Months and Terms

I have been receiving quite a lot of feedback from my recent post about enrolling the Udacity’s Data Analyst Nanodegree. Unexpectedly, even prospective students contacted me out of the blue asking for some advice on whether they should enroll or not, which totally came as a pleasing surprise.

One of the things that recurrently showed up during these conversations was the fact that I deliberately sticked to the monthly structure rather than switching to the updated term model, given the opportunity.

This is actually a great question, but one that I am not going to answer here. I will instead focus on why I think the term-based structure is a superior approach when it comes to incentivize student retention. On top of that, I will also drop some thoughts about bridging the gap between offline and online education and how to replicate the social aspect of in-person programs into online experiences.

From Months to Terms

All Udacity programs used to be offered as a monthly subscription. The student paid each month and was presented with an incentive to get to the "finish line", thus decreasing drop outs. The incentive was no other than: get half of your money back if you complete the program in less than a year.

It is a clever approach because it seems the student would be primarily driven to finish as soon as possible since money is at stake. The sooner the student graduates, the less money will end up paying. Although after taking a closer look at the issue — but also having gone through the experience myself, I would argue that this is not how incentives ultimately work, at least when it comes to education.

A lot of research has been already published around the topic, but long story short, the takeaway is that extrinsic incentives (getting some of your money back), only work to a certain extent. Udacity’s money back strategy is a paradigmatic example of these dynamics at play. Getting your money back is a perfectly reasonable motivator, but when dealing with hard, creative and non-repetitive tasks, there is something more at stake: we just stepped into "unreasonable territory".

Here is precisely where intrinsic motivators kick in and this is why a term-based model is better suited to recreate the conditions for them to thrive.

A Time Constraint

On the other hand, term-based programs provide something far more valuable than getting your money back: synchrony and a time constraint. Synchrony is all about the sense of community and sharing the learning experience with other students. The time constraint helps handicap the program from a time perspective.

While the monthly model places an imaginary, soft deadline of twelve months to get your money back, it doesn’t set a specific point in time where the program ends. In other words, as a student you can get stuck, indefinitely paying every month until the end of time, without having graduated. The term structure instead delivers a much clearer time framework, because you either graduate within the given term, or you don’t.

A healthier relationship comes out from the fact that if you don’t commit to the given time frame, you won’t graduate. Which ultimately means you’ll lose all your money. A clearer, more transparent and of course, far more effective value proposition.


Finally, and most important, a term based approach brings synchrony to the cohort and the sense that you belong to a larger community, aka. peer pressure.

During my time enrolled at the DAND I felt lonely. I knew more students were simultaneously going through the same experience, but I had no way to "feel" it. Despite there was a dedicated Slack community aimed to bridge this gap, overall, it felt scattered and it was difficult to cut through the noise. Each student was in an entirely different stage of the program and the sense of "class" was nowhere to be seen. You were absolutely on your own.

Terms improve, to a certain degree, these dynamics. I don’t have Udacity’s exact graduation numbers, but the fact that each term starts at a fixed schedule must help students feel closer to the rest of the group, sharing questions, struggles and most important, aligns them around the vision of graduating.

Despite trying to recreate the social aspect of an offline experience through an online program remains extremely challenging and something nobody, as far as I know, has entirely figured out.

Online experiences are exclusively focused on having cutting-edge curriculums, the latest and greatest materials, but still missing the point on how "the 99%" of people learn. These programs are truly amazing, but sadly targeted to the "1%".

Because at the end of the day, life will throw at you a shitload of distractions and other priorities. The lack of offline attachment to other students and teachers make these programs the perfect candidates to be the first thing you will set aside.

Yet this is a separate discussion, way beyond the scope of this post.

Even though, I do believe a term-based program is a step in the right direction, but still far from the place where social dynamics, arguably the most powerful of the incentives — specially for obligers, can kick in.