In my study of marketing at Notre Dame College, I discovered that the college’s leaders used the marketing mix as a framework for transforming the institution. By taking a marketer’s approach to leadership, the college added major areas of study, men’s and women’s sports, and online programs. The third P for consideration is price. Students, families, and other stakeholders are focusing more on college cost and financial aid with tuition increasing much faster than the rate of inflation and higher levels of student debt burdening more college graduates.
Notre Dame took a basic approach to its tuition and fees. Its primary competition for students came from Cleveland-area private colleges such as Baldwin Wallace University, Lake Erie College, John Carroll University, and Ursuline College as well as public universities that have lower published tuition and fees. With this in mind, administrators intentionally kept tuition levels lower than a majority of the colleges in that competitive set. The lower tuition reflected the college’s relative position in the marketplace (with some other colleges having better campus amenities or more programs) and helped make the case with students and families that the college offered a high-quality, personalized education at a lower cost than most other colleges.
Financial aid was integral to Notre Dame’s pricing strategy. Prior to 2003, the college treated financial aid as a fixed expense. In other words, the college would award scholarships and aid to students knowing that only a certain percentage would accept offers of admission. After Dr. Roth’s arrival as president, the college began to leverage financial aid. Financial aid leveraging gives a college better control over its net tuition revenue by awarding the amount of aid a student needs to enroll without providing too little or too much. Colleges use financial aid leveraging to exert better control over the students it enrolls and its financial aid expenditures.
A lower published tuition combined with an attractive financial aid package gave Notre Dame a competitive edge on price. The college would communicate those advantages to students and families while repeating messages about individualized attention and opportunities to become a campus leader.
Private colleges in Notre Dame’s area developed other innovative approaches to price, such as Hiram College’s Tuition Guarantee. The Tuition Guarantee assured students and families that tuition and fees would be fixed for the duration that a student attended Hiram. As you can imagine, Notre Dame’s promise of a lower initial price versus Hiram’s promise not to increase its price for four years made for difficult decisions for some families. This is why colleges cannot compete on price alone—it takes a combination of program, place, price, and the final P—promotion—which I will cover last.