In 2019, more than 3.2 million students were enrolled exclusively online, a 22% increase compared to five years earlier. While traditional on-site enrollments have been flattening or declining over the past decade, online enrollment has experienced steady growth, only to be accelerated by the pandemic. New populations of students are making the shift online for a better fit with their lifestyle and needs.
Online Program Management: Short-Term Gain or Long-Term Pain?
Online learning has the potential to reach more students, win over non-traditional learners, provide a more inclusive environment and expand enrollment without limits, among other benefits. It’s not a question of whether to offer online learning—but how to deliver it.
The solution for many institutions is partnering with an Online Program Manager (OPM) in a revenue-share agreement.
Many campus leaders find the OPM model appealing because they provide a turnkey, soup-to-nuts solution that includes content development, the technology platform, marketing activities, enrollment management, faculty and student support. The revenue-share model means they don’t require much of an initial upfront investment from the institution, which can seem particularly attractive to schools with little experience undertaking online learning, worrying that doing it themselves would be formidable, not to mention costly.
Though an OPM offers a full suite of services, institutions must forfeit a high percentage of tuition revenues as part of a long-term contract they’re locked into. As a result, they miss out on the lion’s share of the funds, even well after the partnership was formed. The OPM often owns the content, so if schools don’t renew, their faculty will have to rebuild content and programs from scratch. Additionally, OPM programs can appear as having a cookie-cutter approach or experience, which could make it hard for institutions to stand out in the competitive online landscape.
Online Program Development: What to Consider in The Decision Process
There are several key factors to consider when making the decision between a revenue-share OPM or an unbundled, fee-for-service solution.
1. Long-Term Profitability
With a rev-share OPM, institutions can stand up an online program relatively quickly with little investment required at the start. But this model means the school could leave significant revenue on the table in the long-term. With a fee-for-service solution, the institution makes the up-front investment but only pays for the services it needs and owns 100% of the revenue.
When making a long-term investment in online learning, consider the implications for long-term revenue and profitability in both models and determine what makes the most sense for you.
2. Holistic Needs
OPM companies take on the responsibilities for managing the program, including overseeing marketing and enrollment initiatives and building the platform infrastructure. This comprehensive service offering may seem attractive, but it is important to understand the full terms of the contract and whether there’s room for customization. An unbundled model offers these same services but in a flexible, scalable format, tailor-made for each school’s needs.
3. Commitment to One Provider
OPM companies can require long-term contracts of eight years or more, which can leave schools feeling locked in if they’re not pleased with the results or business model. Unbundled solutions offer flexible payment plans and shorter contracts.
4. Ownership of Course Content and Intellectual Property
OPM companies often own course content, meaning you’ll have to rebuild course materials from scratch if you decide not to renew the contract. With a fee-for-service solution, you can continue using your own learning management system for the delivery of course content you create while also owning all the course content and intellectual property.
OPM companies often require that institutions use certain LMS technology, which could require quite a bit of change management. A fee-for-service model is LMS agnostic, allowing you to choose your technology.
6. Decision-Making Power and Transparency
If you want visibility into your leads, enrollment practices, and other data that reflect your brand, consider a flexible solution that provides transparency and visibility into data reporting rather than the black box approach of a traditional OPM.
Keep Learning with the Guide to Choosing the Right Online Program Partner
When choosing how to develop and grow your online learning programs, there’s a lot to consider. When it comes to finding the right partner for your school, do your homework and be prepared with the right tools to make an informed decision. In the guide to choosing the right online program partner, learn about and compare the different service models, understand the key factors to consider in the process, and check your unique needs to determine the right path for your school to develop and grow online programs.