Update Jan 2012: This was originally an article comparing the benefits of a GMAT score of 750 vs. a GMAT score of 700. However, Google has ranked this page #1 for “gmat score distribution”, so if you have arrived here seeking that information, here it is:
As of January 2012, the median GMAT score is 540. The 90th percentile score is 700.
The median GMAT quant score is 39. The 90th percentile quant score is 50 (that’s very difficult to get). Although you can theoretically score up to 60 on quant, nobody really scores higher than a 51.
The median GMAT verbal score is 28. The 90th percentile score is 40. Again, you could theoretically score up to 60 on this section, but I’ve never seen anyone score higher than a 46.
Now back to our regularly schedule article:
The popular perception among MBA applicants is that a GMAT score of 700 is the magic number for acceptance into a top-ranked business school. Many applicants aren’t comfortable until they have the magical number of “7” in the hundreds digit of their score. However, you may be wondering if an even higher score – a 99th percentile score – will differentiate you from the other applicants to top MBA programs. Increasing your score from a 700 (94th percentile) to a 750 (99th percentile) may require additional study time of anywhere from 20-50 hours, and you may wonder if it’s worth it.
To answer this question, I began with the data published by the top-ranked schools. It’s a bit hard to compare, but it’s a start. At Harvard, the middle 50% score range of the most recent incoming class was 700-760. At Stanford, the median GMAT score is 730. Finally, at Wharton, the average score (which may differ from the median) was 715. From these numbers, it appears that admissions officers at these schools put a slight premium on 99th percentile scores.
Next, let’s go a little further to see just how big the advantage is for GMAT scores of 750 or higher. For this analysis, I used data published by the Kellogg School of Management at Northwestern University. In 2009, Kellogg had a total of 5,795 applicants, and 689 students enrolled. That’s an 11.8% enrollment rate.
Now here’s a key point: the enrollment rate differs from the acceptance rate. Not every student will accept an offer, so adcoms have to admit more students than will actually enroll. These two figures are related by what is called the yield – the percentage of students that accept their offer. The most recent data I could find for Kellogg indicates their yield is 57%. This means that 1,208 students were actually given offers in 2009, an acceptance rate of 20.8%.
Kellogg is kind enough to give us the GMAT score distribution of their applicants, as well as the distribution of the students who actually enrolled:
The data in this second table indicates that you have a 29% chance of admission with a 750+ score, as compared to a 21% chance of admission with a 700-740 score. Now here’s the kicker: this table assumes a flat 57% yield across all GMAT score levels. However, this may not be an accurate assumption. The adcom at Kellogg knows that if they extend an offer to a <640 scorer, that applicant is much more likely to accept than a 750+ scorer.
In other words, the yield for <640 scorers is much higher than the yield for 750+ scorers. A 750+ scorer will likely be weighing admissions offers from a number of different schools, whereas a <640 scorer has a very high chance of accepting the offer to Northwestern. As a rough estimate, the yields may look something like this:
<640: 80% likely to accept
650-690: 60% likely to accept
700-740: 50% likely to accept
750-800: 30% likely to accept
This means that the advantage of scoring 750+ is probably even higher than indicated in the second table.
Of course, the GMAT is but one part of your overall application. The important question for an MBA applicant is: is it worth it spending the extra time to reach a 750+ score, or spending that time on the other parts of your application? The answer, of course, is “it depends.”
The GMAT continues to persist in MBA applications because it’s the only standardized metric for adcoms to compare students from different backgrounds. However, it is only one part of your overall application. An admissions officer at UCLA Anderson writes,
Beyond the [GMAT] lies such qualitative measures as leadership and teamwork skills, managerial experience, initiative, ability to learn and growth from mistakes, introspection, ability to articulate clear reasons for an MBA and career goals going forward, contributions (to school, work, and/or community), etc. It is here that the bulk of time of applicant evaluation is spent. Although less quantifiable dimensions than the GMAT, they are equally important.
My takeaway from the above quote is that the incremental effort to boost your GMAT score is better spent working on your essays, career, and extracurricular activities. If you start your MBA application process early enough (January of the year you are applying), you should be able to make significant and demonstrable progress in these areas. Once you reach a GMAT score of 700+, your other strengths will differentiate you from other applicants. A comment from a GMAT forum:
I would think that the law of diminishing returns kicks in after a while. If you’re not good enough for them at 730 then what makes you better at 750? GMAC says that scores can vary by as much as +/- 30 on any given day. Basically, if you’re a 720 scorer you could go as high as 750 and as low as 690 just based on the variability involved. Even HBS Admissions Director Dee Leopold says that once you get over 700 you have “checked the box” for GMAT.
For those wondering how to get accepted into an elite school with a below-average GMAT score, I recommend researching a phenomenon called the Superstar Effect. The Superstar Effect proposes that if you are able to distinguish yourself enough to become a top expert in a particular field, you can bypass some of the traditional admissions criteria (GPA, GMAT, etc.) Students that are admitted to elite universities with below-average test scores often fall into this category.
Keeping the above in mind, a GMAT score of higher than 750 can definitely come in handy for two things:
1. It may get you a partial or full scholarship at some schools. Usually, these will be schools ranked in the second tier or lower. However, if you are smart enough to score a 760 on the GMAT, you probably also know that an MBA from a second-tier school is worth much less than an MBA from a top-20 school. So, the savings on your up-front tuition investment must be measured against the possible future benefits you are giving up by attending a lower-ranked school.
2. It qualifies you to teach the GMAT for a test-prep company that requires you have a 99th percentile score. These jobs can be quite lucrative; however, they are also very competitive. You’ll still have to go through the interview process and compete against other 99th percentile scorers, some of whom may have more teaching experience. Also, I don’t imagine you are applying to business school with the hope of teaching the GMAT.
Ultimately, whether to spend the effort to achieve a 99th percentile score is up to the individual applicant. While the raw numbers indicate that 750+ scorers are favored over 700-740 scorers, the incremental effort to boost your score may be better spent elsewhere.
Author: Matthew Kirisits.