There are things UOPX can do better as there are things any other school can do better to increase educational quality. They probably do need to offer more tutoring for students, strive to always increase faculty quality and offer additional financing options to help students fund their degrees. However, there is no reason why UOPX should be a lightning rod for criticism - when much of that criticism is based on unjustifiable tenets - (1) UOPX has a low graduation rate but also has extremely high risk students; (2) faculty quality may be high or low but there is no data to support that faculty quality is not where it should be and (3) there is no data supporting the assertion adjunct faculty provide lower quality instruction.

New Resource for Public Policy Wonks: University Channel Online

Four renowned public policy schools have launched the University Channel Online, a new online resource for free, on-demand access to a wide range of public policy lectures, panel discussions and events from academic institutions all over the world. This is just another example of the power of online learning to make formerly proprietary content easily available to students, researchers, policy makers and citizens world wide.

According to the press release, the four charter members are:

• The Rohatyn Center for International Affairs at Middlebury College
• The Woodrow Wilson School of Public and International Affairs at Princeton University
• The School of International and Public Affairs at Columbia University
• The Lyndon B. Johnson School of Public Affairs at the University of Texas at Austin

Recent broadcast-quality audio and video selections include Stuart Bowen, special inspector general for reconstruction in Iraq, speaking at the University of Texas at Austin on Oct. 27; retired Lieutenant General William Odom, director of the National Security Agency from 1985 to 1988, speaking at Middlebury College on Oct. 11; and United Nations Secretary-General Kofi Annan, sharing his parting policy address at Princeton University on Nov. 28.