While many colleges have reduced campus capacity for the fall and explored virtual learning options, students are earning the right to fight back for tuition discounts, and in several cases they are winning.
As many students remain unsure of their plans for the fall, colleges have pushed May 1st acceptance deadlines back to June, July and even September. Additionally schools have been given the right to recruit students who are already committed to other institutions, increasing the competitive environment colleges play in.
20 years ago colleges built algorithms to predict the price sensitivity of their prospective students. This allowed them to adjust pricing per student while competing in the competitive market of higher education.
With COVID, the quality of education that universities will providing has been brought into question. Parents are starting to take action and protect their savings accounts. Many are turning to private consultants who formulate their own algorithms that procure money saving strategies against institutions. Many cases of strategic negotiation have rewarded students with significant tuition deductions.
Reports from April indicated that college enrollment for the fall of 2020 will drop 15%. Since then, enrollment likelihood has increased but the average dollar amount that parents are willing to spend has decreased by 13%. This will cut billions of dollars out of college revenues, decrease international student attendance, and reduce public funding.
It’s become more inevitable that the average tuition price colleges are reporting is merely just a starting point for them in a complex bidding process. Insecurity about the 2020 fall has handed the bidding power over to parents and will surely increase the financial hardship many colleges are experiencing across the nation.