In the month ahead, SimpsonScarborough will celebrate its 15th year in business, and I'll celebrate my seventh year with the agency. Time sure flies when you're doing great work (and having fun doing it). But when I think about what I'm most proud of in being a part of SimpsonScarborough, it's the unique combination of our people and the culture we've built, the impact we've been able to have with our clients and, more broadly, playing a part in moving higher ed marketing forward. For those of us that have been in this industry a long time, it's easy to point to long-held challenges—lack of budget, decentralized silos, marketing as the campus Kinko's, daily crisis dominating everything, and a constant revolving door of senior leaders. It's harder to pause and recognize just how much our industry has changed and improved.
I'd venture to say that our industry is positioned to have more professionalism, innovation, and impact than ever before. COVID-19 threw higher ed into turmoil in every conceivable way. And higher ed marketers stepped up. Marketers were driving strategy, building critical bridges across campus, and delivering results. As as we struggle to now all exist alongside COVID, that's not bound to slow. Those same issues are now imperatives, and the higher ed marketing landscape has permanently shifted. In the new year, we'll be publishing new industry research, thinking, and ideas around these five questions. Our goal is to help the CMO community leading our nation's institutions navigate their way through these challenges.
As Terry Flannery notes in her new book, "How to Market a University" marketing communications has shifted from the periphery of the institution's strategic vision to central to the institution itself. And while there have been more CMO roles created, stronger central organizations (and center-led organizations), the industry has also endured massive job cuts, and many have hit those same teams. New organizations may be smaller with deeper external partnerships. Key competencies will focus on speed (delivering faster), responsiveness (meeting customers with the right service at the right time in the right medium), and accountability (delivering measurable results while managing investment). They will most certainly be digital-first and data-driven with a greater focus on owned, earned, and shared channels. Crisis and issues management will continue to be core competencies and require daily focus.
COVID has compounded a business model that was already precariously dangerous (falling state investment, growing discount rates, tuition resets, ballooning fixed costs and capital debt, etc.). McKinsey estimates the cumulative deficit of four-year colleges alone could be $118 billion next year. And Moody's predicted that 60% of public universities, 75% of privates, and 87% of small colleges will see a drop in "net tuition revenue" in the year ahead. That revenue pressure will likely lead to a new, nimble environment, where marketers are focused on bringing new products, partnerships, and revenue opportunities to life. It might mean examining OPM relationships and determining how schools can manage that work directly. And there will most certainly be better budget integration in measuring marketing investment, particularly between enrollment management and central marketing units.
Remember when the 2025 demographic cliff was what we were all worried about? It's still there, and with COVID on top of it, a smaller number of prospective students will be questioning the value and investment in higher education. New Common App data shows that large, public flagships are thriving. Small privates and regionals are struggling. And while schools strive to increase their shares of first-gen and minority students, COVID has wrecked access for those students in particular. Will international enrollment bounce back? And with the short and long-term issues related to College Board and ACT, lead generation and first source names will be extremely valuable and costly. Marketing "gimmicks" and sales offers are already appearing (incentives such as guaranteed parking spaces, early move-in, and sweepstakes-style giveaways for rooms, books, and scholarships). It will most certainly be more cut-throat than our friendly competition for students.
This isn't a new challenge, but it will become more critical. With the questions above, now it is imperative to tighten your brand strategy and have that locked in. In a recent Gartner CMO study, 33% of CMOs cited brand strategy as their most vital capability surpassing analytics. A year ago, it was near the bottom of the same survey last year. The Atlantic noted that "the pandemic has made college frail, but it has strengthened Americans' awareness of their attachment to the college experience." Identities will need to tie to values, and those values must be authentic and experienced.
COVID broke the barriers of some long-standing digital resistance. But so much more is needed. Gartner's study on the role of technology in creating "genius brands" showed that martech represents 26% of marketing expense for CMOs, but brands utilize just 58% of that capability. It's likely more pronounced in higher ed where duplicative technology, disparate owners, and bad technology stacks abound. Just as we're finally deploying CRM's, the imperative is now around enterprise solutions. And with changes in privacy, ad technology, and more, the importance of the first and zero-party data institutions have and can gather on their own will be critical.
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Jason is CEO & Partner at SimpsonScarborough. Before coming to SimpsonScarborough in 2014, Jason led the marketing communications teams for the University of California System and North Carolina State University. In 2013, he was named Higher Education Marketer of the Year by the American Marketing Association. Known for being our chief Peloton evangelist, he and his wife, Meredith, live in Oakland CA with their daughter, Amelia. Learn more about Jason here.