Having the right product mix for your continuing education or extended learning division is now more important than ever. You cannot just offer what you “think” will work, but instead you must offer what you “know” will work. With limited promotion resources, it is critical promotion dollars get spent on the offerings with the best chance of generating registrations and/or revenue.
When thinking right product mix, you must be thinking not just in terms of the classes/events, but also the market segments served and the delivery methods utilized. Diversity is critical as you strive to reach as many people as possible.
It is the responsibility of a class/event programmer to select repeat offerings, as well as determining what new offerings to list. Thus the importance of allowing class/event programmers the time to do the needs assessment, research, modeling, and surveying required to make smart decisions.
The following are strategies and benchmarks to consider when working to get the best product mix possible.
- Your overall continuing education organization is a unit or department supported by divisions such as community education, continuing professional education, and corporate education or contract sales. Within the divisions there are categories of programming supported by subcategories. So within community education Arts may be a category supported by multiple subcategories such as Dance, Cooking, and so on. Ideally a division should have 4-7 categories and each category should have 4-7 subcategories.
- 20% of what you offer each year must be new. New is defined as brand new or redesigned.
- 30-50% of what you offer new will cancel the first time out, but by the third time listed the offering should generate the needed number of registrations to cover production/delivery costs. If not, it should be eliminated or redesigned.
- No market segment, product area, or delivery method should generate more than 30% of your registrations and/or revenue. You want to have a balanced portfolio not dependent on one or more big winners.
- Understanding the operating margin (revenue – direct costs) of your individual offerings, divisions, categories, and subcategories is important. Normally you do not want to have an operating margin of less than 40%, although there may be programming such as children’s programming with an operating margin of less than 40%.
- There is a difference in offering new classes/events and offering new initiatives. A new initiative is a new product area not presently being offered, a new market segment not presently being reached, or a new delivery method, not presently being utilized. One new initiative a year is ideal for most continuing education units.
- Understanding the market potential and market share of the audiences you are trying to reach is critical. You want to grow present market shares, but before utilizing too many resources, you want to know there is enough potential.
- The most critical statistic in continuing education is repeat rate, the percentage of people repeating from one time period to the next time period as a percentage of the first time period. The higher your repeat rate, the better growth and profitability. So you must be programming to get existing customers to repeat.
- Ideally you want to be able to target your programming to one or more market segments instead of just listing your offerings in a general catalog and hoping people who might be interested see the offering. Thus the importance of having names you can market to, either in your database or rented.