Patron Loyalty
A Love Story
Jill Robinson
President & CEO
Copyright © 2014 TRG Arts
All Rights Reserved
People
Your Patrons
Patron
Relationships
Revenue from
Patron Relationships
Vancouver Recital Society
What We Do
Patron Results
1. Consulting
Capacity building for sustainable growth
2. Data & Analytics Services
Aggregation,...
Today’s Case
Next Wave Theatre Co.
1. Major regional theatre
Built on an amalgam of TRG clients
2. Real issues. Real situa...
Copyright © 2014 TRG Arts
All Rights Reserved
Patron Loyalty
Background and Context
TRG R&D
Superlative Growth
REVENUE RISK/OPP
% of Patron Revenue
How much do patrons contribute?
• Ticket sales
• Subscriptions, memberships, donation...
Growth/decline
In patron database?
% of Revenue
derived from patron consumption?
% of Patron Households
active in past two seasons?
ROOT CAUSES
That Impact Patron Revenue
Alignment around realities
• Art form
• Market
• Current operational practices
• Cu...
ROOT CAUSES
That Impact Patron Revenue
Committed time to align
• First step in process
• Artistic, executive, board leader...
STOP DOING
Means: Make Choices
Bold leadership.
• Insist on alignment
• Ensure accountability
• Saying “no” or not now
Foc...
Data?
Data Dazzles!
1. Big Data
2. Analytics in the field today
3. Data Stewardship
Data Stewardship
What Leaders Must Do
1. Value the organization’s data
2. Promote a culture that values data
3. Dedicate a...
Patron Behavior
Measure to manage
1. Size of database?
2. Growth or decline in database?
3. How recently have HH been acti...
Measuring Loyalty
Loyalty Metrics
1. Strong relationships = greater, lasting
revenue
2. RFMG (recency, frequency, $$$, >)
...
Measuring Patron Loyalty
Integrated Analysis
.1% HH
11% revenue
Super Advocates $40,000
Advocates $4,000
7.9% HH
43% revenue
92% HH
45% revenue
Buyers $527
Tryers $48
...
.06% HH
39% revenue
Super Advocates $14,968
Advocates $2,375
1.6% HH
13% revenue
98% HH
48% revenue
Buyers $724
Tryers $41...
1% HH
74% revenue
Super Advocates $51,004
Advocates $4,256
3% HH
8% revenue
96% HH
19% revenue
Buyers $875
Tryers $236
Loy...
Loyalty: presenting/orch case
What Makes a Super Advocate?
Deep, consistent philanthropic activity; single ticket buying
What Makes an Advocate?
Performance attendance, less consistent donation activity
What Makes a Buyer?
Large group, active ticket buyers
Who are Tryers?
Huge portion of patrons; Very little loyalty
Behavior Over Time
Longitudinal Trends in Loyalty
2008-12 2009-13
.22%
418 HH
3.74%
7,161 HH
96%
183,829 HH
.26%
497 HH
3....
Copyright © 2014 TRG Arts
All Rights Reserved
Patron Loyalty as
a Love Story
Purposeful cultivation of
people’s passion for the art form that
builds a relationship resu...
Measuring Engagement
Loyalty Metrics
1. Strong relationships = greater, lasting
revenue
2. RFM (recency, frequency, $$$, >...
Donors and
consummate
loyalists
The magic
of “and”
From 1st time to
second or last time
to NOW
4 out of 5 new patrons leave…
and never come back.
Introduction:
The Blind Date
1. Tell me what you look like
They must be able to find you.
2. Welcome packet via email
Maps...
Chapter One:
First Date
1. Get the phone number!
You must be able to contact them again
2. Then, ASK for the second date
P...
4 year retention study
New buyers
SRT achieved second
date in same season
TRIPLED retention rate
Revenue kept growing.
Mor...
Seattle Rep
Starting with the 2nd date
Year 1 Offer: same-season ticket offer ONLY
Nothing else.
Year 2 Offer: 3 plays for...
Case Study:
First Timer Cultivation Group: Four-Year Study
Case Study:
First Timer Cultivation Group: Four-Year Study
Case Study:
First Timer Cultivation Group: Four-Year Study
Seattle Rep Case
Key Points
1. Retention is a worthy discipline
Requires focus
2. Asking for the second date
THE right nex...
Ideas for 2014-15:
• Reactivation
• First-timer Orientation
• Second date
Same
Format
Each
Time
Calendar
Driven
Offer
K.I.S.S
Principle
Ideas for 2014-15:
• Reactivation
• First-timer Orientation
• Second date
Donors and
consummate
loyalists
The magic
of “and”
From 1st time to
second or last time
to NOW
Chapter Two:
The Second Date
1. Don’t ask them to marry you yet
The RIGHT next step
2. Take the relationship “to the next ...
Next Step: Reactivate
Message: “Try us again
THIS way”
How? Treat them like a
valued patron...or, a first
timer.
Next Step...
Chapter Three:
Courting & Commitment
1. What’s next for our multi-buyers?
Small package or series
2. Make the ask
Ask for ...
GET MORE ENGAGED
Upgrades to grow loyalty
Focus: Harness the power of “AND”
Include: All organizational assets
• Multiple ...
Add a donation
Renew Flex to Full
Renew & Upgrade
Renewal
Is Not Enough
Challenge: three theaters; three series
• Grow mid-sized series subscriber base
Strategies
“Premium Subscription” adds mid...
Upgrade offer for every
renewing subscriber
Renewing Subscriber
Segments - what they have
now
NOTES
CURRENT 1213
PRICE for...
3,012 new Premium Subscribers (14,250 total)
21% of all subscriber units
30% of total subscription revenue
119% increase i...
Renewal
Is Not Enough
Chapter Four:
So happy together
1. Sustained support, year after year
Active donor/investors
2. Patron family matriarchs a...
Single Ticket
Buyers
New
Subscribers
Renewing
Subscribers
Renewing
Subscriber-
Donors
Per Patron
Yield $53.84 $156.05 $341...
Organizational Commitment
to Patron Loyalty
HIGHLOW
LOW
HIGH
LOYALTY
TRUST
TIMETryer
Buyer
Advocate
Patron Loyalty
A Love Story
www.trgarts.com
Patron Loyalty: A Love Story
Patron Loyalty: A Love Story
Patron Loyalty: A Love Story
Patron Loyalty: A Love Story
Patron Loyalty: A Love Story
Patron Loyalty: A Love Story
Patron Loyalty: A Love Story
Patron Loyalty: A Love Story
Patron Loyalty: A Love Story
Patron Loyalty: A Love Story
Patron Loyalty: A Love Story
Patron Loyalty: A Love Story
Patron Loyalty: A Love Story
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Patron Loyalty: A Love Story

