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How colleges use enrollment management strategies to manage yield

college enrollment management strategies

You would think that universities and colleges would grab the best applicants for their academic programs every time. However, more than a decade ago, during one US admissions year, the undergraduate admissions office at Franklin and Marshall, Lancaster, Pennsylvania, put 140 of its best applicants on its waitlist.

There was no “clerical error.” The admissions office was managing what is known as the “yield” of the college—the percentage of applicants who are offered admission and go on to enroll.

Evidently, Franklin and Marshall knew its position on the higher-education food chain. In earlier years, hardly half a dozen of its best applicants had accepted its admissions offer and joined the college.

Therefore, this time, the college got wiser, and offered admissions only to applicants who were likely to enroll. It knew that doing so would increase its yield and bring down its acceptance rate (proportion of number of applicants admitted to total applications), which would do a lot of good to the desirability and prestige/selectivity of the college.

The college would get a better rating from ranking agencies (though not all use yield as a criterion), education consultants, counselors, admissions guidebooks, and what have you.

In an ideal world for admissions offices, most admitted applicants would queue up to enroll. But it is an ideal world for only a few elite institutions that are a big draw among students.

According to figures from the fall of 2014, Harvard University had a yield of 81 percent of students, Stanford and Brigham Young (Provo, Utah) 78 percent, MIT 72 percent, and University of Alaska (Fairbanks) 71 percent.

They made up the top five national universities in the US that reported data. The bottom five universities on the list had yield rates of just around 10 percent. The average yield among colleges is about 35 percent.

The importance of yield and enrollment management

Yield management is a serious task for many colleges. An accurate estimate of yield can help colleges decide how many students to admit, calculate tuition revenue, and budget for programs.

All except the elite universities, which can rest assured that they will attract an ideal number of the best applicants, have devised ways to estimate yield accurately. An important piece of data is the yields from previous years.

If a university has set its ideal student-body size at 500 seats and its average yield is 50 percent, it should send out acceptance letters to 1,000 applicants. But what if the yield drops to 40 percent that year? Only 400 applicants will enroll and 100 seats will remain vacant, which would wreck financial and logistical plans.

Yield management strategies

A survey found that 25 percent of all college applicants usually plan to apply to five institutions. This makes colleges resort to preparing waitlists as an insurance policy to fill courses: if some of the admitted students don’t enroll, they can offer admissions to the waitlisted applicants. Some use the priority waitlist concept, where accepted applicants are asked to deposit a sizeable sum that they would forfeit if they don’t enroll.

The more unsure an institution is about what its yield is going to be, the longer will be the waitlist and the more complicated and longwinded the admission process. The waitlist “purgatory” obviously puts applicants in an agonizing limbo, but colleges feel it is a fair tactic in the competition for students.

In order to manage yield, colleges collect data on “demonstrated interest” to predict whether an accepted applicant will actually enroll. They glean information from the application:
– Has the applicant mentioned why attending the particular college is important to him?
– Has the applicant got in touch with the college for more information?
– Has she expressed interest in visiting the university campus or interviewing a college representative?

Many of the elite colleges don’t bother to analyze demonstrated interest seriously. Stanford and Dartmouth, for example, have made it known explicitly that they do not. But others, such as Baylor and Carnegie Mellon, do use this information to figure out which accepted student is more likely to enroll than another. According to the National Association for College Admission Counseling, 50 percent of all colleges give at least some importance to demonstrated interest.

Tracking demonstrated interest

Some colleges have turned the art of using demonstrated-interest data into a science. Duke University’s Fuqua School of Business has used software named “Talisma” for garnering information about applicants’ contacts with its admissions office and their visits to campus.

Other schools use sophisticated software that can tell them which applicants have met alumni or enquired about programs. Booth and Kellogg have used “Slate” to manage their yield and build an ideal student body. On the other side, Sloan and Haas, for example, depend on their admissions staff, not software.

While the use of software has helped some schools increase their yield somewhat, it has not made a difference to others. For example, while Fuqua estimated that software may have helped it increase its yield by 2 percent a couple of years ago, Booth didn’t find any dramatic change.

Colleges make it a point to make it known that demonstrated interest, by itself, does not dramatically alter the chances of an applicant. This means that the quality of incoming freshman classes remains the same.

Early Decision Round for Applications

Another strategy for yield management is the early-decision (ED) program. Under the program, an applicant applies to a college and receives an admission decision well in advance of the usual notification date.

The ED program involves a binding commitment on the part of the applicant to enroll in a college if selected. If admitted under ED, the applicant would have to withdraw his/her applications to all other institutions and make a nonrefundable deposit. A few well-known universities are known to depend heavily on ED to manage their yield rates.

The 2013 E-Expectations survey found that parents/guardians, admissions and high-school counselors, relatives attending college, and faculty were the major influencers for students in choosing colleges. Colleges have evolved strategies for impressing these influencers by highlighting why they are the best choice.

They also try to curry favor with the applicants themselves. Some send T-shirts, stickers, and other gifts, some mail invites to campus sleepovers, and some highlight their luxury dormitories or Olympics-standard sports facilities.

Why strong applicants may get rejected or waitlisted

Occasionally at least, colleges’ pursuit of high yields makes victims out of the best students. Here’s one story: A university applicant who had very high SAT scores and a top-10 rank in a reputed high school applied to Harvard and was accepted. But Harvard was not her first choice, and she applied to four other top universities.

During her admission rounds at these four universities, she revealed that she had been accepted at Harvard. The result? Three of the four universities rejected her application, probably thinking that she would anyway go to Harvard and that accepting her would bring down their yield.

There has been much criticism of colleges managing, or manipulating, their yield rates. Meanwhile, as acceptance rates fall, students apply to more schools. This increases the chances of accepted applicants turning down admission offers from all but the best institution available to them, and compels colleges to “strengthen” their yields.

Some colleges have even been accused of using creative ways to pump up the number of applications, so as to lower their acceptance rates and make themselves seem more selective and prestigious. But that’s another story in what experts call the admissions arms race.
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Sameer Kamat
About Sameer Kamat
Founder of MBA Crystal Ball. Author of Beyond The MBA Hype & Business Doctors. Here's more about me. Follow me on: Instagram | Linkedin | Youtube

2 thoughts on “How colleges use enrollment management strategies to manage yield”

  1. Hi Sameer. I have around 11+ years of exp and I am looking to change my industry now. I want to know more regarding what value addition can I add up to do so. Any short term coyrse which can take me to a Managerial role aling with career transition. Pls advise. I am currently into HR.

  2. Ritika: Short-term courses are helpful if you want to learn the basics of a new skill quickly. For bigger goals such as changing your career, they won’t be as effective.

    With all the experience you’ve gained over 11 years, I’m sure you have picked up non-HR related skills (such as general administration, project management) as well. If you have a supportive senior management team you can try for an internal transfer into a new department.

    I’ve known folks (including colleagues) who’ve managed to do that without relying on short-term or long-term courses.


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