Online or Bust: An Educational Manifesto
Online education is gaining ground over the brick-and-mortar variety. Colleges that fail to adapt will be left in the dust
In this postrecession, digital era, colleges must reevaluate how accessible they are—or, often, how inaccessible they really are—to their potential customers, or, as you call them, "college students." Schools must change their business models to attract more students if they have any hope of surviving in the current competitive economic environment.
Over the past 10 years, we have seen a definitive shift from brick-and-mortar to online offerings across most industries. If 20 years ago you were told that shopping malls would be cannibalized by online shopping sites like eBay (EBAY) and Amazon.com (AMZN), and that movies would be accessed online through Netflix (NFLX) instead of at the movie theater, many of us would have found that difficult to believe. Yet the companies that failed to adapt to the digital consumer's demand for instant, online access struggled or failed. And for the companies actively marketing online to consumers with infinite options at their fingertips, competition has never been tougher. Online consumers today are looking for the best, most reliable bargain.
In 1999, Netflix had 100,000 subscribers. Recognizing our demand for instant, home access to movies through the mail and the Internet, just 10 years later the company had more than 12.3 million subscribers. At the other end of the spectrum, Blockbuster (BBI), once the national hub for movie rentals, announced last month it may have to file for bankruptcy. Since 2007, Blockbuster has lost more than $1 billion to online competitors.
On-Demand Education
Colleges and universities must recognize that students, too, have to be viewed as consumers. The ones that recognize the on-demand educational needs of the modern-day student will thrive. Deans, chancellors, and administrators need only look back 10 years for examples of companies that failed to adapt to the online consumer quickly enough.
In a March speech on technology and education, U.S. Education Secretary Arne Duncan touted $500 million in new spending to develop postsecondary online courses. Just a month after this speech, a report from the National Center for Education Statistics (NCES) showed that in just six years the number of students enrolled in private nonprofit colleges compared with those at for-profit institutions had slipped to two to one. While every sector saw an increase in enrollment, the biggest gains were in the private sector with a one-year increase of 21.1 percent.
That statistic paints a scary picture for brick-and-mortar colleges and universities. Students want an on-demand education. I fear that the traditional schools that fail to recognize this increasing need will go the way of Blockbuster. It's not that all universities that fail to create an online offering will vanish—just as video rental stores and shopping malls still exist, despite sites like Netflix and Amazon, respectively. There will always be a certain percentage of students who prefer the more traditional college experience, just like there are still people who feel uncomfortable providing credit-card information online and would prefer to see what they are buying first. But make no mistake, schools that do not adapt to meet the needs of the growing population of contemporary students will undoubtedly suffer, and many universities will go under.
Online Flexibility
The growth of online education is a result of the shifting needs and priorities of today's students coupled with a struggling economy.
It is no longer the high school senior seeking a four-year college who is dictating the terms of the education industry; rather, it is the single mother looking to go back to school or someone who got a job right out of high school and took a few years off to make money before pursuing a college degree. Many of these students require the flexibility of an online education because their hours are not those of a traditional student—they need night classes, weekend programs, and coursework they can complete at their own pace.
For years this niche education was provided by community colleges, and according to the NCES study, community colleges were responsible for about two-thirds of the one-year increase in public-school enrollment in 2008. According to the American Association of Community Colleges, enrollment at the nation's 1,173 community colleges has increased 17 percent since 2007. But community colleges are at capacity, and with all schools struggling through the recession, funding is scarce.
In a recent survey of undergraduate students, more than half of the students polled preferred either a hybrid of online and classroom education (34 percent) or all classes online (20 percent). Graduate students were asked the same question, and more than half (56 percent) responded that they prefer either a blended education or an online-only experience.
For-profit higher education institutions have been the first to recognize that education is as much about interaction as it is about coursework, offering live faculty interaction for mentoring and tutoring as well as interactive meetings and study groups. Just because an online component is available does not mean that students will access their education in isolation. There is absolutely something to be said for personal interaction, and increasingly online programs are recognizing and adapting to this.
Stigma Fading
Furthermore, the stigma of online education is quickly disappearing. Twenty years ago, people thought the only option for higher education was a four-year institution. More recently, there has been a shift toward students pursuing postsecondary education at community colleges. It is only a matter of time before online outlets become a focal point of those pursuing postsecondary education. The quality of the education has increased, as has acceptance of those with online degrees and certificates in the workforce.
There is more progress necessary to completely remove the stigma. A school's reputation still carries weight in the job market, and this is an area where online education is lacking. First, it is important that the business community recognizes the rigor of online coursework, which will take time, but it's already more accepted today than it was even five years ago. Second, the online community needs a better alumni networking system to help students secure jobs and efficiently network after graduation. Will someone with a traditional degree get a job over someone with an online degree? Right now, possibly. But should these brick-and-mortar graduates be looking over their shoulders? Without a doubt.
Using the Internet as a business tool is obviously not a trend—all industries and companies that are currently booming have online components. Higher education is a huge market with great potential for growth; but if traditional universities do not adjust to meet the needs of their customers, contemporary students, it is only a matter of time before they are out of business.
Steve Isaac is the chief executive officer of EducationDynamics, and works extensively with for-profit and not-for-profit educational institutions to find, enroll, and retain students.
