Four Big Changes Accelerated By Covid 19
Eduvantis has analyzed the impact Covid-19 has had, and will continue to have, on business schools. We’ve been impressed by the resilience of nearly every school to adapt to bring a high-quality educational experience to their students and the true commitment of the faculty, administrators, and staff who worked tirelessly make the academic year a success in the face of considerable challenges.
The impact of Covid-19 and the institutional responses varies widely, depending on factors, such as brand power, technological savvy, geography, faculty mindsets and flexibility, financial resources, existing portfolio mix, and others. We will explore four universal dimensions of the next generation business school every business school dean, CMO, and college president must consider in a four-part series.
Part 1: Online learning is no longer just an additional mode of delivery, it’s an entirely different business model
In our 2020 Deans Survey, 75% of deans said online program delivery will be a big part of the “new normal,” it’s just a matter of the extent of change.
Today, we know that online learning must become part a core part of a business school’s programmatic portfolio and not treated as a supplemental add-on or afterthought.
MARKET ACCEPTANCE FOR ONLINE EDUCATION IS GROWING—AND SO IS THE COMPETITION
The idea that online degrees can’t be as valuable as traditional ones has faded. We see evidence of this in our data and a recent Wall Street Journal article describes how high-profile business schools, who initially resisted entering the online market, are now joining the online learning ranks. Covid thrust students into the online-only environment and guess what they discovered? It’s not that bad. In fact, it’s very good in many cases, with online learning being equivalent to on-campus.
Today, top schools are embracing this direction and building platforms to support online delivery. This is and will continue to fundamentally change the market. If you weren’t the first-mover with a strong brand, you’re likely facing a hard battle.
READY TO COMPETE ONLINE—FACTORS TO CONSIDER
There is much to consider when deciding to pursue market share in the online space, with a degree of difficulty that cannot be underestimated. We’ve outlined the factors to consider:
- Price pressure: The University of Illinois now offers an Online MBA for $22,000. Boston University offers theirs for under $25,000. Do you have the brand strength or marketing investment required to get the volume of students necessary to achieve a positive ROI?
- Marketing costs: The fact is, it costs more to market an online MBA program. Google “online MBA” and see how many results you get. MBA keywords are expensive, so if you hope to find your program at the top of the SERP and are not a household name, prepare to make an investment. Do you have the budget needed to gain visibility?
- Technological investment: Whether or not you choose to go with an OPM, investment in technology is high—and going up. Virtual reality and artificial intelligence are on the rise and necessary to strengthen customer satisfaction. Are you prepared to embrace emerging technologies?
- Program differentiation: The number and type of programs is growing, and the delivery models are evolving. True differentiation can be challenging. How would your program(s) differ from the rest?
- Faculty challenges: From our experience, faculty willingness to participate in online delivery and learning varies widely across institutions. It’s a fundamental challenge we hear from many deans. As time goes on, perhaps faculty perspectives have changed. Where do faculty stand on your campus?
- Financial margin: It difficult to get the right margin until you get the right scale. Have you carefully considered your profitability ratio?
- Brand: Traditionally, university brands are rooted in place and space, with nothing to do with an online learning experience. How can you build a model that supports your particular brand in the online space?
WHAT MODEL IS RIGHT FOR YOUR INSTITUTION—AND WILL YOU SEE ROI?
We’ve worked with 80+ business schools and know first-hand how much money goes into successful online programs. In more cases than not, schools are disappointed in the revenue.
You must think very carefully and analyze what business model is the best fit for your institution. There are a number of models—and questions—to consider. The most important, and obvious, one: Do you outsource to an Online Program Manager (OPM) or build your own in-house? Both have advantages—and drawbacks.
OPMs are more complicated than they first appear as you must consider the cost structure, the nature of the revenue share, terms and conditions, and more. It can be very complex and not always in favor of the school—especially in the near term.
Ready to build your own? Consider the wide range or resources required, including an educational designer (or more), a marketing staff or an agency, a separate CRM instance, faculty support, and more. Are you prepared—and resourced—to do this all yourself?
A third option is to try something in-between. You could engage an OPM to control the marketing and recruitment, then pass the down-funnel management to the school and require faculty to handle course development.
There are many ways to disaggregate the pieces and the parts, based on your institution’s capabilities and resources, and picking the one that fits your institution’s circumstances will be critical to giving your program the best opportunity for success.
ONLINE IS HERE TO STAY
You already know this. Online learning has to be considered as a fundamental and increasingly important aspect of the overarching business model and brand. This will require a very different way of thinking and deep analysis to make the best decision for your institution.
Stay tuned for part two of this series: the changes necessary to build your brand and sell your programs. We’ll explore what the pandemic has done to your brand while your classrooms sat empty.