Q: Have there been any studies regarding the effect on enrollment of lowering, or raising prices. If we lower our prices, will we get a disproportionate increase in enrollment?
I would greatly appreciate any information you can provide.
A: Lowering prices does not necessarily result in significant enrollment increases. Some strategies that can work would include offering a special "early bird" rate which is typically very effective, or offering "specials" on some of the courses in your catalog. As counter-intuitive as it seems, it is often the case that raising prices increases enrollments. If you increase your prices, you should look at an increase of not more than 10% and keep your increases below a price break. For example, if you raise the price of a course from $45 to $49, your enrollments are not like to be negatively affected at all. The increase is below a price break and is essentially "invisible."
Sometimes, prices are too low. A course may be perceived as being of poor quality or inadequate if the price is too low. For example, a course on database management may underperform if priced at $59, but do much better if priced at $125. The participants might believe that a $59 course cannot give them what they need.
Pricing is a critical part of your marketing strategy and image. It is important to offer programs at both ends of the spectrum--some courses should be low-cost and easily affordable, and others should be priced at the high-end of what your market can afford. The majority of your classes should be in the middle. This gives your participants a range of choices and helps keep you from being branded as "too expensive" or "too cheap."
Further, you need to be aware that in today's world, price is not as big an issue as quality and value. People are often willing to pay the price for a class if they perceive it to have high value. Thus, positioning your courses as having a lot of bang for the buck is critical.