These are the slides and notes from a webinar I gave for the SIIA. The webinar is an introduction to the SIIA's Expert's Guide to the Postsecondary Market. There is a sampler from that report on the SIIA website. I'd written a section of the guide, Five Things You Need to Know About the Postsecondary Market, which is part of the sampler.
These are the five different aspects of the postsecondary marketplace that are reviewed in my report. If you are going to sell into higher education, you need to know how the market size and demographics, online courses and content, accountability for postsecondary institutions, new technologies, and student attitudes toward e-content and online classes are changing the face of higher education.
Because the report is available free here, rather than repeat what’s already in the report, I decided to talk about three other aspects of the market which are also critical to success, the fact that there are at least four different markets, not one, the content areas that are growing fastest, and a little about the financial drivers for higher education.
If you develop a product or service, and then go into one of the large public university systems and tell how you’ve been successful at Trinity College or some other small liberal arts institution, you are not going to be successful. You can’t be successful speaking to Higher Education with a one size fits all approach.
The most common breakdown is shown above, Public 4-year, Public 2-year, Private not-for-profit, and Private for-profit are the four main sectors. The last two, dealing with private 2-year schools are tiny in comparison.
Over the past 15 years, the private for-profits have been on a roll, growing from less than 1% of the market to almost 10% of the four-year market. However, changes in how the federal government finance student tuitions (loans and grants) to for-profits may throw a curve at the industry. For example, one pending policy is that these institutions, in order for their students to receive tuition assistance, will need to show that most of their students do, in fact graduate and earn enough to pay back student loans. This touches on the broader accountability issue which is covered in greater depth in the Five Things report.
Notice the big difference at the 2-year schools, where almost twice as many of the students are part time. That means that the way you define and position your services for two year schools may need to be very different from the way you talk about them to four year schools.
These are just two examples of how you need to know your market niche, and prepare your product or service toward your potential buyers.
With an increasing emphasis on jobs, it helps to know which occupations are growing. These projections are taken from the Bureau of Labor statistics. We pulled professions that earn more than $30,000 a year and were growing and here are the top 6.
Some things to note. Two of the top six involve accounting. Elementary school teachers are fourth, despite the short term disruption with state budgets and spending. This is because the elementary school population is starting to grow again, along with the fact that there are sleighted to be quite a few retirements of senior teachers over the next 5 to 10 years. Truck driving, with a median income of about $50,000 and no education requirements doesn’t look that bad, does it?
The National Center of Education Statistics records the number of students receiving degrees for different majors.
For 4 year schools, what do you think the number one major is?
Business, 350,000 graduates, almost three times as many as the second biggest, which is Health Professions at 120,000. However, health has grown at a 10% annual rate for the last five years, while business has grown at 2.5%.
Education, which is the third largest major at 101,000 graduates, has been shrinking by just under 1% per year.
What do you think the number one major is at Community Colleges? Liberal Arts with 260,000 graduates, growing at 3%. Healthcare and nursing is second at 140,000, growing at 10% per year, and Business and Accounting is 3 with about 80,000 also growing at about 10%.
If you’re looking at content, these are the largest content areas to concentrate on.
The final of these three additional things you need to know about the postsecondary market has to do with costs. Expenses have been increasing faster than inflation at all types of institutions, but this especially hits the public ones.
Above is the breakdown of major costs for public postsecondary institutions. If you look back at the original slide, more than 2/3 of students attend public institutions, either 2-year or 4-year. Increasing costs, as states are all decreasing spending, at a time when the number of students is increasing, so schools are being hit with a triple whammy.
Thus if you target one of the niches and can come up with a solution that attacks costs in instruction, academic support, student services, institutional support, or the operation and maintenance of the physical plan, or which allows institutions to increase students without increasing costs, or allows them to teach more students with the same or lower costs, you’ve got a decent chance of being heard.