Do you want a fair college tuition price? Do you want to know what others are paying?

My name is Gary Stocker with CollegeViability.com. Our continuing efforts to provide guidance and perspective on higher education topics takes us today to an interview with Mark Salisbury. Mark is a founder of tuitionfit.org, an app that gives families control of college tuition pricing. Today, Mark shares insights and guidance that parents, students, and a variety of stakeholders should hear. It's a fairly simple premise, and it's just in an effort to take all of the actual prices that colleges charge different kinds of students from the millions of award letters that get sent out every year and pull out all that data into one place, one central dataset, so that the public can search for actual prices and circumvent the whole stress of how you're trying to shop by price. And get right to which colleges fit my price range. Well, for 25 years working in colleges and universities, it's been a constant theme that the public is just increasingly frustrated with not being able to find out which schools fit their price range. And As a function of that, people engage this process the way they think they should. They end up over a barrel and borrow way more than they should. And so we've got a whole generation of stories of families who've sent their kids off to college, borrowed a ton, and now their kids are stuck and the parents are stuck. So it's pretty well known that the lack of transparency in actual pricing is a tremendous problem for the public. And we can, you know, talk more about that at some point if you want to dive deeper. But the other thing that I noticed over the past several years before starting TuitionFit was the degree to which that lack of price transparency was strangling so many small liberal arts colleges, regional public institutions, all the schools that don't have that giant national name brand prestige cred. They're struggling to get students, and often it's because people see the sticker price, go to the next one, don't even bother to look further. And at that very school, nobody's paid the sticker price in 20 years. The average discount, 65%. The real price is the exact price that that student and that family is looking for, but they can't find it, and they're not going to bother trying because it looks to them like it's a waste of time diving down a rabbit hole that then looks like a scam? A couple of things. And really, you can kind of put it into one of three categories. Either they just say, this college search process, this whole thing looks like all of the other scams I see every day. That are intended to lure me in and then at the last minute tell me, oh yeah, your actual price is a lot more than you thought it was gonna be. Sorry, but it's for all these good reasons and you gotta decide. So here's a way to make it work and we can help you with these loans, right? So the public just sees all that and says, you know what, this whole thing's a scam, I'm out. I'm not even doing higher ed and I'm skeptical about the whole thing. And we now have lots of data public surveys of the degree to which that's already percolating all over the country. The second thing that they do is just say, look, cost matters. So lots of schools are really expensive. So I'm just going to use this sort of blunt force proxy that I can use to ensure that I don't get into a place that's too expensive. So I'm worried about money. So I'm just going to look at public in-state institutions, or I'm just going to look at community colleges. And while many of those institutions have lots of good people doing lots of good work and teaching well and all the things, there's a whole bunch of students in the millions for whom those institutions aren't actually the best environment for them to learn, grow, be supported, succeed, and graduate. And so those kids end up going places that really aren't best for them, and that then gets reflected in the attrition rates. Those schools' graduation rates aren't great. They're just not. And sometimes it's not a function of the individuals at those institutions. It's a function of this is just a big, big place, and you got a lot of people that the exact thing they need is the opposite of a big, big place. But what they've done, normal human behavior, is just to ensure that I don't end up over a barrel financially, I'm going to use the proxy of type of school because I heard it from my parents and my grandparents that that's the type I should look at. So that's group 2. Group 3 is the ones that we all know about where people say to do this college search, pick your colleges, go through the process, then figure out how to pay for it. And so left to their own devices and left to the degree to which the college marketplace is so much about driving emotional responses, they swoon over the brand names that they've heard of. They swoon over the school that looks like that quad is right out of a movie. They swoon over some other thing about how cool that place is. and those are the only places they apply to. They get in, they get price tags over the moon. They think that they got to pick one of them. And the possibility of the public shame that would come with saying, I can't go to any of them, is just not worth it. So they go out and they borrow way too much, get completely overwhelmed with debt. But I'm going. And then it's hopefully you make it work. And we all know what the consequences of