Across the country, new first-year students in the fall Class of 2021 are busy preparing for a college experience they hope will feel a bit more “normal” than the high school experience they just completed. While most students are justifiably anxious as they anticipate a campus experience that’s still being defined given the lingering questions and unknowns from pandemic restrictions, many are also carrying a burden that isn’t as easy to see: the uncertainty of affordability.
And students aren’t the only ones with a bit of anticipatory anxiety. Many colleges also have lingering questions about their own budgets.
As reported by many news organizations as well as institutions across the country, the financial need of students in this post-pandemic environment has never been greater. While this is happening for prospective families, university budgets are incredibly strained from increased discounts (a function of higher need profiles) and enrollment counts that are not trending up and to the right.
Yet at the same time, the number of FAFSA filers has declined in many areas compared to past years. Is this a result of fewer students attending college, limited support from strained and homebound school counselors, or the lack of on-campus time for prospective students and families in this last cycle? Perhaps it’s a mix of all three? Couple these questions with the increased number of students seeking a gap year in 2021 and we have a recipe for a significant challenge for any campus heavily reliant on undergraduate net tuition revenue.
So how do we respond?
When considering and constructing financial aid models and communications-flow designs this year, many financial aid officers are already weary from an increase in “professional judgment” due to widespread appeals and hyper-competitive award practices. This creates a need for new and/or updated communications protocols to answer the coming appeals from prospective students alongside modeling and awarding practices that are mindful of the increased need throughout the enrollment cycle.
Many point to the pandemic as the primary reason for current pressure on institutional aid, and the research we have done as a company confirms that. That said, significantly shifting demographics and economic realities were already in play prior to the pandemic and will continue to put pressure on many institutions to leverage their financial aid strategy and corresponding communications more aggressively.
The reality is the pandemic tipped the scales on higher education in a way no one fully expected until much later in the decade. It shifted the power in the enrollment cycle from an institution-dominated (supply side) one to a prospective student–dominated (demand side) one. In short, the economics of enrollment changed. The buyers (prospective students) now have more power to determine their willingness to pay over the suppliers (institutions). This demand-side shift is poised to remain in place at least through 2034 as demand continues to weaken further in the years to come.
As we move forward, institutions will need to see their financial aid strategy through a conversion lens (opportunity to differentiate) just as clearly as the regulatory one (financial management and equity). That means financial aid has to be conceived as part of the marketing strategy. In a demand-controlled market, financial aid season can’t be just a time to send a carefully worded letter with the particulars of a financial aid award. It also has to be a marketing opportunity to demonstrate value, flexibility, and process to those who have other options or pressures that might not be found on a Student Aid Report.
4 tips for marketing financial aid
1. Ensure you have well-documented and transparent appeals processes
The reality of these uncertain times is that many families have had major shifts in their household dynamics such as job eliminations, job changes, moving, virtual school, etc., particularly in response to the pandemic. Some of these changes will be temporary, whereas others will have lasting impacts. Many won’t appear on a prior-prior FAFSA. As a result, it’s important to keep a well-documented and promoted appeals process throughout the admissions cycle to ensure families understand you want them to call you with concerns or questions about their financial aid package. To be clear, this is not a “call us for a bargain” strategy—it’s a “we understand your financial uncertainty” pledge that just might demystify costs for a swath of students who otherwise might not enroll.
2. Mailbox moments are back
The pandemic reintroduced the physical mailbox to Gen Z students in a way no one anticipated. As a result, students report interest in receiving high-quality mail from colleges and universities that they have familiarity with. The financial aid package doesn’t have to be pedestrian. Universities who choose to amp up the power of that moment with stronger creative and content have a chance to win versus less marketing-savvy competitors. The read-through rate of financial awards is among the highest in the entire communications flow. Maximize the moment with key messaging that positions the university, not just the aid package.
3. Financial aid isn’t a “season”
At many institutions, “financial aid season” is still associated with the timeline based on the outdated FAFSA deadline in February of the enrollment year. This historically began to signal the time when packages were assembled and sent out to admitted students. Today’s opportunities for differentiation by institutions abound in shifting the timeline of that process and getting ahead. Being first in the door is a common strategy that might be a win with students who have a lot of options to choose from. That said, if your competitive set is selective, you might be more comfortable with a delay. The bottom line: Timing is everything, and you need to be sure you make an impression to help increase your matriculation chances.
4. Expand FA communications beyond admitted students
Once you expand your thinking of what to communicate about your financial aid approaches, think about looking at marketing some of the key differentiated elements of your institution, scholarships, and aid models in audience segments beyond admitted students. This is a great way to pick up later cycle applications, build affinity and reputation for future years, and expand your overall class size. A key consideration would be to work hard at cultivating communities and influencers with reputations enhancing financial messaging that demonstrates your ability to provide access.
Moving forward, most admissions leaders need to rethink their financial aid communications strategy to expand audiences, promote processes, and build stronger value propositions with prospects. Students will expect it, and institutions need to lean into marketing their value in new ways in the years ahead.
Contact us for strategic aid negotiating the complexities of your enrollment cycle, and for more content like this, see Carnegie on stage at NACAC and AMA Higher Ed this fall.
Scott Ochander is Partner, and Chief Client Solutions Officer for Carnegie. As a former Vice President for Enrollment and Marketing, Scott Ochander is regarded as an expert in reputation and enrollment strategy in higher education. Scott pioneered a consensus-building reputation and change management research model in higher education that empowered campus communities and enabled enrollment growth and reputation transformation. Scott has worked extensively in marketing and enrollment strategy, completing hundreds of strategy development projects across higher education at some of the largest and most influential institutions in the nation.