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President & CEO Jill Robinson presented this intensive session on patron loyalty on May 31, 2014 at the Canadian Arts Marketing, Development & Ticketing Conference in Toronto. Two decades of arts consumer research is clear: patron relationships have the plot lines of a love story. Take, for instance that first contact with a person that has never before walked into your organization’s life. It could be the beginning of long, loyal engagement or a one night stand, depending on how you behave on this first date. In this 90-minute workshop, Jill showed how to build happily-ever-after relationships that can build patron loyalty and revenue. Hear case studies on today’s best loyalty practices and learn techniques that are timely for you to apply in your own organization now.

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  • We’re talking about loyalty today
    The premise is this: Your audience is not some vast, unknowable conglomerate, but people—the individual audience members or PATRONS who come through your doors
    At TRG, we use the word “patron” for any PERSON engaged with an organization—visitors, ticket buyers, members, donors, event attendee) So know that when you hear us say “patron”, know that I mean any PERSON engaged with any type of arts and entertainment organization—visual or performing arts; seated event or general admission.
  • Loyalty is all about people—and their RELATIONSHIP with your organization. Yes, you heard me use the word relationship. [CLICK]
    It’s courtship, a love story—And in your ticketing and database systems, your audience writes the plot line for their relationship with your organization…
  • …through the revenue-based you have with them--transactions like:
    Which exhibit they attended, which years they subscribed, how much they donated.
    This revenue is what allows your organization to exist, sustain itself, and thrive. It’s funded by revenue, yes, but more deeply, by your patrons’ PASSION for your artform.
  • TRG Arts is a consulting firm dedicated to the arts and entertainment field. We use data to develop strategies that help clients achieve results. TRG Arts was founded in 1995 by our late founder, Rick Lester. Our firm has grown over two decades on pioneering strategies focused on patrons and ways to develop pricing and loyalty that today have achieved results for our clients.

    We are based in Colorado Springs, Colorado with 35 team members, each skilled in providing guidance and solutions that are patron-based for sustainable loyalty of patrons and sustainable revenue from those patrons. At TRG, we use the word “patron” for any PERSON engaged with an organization—visitors, ticket buyers, members, donors, event attendee) So know that when you hear us say “patron”, know that I mean any PERSON engaged with any type of arts and entertainment organization—visual or performing arts; seated event or general admission. CLICK
  • We’ve worked with about 1,200 organizations in arts and entertainment over nearly two decades, in three countries: in the United States…these are some of our marquee clients….CLICK
  • ….in Canada, where our presence has expanded over the past few years, and in Australia. CLICK
    CLICK
  • This is What we do at TRG falls into 3 areas:
    Please proceed in your own words, Jill
  • Our firm is the largest provider of community data networks in the US – 20 in all and located across the United States, with New York City coming on as network number 21 in 2014. You heard me say that we are a “data-informed” consulting firm. In fact, data informs every strategic solution we offer at TRG, and enhances the expert knowledge of the staff team on which TRG is built.

    We have a catbird seat from the data networks we manage to observe some 35 million arts consumers and their transactions. We study and learn who is investing in the arts, how, when, and where. We are constantly working to harness the power of this data to develop client solutions and to benefit industry knowledge for very practical operational applications. 

  • This is What we do at TRG falls into 3 areas:
    Please proceed in your own words, Jill
  • [More detail to come with this slide…this is overall approach]
    Big shift in what we’re hearing from prospective clients and others within the industry that we talk to.
    Fewer organization are combatting overall decline. That’s much less the issue.
    More are seeing growth in ticket sales, and want to keep that upside trend moving up.

    Optimism there is offset by what’s going on in Washington, in state capitols and city halls around the country.
    I’m sure you too have seen the near daily outcry from arts advocates.
    It seems we may have lost any attempt to preserve arts spending – nationally with the budget sequestration, and at the state and local level that are hard-hit by everything from lost tax revenue to natural disaster.
    Some parts of the country are struggling more than others, but overall it’s not a hopeful picture.

    The most recent consumer confidence reports clearly show: there’s still a great deal of economic and political uncertainty out there.
    That presents a huge challenge for the sustainability of the arts….things may be getting better in some areas, but economic uncertainty weigh down revenue opportunities, especially from public funding.

    NEXT SLIDE
  • [More detail to come with this slide…this is overall approach]
    Big shift in what we’re hearing from prospective clients and others within the industry that we talk to.
    Fewer organization are combatting overall decline. That’s much less the issue.
    More are seeing growth in ticket sales, and want to keep that upside trend moving up.

