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Adapted from: "Strategic Marketing for Educational Institutions" (1985) Philip Kotler and Karen F. A. Fox,
Prentice-Hall, I985, pp. 6-I5
Chapter 1
Marketing is of growing interest to schools, colleges, universities, and other educational
institutions that face declining enrollment, rising costs, and an uncertain future. They
realize their dependence on the marketplace and wonder how they can be more
successful in attracting and serving their publics. Marketing is a management function
that offers a framework and tools for doing this.
EDUCATION AND MARKETING
I
WHAT IS MARKETING?
1 What does the term marketing mean? This question was put to 300 educational
administrators, whose colleges were facing declining enrollments, spiraling costs, and rising
tuition. Sixty-one percent said they viewed marketing as a combination of selling, advertising,
and public relations. Another 28 percent said that it was only one of these three activities. Only
a few percent knew that marketing had something to do with needs assessment, marketing
research, product development, pricing, and distribution.
2 Most people think marketing is synonymous with selling and promotion. No wonder, since
Americans are bombarded with television and radio commercials, "junk" mail, newspaper ads,
and sales calls. Someone is always trying to sell something. Therefore, most administrators are
surprised to learn that selling is not the most important part of marketing! When an institution
offers appropriate products and services and prices, distributes and promotes them effectively,
the products and services sell easily. "Hard selling" will be unnecessary. Peter Drucker, a
leading management theorist, wrote, "The aim of marketing is to make selling superfluous."
3 Marketing is a central activity of modern institutions, growing out of their quest to
effectively serve some area of human need. To survive and succeed, institutions must know
their markets; attract sufficient resources; convert these resources into appropriate programs,
services, and ideas; and effectively distribute them to various consuming publics. These tasks
are carried on in a framework of voluntary action by all the parties. The modern institution
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relies mainly on offering and exchanging values with different parties to elicit their
cooperation and thus to achieve the institution's goals.
4 The concept of exchange is central to marketing. Through exchanges, social units 
individuals, small groups, institutions, whole nations  attain the inputs they need. By offering
something attractive, they acquire what they need in return. Since both parties agree to the
exchange, both see themselves as better off after the exchange.
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Here is our definition of marketing. Marketing is the analysis, planning, implementation,
and control of carefully formulated programs designed to bring about voluntary exchanges of
values with target markets to achieve institutional objectives. Marketing involves designing
the institution's offerings to meet the target markets' needs and desires, and using effective
pricing, communication, and distribution to inform, motivate, and service the markets. Several
things should be noted about this definition of marketing. First, marketing is defined as a
managerial process involving analysis, planning, implementation, and control. This definition
emphasizes the role of marketing in helping administrators face very practical marketing
problems.
6 Second, marketing manifests itself in carefully formulated programs, not just random
actions. Effective marketing activity depends upon thorough advance planning.
7 Third, marketing seeks to bring about voluntary exchanges of values. Marketers seek a
response from another party by formulating a bundle of benefits sufficiently attractive to the
target market to produce a voluntary exchange. Thus, a college that is seeking students will
offer a strong academic program, financial aid, jobs, and other benefits to those who choose to
attend.
8 Fourth, marketing means the selection of target markets rather than an attempt to be all
things to all people. Marketers routinely distinguish among possible market segments and
decide which ones to serve on the basis of market potential, mission, or some other
consideration.
9 Fifth, marketing helps institutions survive and prosper through serving their markets more
effectively. Effective marketing planning requires that an institution be very specific about its
objectives.
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10 Sixth, marketing relies on designing the institution's offering in terms of the target
market's needs and desires. Efforts to impose a program, service, or idea that is not matched to
the market's needs or wants will fail. Effective marketing is client-oriented, not seller-oriented.
11 Seventh, marketing utilizes and blends a set of tools called the marketing mix  program
design, pricing, communications, and distribution. Too often the public equates marketing with
only one of its tools, such as advertising. But effective marketing requires an understanding of
all the factors influencing buyer behavior. For example, a school may do no advertising and
yet attract a large following because of its location or its reputation for effective teaching.
II
HOW ARE EDUCATIONAL INSTITUTIONS USING MARKETING TODAY?
12 Educational institutions vary in their use of modern marketing ideas. Some colleges and
universities are beginning to actively apply marketing ideas, whereas many private schools are
just becoming aware of what marketing has to offer. Public schools have generally not shown
any interest in marketing, but they would like more public support nonetheless.
