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National Press Foundation Seminar Nov 1, 2006 New York

The Business of Higher Education:. The Distance Learning. Revolution. Michael P. Lambert Executive Director Distance Education Training Council. Mike@detc.org. National Press Foundation Seminar Nov 1, 2006 New York. The Distance Learning. Revolution.

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National Press Foundation Seminar Nov 1, 2006 New York

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  1. The Business of Higher Education: The Distance Learning Revolution Michael P. Lambert Executive Director Distance Education Training Council Mike@detc.org National Press Foundation Seminar Nov 1, 2006 New York

  2. The Distance Learning Revolution • Student enrollments grew from 483,000 in 2002 to 1.5 million in 2006 • In 2004 alone, student growth was 34% • Average annual growth will be over 20% for each year of this decade (the above data does not include DETC data)

  3. Revolution cont. • Total online school revenues grew 36% in 2005, to over $7 Billion U.S. • By contrast, the online music market was only $1 billion in 2005 • In 2001, online students were just 2% of the total U.S. college students. Today, they are over 7%

  4. Revolution cont. • Due to aggressive internet marketing, and the availability of Title IV student aid since July 1, 2006, for-profit online schools will exceed over 50% growth rate in 2006. • Availability of Federal Student Loans and Grants to online schools will likely result in millions of new student enrollments in the coming years

  5. Revolution cont • Growth at non-profit online colleges is strong as well: 25% growth in 2004 and 23% in 2005 • 2 out of 3 Universities now offer online programs • As growth in classroom colleges flattens, growth in online learning will soar

  6. Snapshot of DETC Today Total Institutions 100 in 7 countries Total New Enrollments, 2005 850,000 Total Active Students, 2005 2,250,000 Avg. No. of Programs Offered 20 for Career; 12 for Degree Avg. No. of Employees 37 Career; 70 Degree

  7. Profile of Students in DETC Career CoursesDegree Programs Av. Age 34 37 Employed: 81% 94% High School Diploma 85% 99% Male 47% 55% Fees Paid by Employer 40% 38%

  8. Top Academic Degree Programs in DETC 1. Bachelors in Business 2. Masters in Business 3. Bachelors in Criminal Justice 4. Masters in Information Systems 5. Health Care Administration

  9. Top Career (non-degree) Programs in DETC 1. Medical Transcription 2. High School Diploma 3. Child Care 4. Paralegal 5. Medical Billing and Coding 6. Bookkeeping 7. Personal Computer 8. Nutrition

  10. Technological Features Used in DETC Schools Offer Online Programs 70% “Free” Phone for Students 96% Enroll Online 95% Uses Email for Services 98% Use Phone to Contact Students 96%

  11. Customer Satisfaction in DETC Responses from random surveys of students from EVERY DETC institution • RESPONDED “YES” • Did you achieve the goals you had? 95% • Would you recommend the school to a friend? 96% • Were you satisfied with your studies 96%

  12. Course and Program Completion Rates Av. Degree Graduation Rate 56% Av. Career Course Completion 60%

  13. In Curricula Area, DETC Institutions Plan On-- • Moving content and courses online • Moving tests/exams online • Making content more interactive and engaging • Streaming video and audio, simulations, interactive assessments • Implementing communication tools • Messaging and online meetings • “Staying the course” with print/correspondence models

  14. DETC School Survey Do you currently use or plan to purchase a commercial course/learning management system to deliver online courses to students?

  15. Marketing Shifts • Positioning and differentiation • From a niche market to a mass-market • Marketing expenditures escalating • 20-30% annual increases among for-profit institutions • +1-2 percentage points over revenue • Supply and demand and competition from “traditional” institutions is driving up costs • Media mix is shifting toward the Internet • New channels and strategies are emerging

  16. DETC School Survey Of the following marketing channels, which do you expect to focus more (i.e., budget, time) on in the next 2 years?

