A Mutually Beneficial Online Store

The state of the economy and the sheer size of the University of Phoenix community created an opportunity for a new online shopping portal to better serve strategic partners, as well as students, alumni, faculty, and staff. The University Marketplace brings together a community of potential shoppers with vendors representing diverse categories such as automotive, recreational, electronics and apparel. The online shopping portal offers discounted software, for example, just like a traditional campus bookstore might, travel discounts like a traditional alumni association might offer, and a variety of additional merchandise, discounts and services. The University of Phoenix community is nearly 1 million strong, and includes approximately 440,000 enrolled students, 450,000 alumni, 19,459 employees, and 27,047 faculty members, notes Mike Mayor, senior vice president of corporate partnerships for Aptimus, Apollo Group’s marketing arm. The Marketplace is free to users and vendors and the university passes on 100% of exclusive savings to the University of Phoenix community through a secure site available on the intranet. There are currently more than 80 strategic partners that represent thousands of offers and new vendors are being added monthly. “Our goal is to provide great products and services to our network of students, alumni, faculty and staff at highly discounted prices. The University Marketplace is but one example of how we bring value to our University community that goes beyond their degree and is used in their everyday life,” says Joseph D'Amico, president and chief operating officer.

The model for the University Marketplace is dynamic and largely driven by input from users and vendors alike. Mayor says suggestions from students and alumni have led to new partnerships. “It grows organically,” Mayor says. “We really try to embrace the partnerships strategically.” In addition to the online Marketplace, the university features “spotlight” vendors of the month on a University of Phoenix campus. For example, Microsoft Corp. recently visited campuses with the latest Xbox and hosted demonstrations and giveaways. These types of vendor events bring excitement and energy to campuses, while allowing strategic partners to learn more about the university and have exposure to the university community. The goal is to embrace strategic partners as specialists in their field, while providing valuable services to the university community. Thus far, feedback from users and vendors has been overwhelmingly positive, notes Mayor. The user interface is intuitive and easy to use, allowing the university to add new vendors without making the site overwhelming to users. Meanwhile, vendors praise the professional presentation they receive in the Marketplace. By forging new relationships, the university also benefits. “It’s a win for everybody involved,” he notes.

Transformation of Corporate Partnerships

Corporate partnerships are not new to higher education. Businesses are forming strategic relationships with colleges and universities to become the customers of education and help shape specific educational priorities. In the early 2000s, for example, John Deere Corp. partnered with the Indiana University Kelly School of Management to develop an eMBA program customized for a cohort of finance executives at the company.¹¹ Other corporations such as Microsoft Corp. hire student ambassadors to market products on campuses like Boston University.¹² Similarly, the University of Phoenix has been developing student and employee discount programs to deliver discounted products and services relevant to the educational experience since the late 1990s. These discount programs initiated in corporate purchasing and focused on suppliers the university already had an existing institutional relationship with, recalls Patrick Bliss, director of strategic sourcing and procurement at Apollo Group. The first major supplier to sign on to the discount program was Dell Inc. A portal was created for students, faculty and staff, where they could receive discounts on anything Dell sold. A few years later, the university began to work with Microsoft and a re-seller of Microsoft products to offer software at discounted rates, followed by Verizon Wireless and AT&T Wireless to provide discounts on cell phones, wireless cards, and PDAs. Though the university added a few other providers, Bliss says the discount program remained very small because of limited resources.

When Apollo Group acquired Aptimus two years ago, the idea of creating a more robust online shopping place was put into action. Oversight of the program moved from strategic sourcing and procurement to the marketing division. Since the discount program was handed off to Mayor’s department, it was given an identity (University Marketplace) and the university partnered with third-party providers to develop an interface for the intranet shopping site. The University Marketplace continues to carry its initial offerings, with the exception of Verizon Wireless. Products to enhance the educational experience are still a primary focus, and the Marketplace has expanded to include standard household items and products for professionals. 