    Optimism there is offset by what’s going on in Washington, in state capitols and city halls around the country.
    I’m sure you too have seen the near daily outcry from arts advocates.
    It seems we may have lost any attempt to preserve arts spending – nationally with the budget sequestration, and at the state and local level that are hard-hit by everything from lost tax revenue to natural disaster.
    Some parts of the country are struggling more than others, but overall it’s not a hopeful picture.

    The most recent consumer confidence reports clearly show: there’s still a great deal of economic and political uncertainty out there.
    That presents a huge challenge for the sustainability of the arts….things may be getting better in some areas, but economic uncertainty weigh down revenue opportunities, especially from public funding.

    NEXT SLIDE
  • Talk about this formula
    Explain how this is a measure of risk vs. self-reliant income – that only the company can earn for itself.
  • Question: Put yourselves back in your homeroom seats…in Phoenix, in Vail, in Winnipeg. Think about the challenges you face, the obstacles that get in your way of achieving all you wish to achieve in your organization/FOR your organization…and consider, what’s at the heart of those challenges? What’s THE main roadblock? I’d like to go around the room and give you each one minute to describe what the heart of your challenges is, from your perspective.

    You’ve named some operational hurdles. And some important root causes. (Draw SOIL AND FLOWER) Getting down to the roots of what troubles or prohibits your organization’s growth is a must now.
    At Tulsa Ballet, spot on implementation – it worked. Then it didn’t. We had to dig down and evaluate everything. Marketplace is an issue. Programming in that marketplace is an issue. And this CLICK is an issue….
    DESCRIBE CONTINUUM.
  • Talk about this formula
    Explain how this is a measure of risk vs. self-reliant income – that only the company can earn for itself.
  •  
    Part of our job as your consultants is to help you prioritize and maintain focus on patrons, on patron-centered revenue sources, and on your next biggest opportunities for patron-centered revenue sources. You’ll hear us say, with greater urgency: Make a Stop Doing List.

    We cannot expect our teams to treat EVERYTHING as important.  None of us have all the staff or the financial resources to do everything, we have to make choices.  
    Believe it or not, this is one of the most controversial statements TRG has made in public this year. That’s because a call to STOP DOING ….calls into question what we value as a company, an industry or art form. So…to be clear….
    .
     
  • Even if we DID have the resources, making choices is the most important strategic tactic we have for ways to change –read: IMPROVE -- the outcomes of our work.
    Choices ….must ….be ….made, and we will always counsel you to say “no” to activities that are stalled, aren’t having the same impact as other activities, or ARE DISTRACTING you or your organization from achieving its highest goals.

    We say “follow” the money trail. Patron-centered income represents the lions-share of your revenues. We acknowledge this reality and use that as a tool to prioritize going forward. It’s part of our consulting practice to stop periodically, do analysis and set sights on the next big opportunity within your organization. We do this because 
    In an environment where everyone on the team is behind a specific set of clear priorities, saying “not now” and even just “no” become incredibly powerful tools.
    We’ve seen these words bring clarity, and time and time again galvanize and motivate a team to create results that once seemed unachievable.

    [Pause. Next slide]
  •  
    Jeremy Ganter, Associate Executive Director & Director of Programming and Don Roth, Executive Director of the Robert and Margrit Mondavi Center for the Performing Arts
    Jim Palermo, Executive Director and Lisa Mallory, VP of Marketing and Executive VP of Bravo! Vail Music Festival
    Kevin Moore, Managing Director of the Cleveland Play House
    J.L. Nave, Executive Director of the Fort Wayne Philharmonic
    Andrew North, Executive Director of The Globe Theatre
    Vincent VanVleet, Managing Director of the Phoenix Theatre
    Jeff Herd, Executive Director of the Royal Winnipeg Ballet
  • We at TRG have never regarded engagement as a kum-bah-yah emotional experience. Audience engagement is a real, measurable relationship that we see manifested in transactional data.

    What’s transactional data?

    It is in your ticketing and database systems that your audience writes the plot line for their love story with your organization.
    Every record tells an individual’s story through their ticket-buying and individual desires.
    They come every year to Nutcracker for a once-a year fling…
    They are a subscriber and we’re in a long-term committed relationship.
    They came once and never again—it wasn’t a good date.
    .subscription…membership….donations….and more.

    What we can see and measure in the data , we can manage.
    CLICK


    [Photo by Todd Huffman http://www.flickr.com/photos/oddwick/2126909099/ ]
  • TRG is the largest aggregator of consumption data in the Arts. We currently collect ticket, subscription and membership purchase data as well as donation contribution data from 1,039 organizations across the US, and manage 22 trade communities.
  • It CAN be measured, using loyalty metrics – specific transactional data that mark the progress of your hot and steamy patron relationship.

    [CLICK] Our study of data tells us that the stronger the RELATIONSHIP with the patron – as measured in transactions -- the greater LASTING revenue for your organization--whether that revenue comes in through the box office, marketing, or development teams.
    [CLICK] With every patron transaction, we can measure and look for increases in three important metrics, R F M:
    Recency – how current a transaction is….
    Frequency – how often a patron has transactions with you…. And
    Monetary value –the revenues associated for all the transactions.
    [CLICK] By tracking RFM of loyalty metrics that any of you have in your ticketing and database systems, we can manage and grow patron relationships.

