Noel-Levitz just released its 2012 Discounting Report, a summary of fall 2011 discount and net revenue outcomes based on aggregate freshman data from institutions partnering with us to strategically manage their financial aid. (Our participants are 139 private four-year colleges and universities.) The good news from this report is that the average overall freshman discount rate increased less than one percent in 2011, the smallest increase since the peak of the recession in fall 2008. The recent growth trend appears to be slowing as the economy improves.
The art and science of enrollment management has many performance indicators that drive the investment decisions of colleges and universities. Some campuses invest resources into increasing the size of the incoming class in order to increase both immediate and long-term revenues; these campuses may make investments into their marketing and recruitment budgets, or they might increase their financial aid budget for new students. Two-year colleges might be more concerned with investing in the best outreach services available to ensure access to their institutions; these campuses want to support more high school students and their families in making the decision to go to college.
However, many institutions still do not invest in student success and retention activities that can also provide an immediate as well as a long-term return on investment (ROI). In addition to the short-term gain you can achieve by retaining new students to the second term, you also realize an additional, longer-term ROI when these students continue, year after year, to graduation.
For several years, Aurora University in Illinois had been trying to increase its first-year enrollment without reducing its net revenue. “We always had a goal of 200 freshmen,” says Director of Freshman Admission James Lancaster, an Aurora alumnus who assumed that role in 1999. “But our average freshman class from 1990 to 1999 was 148.”
When President Rebecca Sherrick arrived in 1999, Lancaster relates, she asked Noel-Levitz to evaluate the college’s enrollment efforts and provide strategic advice. That year, the admission office began employing the Noel-Levitz Enrollment & Revenue Management System™, which uses an institution’s historical enrollment, tuition, and award data to create an econometric model that guides financial aid awarding to maximize enrollment returns. “This allowed us to take a hard look at price elasticity to make decisions on tuition hikes and merit awards to help us shape and build our class,” Lancaster says. “We hit 204 that year.”