Based upon its 2007 study of traditional-aged college students, Burst Media concluded that “the Internet is the media to reach college students.”¹³ The size of the University of Phoenix community provides sufficient scale for vendors to offer meaningful discounts and value-added services online. Before the Marketplace was established, Bliss says, the volume of purchases with Dell, Microsoft, and AT&T at an organizational level helped to secure better discounts for students and alumni. “I think we do a very diligent job of merging our institutional purchase volume with our student volumes to maximize discounts for both,” he notes. Bliss and Mayor work in two of the three pillars of the supplier relationship management – institutional purchasing and student/employee discount programs; the third pillar markets and sells educational services. Bliss says past institutional purchasing partnerships have led to some incredible educational partnerships with major organizations and sees the potential for further synergy with the University Marketplace.

Unlimited Opportunities Await the University Marketplace

As the University Marketplace expands and transforms, Mayor anticipates more strategic partnerships in the future that go beyond just a discount offering. For example, the university will soon add an offer from Men’s Warehouse which will provide a 25% discount on men’s apparel. In exchange, the company will write a white paper to be provided for students about how to dress for an interview. By creating more collaborative partnerships, Mayor hopes the Marketplace will help draw in new students from the partner corporations. He says there are big plans for the potential of the Marketplace to be a reflection of and service to the University of Phoenix community. “The partners that we include in the University Marketplace by and large are partners that really embrace education and allow us to speak to their communities about the University of Phoenix and our offerings,” Mayor says. In addition, Mayor says new regional offers are also in the works so users can search by zip code to take advantage of discounts at local retailers and restaurants. He says the goal is to end the year with more than 100 partnerships and double that number next year.

As online shopping and social media networking continue to grow in popularity, colleges and universities have the opportunity to reshape how they deliver valuable services to students, alumni, faculty and staff. Campus bookstores and alumni associations are retooling their models to better serve students. At the University of Phoenix, the University Marketplace provides financial and social benefits to a community of nearly 1 million, and new strategic partnerships could ultimately benefit working learners in the classroom.

1 Green, Kenneth C. Regulating the Bookstore. Inside Higher Ed. May 1, 2009.  Retrieved from: http://m.insidehighered.com/views/2009/05/green.
2 NACS. 2009. Higher Education Retail Market Facts & Figures 2009.
3 NACS. 2009. The State of NACS: Transforming the Industry. Retrieved from: http://www.nacs.org/public/nacs/NACSAnnualReport2009.pdf.
4 The University of Arizona Alumni Association. 2009. History of Association. Retrieved from: http://www.arizonaalumni.com/About/history.shtml.
5 The University of Arizona Alumni Association. 2009. Membership Perks & Services. Retrieved from: http://www.arizonaalumni.com/membership/benefits.shtml.
6 Stuart, Reginald. Reinventing Alumni Associations. Diverse Issues in Higher Education. July 23, 2009. Retrieved from: http://diverseeducation.com/artman/publish/article_12745.shtml. 
7 Jan, Tracy. UMass-Amherst could drop alumni group membership fee. The Boston Globe. Nov. 1, 2009. Retrieved from: http://www.boston.com/news/local/massachusetts/articles/2009/11/01/umass_amherst_could_drop_alumni_group_membership_fee/
8 Marketing Charts. 2007. Survey: To Reach College Students, Brands Need to Use Internet. Retrieved from: http://www.marketingcharts.com/television/survey-to-reach-college-students-brands-need-to-use-internet-1389/.
9 Marketing Charts. 2008.  First Time Ever: Multi-Channel Holiday Shoppers Prefer Web to In-Store. Retrieved from: http://www.marketingcharts.com/direct/draft-first-time-ever-multi-channel-holiday-shoppers-prefer-web-to-in-store-6380/.
10 Marketing Charts. 2009. Half of ’09 Holiday Shoppers to Buy Gifts on Web. Retrieved from: http://www.marketingcharts.com/interactive/half-of-09-holiday-shoppers-to-buy-gifts-on-web-10832/
11 Meister, Jeanne C. The Latest in Corporate-College Partnerships. T&D Magazine. October 2003.
12 Schweitzer, Sarah.  Building a buzz on campus: Companies enlist students to pitch products to their peers. The Boston Globe. Oct. 25, 2005. Retrieved from: http://www.boston.com/news/education/higher/articles/2005/10/24/building_a_buzz_on_campus/?s_campaign=8315.
13 Marketing Charts. 2007. Survey: To Reach College Students, Brands Need to Use Internet.