    At TRG, we also refer to this process as loyalty building. CLICK
  • Tryers = 92% of all households – typical
    180
    12,000
    140,000 (92%)
  • Tryers = 92% of all households – typical
    180
    12,000
    140,000 (92%)
  • Tryers = 92% of all households – typical
    180
    12,000
    140,000 (92%)
  • Study period: 2007-2011; Total households studied: 148,673

  • 385 households contribute 15% of all revenue
    Advocates attend first, donate second
  • This is a large group of active ticket buyers -- 21,630 households contribute 54% of revenue.
  • Here’s how we’ll define it
    We’re adding an action word in front of it [CLICK]. When we add an action word, we can DO something with it…
    Monetizing Audience Engagement means PURPOSEFUL cultivation of people’s passion for the art form that …..
    Builds a relationship, resulting in
    Loyalty and Revenue.

    CLICK
    Yes, you heard the word passion—because Audience Engagement is essentially a love story. [CLICK]
  • It CAN be measured, using loyalty metrics – specific transactional data that mark the progress of your hot and steamy patron relationship.

    [CLICK] Our study of data tells us that the stronger the RELATIONSHIP with the patron – as measured in transactions -- the greater LASTING revenue for your organization--whether that revenue comes in through the box office, marketing, or development teams.
    [CLICK] With every patron transaction, we can measure and look for increases in three important metrics, R F M:
    Recency – how current a transaction is….
    Frequency – how often a patron has transactions with you…. And
    Monetary value –the revenues associated for all the transactions.
    [CLICK] By tracking RFM of loyalty metrics that any of you have in your ticketing and database systems, we can manage and grow patron relationships.

    At TRG, we also refer to this process as loyalty building. CLICK
  • CLICK (Tryers) from 1 st time to second or next time to now
    CLICK (Buyers) the magic of “and”
    CLICK (Advocate) Donors and consummate loyalists

    Pause

  • Here’s what we typically see in a patron record as the sparks fly and a patron love story develops.
    Almost every patron in your database begins as a new ticket buyer-94% of newbies begin as a visitor or single ticket buyer.
    [CLICK] If they enjoy their “first date” with you – and if they are invited -- they’ll come back
    [CLICK] The plot thickens if and when the patron buys twice in the same season or year. We call that a “multi-buyer”
    [CLICK] When the romance goes to the Subscriber or Membership level, this is akin to getting engaged.
    [CLICK] Donation: that’s like putting the ring on the finger and saying “I do”. Once you have each other, and, the relationship is well-developed and cared for, you often keep the relationship for life.
    [CLICK] Finally, Advocate/Investor: Here, we’re celebrating a long, happy life together. Not many get here, but these relationships are worth their weight in gold – for you and the patron.

    This evolution of patron development is a series of largely incremental “next steps” – each involving more active, more frequent, more current transactions that – cumulatively –represent longer, greater patron investments.
    CLICK
  • You’ll notice that we are very specifically saying that to get here [CLICK (ADVOCATE)]
    You cannot start here [CLICK (DONOR)]
    Or even here [CLICK (SUBSCRIBER)]

    Two decades of arts consumer behavior research tells us loud and clear:
    Subscriber or Members and especially Donors are MADE not FOUND
    Most – 9 out of 10 – start here [CLICK (new single ticket buyer)]
    As a new or reactivated single ticket buyer who then [CLICK] comes back for a second date and subsequent, more frequent get-togethers.

    But for any relationship to happen at all, you have to prevent a one-night stand.
  • Remember that unstable base of Tryers at the bottom of the pyramid?
    About 4 out of 5 of those Tryers come once and never come back. Our arts consumer study and research by others have corroborated this sad fact. Whether you call this high rate of patron loss “churn” or “attrition” or “turnover” it all means the same thing: You aren’t achieving growth – not in audiences, not in prospective subcribers, members, and donors, not in revenue of any kind.

    Too many new and reactivated patrons will churn out if you cannot retain them. Or ….develop a second date or next step with them. In short, you’ll love em – by getting that second date – or lose them. Period.

    ASK: How do you CURRENTLY engage people for a second date?
  • So, chapter one in our love story? Achieve the second date. Here are the critical steps.
    CLICK
    Get their digits – their contact information. This is a must do. It doesn’t matter how cute they think you are or how much they’d like to see you again. If you can’t ask them back, you’ve lost them…it’s a one-night stand.
    Once you have their contact information, then you must ASK them to come back. If you don’t ask, they won’t come. On this you can be sure…8 of 10 of them will never be seen or heard from again. So, remember, it’s like a second date, your ask needs to personal, direct and as soon after the first date as possible.

    One of our clients, the Seattle Repertory Theatre has been working on their second date strategy, and theirs in a wonderful story we’d like to share.
    CLICK
  • In order to get a second date, you’ve got to have a good first date, right? That’s chapter one in our love story. Here are the critical steps.
    CLICK
    Get their digits – their contact information. This is a must do. It doesn’t matter how cute they think you are or how much they’d like to see you again. If you can’t ask them back, you’ve lost them…it’s a one-night stand.
    Once you have their contact information, then you must ASK them to come back. If you don’t ask, they won’t come. On this you can be sure…8 of 10 of them will never be seen or heard from again. So, remember, it’s like a second date, your ask needs to personal, direct and as soon after the first date as possible.
  • Here’s the case study, which you can read in its entirety, which you can read on our web site: www.trgarts.com

    The case is a retrospective look at Seattle Rep’s four-year, disciplined effort aimed at retaining new single ticket buyers. The first phase of their effort was to achieve that all-important second date in the same season. By doing that, retention among the specially cultivated group of new buyers was triple that of other new single ticket buyers…..as S-R-T’s cultivation efforts toward this group continued, so did growth.