that are. I talked to a mom in Long Island last— 2 weeks ago, and she just was sort of just overwhelmed. And the words that came out of her mouth were simply, I never knew I could think about it like this. And what she was referring to was this whole idea that she could actually approach the college search process rationally. Price matters. And that she would be able to find a place that she doesn't have to worry that at the last minute they're going to be a bait and switch and suddenly the price tag is going to be more than than you could afford. She doesn't have to go through this whole process hoping that maybe that we'll be able to make this work somehow. So one of the first things that happens is families just have a whole nother level of knowledge and confidence and less stress as a function of using TuitionFit. They also get a whole nother level of leverage and belief in themselves to go to the school and say, look, really appreciate that you accepted our son or daughter, really happy about that, but the price tag that you've offered us just doesn't work for us and we don't really feel like it's a fair price given what else is going on in the marketplace. And suddenly that family's got more leverage and more information to be able to negotiate a better price. And the fact of the matter is, is that Colleges do that now, but most of them do that now regularly, and they depend on the families not knowing anything in order to be able to win that negotiation or do it the way they want. This now evens the playing field, given how unable colleges and universities are to change at all. Colleges and universities still are tied to this notion of a sales funnel, and they're tied to the companies that provide the consultants, the algorithms, the tech resources, and the modeling, financial modeling, that essentially perpetuates the use of that model. The colleges are tied to them in the same way that an addict is stuck with their dope dealer. They can't cut that cord for a whole bunch of reasons. And so the folks that are going to drive change aren't going to be the colleges that make the big changes because they're just not good at it. It's going to be what new ideas come from the organizations that are shaping enrollment management. And what's coming right now is a couple of different organizations that are essentially making it possible for students to find out that they've been accepted to colleges that they never applied to. So there's this whole other— the old school way of doing it was, you know, you had to complete this application and colleges were just going to make the application longer and longer and longer until they found out we're not getting enough applicants. So now they make the application shorter and shorter and shorter. Far fewer schools ask for an essay, for example. Hardly anybody does interviews anymore. Well, now the next stage of that is a platform that allows the students to put their basic information in and then the colleges just to say for all of these kids, hey, you're already accepted and we got a bunch of scholarship money. So you're just trying to lure the students farther and farther into the funnel. You still are holding back an honest answer on price. Yes, you do. The point that you just made in the question about the fact that this money is really sort of magical fairy dust money. It's not money that the college has already acquired that's in a bank account somewhere that then they're taking from that bank account to give to you so that you get a better price. All of this stuff is coming off of that magical sticker price that they set ridiculously high in the first place so that they have more of the magic fairy dust discount money to work with to swoon, to get you to swoon as a student. So in order to be in a position to ask for more scholarship money, more better discount, you kind of have to be a little bit behind. You have to back up a little bit. And the first thing the family has to do is to make sure that they have gotten accepted to a number of schools that are in a similar vein, that they have the ability to say, I have a couple of offers that I'm trying to judge between which one. In the end, if you're not willing to walk away from a school, they're not going to give you more money. You can't, you know, you can't have the college and pick the price. You have to be able to walk away from a school if they don't give you the price you want. You have to say, look, love you, see how this would be great, but the price you're asking to pay just doesn't match my sense of value. And because I've got a couple of different options, I can make one of these other ones work. That's the only way you're going to get them to move. Some— in some ways it is fair. It's absolutely fair to say that because cars have a price that is a sort of recommended dealer price. But then there's all kinds of other discounts that the dealer has that they can offer. And colleges have decided that they're going to approach pricing in the similar way. The way where it differs is that the thing you're buying when you buy a car, you have it the moment you drive it off the lot. The thing you're buying when you go to college, you don't get until you walk across the stage at commencement 7, 8, 9, 10 semesters later. Ideally 4 years later, but it could be longer, right? So, and you're not even so sure that the raw materials that you acquire in those first 5, 6, 7 semesters are going to necessarily