*The following is excerpted from an online article posted on The Washington Post.
As soaring tuition scares off many families, a growing number of private colleges have embraced a marketing tactic associated more with selling airline tickets or flat-screen televisions than higher education: a price cut.
St. John’s College slashed tuition from $52,734 in this school year to $35,000 in the next.
The liberal arts school, with campuses in Maryland and New Mexico, joined more than 20 others nationwide that have reduced prices in the past three years.
The movement exposes a reality of higher education long hidden in plain sight: The difference between sticker prices and what the average student actually pays is often vast.
Twenty-three private institutions have reduced tuition since 2016, according to the National Association of Independent Colleges and Universities. “The trend is beginning to pick up,” said David L. Warren, the association’s president. These schools view cuts as “an important tool,” he said, to help them stand out in a crowded market.
Their reasons vary. Some need to bolster recruiting in the face of major financial challenges. Others want to escape a pricing formula that assumes prospective students view high tuition as a mark of educational quality even though they simultaneously seek significant discounts or financial aid.
The average sticker price for private colleges is about $48,500 for tuition, fees and room and board, according to the College Board, a nonprofit organization representing thousands of educational institutions. However, sticker prices above $60,000 a year have become commonplace, and a growing number top $70,000.
The most prestigious schools enroll large numbers of students willing and able to pay full price. Federal data show the share of full-paying undergraduates in 2016-2017 — those who received no grants — was 42 percent at Princeton University, 50 percent at Bowdoin College in Brunswick, Maine, and 57 percent at Wesleyan University in Middletown, Conn. A similar pattern held at numerous other colleges.
But many schools have few full-pay students. The Washington Post found more than 310 colleges and universities in 2016-2017 where at least 95 percent of undergraduates received grants or scholarships. (For St. John’s, the share was 97 percent on its Annapolis campus, 99 percent in Santa Fe, N.M.)
At such schools, sticker price may be more of an aspirational statement than a revenue generator.
Even so, sticker prices usually go up faster than inflation. Knowing this, students and bill-paying parents hope the increases remain manageable. Their best-case scenario would be an occasional price freeze.
Even so, sticker prices usually go up faster than inflation. Knowing this, students and bill-paying parents hope the increases remain manageable. Their best-case scenario would be an occasional price freeze.
Now, price cuts among private colleges could be signaling a pivot point in that sector.
Sweet Briar College in Virginia, which nearly closed in 2015 amid financial difficulties, cut its price 32 percent for the current school year, to $34,000 for tuition, fees and room and board.
Elizabethtown College in Pennsylvania will cut tuition 32 percent in the coming year, to $32,000 (not counting fees and room and board). The echo on 32 is not accidental. Carl J. Strikwerda, president of the 1,700-student college, said he wants to grab the attention of middle-class families.
Price cuts are risky. If they are not deep enough, they won’t get noticed. If they are too deep, colleges could lose substantial revenue. “This is not for the faint of heart,” Strikwerda said. To succeed, he said, a college must convince prospective students of the quality of the education it offers regardless of price.
Source: The Washington Post
https://www.washingtonpost.com/local/education/attention-college-shoppers-these-schools-are-slashing-their-prices/2019/01/21/e384eca0-12bc-11e9-90a8-136fa44b80ba_story.html
Source: Home Word
