Say it "ain't" so: Washington Post article: For-profit colleges urged applicants to lie to leverage more aid, GAO finds

Makes me cringe to think about what this article says. My wife hates when I use the contraction "ain't," but say it ain't so.

For-profit colleges urged applicants to lie to leverage more aid, GAO finds

Using secret shopping approaches in its methodology, the Washington Post article states a number of cases of shoddy recruitment and application practices among for-profit education institutions. A side of me wants to hope that the article is based on the extreme weaknesses of journalism (but this is the Washington Post reporting) and the accusations are exaggerated or that an institution had a bad day. However, the article suggests otherwise and that in truth, something poor really did happen.

Knowing a number of credible leaders at some for-profits, I only hope that they are not part of this mix of questionnable practices. I also realize that some of these practices may also be present in the "not-for-profit" or traditional college/university experience.

Minimally, while no one wants to hear bad news regarding the education of our society, what I hope comes out of this is a higher standard for education, marketing and the recruitment process. I only hope that greater details come out regarding this mess and until then I need to show patience about over-reacting.

Great Resource on Engineering Education Trends

My colleague Nelson Baker, Vice Provost of Distance Learning and Professional Education at Georgia Tech, recently presented at the International Association of Continuing Engineering Education (June 23, 2010 in Louisville). His presentation can be found off his blog http://www.dlpe.gatech.edu/blog/. It's a pretty impressive and entertaining presentation if you keeping abreast of engineering education trends. Very comprehensive. However, user beware, it is a 10 MB file. (Oh, that's no longer a problem, as engineers have fixed the bandwidth and storage needs of society!)

Kudos to Nelson for an inspiring presentation.

Balancing Change and Being Smart

As I was helping a client with a presentation, I came across an interesting tidbit on how fast technology is changing. I don't live under a rock ... I know things are moving fast. I've got computers and televisions all around me. I Skype, Slingbox, Bluetooth, Crackberry, Facebook, LinkedIn, Wii, Playstation, teach online and all sorts of good stuff like that. The kicker for me comes from two contrasts 1) How fast Apple sold a million iPads (53 days with advance orders) as compared to how long it took for a million VCRs to be sold (See the chart, Source: Apple, Inc., Greystone Communication, The Yankee Group) and 2) Microsoft killing of Kin this week http://adage.com/article?article_id=144759.

The implication for higher education and marketing for me is how fast the rest of the world is moving in comparison to slower moving higher education. On the other hand, I blogged earlier about how the UT System was closing its centralized distance education operation in favor of decentralization. This I believe was too fast. However, wiping out Microsoft Kin after just a few months was probably a good idea, as rumour has it that it only sold 500 units.

While Apple probably did a lot of planning and we for sure know they did great marketing well in advance of its launch, the lesson to learn from all of this is that we need to move faster and smarter, not recklessly like Kin. For higher education marketing, we need action-oriented data and information that we can quickly and easily access, CRM systems that truly work, smart people who can do the job, a sustainable budget, support of strategy (as opposed to quickly diving into tactics and design) and a bit more for urgency. My soon-to-be released white paper on continuing and distance education websites shows many folks still in Web 1.0 formats.

Got to go ... my Commodore just finished booting up. :)

Marketing Budget Benchmarks

Food for thought. In 2006, Tut Bailey and Kim Erickson, two of my former Penn State Outreach colleagues, conducted a study I had carried through in 2000, 2002, and 2004 ... The State of Continuing Education Marketing. Since then, the association (UPCEA, formerly UCEA) has conducted the study and recommends that 10% of gross revenues be set aside for marketing. This would include media, personnel and operating costs associated to marketing. In 2006, Bailey and Erickson said that number should be 8% and my number (and Tut Bailey's) in 2004 was 13%.

MarketingSherpa http://www.marketingsherpa.com/article.php?ident=31641just released a report on B2B marketing regarding marketing budgets and suggested that 6% of revenues for larger companies (more than a 1,000 employees) be set aside, 9% for medium size companies and 11% for smaller companies (less than 100 employees). Acknowledging that B2B differs from continuing education marketing, the MarketingSherpa report provides yet another benchmark. Bailey and Erickson suggested, although with a different definition of small, medium and large, to be 8%, 6% and 7% respectively. The analysis that Tut Bailey and I did in 2004 showed 23%, 9% and 8%. The issue for smaller operations at the time was the trend to get programs online and invest in marketing despite the organization's size. It was a race for survival.