    Here’s a quick outline of what they did. CLICK
  • Seattle Rep started in year one with efforts focused on getting that second date. And so, that first year, new single ticket buyers got offers to come back for a second show – and nothing else. No donation requests, although some newbies volunteered a donation as a round-up to ticket purchases….and no subscription offer.
    CLICK
    In year two, this group of households received a special direct offer – come to any three plays for $99. Again, that was the only special offer put in front of this group SRT was cultivating. And, in year two, households in this group bought on average five tickets in year two.
    CLICK
    In year three, this specially cultivated group got its own subscription offer, their first traditional subscription mailer and follow-up phone call. In year three, relationships developed further and this group of households bought on average six tickets that year.
    CLICK
    In year 4, which was the season just completed in June 2013, SRT’s specially cultivated group of subscribers were asked to renew….and they did – at an 81% renewal rate, which is a rate we normally see with long-time subscribers, not newbies.

    SRT’s retention program is a concentrated, patient, focused effort to get newbies to come back. They were building a relationship where none existed. Like a romantic relationship it took time and trust. Here are more results. CLICK

  • Here’s where we see retention. The red line tracks the rate of retention for SRT’s cultivation group – the households they got a second date with in their first year. The blue line tracks the rate of retention for other first timers. You can see that the second date really paid off – with 30% coming back in year two, while only 10% of other first timers came back. To be sure, SRT was fighting the forces of churn with both groups, but they DID achieve better retention, and the rate of retention among that specially cultivated group remained significantly higher throughout the period.
    CLICK
  • Now, let’s look at revenue growth. CLICK This chart tracks the average annual household spending among the new ticket buyers who had a second date with SRT in their first year together. You can see that in year one, the average spending was $122 and it rose slightly in year two – remember – SRT was holding back, trying to KEEP these patrons rather than bombard them with more and more offers. Then look what happens in years three and four – BAM, they are starting to subscribe and then renew – a huge jump in annual household revenue over four years of 75%.
    CLICK
  • Now let’s look at lifetime value. To calculate this metric, TRG looks at the cumulative average investment of each household that comprised all of the first-time ticket buyers in year one. We do this measurement to observe the value of retention in a perspective that normalizes for the size of each group. Of all first time ticket buyers that first year, those who agreed to have a second date represented only 11%, but see here the spending power they represented.
    CLICK
    Here, the red bars represent our cultivation group – the second daters, and the blue bars represent other first time ticket buyers who did not accept a second date. You can see that by the end of year four, each original household in the cultivation group represented $257 in cumulative average household spending –that’s more than double that of the value each of the other new timers contributed.
  • This case illustrates these key points
    Retention of new single ticket buyers is worthy discipline that requires focus. Seattle Rep found it difficult to keep that focus but chose to STOP DOING other things – specifically some of their time- and expense-consuming billboard and other mass media advertising – to make time for retention.
    Asking new-to-file single ticket buyers for a second date is THE right next step. SRT chose to follow-up mindfully but did not bombard their first-timers with other offers -- just a constant reminder to come back again.
    Growth is incremental – SRT saw increases in frequency and recency and monetary value, but it was incremental and occurred over a four-year period. Monetizing engagement takes time!

    Now that we see what it takes just to get that second date, let’s put next stages of our patron romance into a broader perspective. CLICK

  • Does this makes sense for you in your organization? (Do you have any questions?)
    Who here is doing anything specific to reactivate? (Think about your biggest blockbuster—that’s your biggest opportunity. Invite then.)
    Who here is doing anything specific to orient first-timers?
    Who here is doing anything specific to get a 2nd date? (CLICK to show postcard—here’s a starting point) (if nothing—check out our website. This strategy works.)


  • Used same format each time – change the copy on the shows
    Offer was calendar-driven – whatever came next….
    Followed K I S S principle – Keep it Splendidly Simple – realized EFFICIENCIES using the same format.
    We didn’t test different offers, we didn’t have time. We stayed focused on getting them done each time the run ended.

  • Anything else on second dates?
  • CLICK (Tryers) from 1 st time to second or next time to now
    CLICK (Buyers) the magic of “and”
    CLICK (Advocate) Donors and consummate loyalists

    Pause

  • You’ve had your first date, you have a second date, now what?

    ASK AUDIENCE: What are you all doing with people who have come twice? Do you ask them to subscribe?

    CLICK
    Hold your horses. Don’t ask them to marry you….yet. You’re going to use data in your systems to find the right next step.
    CLICK And you’re going to do so with an eye toward taking the relationship to the next level.
  • In this phase, we going to look at Tryers in the way that TRG generally categorizes them – by transaction types that we see in buyer data. I’m going to use terms here that are most usually related to seated-event organizations. Museums and other cultural organizations likely talk about visitors rather than single ticket buyers, and I hope you’ll accept our lexicon for the sake of simplicity.
    These are the three common transactional types that comprise Tryers. The next step is slightly different for each kind of Tryer patron. I’m going to give you some examples, assigning roles to different departments. At this point, the leading roles are most likely played by your marketing and box office or visitor services team. Let’s start at the very bottom of the pyramid with lapsed ticket buyers.

    They haven’t seen you for a while, and from a dating perspective, you’ve got their number but having been in touch. They have probably forgotten how cute you are, so you’re going to have to start all over. Let’s say you have targeted lapsed patrons with an invitation to come back and now they are calling the box office. What’s the next step?
    CLICK Reactivate them! Ticket office staff using most systems can see from patron history that the patron in front of them has lapsed – they haven’t been with you in a while. Welcome them back. Treat them like a first timer and give them some orientation to how best to enjoy their experience. That’s an upgrade from inactive to active, and also an example of up-selling or suggestive selling. That’s right – you heard that four-letter word: SELL. Selling in the context of patron loyalty IS relationship building. Remember that!

