A recent Businessweek article, “As Applications Flag, U.S. B-Schools Hit the Road,” discusses the implications of the new five-year GMAT test taking low (8% fewer tests taken in 2011 than in 2010). Not surprisingly, the number of U.S. applicants applying to U.S. b-schools is also on the decline with 10% fewer than last year.
In response to these declines, U.S. b-schools are increasing their recruiting and advertising efforts. One reason why they are so quick to “hit the road” and ramp up their campaigns is so that they improve their selectivity rankings. When fewer applicants apply to their programs, a higher percentage of applicants get accepted, thus making them appear less selective. Top schools want to maintain their edge as being highly competitive and exclusive.
Implications for MBA Applicants:
- These numbers mean opportunity for MBA applicants. Not go wild craziness, but opportunity nonetheless. I am not suggesting that you apply only to the elite programs when your grades, work experience, and test scores are strictly subterranean. I am suggesting that you should stretch a little in your school choices. Apply to programs where you are competitive and that support your goals (see the Accepted Positioning System) according to the available data (which reflect the past), and then add a program or two that are unlikely acceptances, but that you really, really want to go to. Particularly if these “stretch” programs are outside the top 10, your chances of acceptance at one of these stretch programs are probably much better than they were last year – or any time in the last five years.
- Yield at programs outside the top ten will decline. Expect to see more movement on waitlists this year. If fewer applicants submit more applications, as the results become known, schools will experience more declined offers, more “melt,” and lower yield. They will be forced to turn increasingly to their waitlists.
- If the volume decline continues, expect to have more financial aid offers as schools attempt to seal the deal with accepted applicants. At least that’s the silver lining for law school applicants following the law school market implosion.
It’s a good year to be applying to business school.