The concept for this post has been swirling around in my head for more than six weeks. After a lunch with a Director over Instructional Innovation last week, the parallels came fully into focus.
So what are Bricks and Clicks and how does it apply to Higher Education? In 1999, the Co-CEO of Charles Schwab, David Pottruck, coined the phrase to reflect a business model that integrates offline retail with a modern online presence.
On the surface, this strategy seemed like a logical push as there were many explicit strengths to this business model. The most prominent being the ability to leverage brand and increase revenue for the organization without incurring the fixed costs of opening additional retail locations. In addition, the retailer was able to leverage the long tail, which is a retailing strategy that focuses on selling a greater number of unique items but in smaller quantities. This allowed them to offer an expanded assortment of goods without physically distributing those goods to each “brick” location. Finally, there was the ability for the consumer to buy online and return items as necessary to a physical store. However, like most channel augmentations, the model also had some unintended complexities.
The most pressing issue of online expansion mandated the need for new technologies and capabilities. Retailers needed to be able to merchandise vast assortments of additional SKU’s and expand their presence to fully embrace an online strategy. Methods were also required in the physical store for customers to order from the increased product breadth. There was also significant investment around distribution centers and introducing single unit economics and distribution. New distribution methods were built and new customer service centers were staffed. The service teams accessed a far more complex software to accommodate a bricks and mortar operation. Returns in the physical location also created the need for centralized systems to accommodate the customer in both the physical and online world. So, what are the results?
The strategy has worked extremely well for the retailers who had a strong focus on distribution software technology and were interested in growing their business. For example, Walmart and Target have effectively leveraged this strategy and Home Depot continues to improve on it. Others struggled or folded. To further complicate the issue, all bricks and mortar operations were competing with pure-play companies like Amazon who excelled in technology innovation and leveraged existing unit driven distribution systems in place like FedEx, USPS and UPS.
Now fast forward to the higher education market of 2012. Some of the parallels are striking. First, universities are trading heavily on their brands and spent the last two decades attracting students by constructing amenity rich campuses. This increased infrastructure has placed tremendous financial performance pressure on both private and public institutions. The marketing has created demand but has pushed required courses into large lecture halls. This leaves the institution in a dilemma. Do they build more physical buildings and lecture halls or do they leverage their brand and the abilities of the internet to create a blended/hybrid delivery system? Does this bricks and clicks solution address the needs of these students? What is the outcome? Do the students achieve equivalent subject level mastery as the traditional class lecture?
The early data being reported, almost daily in educational journals, supports equivalent student outcomes. In many cases, there is also a strong student affinity to hybrid delivery. The preference is also confirmed by institutions who offer both an in class version of a course and a hybrid course augmented with lecture capture’s participation, and assessment/collaboration technology like Via Response. A recent project Via Response was involved in demonstrated a 7:1 preference for hybrid delivery. What is interesting is that student preference is extending into smaller sections of more advanced course material. In all cases, the student wants the choice to attend physically some days and remotely live or asynchronously on other days. That is a topic for a subsequent post.
Second, the long tail discussed earlier allows for very specialized courses to be taught to a much broader audience of students. The explosion of MOOC’s (Massive Open Online Courses) serve as a brand extension of the most prominent universities in the country. MOOC’s center around very advanced course material that requires a population of tens of millions to fill a class of 2500. Prestige is not lost for the students who are actually enrolled at the university and in the course. In fact, the prestige may even be enhanced as the extended classroom includes hundreds of passionate learners who could never attend the university but wish to participate. I believe, ultimately, that the extended open population will add value to the course as technology tools advance. In a worldwide system, leading authorities can co-teach in lecture halls with students and allow students to join from anywhere. The barriers of space and time have been effectively obliterated.
Of course, education has also evolved with the University of Phoenix and others being the Amazon of education. The online only delivery model is here to stay and is a viable option for many adult learners. So, where does this leave us? What are the differences? Although no one is sure, there is no doubt that we can look at the 12-year expansion of retail delivery and apply it to education.
Like retail, higher education delivery models will continue to proliferate. Technology will be at the forefront of this expansion as the construction of physical buildings slow. The buildings that are constructed will feature multi-media and advanced technologies to bridge remote and live audiences as well as provide a strong suite of tools for asynchronous learning that mimic the live classroom experience.
It is my belief that students still crave connectedness. Students want a physical campus home and brand but also want flexibility. This bodies well for blended learning and it is Via Response’s mission to help. The world’s most complex transaction is the transfer and creation of knowledge. One could argue that education may be even better suited to a bricks and clicks model than the retail industry. Only time will tell!
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COO Via Response Technologies