President of The Dysart Group, John W. Dysart will participate in a tuition discounting conference sponsored by Academic Impressions in Atlanta on December 8-9. 2014.  The following is brief interview in anticipation of two-day event.

• Several industry experts continue to warn of higher-than-ever average tuition discount rates. However, a recent Academic Impressions survey completed by nearly 100 institutions revealed several institutions experiencing net tuition revenue gains, despite offering discounts at or above national averages. Do you see these situations as merely outliers, or are they proof that institutions can inform themselves on how best to discount tuition while boosting NTR?

The survey results are in line with the experiences of my client institutions.  Certainly, there are many instances of colleges and universities facing stagnation or reduction in net revenue due to rising discount rates.  Schools can, however, still realize revenue gains despite increases in discount rates if they effectively coordinate pricing with their recruitment and retention plans and utilize these to inform financial aid packaging policies. 

In my experience, each school that has seen increases in both their tuition discount rate and net revenue has strategically explored three central questions: 

1. How does the market position of my institution impact net revenue? 
2. Does institutional capacity allow for enrollment growth to mitigate increases in discount rates? 
3. How can institutional policies and procedures and academic program offerings be reconsidered in order to meet revenue goals?

• What 2-3 items do you think each institution must analyze about their context in informing discounting strategies?

 Context is everything in evaluating your discount rate.  It is critical to consider the academic and socio-economic characteristics of your enrolled students and your academic and co-curricular program offerings as they can also influence discount rates and institutional capacity. 

Student characteristics such as pre-enrollment levels of academic preparation, percentage of “first-generation” college students, indicators of family financial strength such as number of students eligible for Federal Pell Grants and residence status-both percentage of students living on campus and percentage residing in your home state -can all inform context. 

Academic majors can make a difference.  Colleges offering majors in the fine arts will tend to have higher discount rates than colleges that do not.   Program specific scholarships for such majors are common.  Nationally competitive programs such as engineering may require more generous financial aid packages than more generic majors such as Business or Political Science.  Colleges and Universities participating in scholarship athletics are likely to have higher discount rates.

• Looking ahead 3-5 years, do you see the challenge of tuition discounting as largely confined to private institutions?

 Challenges associated with tuition discounting are no longer limited to private colleges and universities. More and more public colleges and universities are aggressively pursuing tuition discount strategies as competition increases, demographics change and states continue to reduce budgets and subsidies.  Private institutions have the advantage of decades of experience in managing discounts while the intricacies and nuances of net revenue tactics are still relatively new in the public sector.  Unique opportunities for effective discounting in the public school sector exist.  The combination of significantly lower prices and targeted discounting can give public colleges and universities a real long-term, competitive advantage.

• Which 3-4 on-campus partners do you see as critical to this conversation on each college or university campus?

 Presidential involvement is, perhaps, most important since effective control of the discount rate involves several campus administrative divisions.  Enrollment managers, business officers, financial aid directors and even chief academic officers must collaborate on the discount plan and work to educate and inform key constituent groups such as faculty, staff and Board members.  Optimizing tuition discounting is a complex endeavor, far beyond the scope of a single enrollment management department, and each contributing perspective offers much to the conversation. 

• The President is critical to the topic as he/she is uniquely positioned to bring the varied divisional leaders together in a collaborative conversation. 
• The chief financial officer brings influence over pricing, knowledge of specific revenue needs and responsibility for collection policies. 
• The chief academic officer can provide insight on academic majors.  Perhaps more importantly, it is often the academic division that is charged with retention activities and initiatives and the impact of improved retention on increased net revenue cannot be under-stated. 
• The Director of Financial Aid is in a powerful position to influence revenue outcomes.  The timing of packaging, the details of the institutional award policy and the practices for addressing financial aid appeals all can make a measurable difference in revenue. 

Learn more about the conference by visiting www.academicimpressions.com.  The conference will be held at Grand Hyatt Atlanta on December 8-9, 2014.