While it may not be anything new, it's more food for thought and confirmation if you need a benchmark. My read on this for continuing education is 8% to 15% for smaller organizations, 6% to 12% for medium size organizations and 6% to 8% for larger organizations.

However, it should not always be this type of cookie cutter ... you need to adapt your budget based on a number of considerations:

- Are you launching any new initiatives that you need to gain awareness?
- Are you spending more because of shifting media?
- Are you spending more or less based on digital initiatives?
- Do you have the right metrics to track the effectiveness of your spend?
- If you increase your budget, are you going to be spending it wisely? This translate into "what is your plan or strategy?" My good friend Judah R. once told me "Just because you say my organization needs to get to 10% doesn't mean that I am going to spend good money after bad."
- You should consider having a market research budget of 1/2 percent more or less. A 2008 Corporate Executive Board shows 0.62% while the American Marketing Association state 1/2 a percent in 2000.

Hope the numbers are helpful. Please consider them a starting point to move up or down from, as they need to be adapted based on your situation. Don't fall into the "me too" trap.

A Woman's Guide to College

My good friend Carla Andrews-O'Hara recently published a book A Woman's Guide to College: Navigating the Terrain to a Better Life. There's probably no better person to write such a book, as Carla herself was a returning adult learner, earned a number of degrees and is now marketing pro and author. The book is grounded in sound philosophies regarding adults returning to college or going to college later in life. The twist is its special focus to women. However, many of her principles and tips can be helpful to both men and women, but Carla takes an interesting historical look at women in higher education and the challenges one faces. She takes her principles and topics and overlays interviews and research to help make the book even more applied and useful, but also more interesting as she get into the lives and experiences of others. Great job Carla. If you are interested, the book can be found at Amazon.com at http://www.amazon.com/Womans-Guide-College-Navigating-Terrain/dp/1439262411/ref=sr_1_1?ie=UTF8&s=books&qid=1266861348&sr=8-1.

You can also reach Carla at carla@caoconsulting.net. To read more about the book, go to http://www.awomansguidetocollege.com/. Enjoy!

The Marketing Implications of the University of Texas' Telecampus Decentralization

On Saturday, I was reading an article in the local paper about "Chip" (http://www.centredaily.com/2010/05/15/1978577/layoff-forces-changes-and-grad.html). I've met Chip ... nice guy. Our kids go to pre-school together. Chip graduated this weekend from Penn State, earning his bachelor's degree in organizational leadership by taking courses through Penn State Continuing Education (on-campus and online). He had twenty years of experience in manufacturing and like many other companies, the company he worked for moved operations overseas to tap into less expensive labor and raw materials or was acquired. While I am sure it was a difficult decision for the company, the key factor was clearly cost reduction.

On Friday, I read the Inside Higher Education story of the University of Texas decentralizing its famed UT Telecampus (http://www.insidehighered.com/news/2010/04/09/telecampus). The campus has been a model for so many other institutions, as it has served many individuals, including the aspiring healthcare worker that can't predict his or her working schedule to the returning adult learner seeking to complete a degree he or she had started a decade earlier. The big issues for me from a marketing standpoint are:

• Can the decentralized marketing activities of many disparate units provide a clear door for the prospective adult learner? Will there be contrasting websites, collateral and other advertising? I've seen fragmentation of the brand, but more importantly, competition for the exact same students by different units of the university.
• Will the cost of marketing increase as each unit that markets their academic college scales up? Most likely, yes, unless you are the Business School and have your well-oiled marketing team in place, but if you are Liberal Arts, I doubt a true integrated marketing function exists. In the least, the stronger programs won't be there to underwrite the weaker programs. The richer will become richer and the weak weaker.
• Will the talent pool or overall abilities to conduct marketing only reach a minimal level? As I have seen with other decentralized marketing efforts, some academic colleges are better suited to do a great job of marketing (as they have a marketing staff devoted to the serving alumni, traditional students and others), while others are not and as a result do not allocate enough or they hire an entry level marketer to do a strategic marketer's job.
• Will the prospect see a better customer experience? Some might argue that they are closer to the product and not two steps removed. However, similar to the last bullet, the student service or enrollment management process may be strong to serve the adult or it might be cobbled together with duct tape and paper clips.

Sounds a bit premature for U of T to be pulling the plug, as the market for distance education is still evolving. We haven't even hit the evolution of Internet and the merging of television, telecommunications and computing. Smartphones are getting smarter ... by not keeping pace with how it interfaces with distance education, are we going to get dumber?

