GMAT: Paying for Points

(page 2 of 3)

Advice: "Our most successful students are those who understand they need to put in the time, effort, and investment to prepare," says Kaplan.

Manhattan GMAT

Services: Classroom course, online course, private tutoring

Cost: $1,390 for classroom course; $990 for online course

Pros: The brainchild of former Teach for America participant Zeke Vanderhoek, Manhattan GMAT is academically rigorous and targets test takers who want to score a 700 or above. Manhattan GMAT students use the company's strategy guides, which cross-reference actual GMAT questions and help test takers understand what academic skills are tested in each section.

Because of its niche in the marketplace, Manhattan GMAT's standards for instructors are high—and so is their pay. Manhattan GMAT boasts little turnover from instructors who can only be hired if they scored 760 or better on the GMAT, have experience teaching, and are likable people, says CEO Andrew Yang. In return, instructors earn about $100 per hour.

Although clients pay less for the course than they would at a larger outlet, the company says it keeps its own costs down by not spending a lot on marketing efforts, instead relying on word of mouth. "We think the best marketing is students who do well on the test," says Yang, who also sometimes teaches class and often takes calls from students. Goldman Sachs (GS), J.P. Morgan (JPM), and McKinsey have hired Manhattan GMAT to prepare groups of their employees for the test.

Cons: Launched in 2001, the company is still young. Serving a niche market, it's also small. In 2007, the company expects to attract 4,000 to 5,000 students. Unless you live in New York, Boston, Chicago, or certain parts of California, you won't be able to sign up for the face-to-face Manhattan GMAT course. (A D.C. location is planned for this summer.) Your only option, for now, will be the online class. The rigor might be too much for someone looking to go to a second- or third-tier B-school, where students have lower average GMAT scores.

Advice: Yang says to remember to brush up on the skills you learned in eighth- and ninth-grade math class because you'll need them for the quant part of the GMAT.

Princeton Review

Services: Classroom courses, private tutoring, small group tutoring, live online instruction, self-directed online instruction, express online (for those who have only two to three weeks to prepare for the GMAT), private online tutoring

Cost (as specified for northern New Jersey): $1,249 for traditional class; $1,500 for small group tutoring; $899 for live online course; $599 for self-directed online course; $99 for express online; private-tutoring options range from $2,000 to $5,600

Pros: Like Kaplan, Princeton Review is a larger corporation that offers test prep for many standardized exams in many locations. Still, the company limits the number of students per GMAT class to eight, so students can get lots of personal attention. Princeton Review also offers a range of private-tutoring options, including one-on-one instruction online and tutoring for groups of up to three.

The idea is making test prep convenient for B-school wannabes, who tend to be occupied with work and family. "We teach them everything they need to know about the GMAT and nothing more, which is important when you're a very busy person," says Liz Wands, executive director of field sales and marketing for Princeton Review.

Students can choose the format that works best for them and take advantage of the deep pool of questions and materials available to them, Wands says. Princeton Review students scored 92 points higher, on average, after completing the coursework, she adds.