One question we get often at Collegis is “Should my college launch an online MBA program?” Another is “Why isn’t my college’s MBA program growing?”
There are a number of complex variables in play, but those who ask these questions should know that they are not alone.
“Unless you’re among the top 20 MBA programs, or well differentiated, enrollment can be challenging in this competitive market,” said Bob King, managing director of enrollment growth management at Collegis Education.
Below are insights gathered by the Collegis programming research team that shed light on the current state of MBA programs.
Why Most College MBA Programs Aren’t Growing
1. MBA graduates are pervasive. Universities have awarded over 100,000 MBAs annually for more than a decade. As of the most recently available data from school year 2016-17, conferrals for that year were 105,880. The sheer volume of graduates has made it difficult for many MBA holders to stand out vs their peers. Prospective enrollees are more sensitive to this issue than ever and will be looking for credible evidence to justify selecting an MBA program that isn’t either prestige-oriented or value-oriented.
2. The market is saturated with MBA providers.
In 2016, there were 1,062 MBA-conferring institutions competing for 8.5 percent fewer students than in 2012. As the top-conferred master’s degree, this shouldn’t be surprising. However, compared to the second-most-conferred graduate degree, Master’s in Social Work, the difference in competitive options and conferral health is staggering.
- Providers offering MSWs as of 2016: 295
- Increase in MSW conferrals between 2012 – 2016: 22%
3. In addition to the intense number of MBA providers, these programs are competing for declining graduate cohorts. MBA conferrals declined by 8.5 percent through 2016 with further declines in the most recent 2017 data. As the pool of students declines, it is increasingly important that institutions are able to speak to interested prospects with a clear and compelling rationale for enrolling in their program.
4. Despite this decline and the market saturation of conferring providers, 19 additional schools began conferring MBA degrees over the past 5 years. The questions to ask are how much it will cost to acquire enrollees and whether the institutions drew enough students to cover the cost of running the program. Top considerations when trying to overcome the financial hurdles should include the ability to tap into corporate relationships and the marketing and operational synergies that exist within your institution’s program portfolio.
5. Looking closer at the providers, market leaders fall into three buckets: value, marketing powerhouse or prestige. New entrants or those looking to grow their enrollment need to critically consider how their program compares as standing out in this space is increasingly difficult.
6. Very strong growth by a few of the value providers is just one indicator of how the MBA has become commoditized.
- Southern New Hampshire University: 1,410 conferrals in 2016; +236% vs 2012
- Liberty University: 1,597 conferrals in 2016; +106% vs 2012
- Western Governors University: 1,073 conferrals in 2016; +195% vs 201
7. Enrollment strength is not equally shared by all providers. The top 100 conferring providers account for 52 percent of the market share of this degree. In fact, while the top 100 institutions typically confer 505 degrees (each), annually, the average for the smallest half of providers is only 20 conferrals per year.
While an MBA program may not be the enrollment generator that is used to be, there are other ways to respond to the market. First, do some detective work to find out what skills and occupations are in demand. Next, review your current programs to see if they overlap with workforce needs. It’s possible that prospective students simply don’t realize how a program connects with their career goals. A revamp of program messaging and promotion could help. Finally, take stock of where your college is attracting students and consider how that might be expanded upon.
If you would like help with researching the marketplace or evaluating your programs, feel free to contact us at info@CollegisEducation.com.
Source: All IPEDS data reflects Master’s level conferrals reported for the Business Administration and Management, General (52.0201), degree. Data extracted from the National Center for Education Statistics (NCES) IPEDS database from 2012–2016 unless otherwise stated as 2016–17 data.
Need help researching the higher ed program market? Collegis can help.