Can your customers afford your courses?

Charlie Farmer

Charlie Farmer

7 min read
Cost of living crisis

Maintaining a confident pricing strategy is difficult for education businesses right now.

Even before the pandemic, the battle for market share between online-only and in-person and hybrid schools was raging. The pandemic drove many formerly in-person schools online, removing overheads, streamlining operations and reducing learner-to-staff ratios. The result is even stiffer competition in terms of price.

Showing why you’re different is tough

“Online course” can mean so many things, delivering entirely different levels of value. To illustrate, we’ll do a short thought experiment. First, we’ll describe the factual features of three courses. Then we’ll condense them down to a marketing sentence.

Course A: 20 pre-recorded videos. Online forum to ask questions. 1 pre-recorded CV advice session. Course B: 20 live sessions. Live chat support from named mentor 5 days per week. 3 live career advice sessions. 1 personalised 1-2-1 career advice session. Course C: 20 live sessions. Instant, unlimited video call support from a mentor. 3 live career advice sessions. Unlimited feedback on CVs/cover letters. Up to 5 hours personalised 1-2-1 career advice. In-house career placement team, employer connections.

Course A: A series of 20 expert-led on-demand lectures, complete with a digital workbook and community forum to get guidance and help Course B: A series of 20 expert-led live lectures, with 1-to-1 support from a mentor via live chat 5 days a week and extensive career support Course C: A series of 20 expert-led live sessions, with video call support within 1 hour at any time from a mentor and 1-to-1 career counselling

As we hope you’ve spotted, Course A is really a representation of mass skills-driven online learning, which can typically be purchased for between £10 and £100. Course B is a typical career-driven school-led/specialist-led course. Course C looks more like a premium bootcamp often priced upwards of £4000.

What we hope is obvious here is that when communicated poorly, a description of a course can greatly diminish its true value. While Course C still sounds better than Course B, and Course B sounds better than Course A; it doesn’t feel as though Course C should cost 10 or 20 times as much as Course A.

Unfortunately it isn’t uncommon for education businesses to under-communicate points of value. In an increasingly competitive landscape, it is crucial that product and service features and their value are explained as fully as they can be, especially in areas which differ hugely from provider to provider, such as career support or mentoring. The more value that is built in, the more important it is that it is clear.

To put it another way, when potential students learn about the value of a feature of your service, their expectations for what any course, at any provider, should offer as standard should change.

Businesses need to be innovative with how they adapt to an increasingly competitive market.

Pricing strategy matters (more than ever)

Maintaining a confident pricing strategy is tough, but it’s never been more important. In a world where perceived value for education businesses is increasingly fuzzy – and contingent upon brand and marketing efforts – price matters for all kinds of reasons beyond your bottom line.

Firstly, as competition grows, price is acting as a stand-in for value in consumer’s minds. You probably don’t want to be priced similarly to a competitor who is offering much less value. Secondly, a higher price gives potential students confidence in your courses. Consumers aren’t as likely to trust your brand and your courses if the pricing is too low.

But having a lower price that close competitors can help to attract customers. That might be true, and that can be right for some schools, and in some circumstances. Don’t forget though – learners aren’t buying your courses. They’re buying real, tangible career outcomes, and they need you to give them the confidence to get there.

Pricing Vs Cost of Living

Are your customers often those earning lower salaries? Unfortunately, this group is disproportionately affected by a rising cost of living, with less (if any) disposable income and fewer savings. With a rising cost of living, any savings are even more likely to be depleted. In the UK, official figures show real wages have dropped at the fastest rate in two decades. According to research by the Havas Media Group, there has been a 77% net increase in consumers who expect brands to help them save money since the start of pandemic.

But for those that earn the least, upskilling and education is incredibly important as a long-term strategy to improve pay, meet the rising cost of living and grow disposable income – as well as, also importantly, unlocking a wider range of rewarding and fulfilling careers.

For education businesses, it’s easy to think that the huge number of people who want to learn new skills or change careers, paired with inflation squeezing income, means people are actively looking for change for themselves.

But the opposite can be true. When times are more challenging, motivation can drop; confidence can drop, imposter syndrome can take over – it can be harder for people to picture themselves making the change that is needed to reach their goal.

So for schools, bootcamps and any kind of educational institution for adults, having a clear, intentional path to change for your potential customers and stepping into their boots to understand their fears and concerns is more important than ever.

Offering finance is strategically important

Maintaining a pricing strategy for a course is easier when you offer flexible ways for learners to pay. This lowers the financial barrier to entry without compromising the pricing strategy. Every flexible payment solution is different. Always consider… * Are we getting paid upfront? (Not getting paid upfront not only has negative cashflow implications, this is exacerbated by inflation as the money is worth less when you receive it) * Are we taking on any risk? (What if the learner can’t pay?) * Is it attractive to learners? (Will the option help you boost enrolments?) * Is it fair for learners? (Does it fit with the ethical values of the business? Could learners end up paying significantly more than they should?)

We can help

Knoma helps learners find and finance courses at institutions like yours.

Our mission? To enable access to lifelong education and reduce the skills gap.

Offering fair and ethical finance 0% finance options for your learners gives your potential customers a greater choice and a greater chance of being able to afford your programmes and enrol. This is exactly what we do – and so much more.

Knoma also has a Knowledge Marketplace, the perfect platform to get your courses in front of potential learners with strong intent to train. It’s where lifelong learners and the career-curious come to discover the courses they need to get – and stay – ahead.

We fight for fairer finance for lifelong learners, and help some of the best schools and bootcamps around the world reach a new audience of would-be career changers and upskillers.

Book a call today, or send us a message to find out more.