The article suggests that U of T TeleCampus was growing in enrollments, but also had increased costs to the academic units. I say you have to spend money to make money ... get ready to spend more money in a decentralized model to maintain enrollments or get ready to see your enrollments drop because you can't scale up the way you think. A centralized operation, run correctly, is typically a better model in a tight economy. In education, you only decentralize to either force underperforming units to become more profitable (or eliminate them) or to get intimately closer to the customer. You don't do it as a money saving strategy.

Congrats Chip!

My NAASS Webinar

Thanks for attending the NAASS webinar on April 8, 2010. You can find the link on the right hand bar under "Presentations and Papers." Thank you for the opportunity to help increase your enrollments!

Back in Action ... Hospital Customer Service

About a month ago, I visited my father at Sturdy Memorial Hospital in Attleboro, Massachusetts. He had major surgery and was there for a good three weeks. Little did I know that a week and a half later, I'd be the one who would be in the hospital for 15 days. I had quite the battle and a number of surgeries, but came through with a long-term outlook that is very favorable.

The one thing I do want to say is that the customer service I received from Mount Nittany Medical Center and the Hershey Medical Center in Pennsylvania was outstanding. There was a strong sense of caring and customer focus as compared to going through the motions. I am not saying that Sturdy's care was bad, but the sampling I saw over three days was lower than that of what I personally experienced. The good thing with Sturdy is that my dad pulled through and the physicians seemed to be really on top of things.

Back to Mount Nittany and Hershey Medical Centers. The physician and nursing staffs were experienced, but also had a strong sense of caring. They were outcome focused, as opposed to going through the process. I will say that Mount Nittany, while smaller, seemed to be more intimate to the patient's needs. Hershey had a breadth of services and staff, but had good processes. There was a level of inexperience at times at Hershey due in part that it is a teaching hospital, but there were checks and balances to insure for a positive overall experience despite the pain people are going through and their need for healing.

I am on the mend and thankful for the expertise at both hospitals. The customer service experience was a bonus. A bonus on top of this was the awesome food at Mount Nittany. It was restaurant quality.

Back in action to serve the educational marketing community ... Thank God for a positive outcome.

A Failure to Fulfill the Brand Promise

My blog was supposed to serve the education community, but has turned into my sounding board on poor marketing and customer service practices. The irony is that I just got in to Tuscaloosa and will be speaking on customer service processes. Along the way, I hit a real dinger ... Enterprise Rent-a-Car. I made a "reservation" with them about a week ago so that I could drive from Birmingham, AL to Tuscaloosa. It is about 70 miles, so having a rental car is a necessity. Well along the way, the plane had equipment malfunctions and arrived 2 hours and 40 minutes late.

If you're late Enterprise gives your car away. Over the last five years, I've averaged about 15-20 rentals that represent about 40 rental days a year. I decided that I'd try Enterprise this time ... never used them before. Never will again.

Being 2 hours and 40 minutes late and having my flight number on the reservation, Mr. Bonehead employee still decides to give my rental, along with at least six other late comers away. How many "no shows" does Enterprise go through? They say they overbook because of no-shows. I think they've made a huge mistake on lifetime value ... to get at 50% of my personal market share (as opposed to Avis) could amount to $1500 a year. Equivalently, I am worth 10 no-shows. Hopefully, they've done the math on this, otherwise, it is a poor business practice.

The brand promise or the perception that they've created is exceptional customer service, service that is premier that delivers a car to your door. It is a very polished message, but unfulfilled in my opinion. Where does your university stand on brand fulfillment?

I've done dozens of customer service audits and the research shows that the for-profit institutions are excelling, as well as those using outsource partners to manage prospects and applications. Some traditional universities are in fact doing a good job, but the vast majority are failing miserably. Why? Because colleges and universities are too afraid of the front line staff, measuring results or adopting the dreaded "sales" culture.

Many colleges and universities are openly opposed to a "sales" mentality. They don't believe that education should be sold and as a result choose words like "client development," "corporate manager," or "partner relations." Yeah, I'm all for a slick term, but when a culture is so afraid of the word "sales," it is indicative of bigger problems.

BTW, now that I work for myself, I was seeking more frugal alternatives than Avis or Hertz, thus my foray into what I saw as an upper middle brand ... Enterprise. Never again. They don't deserve 10-20 years of my personal 50% market share. 20 years x $1500 = $30,000 lifetime value. I'm back to Avis.

UCEA Marketing 2010: Digital PR and SEO, Fong and Gifford

Mother nature kept me away from Tampa today, but Janet Gifford of Linfield College delivered our joint presentation. Thanks Janet!

Fong_Gifford_2bNotes.pdf