The current president of Maryland’s Frostburg State University (FSU) noticed two things after he joined the institution three years ago—enrollment was declining and merit-based aid was not doing much to turn the numbers around. After partnering with an analytics company, Ron Nowaczyk instead found that need-based aid was in fact more effective in attracting students to FSU, and that changing who the university offers the institutional aid to could dramatically increase both enrollment and retention. Based on these recent findings, FSU has implemented changes to the method it uses to offer this aid.
In a webinar held Thursday, hosted by Inside Higher Ed and titled “Using Financial Aid Analytics to Overcome Enrollment Challenges,” Nowaczyk explained that after analyzing other schools in the state, he found that for FSU—a four-year state school serving around 5,300 students, almost half of which are students of color and one-third are Pell-eligible—the biggest competitor is Maryland community colleges. Nowaczyk said this was his biggest clue that FSU was not attracting more students because of financial barriers, which led to many discussions among the university’s leaders of whether they were leveraging their financial aid properly.
Enlisting the help of HelioCampus, an analytics company designed to help institutions gather and contextualize data around admissions and enrollment, Nowaczyk said FSU leaders were trying to figure out the answer to two questions: how the university could use financial aid strategically to increase their retention rates and yield, or the number of students who apply to the school, as well as how increasing the aid it offers students impacts enrollment and net tuition revenue.
The data allowed Nowaczyk and his team to break down students into three categories, or three yields—those who had the lowest chance of enrolling at FSU, those who had a moderate chance, and those who were the most likely to enroll at the university. Nowaczyk explained that through the data it was clear that FSU was offering too much financial aid to students in the lowest yield class—about 49 percent of the aid— when only 22 percent of those students enrolled, and that high-yield students continued to enroll at high rates even when they were offered only 14 percent of the total institutional aid available.
It became clear with this and more data, Nowaczyk said, that the medium-yield students were the ones to target, as they were most likely to be swayed with aid offers and were very sensitive to aid offer size. For example, for those in the medium-yield group, the difference of zero aid to between $1 and $2,499 of aid increased the likelihood of enrollment by about 30 percent, while for those in the low-yield group it made no difference. While aid made some difference for those in the high-yield group, they already enrolled at much higher rates than the other groups and were comprised of a much smaller number of students.
Armed with this knowledge, FSU implemented changes to its admissions process last year to see how adjusting the way it divvies out institutional aid can do increase enrollment rates for the medium-yield students, which Nowaczyk said was based on a greater focus on need-based aid over merit-based aid. Nowaczyk said he worked with the FSU admissions department to change the bucket of students it offers a majority of aid to by taking into account unmet need percentages in addition to high school GPAs and other indicators of college success. FSU also discussed the potential of adding more money into aid pots as opposed to redistributing that aid but found it would not increase net revenue, he said.
“We now have some ‘what ifs’,” Nowaczyk said. “... We’ll continue to evaluate it, we’ll continue to refine it.”
Publication Date: 11/9/2018