13 The point at which an educational institution turns toward marketing generally depends on
the depth of its marketing problems. Institutions that enjoy a sellers' market, with an
abundance of customers, tend to ignore or avoid marketing. Thus, colleges in the 1960s had
their pick of students and were oblivious to marketing.
14 Institutions typically become aware of marketing when their market undergoes a change.
When students, members, funds, or other needed resources get scarce or harder to attract, the
institution gets concerned. If enrollment or donations decline or become volatile, or new
competitors appear, or new consumer needs emerge, these institutions become receptive to
possible solutions such as marketing. This began to happen to educational institutions in the
1970s.
15 Colleges  particularly four-year private colleges  have been particularly hard hit by
population and economic trends. The annual number of high school graduates peaked at 3.2
million in 1977 and declined to 2.8 million in 1983, a decline that continued through the
1980s. A decline in the proportion of high school seniors who choose to attend college could
reduce the pool of potential students still further. Operating costs are rising, and potential
students are increasingly resistant to high tuition at private institutions.
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16 By their responses to these trends, college administrators can be divided into three groups.
The first group is doing little or nothing. Either enrollment has not slipped, or, if it has, the
administrators believe the decline is temporary or easily reversible. Many believe that
marketing methods would be "unprofessional," and some believe that marketing would lower
the stature and quality of higher education.
17 The second group has responded by increasing the budget of the admissions office, the
college's "sales department." The admissions office hires more recruiters, issues more elaborate
catalogs, and places ads in selected media. Some admissions offices have experimented with
novel methods to increase their application and enrollment rates:
 The admissions staff of one college passed out promotional Frisbees to high-school
students vacationing on the beaches of Fort Lauderdale during the annual Easter break.
 St. Joseph's College in Renssalaer, Indiana, increased freshman admissions 40 percent
through advertising in Seventeen and on several Chicago and Indianapolis rock radio
stations. The admissions office also planned to introduce tuition rebates for students
who recruited new students, but this was canceled.
 Milligan College has offered a $50 rebate each semester to each student who recruits
another student for the college. Both students must stay enrolled, and a student's total
bonus cannot exceed his or her tuition.
 Brown Mackie College, a for-profit business college in Salina, Kansas, offered a
"money-back guarantee"  a full tuition refund to any graduate who doesn't get a job
offer within 120 days of graduation.
18 However, this aggressive approach may create new problems. It may anger the college's
publics, especially faculty and alumni. Such promotional activities may turn off as many
prospective students and their families as they turn on. Aggressive promotion can attract the
wrong students to the college  students who drop out when the college does not match
expectations. Finally, this approach can create the illusion that the college has undertaken a
sufficient response to declining enrollment  an illusion that may slow down the needed work
on "product improvement," the basis of all good marketing.
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19 Marketing goes beyond attracting more applicants. Colleges may assume that if they only
had enough students, their problems would go away. Yet they may also need to attract the
goodwill and financial support of alumni, foundations, and other donors, a task that cannot be
accomplished by promotion alone.
20 The third group of administrators works in a small but growing number of colleges that
have undertaken a genuine marketing response. These institutions analyze their environment,
markets, and competition; assess their existing strengths and weaknesses; and develop a clear
sense of mission, target markets, and market positioning. By doing this, they hope to develop
the capability to attract the students and other resources they want from their target markets.
III
WHAT IS A MARKETING ORIENTATION?
21 Few educational institutions fully embody the marketing approach. Many people think
adding a marketing function means that the institution has adopted a marketing orientation.
This could not be further from the truth. Most educational institutions have admissions offices,
fund-raising programs, and alumni offices, and they may even include advertising and publicrelations experts on their staffs. They are using some marketing tools, but they are not
necessarily marketing-oriented. What distinguishes an institution with a marketing orientation?
Meeting Customers' Wants and Needs
22 An institution with a marketing orientation concentrates on satisfying the needs of its
constituencies. These institutions recognize that efficiency and good programs and services are
all means or results of satisfying target markets. Without satisfied target markets, institutions
would soon find themselves "customerless" and tailspin into oblivion. The employees in a
marketing-oriented institution work as a team to meet the needs of their specific target
markets.
