Leveraging data to prove the ROI of higher education
Global economies are creaking under the strain of the Covid-19 pandemic leading to mass unemployment and a hyper-competitive jobs market. This, combined with record high tuition fees has given rise to a generation of prospective students that want to fully understand what kind of return they can expect from such a substantial investment. And failure to provide such information severely damages a higher education institution’s (HEI) credibility and ability to recruit.
More than just money
Higher education is a big investment for the vast majority that choose to pursue it. With the rare exception of those living in the few countries that offer free or heavily subsidized tuition, most students will leave higher education with tens of thousands of dollars worth of debt.The investment isn’t just financial, of course. Depending on the type of program undertaken, students will dedicate anywhere from one to ten years of their time studying it.
Before we look at how HEIs can demonstrate ROI to their prospective students, it’s important to briefly touch on the philosophical implications of ROI in higher education. Historically, ROI in higher education has been measured in dollars. A person spends $X amount on their education which leads them into a career that pays them $Y. What Y is, relative to X determines the ROI. The Bigger the gap between X and Y, the better the ROI.
In reality, ROI isn’t that simple. There are myriad factors through which one could measure the ‘success’ of higher education that don’t include salary. For example, happiness, social standing, fulfillment, confidence, independence etc. These are all things that can be attained through higher education but it’s difficult to quantify them. This doesn’t mean that they are of any less value but it does mean that, for simplification purposes, the focus of this post will be on the quantifiable outcomes of higher education: vocational and salary data.
Present the ROI receipts
An increasingly key component of any prospective student’s decision making process is understanding the ROI they will get from a proposed major. HEIs typically don’t do a good job of helping their potential students achieve this level of understanding. The focus tends to be more on entry requirements, the modules a student will undertake, the professors that will teach them and stories from graduates that did the same major.
Squiz believes that helping students to understand the ROI they can expect from any given higher education path is going to be paramount to the ability of colleges and universities to recruit the brightest and best talent in the new era for Higher Education.
By harnessing data from economic modeling sources such as EMSI, Squiz can help HEIs to present ROI data to prospective students at critical points of the buying cycle – for example on program pages. This means that, as a student peruses the English Literature program page they can see, at a glance, key information related to the type of vocation they can enter into and how much money they are likely to earn in doing so. Through simple A/B testing it is possible to measurably determine how effective exposing students to such data is by assessing how much more likely they are to convert as a result.
This approach helps HEIs to fundamentally change how they try and attract students using data. And for prospective students who are ever more cynical and wary of marketing tactics and who dislike the concept of ‘being sold to’, a data-driven approach is refreshing. No longer do students have to take a marketing department's word that attending their college is the right choice for them. Instead, the benefits are presented in black and white. Indisputable.
HEIs may be able to go one step further. If they can prove that majoring in a certain program at their institution equates to a greater ROI than the same major at a different institution then there is an extraordinarily compelling reason for students to switch their college of choice. This kind of data would be immensely valuable to marketing departments looking to create campaigns convincing students that their HEI is the correct choice. Furthermore, the opportunity to target a subset of prospective students and to personalize messaging to them, entirely backed by real world data will be massive.
An exciting future development is the potential to display additional data alongside salary and vocational data, as discussed earlier in this post. These data sources are more difficult to source but, in theory, it should be possible to determine the average success metrics of graduating in any given major against things like happiness, fulfillment and social value. Watch this space.
To learn more about how Squiz helps colleges and universities demonstrate ROI and provide exceptional student experiences, get in touch today.
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