Wrestling with the Discount Rate: Escaping the “Strangle Hold” Brad Poznanski, VP for Marketing & Enrollment Manag

1. Wrestling with the Discount Rate: Escaping the “Strangle Hold” Brad Poznanski, VP for Marketing & Enrollment Management Saint Anselm College National Small College Enrollment Conference July 23, 2013 Nashville, Tennessee

2. Agenda • Understanding and Managing the Discount Rate • NACUBO 2012 Tuition Discounting Study • Case Study: Saint Anselm College • Discussion

3. Discounting Terminology • Tuition Discount Rate • Tuition Discounting • Freshman Discount • Net Revenue • Net Price • Sticker Price • Funded Aid • Unfunded Aid • Merit Aid • Need-based Aid • Athletic Scholarships • Tuition Exchange Grants • NACUBO

5. “Institutional financial aid is not considered an expense, it is a contrarevenue.” Tuition Discounting in an Era of Austerity, NACUBO, April 12, 2011 Patricia McWade Dean, Student Financial Services Georgetown University

8. Net Revenue Management Enrollment: Headcount Net Revenue Triangle Pricing: Sticker Price Discounting: Institutional Aid

12. Comments submitted with NACUBO Tuition Discounting Survey, 2012

13. Heads or Tails?

14. Related Issues • Public perception of college costs versus value: “Greedy Colleges” • Congressional concerns with college costs • Shrinking student demand: shrinking pricing power • High price / High discount model is confusing for students and families

15. Case Study Saint Anselm College

16. Strategies to Reduce the Discount Rate • Strategic Enrollment Management Committee • VP for Marketing & Enrollment Management • Director of Admission • Director of Financial Aid • VP for Finance • Associate VP for Finance • Faculty Member, Economics • Faculty Member, Chemistry

17. Year 1 Strategies (2012) • Strategic Pricing Analysis: Defining Value, Price Sensitivity, and Institutional Aid Strategies • Survey research to gauge price expectations and perceived value • Strategic modeling to understand impact of current awarding strategies • Econometric modeling and simulations to project impact of alternative strategies • Trade-off analysis to assess impact on headcount, quality, diversity, net revenue, Etc

18. Outcomes to Balance: Trade-off Enrollment Goals Economy Admitted Student Profile Predictive Model Multi-Year Recruitment campaigns

19. Year 1, Con’t • Differential packaging of nursing students • Caps on all need-based aid • Reduced freshman discount rate by 1% • Hit enrollment target, 527 freshmen

20. Year 2 (2013) • Increased communication with Board of Trustees about discount rate issues • Data, econometric models, simulations • Apps and admits down 6% • Selected a less generous awarding matrix to reduce DR by an additional 1% • Appeals doubled from prior year • Lowered DR 1%; increased yield 1%; increased diversity; maintained quality; enrollment fell from 527 to 510

21. Year 2, Con’t • Launched new brand – publications, website, on-campus banners • Beefed-up yield program • Award-winning social media campaign • Promoted outcomes

22. Plans Going Forward • Grow applications • Build demand and perceived value • Promote major-specific features and outcomes • New core curriculum: more flexible • New residence hall • New President of the College • Increase advertising to build inquiries • Integrate digital & print • Out-of region recruitment • Continue financial aid models lean toward maximizing net revenue

23. Discussion