Since 2000, the Department of Defense has been paying college costs of up to $4,500 annually for active members of the military. The availability of these funds are leading institutions of higher education to compete for students who qualify for this special funding. A recent Businessweek article pointed out that over $3 billion has been spent on this program in the past 9 years.
Daniel Golden notes that for-profit colleges have managed to enroll nearly 1/3rd of military students. The big advantages that online, for-profit colleges have are ‘flexibility and options’. These schools also accelerate learning programs to allow students to quickly complete degree programs and sometimes accept transfer credits for classes in which students earned poor grades. This practice has led critics to question the quality of these degree programs but there is no shortage of students interested in enrolling.
Golden points to several policy changes made by the Defense Department since 2000 which are leading to increased enrollment in the military market. The Department pays tuition assistance to regionally and nationally accredited colleges and now pays 100% of tuition costs up to $250 per credit. Competition for students interested in these programs and the associated government-funded tuition is so fierce that schools try to outdo each other by offering bonuses such as free laptops or textbooks.
This trend is also causing a major shift in the military education market from traditional to online classrooms. Online courses are increasingly popular with active duty students because they can complete their studies even if they deploy. Nearly 2/3’s of active-duty students who choose to study do so online. Several large operators have emerged in this market including American Military University with 36,772 active-duty students, Columbia Southern with 9,582 students and TUI with 7,665 students.
Some for-profit colleges have tried to market themselves on military bases but those doors are starting to close. Still, many active-duty personnel are eager to advance their education in hopes of a future career. As schools reach this pool of students, look for for-profits to shift their marketing to other strategies such as online or via direct mail.[source: Golden, Daniel, Online Colleges Surge with Marketing to Military, Businessweek, 12.15.09]