Why universities are using marketing to improve student retention

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Why universities are using marketing to improve student retention

“Some college, no degree” – that’s how researchers call those who get into higher education and, for several reasons, are not able to fulfill the academic programs, spend just a couple of years in the university and then quit.

According to the National Student Clearinghouse Research Center (a US-based institution), “over the past 20 years, more than 31 million students have enrolled in college and left without receiving a degree or certificate. Almost one-third of this population had only a minimal interaction with the higher education system, having enrolled for just a single term at a single institution”.

This is a permanent challenge for higher education institutions because, as we’ve seen in a previous blog, student quitting involves economic and corporate difficulties for universities. In this way, a wide variety of retention strategies have been developed in the last years to reverse this increasing global trend and marketing is one of the disciplines where an important amount of initiatives have been implemented to transform students’ lack of interest and apathy into loyalty and engagement.

Why higher education authorities have decided to apply marketing strategies?

Professor Michael Fontaine, PhD, College of Management and Business of National Louis University (Illinois, US) explains in his white paper entitled “Student Relationship Management (SRM) in Higher Education: Addressing the Expectations of an Ever Evolving Demographic and Its Impact on Retention” that “the idea of economic self-sufficiency and commoditization of higher education have also depicted students as fee paying customers and universities and colleges are switching from teacher-centered to student-centered approaches for attracting and retaining students.”

Despite some academic resistance about calling students as costumers, the global student quitting phenomenon and the increasing number of new higher education institutions has motivated many colleges and universities to adopt this customer-oriented philosophy.

A different management orientation that already has delivered very interesting perspectives and answers that are helping to understand the complex behavior of student, which might not be very different from customer behavior.

Professor Fontaine set an example: “students who complain and are responded to immediately, even if the response is not favorable, can actually become more loyal than students who appear to be satisfied without complaints (Kotler and Fox, 1995). Traditionally, businesses have concentrated their marketing efforts on attracting new customers to maximize profits.”

“Over the last few decades however, service-oriented businesses have shifted away from this traditional marketing strategy towards a relationship marketing approach that focuses on developing long-term relationships with existing customers. This approach assumes that retaining satisfied customers will ultimately prove more cost-effective than continually spending marketing dollars on securing new customers (Barnes, Sines & Duckworth, 1994),” Professor Fontaine adds.

Relationship Marketing

This marketing specialty aims to create and nurture a loyalty bond between student and university and it has shown good results in student retention strategies. In her white paper “Engaging the student as a costumer:  a relationship marketing approach”, Professor Jana Lay-Hwa Bowden, PhD, Macquaire University, stands that “relationship marketing initiatives have increasingly been viewed as a means of achieving a sustainable competitive advantage (…) and the benefits of developing strong relationships with customers are now well established. Customer retention is also a more cost-effective approach than continual customer acquisition.”

Students also have been adopting a new attitude in the way that they connect with universities and they are more willing to express their opinions or criticize about what they don’t like about the academic experience.

Professor Bowden underlines that “Yang, Alessandri and Kinsey (2008), for example, found that students did in fact perceive that they were in a relationship with the institution and that this relationship was communal in nature in that students perceived that the university intended to maintain a long-lasting bond with them.”

“Those authors – she adds – further found that the quality of the student–university relationship was a key driver of students’ positive perceptions of the institutional brand. The students who held the highest-quality perceptions of the institution were also likely to have the strongest perceived relationship with the university brand itself (…) The student–university relationship has the potential to lead to the development of a positive reputation in the educational marketplace (Yang, Alessandri and Kinsey 2008).”

Now, if higher education authorities want to built a long term relationship with their students, as brands builds relationships with their costumers, they should first know who their students are and what is important to them.

Professors Robert Ackerman and John Schibrowsky from the University of Nevada (Las Vegas, US) explain in their white paper entitled “A business strategy applied to student retention: a higher education initiative”, that the relationship marketing paradigm is built on the premise of learning everything relevant about the customer and then using that information to service them.

This work also stands that a relationship marketing strategy contributes to improve student retention rates, boost institutional reputation and strengthen the learning experience. It also helps to reduce costs of student administration (is less expensive to retain students than to acquire new ones).

Besides, this strategy must be understood as a long term process that goes beyond the graduation day. “In fact – Ackerman and Schibrowsky add – graduation is properly viewed as an opportunity to strengthen and refocus relationships with students so that they remain engaged with alma mater as alums.”

Usually higher education institutions use marketing strategies to attract new students, but we’ve just seen how marketing can be very helpful to maintain them and transform them into brand ambassadors.

Is your institution implementing marketing strategies to help student retention? We invite you to leave a comment.