23 Satisfying target markets does not, however, mean that an educational institution ignores
its mission and its distinctive competencies to provide whatever educational programs happen
to be "hot" at the moment. Rather, the institution seeks out consumers who are or could be
interested in its offerings and then adapts these offerings to make them as attractive as
possible.
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Serving the Long-Term Interests of Consumers and Society
24 Is meeting consumers' perceived needs and wants too narrow an objective for an
educational institution? Probably so. First, students often have long-range needs that they do
not yet perceive. Although students may say that they prefer to "take it easy," their longerrange interest may require not only a diploma but also real mastery of information and skills
that the diploma stands for. The school or college must set the curriculum and standards that
will ensure this. Education also serves the larger needs of society by preparing people to be
productive and carry out their civic responsibilities.
25 Second, most educational institutions have multiple objectives. Students may view the
school as a retail store whose function is to sell them what they want to purchase, but the
school's mission is usually much broader. The mission statement of a church-supported college
may emphasize academic excellence, educating the whole person, and deepening religious
commitment; some students may prefer easy courses, multiple-choice exams, and sleeping in
on Sunday morning. An educational institution must weigh the needs and preferences of
students while preserving the institution's academic reputation and other institutional goals and
commitments.
26 A growing number of marketers see their responsibility to take four factors into account in
their marketing decision making: consumers' needs, consumers' wants, consumers' long-term
interests, and the interests of society. This orientation can be called a societal marketing
orientation:
Alternative Orientations
27 Even though most educational institutions want to be responsive to the needs of their
students and other constituencies, they often get sidetracked by their traditions and institutional
culture. Instead of a marketing (or societal marketing) orientation, they may reflect a
preoccupation with their product (a product orientation) and with efficiency (a production
orientation), or with pushing consumers to select the institution's current programs (a selling
orientation). Here we shall describe each of these alternative orientations.
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28 Product Orientation: Many schools strenuously resist modifying their offerings even (or
particularly) when the purpose is to increase their appeal. Other institutions keep adding new
courses and majors because faculty or administrators like them. In either case, such institutions
show little concern for examining how the course content and teaching approaches are
regarded by current students, employers, and others. This product orientation presumes that the
school's major task is to offer programs that it believes are "good for" its clients. Although
educational institutions should hold high standards of quality, they should periodically test
their assumptions about the suitability and attractiveness of their programs.
29 Production Orientation: Research-oriented university faculty who have been insulated
from dealing with students may balk at teaching needed remedial freshman courses.
Administrators may prefer to maintain the same curriculum and course schedules year after
year because the system is easy to run. They may focus their attention on "running a tight
ship," even if human needs must be bent to meet the requirements of the production process.
Administrators in some large universities act as though they are processing objects instead of
serving people, showing little concern for the educational experiences of individual students.
Marketers describe this as a production orientation, one based on the belief that the major task
of an institution is to produce and distribute its programs and services as efficiently as
possible. Striving to be efficient is worthwhile, but efficiency at the expense of failing to serve
customers' wants and needs is misguided.
30 Selling Orientation: Some institutions believe that they can increase their market by
increasing their selling effort. Rather than developing more attractive programs, they increase
the budget for advertising, personal selling, sales promotion, and other demand-stimulating
activities. A selling orientation assumes that the main task of an institution is to stimulate the
interest of potential consumers in the institution's existing programs and services. Although
these sales-oriented steps will usually produce more interest in the short run, selling effort
alone will prove ineffective if more basic problems are ignored. Increasing the selling effort in
no way implies that the school has adopted a marketing orientation that will generate more
interest in the school in the long run.
31 Educational administrators may find elements of all five of these possible orientations in
their institutions  marketing, societal marketing, product, production, and selling orientations.
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Each orientation has its place, but to implement a marketing (or societal marketing)
orientation, an administrator must clearly differentiate the marketing orientation from those
that emphasize only part of the task  production, product, and selling.
IV WHAT BENEFITS CAN MARKETING PROVIDE?
32 Institutions that understand marketing principles often achieve their objectives more
effectively. In a free society, institutions depend upon voluntary exchanges to accomplish their
objectives. They must attract resources, motivate employees, and find customers. Proper
incentives can help stimulate these exchanges. Marketing is the applied science most
concerned with managing exchanges effectively and efficiently, and it is relevant to
educational institutions as well as to profit-making firms.