transfer to another institution and be of the same value so that you could get that degree at that other institution's commencement. So this is where the metaphor differs a little bit, and it means that the families have to be even more focused on price and value. Because those prices are going to change over the next several years and you're sort of obliged to keep paying them. In most cases, the school will give you a discount as a dollar amount while they increase their sticker price as a percentage. So you'll have to pay more each year You don't get a sort of relative price. We're going to knock off 50% of the cost no matter what the sticker price is. So families really have to think about the long-term implications of the choice that they make. And, you know, people talk about that when you buy a car, value cuts in half the minute you drive it off the lot, right? It's not that bad with higher education, but It's sort of like saying the jury's still out after you drive that car off the lot for another 4 years while you're still paying for the value of that jury, right? So let's see here, we've mixed cars and now the legal system and higher education together, but it really matters to think about the long-term cost of what you're going to be paying for? That's a great question. I think we'll ultimately see an increase in both of those things. The way I think it'll play out is this: there'll be a whole bunch of colleges that get right up to the cliff edge financially, with clear evidence that they were coming up to that cliff edge for years, and just this wonderful head-in-the-sand over and over, positioning, marketing, everything else. At that point, there will be this big scramble to, well, I guess maybe we should try to come up with a merger. And then there will be a bunch of them that are able to make that happen at the last minute, duct tape and rubber bands. And then there'll be a bunch of them that crash and burn at the last minute because they're— the same ineptitude that got them to that place financially is the same ineptitude that fumbled the ball on the merger and, uh, had the whole thing blow up. So I think you're going to see a lot of schools inevitably get to that place financially, and I shouldn't even say it that way, they're already at that place financially. There's a whole bunch of schools where and your evidence, your analysis of this stuff is top shelf here. It's so clear, like, your costs are going up, your revenue is going down. You can't, like, keep living that way, right? Yeah. Then of those schools, the light bulb will come on at the last minute, and then some of them be able to pull something off. Some of them won't, and you'll see a wave of both of those things at the same time. I wish that we had the other option in there of a whole bunch of schools that can see 10 years down the road, this is the track they're on, and carefully, thoughtfully, deliberately find a group of schools and build a consolidation together and end up with something that's where the whole is greater than the sum of the parts because they really did it in a thoughtful way. I wish we would see more of that. Crickets, crickets. That's interesting. Colleges sort of have ended up in sort of 3 categories with the middle one getting smaller and smaller and smaller all the time. The colleges that are super wealthy that get 150,000 applications every year for 3,000 spots, they, that they just give money based on need, they're actually very transparent. It's very clear what their price is. And they pat me on the head and say, good boy, this is wonderful that you're doing this transparency thing, knock yourself out, and here's a chocolate on your way out the door. They don't care. It doesn't matter. The other big, and it's the large vast majority of higher education institutions, They see what I'm doing, and at the frontline worker stage, like the admissions office person who's out front trying to get people to apply to the school, most of those schools see TuitionFit and go— and those individuals say, wow, that's actually great because now I can get a lot more students to get past that sticker price repellent and 'Look at our school.' But then as you go up the chain within the admissions office and you get to the VP of admissions and they know how much money they're spending with all of the consultants and they know how thoroughly they have embraced the giant broad funnel model of this thing, um, tuition fit looks like a foreign language. And it looks like it undermines their ability to get somebody to swoon over scholarship money. And it forces the institution to have to talk a lot more about outcomes than features, right? When you don't tell people what your price is, you can get them to swoon over the climbing wall and the new gym and the fancy dorms and whatever other majors you just added. But when you talk about it in terms of price from the beginning, Student's gonna say like, that's okay, but fine, what's my ROI? Because now I've got the I of that calculus. Now I want to know what the R is. And so as you get farther up the funnel, or not the funnel, the org chart at those institutions, they start to get less and less interested in what I'm doing and not so happy about it. There's a very subset of schools in the middle here who have actually made money off of the opaqueness of this process. And they're very familiar with collecting a lot of data about all their applicants and knowing which ones