    Then, there’s your first time buyers – they come in largest numbers with your most popular attractions. Once you’ve got a response from a 1st time buyer, your upgrade goal is make sure this first experience with your organization is a good one. CLICK Your message is “Welcome—thanks for joining us.” Remember, this is like a first/blind date. You’re building a relationship with this new patron. In advance, give them some orientation to your venue. Let them know where they can find out about parking or where to get a bite to eat. Hear me say this: The whole relationship rises and falls on the success of the first date. So, make sure they know what you look like, how to find you, and what to expect in the venue. This is a worthwhile investment, especially for new patrons who are excited about coming to see your biggest, most popular programs of the year. And, we cannot emphasize this enough: Make sure you have their contact information, because the next step for new patrons is that all-important second date. Your upgrade or upsell is to position this first date for success so newcomers will WANT to come back when you ask them for a second date. Then, of course, you’re going to ask them for that second date – as we’ve already described.

    Now, you’ve gotten the second date and your patron is now a same season ticket buyer – a patron at the turning point of becoming BUYERS ….if and when you do a little more cultivation. [CLICK] Here’s where you pursue more get togethers. Your marketing invitation might be made in advance of your next big event. Or, it might be an offer to get specially priced admission to something similar to the program they saw when they first came. When you’ve got a patron who is responding to an invitation to come back again during the same season….that’s a cause for celebration. Welcome them back AND foster some kind of further engagement. Say “Thanks,” and suggest – while I have you –might you also want to see: a big season event, another show – even a short series or flexible subscription – some other event or activity that’s coming up soon or early in next season.

    The second or third date in same season is a turning point in your patron relationship. CLICK
  • Patrons are moving from Tryers to Buyers and you’ll want to foster by making appropriate suggestions.

    Moving a Tryer to Buyer may occur in year two or three of a relationship, after a first time patron buys a second admission the same year and then again in a subsequent year. It takes TIME to get to this point in our relationship--lots of dates. The turning point upgrade to Buyer status is the patron’s investment in something more—a subscription, membership, maybe even a class or special program. It’s a new chapter in the relationship. CLICK

  • It’s in this chapter of your patron romance that you’re becoming committed to one another.

    CLICK – It’s like you’re moving in together – you’ve done a number of serious activities together and now the patron is ready for something more – a small subscription package or series of events, maybe a low level membership.

    CLICK -- Once you’ve shared that experience, it’s time to pop the question: Ask for that first real traditional subscription or membership, and perhaps an entry level annual fund gift.

    CLICK – Now you’re enjoying married life – your caring for your patron as you would any life partner, with an eye of maintaining their passion and loyalty and getting them to renew – subscriptions, memberships, and unleashing the power of AND we talked about earlier. Let me say a little more about that. CLICK
  • Your patrons at this stage are BUYERS. At this stage of relationship, upgrades play a big role in greater engagement and in growing loyalty.

    CLICK: Your organization’s job with Buyers is to harness the power of “And” by considering all the organizational assets your relationship with this increasingly loyal patron may want to enjoy. So, think about what you have to offer….ALL you have to offer

    CLICK: You’ll surely want to encourage multiple attendance of not just more, but different kinds of events and programs. Did they first attend a major show or exhibit? Invite them to the next similar event and invite them to something that shows another side of you and your art. Do you have a school or academy event for the public? Invite your buyers for a peek at other artistic assets your relationship with them can include.

    CLICK: We’ve learned in two decades of arts consumer behavior study that an active patron can be encouraged to STAY active. Simply put: The more they buy, the more they keep buying. And, when you’re engaged with a patron, they stick with you. CLICK
  • We’ve seen in our patron behavior study that there is a huge escalation of loyalty growth among Buyers. There are many kinds of upgrades that you can offer Buyers. Today, I’m going to focus on three types of upgrades that can have a big impact on growing loyalty among this group.

    [CLICK] First is renewing your multi-time visitors multi-ticket buyers--into whatever your full-series attendance package is. Or, at the very least, renewing their behavior into another package of their choice. We call choice packages C-Y-O, or Choose-Your-Own programs. In operational terms, that generally means: upgrading your C-Y-O and flex ticket buyers into full series subscribers. This is one of the most powerful and yet most overlooked strategies we know. With this single renewal or upgrade, you can exponentially deepened a patron’s relationship with your organization. It’s a separate, specific type of marketing campaign that requires techniques of cultivation, sales promotion and sales. And, it’s a worthy investment of your time and money as I’ll show you in a moment.

    [CLICK] Next is the purposeful renewal upgrade that can happen with subscribers, members or donors who have been with you for a while. We still are amazed to find really good organizations that do not consistently and aggressively conduct renewal campaigns every year. Those are important. But a renewal upgrade is much more than that – It’s a subscription renewal into a better seat, a longer or additional series. It’s a membership renewal with the addition of an event or one of your blockbuster programs. It’s an annual fund renewal into that higher category that gets the patron’s name in the program or their car into the desirable parking lot – whatever is your “blockbuster” benefit or perk.

    [CLICK] Finally, there’s the purposeful upgrade that achieves a three-figure donation from subscribers or members. Achieve this, and you’ll build passionate patrons who love your art, love your organization so much that they are on their way to being your most-invested supporters.
    PAUSE
    Upgrades among Buyers pay dividends that we can quantify. [CLICK]
  • Now your patrons are poised for the all-important move from Buyer to Advocate. Here, the numbers are fewer, but the revenue stakes are higher. It’s at this point where donor cultivation comes in. CLICK
  • In this chapter, it’s all about being happy together and reaping the rewards of longevity and greater investment. It is in this chapter of your romance that development officers take the leading role.
    CLICK – You are celebrating anniversaries year after year – your patrons are now active donor-investors and
    CLICK –In your patron family, Advocates are your matriarchs and patriarchs – candidates for leadership roles both organizationally and within your audience.
    Its been a long time coming, but here you’ve arrived and you’ll have seen the benefits of the long relationship cultivation efforts in your revenue. CLICK
  • Let’s look at monetizing engagement over time through one recent TRG analysis. (Back to the action word) This is an overview of our findings for a theatre client. The work goes in-depth to show the client just how much revenue, after expenses, each buyer type was contributing to the organization’s financial health. It has become a platform for the organization’s new patron loyalty initiatives.