  17. DETC School Survey Select 3 of the following elements of your institution's offering that you most emphasize in marketing to potential students

  18. Marketing Taglines • “Real school. Real degree.” • Penn State Online (PSU World Campus) • “E-learning with a tradition of excellence” • Virginia Tech • “Get your degree at warp speed – from a name you trust.” • Kaplan University • “Looking for a top-ranked degree that is also convenient? Earn your master’s online from one of America’s Best Colleges.” • Drexel University • “The nation’s leading online university” • University of Phoenix Online • “Accredited degrees – online, with the flexibility to fit your busy lifestyle” • The University Alliance (Regis, St. Leo, Tulane, etc.)

  19. Potential, Future Marketing Taglines • Online or on campus, nationwide and around the world” • Blended models and national/international network • “The country’s only AAPT-accredited online program” • Programmatic accreditation and niche uniqueness • “Online education from your local university” • Brand/locality • “A quality online degree at a fraction of the cost” • Price competition • “The online degree rated #1 by manufacturing employers” • Prospect of quality ratings and labor market outcomes

  20. DETC School Survey Percentage of Students Supported/Reimbursed by Employers (in whole or in part) Extrapolated Mean = 20-25%

  21. Future Programs in DETC (3-5 Years) • Advanced degrees and continuing education • Health sciences • Professional Doctorates, e.g., Doctor of Business Administration • Homeland security • Graduate degrees in education administration • Para-professional degrees, e.g., Physicians Assistant

  22. Trends in the U.S. Market • More discriminating and selective consumers • Continued private investment • Blurring of traditional “boundaries” and segments: • For-profit/non-profit • Online/on-campus • Growing importance of employer relationships • Evolving and increasingly favorable regulatory environment • Productivity and service enhancements through technology • Content is becoming more flexible, dynamic, and interactive • Beginnings of stronger international push among U.S. institutions

  23. Future Challenges • Competition and differentiation • Escalating competition in a growing market • Traditional institutions waking up to the opportunity • Increasing marketing costs, positioning in a noisy market • Staying technologically current • Finding and retaining quality faculty • Transfer of academic credits • Regulatory compliance and quality assurance • Diploma mills

  24. DETC Internet Use In which ways do students use the Internet to interact with your institution? Note: “Check all that apply” – totals do not add to 100%

  25. MEGA Trends for USA Distance Providers • More Competitors for the Same Student • Everything will be Online and Instant • Homogenous Learning Products and Services • More International Partnerships • Price is the Key Marketing Edge for DETC • Productivity and service enhancements through technology • Content is becoming more flexible, dynamic, and interactive • Beginnings of stronger international push among U.S. institutions

  26. What Works In…… MANAGEMENT and ADMINISTRATION • Annual Strategic Planning • Performance-Based Staff Accountability • Competitive Environment Awareness • Virtual Staff and Faculty Meetings • Comprehensive Outcomes Assessment System

  27. What Works In…… PROGRAM DEVELOPMENT • Custom (Docutech) Publishing • Ad Hoc Program Development Teams • Third Party Text Storage and Shipping • Partnerships With Reputable Online Institutions • Customizing LMS Templates

  28. What Works In…… Curriculum Strategies • Spin-Off Programs/Multiple Options for Majors • Combination Degree Programs: Health Care and Law • Degree Completion Programs (2+2 BS programs) • Pre-Matriculation Assessment for Aptitude for Distance Learning • Small (Virtual) Group Projects

  29. What Works In…… MARKETING • Bidding for Top Position on Internet Search Engines • Branding to “Stand Apart” from the crowd • Telephone Call after Literature is Received • Referrals from Current Students • Easy to Navigate Websites with Easy to Enroll Feature

  30. What Works In…… TURNING PROSPECTS INTO STUDENTS • Convenience of the Method • Accreditation and Acceptance by Institutions • Acceptance of the Degree by Employers • Price versus PERCEIVED Value of the Degree • Program Matches Career and Life Aspirations

  31. What DOES NOTWork Today • Print-based Advertising • Mailed-In Enrollments • Voluminous, Printed Catalogs • Scripted, Motivational Email Messages • Slow Evaluation of Student Assignments • Lack of 24x7 Student Services Via Email

  32. DETC RESOURCES AND MEETINGS • 81st DETC Annual Conference, April 15-17 2007, Tucson, AZ • DETC Course Development Handbook, 2004 edition • DETC Accreditation Handbook, 2006 edition (online) • Website: www.detc.org

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