seem to be super interested in their school and it's their number one choice. And then they know they can charge that student more than the student for whom they have to fight for to get to that student. And they'll do that with impunity because that's how this system is designed. That's how it works. That's how they can play in the space. They have the advantage and they're using it. Those schools really don't like what we're doing because now it's sunlight. If it's a cliff, which I'm not even sure it's actually a cliff, it might be just a slope, but if it's a cliff, this makes tuition fit even more valuable because the colleges are even— are going to be even more, uh, required to get people to decide to come to their school, and there's going to be even fewer students, and so, um, they're gonna have to fight for kids. TuitionFit works because there's a supply and demand thing playing out, right? If there's way more demand than there is supply, the colleges can do whatever they want and hold price to the very end. Doesn't matter because they're going to get somebody to pay it. But if, as is true, there's a lot more supply than there is demand, now all of a sudden the consumer should have a lot of power to drive price. And that's what TuitionFit's trying to do, is to give the consumer that power. Now the notion of this cliff coming up is a function of some of its demographics, but some of it's playing out with just people's skepticism about higher education, right? Is it we got these crazy high prices? I don't know any better. So I'm using that as my metric of what the I would be in the ROI and forget it, I'm not paying that. So I'm going to look at a bootcamp for coding. I'm going to look for internships. I'm going to look at apprenticeships. I'm going to look at other things. But I'm just not convinced this thing's going to work. So regardless of how things play out, whether it's a cliff or a slope, there's still a problem for the educational institutions. And that just makes TuitionFit even more useful. And ideally, the goal of TuitionFit is to get the whole marketplace to price transparency. And if that happens and the demographics play out even remotely like we're predicting, we ought to see some prices come down, and that would be a phenomenally good thing. What's a college counselor's biggest challenge? And we're talking about high school counselors who focus on college and career planning. For the high school counselors whose job it is to help students with college and career planning, their biggest problem isn't that there's lots of information out there, because there is, and isn't that they don't have access to it, because most schools have purchased one of the giant, you know, platforms like Naviance or Maya Learning or whatever else is out there. The problem for every one of those individuals, those counselors, is time. They don't have the time to spend with each student. I think some of the most recent data suggests that over 4 years of high school, the student might get an hour with a school counselor, just on average. And the school counselors are spending most of their time putting out 5-alarm fires and essentially being frontline triage workers. Somebody comes in with a mental health crisis, connect them with the resource that can help. Somebody comes in with a scheduling problem, connect with them with a resource that'll help. That's what counselors do. They actually don't do very much counseling anymore, sadly. So what counselors need to be able to do is to provide families with the information that they need fast. And the information that families need is, and the families are asking for, is tell me the schools that we can afford and then I'll go look at them. So when high schools have access to TuitionFit, they can cut to the chase and they can answer that question for a family in 5 minutes and then let the family go and look at all of the other factors that matter when you're thinking about a college fit and go visit a campus. And, and they can find all that other information in in a million places online. But let them cut to the chase so that they can do their job as counselors. That's a really, really interesting question. Um, it's a really, really tough nut to crack, to get colleges to change behaviors, even with all of the data that's out there. Because the data that's out there was determined by people decades ago. And what I mean by that is which data points do we collect? And the folks that decided which data points to collect weren't thinking about how you would use that data as an individual to decide which institution's a better fit or which institution is more financially viable. They were using it just from a big picture standpoint of sort of get that 40,000-foot view of higher ed and maybe be able to flesh out institutions that were grossly off the map in terms of how they run themselves. For data entrepreneurs to really have an effect on higher ed, I think a lot of times they're going to have to go and find that data elsewhere. And the challenge for the entrepreneurs is going to be, do I have the resources and the time to be able to go and create the data set that then allows me to produce the insights that I know the public needs? Or the that the institutions need to actually get better. And that, I think, is the real challenge that's still a hiccup for data entrepreneurs in higher ed to really have the effect that I know many of us think that we could. Mm-hmm.