    For purposes of today’s discussion… however, let’s look at the big overall takeaways:
    Look across the top and bottom rows of this chart --- Revenue yield and renewal rates INCREASE significantly with each successive buyer type – the more loyal a patron becomes, the more they spend and the more they continue to engage and invest.
    Now look at the middle line -- The cost of sale to create subscribers is high – the highest in this analysis. But look what happens to cost-of-sale after that – it does way down. It is indeed cost-effective to get a subscriber renewal or an upgrade to subscriber-donor.
    And here’s the big pay-off—once a patron becomes a donor….look at the revenue yield for renewing subscriber-donors. This metric supports a research finding that comes up time and time again. The number one reason subscribers subscribe is ….love of the art form. The number two reason: they like the way your organization provides that beloved art form. So, subscribers are engaged at a passionate level – an affinity that can propel contributions. Yet, we find, that many organizations don’t have an active, integrated program to involve their loyalists as donors. Our analysis says: that’s one of the first steps you can take to develop an escalator effect.

    [click]



    Looking at their single ticket buyers, we see some pretty typical numbers here. On average, they paid around $53 for their ticket. Cost of sale—how many marketing dollars went into selling that ticket—was around 20%. And it was rather difficult to get them to come back. Only about 1 in 4 single ticket buyers came back the following season (check me on this).
    [CLICK] Looking at new subscribers, it’s a different story. Cost of Sale has risen, but it’s paid off. Average order size tripled—this client is making a lot more money on a subscribers than single ticket buyers. As for renewal rates, another good showing. About half are renewing.
    [CLICK] As you might expect, average order size and renewal rates rise with the more seasoned subscribers, but the real story here is the dip in cost of sale. They are spending a lot less to make a lot more.
    [CLICK] Finally, this clients’ most loyal patrons. Extremely high order size and renewal rate, and low cost of sale.

    So let’s put these numbers together and look at net revenue.
  • So, yes – it’s a love story. And, your efforts to cultivate loyalty….to monetize ongoing, growing engagement WILL pay off.
    How are you monetizing engagement?

    How do we get them in the first place?
    Getting contact info
    When do you actually ASK for the subscription then?
    When do you ask for a donation?

