Illustrations by Rocio Egio
All decisions and initiatives at Winebrenner Theological Seminary emerge from our mission and strategic priorities, and that includes tuition pricing. Our journey to a flexible strategy that would meet changing student needs while also fulfilling God’s kingdom purposes has been several years in the making, and still unfolding.
One of the common refrains you’ll hear in response to tuition pricing is related to some form of comparison to the “market,” which typically means how one school’s tuition compares to another’s. While the market approach can be designed to serve students well, it also can lead to a complete disconnect between the price a school is charging its students and the actual costs involved in educating that same student.
In February 2021, Winebrenner shifted to a model in which students are charged a flat $300 month for tuition. This price permits students to enroll in any courses that are offered, and for which they are qualified. There have been three distinct phases in how Winebrenner approached tuition pricing, with “subscription” tuition the culmination of a multi-year journey.
A competitive model
Prior to 2018, Winebrenner’s tuition was based entirely on benchmarking peer schools and the tuition that was posted on their websites. For example, in an analysis of 10 peers the decision would be to set tuition no higher than a certain number on the list (e.g., no higher than fourth). From a competitive standpoint, we could then say we weren’t the most expensive among our peers. However, as the downsides became more obvious (the comparisons might not take into account fees not published on websites, for example) we intentionally moved away from this approach. It also was clear that peer comparisons reinforce a competitive mindset that works against the idea that we are in unity to fulfill God’s kingdom purposes through theological education.
Clarity, alignment — and a leap ahead
Our mission-driven decision to shift our tuition pricing model began by designating a goal for tuition revenue in our budget, and dividing that number by the number of students we had established as our goal for the upcoming term.
That enabled us to establish a “sticker price” for tuition that was a step closer to a the actual costs for a Winebrenner education, and provided more clarity for current and prospective students. Our Board of Trustees affirmed this strategy in May 2018.
A little over two years later, we began experimenting with a recurring payment plan. Through the Economic Challenges Facing Future Ministers (ECFFM) initiative funded by Lilly Endowment, Inc. and administered by the Association of Theological Schools (ATS), Winebrenner was able to clarify and prioritize intentionality about lowering the costs of education for students and lessening their dependence upon student loans.
Simultaneous with this growing understanding about student educational costs, I also was immersed in researching what it means to prioritize platforms over pipelines when it comes to collaborative relationships.
Winebrenner Theological Seminary exists to equip leaders for service in God’s kingdom. Our platforms, then, involve collaborative relationships, contextual education, and the creation of communities of learners in our ongoing efforts to fulfill our mission. These were emerging as mission priorities that would shape how we invite students to join our community.
Then, the full impact of COVID-19 hit. As soon as we became aware of the funds provided by the federal government through the Coronavirus Aid, Relief, and Economic Security (CARES) Act, we prioritized students and determined we would test subscription-based tuition pricing in the 2020-21 academic year. We were aware of other seminaries using this pricing model and had held previous internal discussions about what it could look like, which allowed us to accelerate our plans as soon as the CARES funds were received.
The cost of tuition
Subscription-based tuition pricing obviously reflects our institutional mission. It does not – and should not – preclude consideration of economic assumptions and implications. One question that quickly emerges when a school determines that a subscription pricing model may work in their specific context is “how much should we charge for our monthly tuition?”
All mission decisions are built upon certain financial assumptions, and subscription-driven tuition is no different. It reflects how the cost of education is priced and valued and, as one of our main revenue sources, has a major impact upon our overall operations. By shifting to a “mission-based” tuition model, I am suggesting that it allows us to maximize mission fulfillment.
Pushing this point further, just because something is mission-based doesn’t mean it lacks economic underpinnings. Jeff Jarvis, author of What Would Google Do?, writing about the strategies of web-based networks such as eBay, Craigslist, Facebook, Amazon, and Google, states: “They charge as little as they can bear [which is] how they maximize growth and value for everyone in the networks.” In one company he found that they “extract the minimum value from the network so it will grow to maximum size and value – enabling its members to charge more – while keeping costs and margins low.” In short, when a monthly payment plan is combined with a strategy of collaboration, the lowest possible price allows for maximum growth of a collaborative network.
During the 2020-21 academic and fiscal years, Winebrenner tested a $300 monthly payment plan that allowed us to gather data-points that informed conversations in real time.
Based upon our experiences, here are some items to consider when contemplating how a recurring payment model can work in another context.
Your “industry:” Are there other organizations who are using the subscription model? If so, how much are they charging? In the case of Winebrenner Seminary, there are only a few seminaries working with a subscription model, with a range of $300 to $750 a month. The large difference in pricing is directly tied to the unique missions and strategies of each school.
Mission and strategy: Are there unique points of mission or strategy that a subscription model complements? Are there specific goals you want to achieve? A recurrent payment model works well in Winebrenner’s context with a strategic emphasis on collaboration. While there is no competition within God’s kingdom, there are market forces that assist in decision-making within theological education. Remaining flexible is critical. For example, our “per credit” tuition is currently $525 – as we’ve explored possible monthly price points we want to preserve the ability to say “enroll in our monthly payment plan and you will save even if you take only one course.”
Current and future possibilities: How this is conceived from its inception makes a difference. For example, headcount could be different than subscribers if a curricular approach is created that allows students to subscribe to services, but not be actively enrolled in courses.
Timelines: How long will you remain at this price point? What factors will be considered if you think you might change the monthly subscription fee? It’s likely that you’ll find the amount you charge per month may, itself, become an aspect of your “branding,” so be careful to resist frequent changes. Attempting to change an identity too frequently can create uncertainty for stakeholders.
I find I am now having three types of conversations each week, resulting from Winebrenner’s dual commitments to low-cost pricing and platform thinking.
The first is with Church congregations that are starting leadership institutes or gathering a cohort of students.
I’m also speaking frequently with other seminaries interested in partnering.
And finally, undergraduate schools seeking to serve their own students with graduate education options.
It is important to remember that a recurring subscription payment model rests at the convergence of Winebrenner’s unique mission and strategy; while we have benefitted from learning from others who have chosen a similar path, we have arrived at our own unique components to accomplish our mission.
These conversations, and our positive experiences at Winebrenner, indicate that our path has the potential to open new vistas for others.
Please receive these as starting points for conversation. A change like this does create some risk for staff. As Tien Tzuo highlights in Subscribed, the process of transitioning to a subscription model likely will lower revenue while increasing users. A well-planned approach will balance out in the end.
Finally, in God’s economy (which often runs counter to a capitalist, market economy) we all can flourish. There exist enormous financial resources for our discrete missions.
My belief is that a subscription model is one way that seminaries can structure themselves by taking appropriate risk to enhance the work of God’s kingdom.