When it comes to college and the high cost associated with it, more and more students and their families are thinking like businesses making an investment: They are asking, “What is the return on my investment (ROI) if I attend this school?”
ROI is not a perfect calculation. Different students invest different amounts, depending on amounts of aid received, whether that is through scholarships or loans, and some college journeys can take five years, others can take three. It can be hard to measure in a uniform way. For students factoring ROI into their decisions, though, there are tools available to help. Here’s what kind of information students can gather, and how analytics plays a role in the data-gathering process.
ROI rankings
The most readily-available information for students to try to calculate ROI are tuition costs and any financial aid they are receiving versus information from a school such as an average starting salary of graduates. Most students would not have the capacity to dig much deeper than that without help. There is a resource that can provide that help: Georgetown University’s Center on Education and the Workforce ranks 4,600 colleges and universities based on the financial value they provide to students.
The rankings use data from the Department of Education’s College Scorecard, including student earnings at different periods of time, the average cost of tuition at a university, and the most common types of degrees from each school.
Some conclusions
Among the results from the database are the fact that a higher ROI was tied to higher graduation rates and the proportion of degrees awarded in the fields of science, technology, engineering, and mathematics, at least as far as public and nonprofit institutions primarily awarding bachelor’s degrees. For-profit institutions awarding bachelor’s degrees were among the lower-ranking schools, as well as many arts institutions.
Eight of the top ten colleges offering the best ROI are nursing and healthcare-focused institutions, with the Massachusetts Institute of Technology and the California Institute of Technology also making the top ten. Experts warn ROI should not be the lone factor in a college decision, because it can very much depend on the field of study a student decides to pursue. When it comes down to deciding between two similar universities, though, something like ROI can help someone make a choice.
The role of analytics
Colleges and universities have an incredible amount of data when it comes to presenting themselves to students for consideration. This is certainly the case when it comes to showing what a student’s ROI can be. In order to do that, though, a school needs an analytics solution that can use the data to make the clearest case.
There are many different steps schools take in order to attract students. One of them is trying to figure out what data points matter most to students. In this case, it’s clear that students want to know how they will benefit from the money they are spending on their education. It is one thing to identify the data that can make a school’s argument. It is another case entirely to use that data effectively.
The right analytics solution can help make sense of the data, taking countless data points and filtering them to show you what’s important. It is also flexible enough to take more than one variable into account. While students are considering ROI in choosing their school, it is one factor among many that could set a school apart. The ability to break down information by field of study, or by certain demographic information, for example, can help make a difference in a school’s admissions numbers.
Colleges have many opportunities to target students in the hopes that those students choose their institution. Schools spend a lot of money on those opportunities, so they want to make sure they are making the right decisions about how to allocate those funds. Analytics can help ensure that all of the appropriate data is being used to make sure a college is spending its money wisely, not just in marketing efforts but in every department across a university. In that way, not only are they expressing to students how they can make the best decision based on their ROI, but colleges can also make sure they are getting the best return on their analytics investment.
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