New GMAT Undergraduate Pricing Initiative

featured_money@wdd2xIn an effort to attract more undergraduate test takers, GMAC is rolling out a tiered pricing structure for students who register for the GMAT before June 1, 2016 and complete the test by December 31, 2016.

While targeted undergrad outreach efforts and undergrad discounts on the GMAT aren’t new to GMAC, the scale and diversity in pricing is. (GMAC piloted discounting test registration fees a few years ago on select U.S. undergrad campuses as part of a partnership program with select test prep companies and universities.) But like any good sale, is the deal too good to be true?  Let’s take a closer look at the offers (and fine print):

Both options feature discounted registration fees, but limited score report options and more expensive additional score reports (ASRs). ASRs are currently $28 per report.

Option 1: $150 registration fee, No initial score reports (ASR: $50 each)

Option 2: $200 registration fee, 2 initial score reports (ASR: $50 each)

Option 3: $250 registration fee, 5 initial score reports (ASR: $28 each)**

**Current GMAT pricing

Keep in mind that the average GMAT test taker submits 2.7 score reports with their business school applications so GMAC is hoping to recover some of those initial cost savings down the road, but yes, that $50 ASR fee can create a little sticker shock.

So is there an upside to any of these options?

For students who aren’t thinking about grad school anytime soon and, more importantly, have time to prepare for the GMAT (think second-semester Seniors or students with a lighter course load), Option 1 does have a few merits. Because these students don’t have grad school or specific programs on their radar, the lack of score reports isn’t an issue. And since scores are good for five years, it gives students a chance to bank a good score early while not shelling out the full $250.

This is the population that GMAC is targeting with this promotion because the reality is most students will end up sending score reports to multiple programs. However, if the cost of an ASR increases down the road, at least this locks in a lower test fee and possibly a competitive ASR fee.

Students who are applying to a graduate program now (think Juniors or Seniors looking at a pre-work-experience programs) should definitely consider Option 2. Since these students already know which program they’re aiming for, the two free score reports at the test center are a bargain (and ultimately save the student $50).

What isn’t mentioned on the website but should be considered is the current GMAT registration fee of $250. This fee hasn’t changed in over a decade, and while GMAC hasn’t made any announcements about a price hike, it’s unreasonable to think that it’ll remain $250 forever. The odds of the fees increasing in the next  5- 10 years? Hard to say, but there’s likely some merit in locking in a lower priced test.

When you examine Option 3, or the current GMAT standard, you should also look at the GMAT’s primary competitor, the GRE, which is a more widely recognized brand at the undergrad level. ETS just increased GRE fees in the U.S. from $160 to $205 in January of 2016 (ETS does offer a reduced fee certificate to undergrads who meet certain criteria which reduces the cost by 50%). So by offering a variety of pricing options, GMAC is making the GMAT more financially competitive with the GRE.

Regardless of whether you take the GMAT or GRE, Veritas Prep is committed to helping you prepare to do your best on test day. You can find additional information about the GMAC tiered pricing here and information on Veritas Prep’s GMAT prep offerings here.  We also encourage students to sign up for one of our free online GMAT seminars, and to follow us on FacebookYouTubeGoogle+, and Twitter!

By Joanna Graham