Marketing is designed to produce four principal benefits:
33 First of all, marketing provides tools for comparing what the institution is actually doing
with its stated mission and goals. Careful analysis prepares the groundwork for programs to
address the real problems. For example, analysis may indicate that few people are attracted to
a school because its mission and resulting programs are too narrow. Knowing this, the
administrators may decide either to increase public interest in the school's specific mission, or
to continue to serve the smaller number of students who find its present mission and programs
appealing. Marketing helps identify problems and plan responses that will help the institution
fulfill its mission.
34 In addition, in order to succeed, institutions must somehow satisfy consumer needs. If the
institution fails to develop satisfactory programs for its customers  students, donors, and
others  the resulting bad word of mouth and client turnover will ultimately hurt it. Institutions
that are insensitive to clients' needs and desires may find more apathy and lower morale. Such
institutions ultimately find it difficult to attract new students and adequate alumni support.
Marketing, in stressing the importance of measuring and satisfying consumer needs, tends to
produce an improved level of client services and satisfaction.
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35 Furthermore, in striving to satisfy their customers, institutions must attract various
resources, including students, employees, volunteers, donations, grants, and other support.
Marketing provides a disciplined approach to improving the attraction of these needed
resources.
36 Finally, marketing emphasizes the rational management and coordination of program
development, pricing, communication, and distribution. Many educational institutions make
these decisions without considering their interrelationship, resulting in more cost for the given
result. Even worse, uncoordinated marketing activities may completely miss the mark or turn
away the very groups they were designed to attract. Since few educational institutions can
afford to waste their resources, the administrator must achieve the maximum efficiency and
effectiveness in marketing activities. An understanding of marketing can help-in this task.
V WHAT CONCERNS DO EDUCATORS HAVE ABOUT MARKETING?
37 For many people, modern marketing carries negative connotations dating back to Plato,
Aristotle, Aquinas, and other early philosophers who considered merchants unproductive and
acquisitive. In modern times, marketers are accused of getting people to buy things they do not
want or need, even things they cannot afford. Customers are seen as victims of high-pressure
and sometimes deceptive selling. Educational administrators, unfamiliar with marketing,
sometimes question marketing's usefulness and appropriateness for education.
Criticisms of Marketing
38 Some educators abhor the idea of marketing; others are interested but feel that marketing
must be introduced cautiously. Two main criticisms may arise:
39 Marketing is incompatible with the educational mission. Some administrators, trustees,
faculty, and alumni believe that marketing is for profit-making businesses, and that
educational institutions should be "above" marketing. They feel that educational values and
techniques are direct opposites of the values and techniques of business and that the two
worlds cannot and should not be brought closer together. In their view, the purpose of
education is to impart knowledge, analytical skills, and habits of reflection and rationality,
whereas the purpose of marketing  and of business in general  is simply to make money.
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They view marketing as "hard selling" and believe it cheapens education and the educational
institutions that use it.
40 Ironically, most educational institutions engage in marketing whether they realize it or not.
Consider a typical private college. The college has an admissions office whose staff visits high
schools and seeks to attract the best students. The college's development office assiduously
cultivates wealthy alumni in a search for the large gift. The college's public relations people
busy themselves with editors and community organizations to disseminate favorable news and
impressions about the college. The dean of students directs academic and personal counseling
programs and runs extracurricular activities to increase students’ satisfaction with the college.
The alumni office maintains contacts with graduates and provides activities and information to
enlist their support. These and other administrators, faculty, and staff have the responsibility of
sensing, serving, and satisfying different markets, although if asked, they may deny that they
are engaged in marketing.
41 Marketing should not be needed. Even when administrators of educational institutions
accept the usefulness of marketing, they may believe that marketing is unnecessary.
Administrators, board members, and others often feel that people should want the educational
experiences and services the school has to offer. After all, they reason, people "know what is
good for them," and education is good for people.
42 Administrators of publicly supported schools are shocked when legislatures cut their
budgets and voters turn down school bond issues. They may wonder why parents are pulling
their children out of public schools and willingly paying to send them to private schools.
Private-school administrators may wonder why alumni aren't more active in school affairs and
why donations have dropped off.
43 An institution that understands its markets realizes that people's attitudes and preferences
change. Rather than presuming that it will always hold the pride of place once afforded to it,
the institution carries out marketing research in order to continue to satisfy its markets.
THE END
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