    Thank you.
    We’ll now take your questions.
  • Patron Loyalty: A Love Story

    1. 1. Patron Loyalty A Love Story Jill Robinson President & CEO Copyright © 2014 TRG Arts All Rights Reserved
    2. 2. People Your Patrons
    3. 3. Patron Relationships
    4. 4. Revenue from Patron Relationships
    5. 5. Vancouver Recital Society
    6. 6. What We Do Patron Results 1. Consulting Capacity building for sustainable growth 2. Data & Analytics Services Aggregation, analysis, direct response counsel 3. Community Data Networks 35 million households
    7. 7. Today’s Case Next Wave Theatre Co. 1. Major regional theatre Built on an amalgam of TRG clients 2. Real issues. Real situations. Where to focus? 3. Remember: PATRON LOYALTY!
    8. 8. Copyright © 2014 TRG Arts All Rights Reserved
    9. 9. Patron Loyalty Background and Context
    10. 10. TRG R&D Superlative Growth
    11. 11. REVENUE RISK/OPP % of Patron Revenue How much do patrons contribute? • Ticket sales • Subscriptions, memberships, donations • Events, classes Higher the %, bigger your need to sustain • Requires focus
    12. 12. Growth/decline In patron database?
    13. 13. % of Revenue derived from patron consumption?
    14. 14. % of Patron Households active in past two seasons?
    15. 15. ROOT CAUSES That Impact Patron Revenue Alignment around realities • Art form • Market • Current operational practices • Current patron behavior • Programming, Venues
    16. 16. ROOT CAUSES That Impact Patron Revenue Committed time to align • First step in process • Artistic, executive, board leadership • At the expense of ???
    17. 17. STOP DOING Means: Make Choices Bold leadership. • Insist on alignment • Ensure accountability • Saying “no” or not now Focus: patron-centric revenue. • Activities evaluated by impact on patron • Integrated planning maximizes interaction • Robust database drives planning
    18. 18. Data? Data Dazzles! 1. Big Data 2. Analytics in the field today 3. Data Stewardship
    19. 19. Data Stewardship What Leaders Must Do 1. Value the organization’s data 2. Promote a culture that values data 3. Dedicate a data steward role within the organization 4. Partner to get education and training 5. Use data to measure and manage performance
    20. 20. Patron Behavior Measure to manage 1. Size of database? 2. Growth or decline in database? 3. How recently have HH been active? 4. What % of patron data is collected?
    21. 21. Measuring Loyalty Loyalty Metrics 1. Strong relationships = greater, lasting revenue 2. RFMG (recency, frequency, $$$, >) 3. By tracking loyalty metrics we manage relationships
    22. 22. Measuring Patron Loyalty Integrated Analysis
    23. 23. .1% HH 11% revenue Super Advocates $40,000 Advocates $4,000 7.9% HH 43% revenue 92% HH 45% revenue Buyers $527 Tryers $48 Loyalty: theatre case
    24. 24. .06% HH 39% revenue Super Advocates $14,968 Advocates $2,375 1.6% HH 13% revenue 98% HH 48% revenue Buyers $724 Tryers $41 Loyalty: opera case
    25. 25. 1% HH 74% revenue Super Advocates $51,004 Advocates $4,256 3% HH 8% revenue 96% HH 19% revenue Buyers $875 Tryers $236 Loyalty: Ballet case
    26. 26. Loyalty: presenting/orch case
    27. 27. What Makes a Super Advocate? Deep, consistent philanthropic activity; single ticket buying
    28. 28. What Makes an Advocate? Performance attendance, less consistent donation activity
    29. 29. What Makes a Buyer? Large group, active ticket buyers
    30. 30. Who are Tryers? Huge portion of patrons; Very little loyalty
    31. 31. Behavior Over Time Longitudinal Trends in Loyalty 2008-12 2009-13 .22% 418 HH 3.74% 7,161 HH 96% 183,829 HH .26% 497 HH 3.69% 6,974 HH 96% 181,695 HH 2007-11 .22% 416 HH 3.9% 7,455 HH 96% 183,508 HH
    32. 32. Copyright © 2014 TRG Arts All Rights Reserved
    33. 33. Patron Loyalty as a Love Story Purposeful cultivation of people’s passion for the art form that builds a relationship resulting in loyalty and revenue. passion
    34. 34. Measuring Engagement Loyalty Metrics 1. Strong relationships = greater, lasting revenue 2. RFM (recency, frequency, $$$, >) 3. By tracking loyalty metrics we manage relationships
    35. 35. Donors and consummate loyalists The magic of “and” From 1st time to second or last time to NOW
    36. 36. 4 out of 5 new patrons leave… and never come back.
    37. 37. Introduction: The Blind Date 1. Tell me what you look like They must be able to find you. 2. Welcome packet via email Maps Restaurants Hall/experience operations Program
    38. 38. Chapter One: First Date 1. Get the phone number! You must be able to contact them again 2. Then, ASK for the second date Personally Directly Soon after the first date
    39. 39. 4 year retention study New buyers SRT achieved second date in same season TRIPLED retention rate Revenue kept growing. More on this case at www.trgarts.com
    40. 40. Seattle Rep Starting with the 2nd date Year 1 Offer: same-season ticket offer ONLY Nothing else. Year 2 Offer: 3 plays for $99 5 tickets that year Year 3 Offer: Subscribe! 6 tickets that year Year 4 Offer: Renew! First time renewal rate: 81%
    41. 41. Case Study: First Timer Cultivation Group: Four-Year Study
    42. 42. Case Study: First Timer Cultivation Group: Four-Year Study
    43. 43. Case Study: First Timer Cultivation Group: Four-Year Study
    44. 44. Seattle Rep Case Key Points 1. Retention is a worthy discipline Requires focus 2. Asking for the second date THE right next step 3. Growth is incremental Monetizing engagement takes time
    45. 45. Ideas for 2014-15: • Reactivation • First-timer Orientation • Second date
    46. 46. Same Format Each Time Calendar Driven Offer K.I.S.S Principle
    47. 47. Ideas for 2014-15: • Reactivation • First-timer Orientation • Second date
    48. 48. Donors and consummate loyalists The magic of “and” From 1st time to second or last time to NOW
    49. 49. Chapter Two: The Second Date 1. Don’t ask them to marry you yet The RIGHT next step 2. Take the relationship “to the next level” Ongoing upgrade campaign
    50. 50. Next Step: Reactivate Message: “Try us again THIS way” How? Treat them like a valued patron...or, a first timer. Next Step: Come back Message: “Welcome— thanks for joining us” How? Make the first time the best possible. Next Step: Come back again Message: “Thanks, and might you wish to _____?” How? Foster further engagement by making the ask.
    51. 51. Chapter Three: Courting & Commitment 1. What’s next for our multi-buyers? Small package or series 2. Make the ask Ask for first subscription, membership, donation 3. Keep them committing Renewal, “and”
    52. 52. GET MORE ENGAGED Upgrades to grow loyalty Focus: Harness the power of “AND” Include: All organizational assets • Multiple attendance AND • A range of activities • The more they buy, the more they buy • Engaged patrons stick
    53. 53. Add a donation Renew Flex to Full Renew & Upgrade
    54. 54. Renewal Is Not Enough
    55. 55. Challenge: three theaters; three series • Grow mid-sized series subscriber base Strategies “Premium Subscription” adds mid series to large Improved discount Current package always offered as 2nd option Results with TRG Loyalty Through Upgrades
    56. 56. Upgrade offer for every renewing subscriber Renewing Subscriber Segments - what they have now NOTES CURRENT 1213 PRICE for A seats (Flex purchases not included) NEW 1314 PRICE paying for Aseats (no flexes) 1213 Households (as of Oct 15) 1314 OFFER Stanley Premiere (Renewal) + Revue Both at full price + $60 $ 468 $ 478 120 Les Mis for free (1 per pkg) Stanley Premiere (GI Upgrade) + Revue ST full + GI $99 + $60 418$ 418$ 53 (Convert to full premiere) you get free Revue Stanley Premiere (GI Upgrade) + 6Flex ST full + GI $99 + $329 $ 358 $ 358 1 same deal + 1 extra GI show Stanley Premiere (Renewal) + 4Flex ST full +GI $99 + $139 $ 408 $ 418 6 (Convert to full premiere) you get free Revue Stanley Premiere (GI Upgrade) + 4Flex ST full + GI $99 + $139 $ 358 $ 358 6 same deal + 1 extra GI show Stanley Premiere (Renewal) ST full + GI $99 $ 408 $ 418 203 (Convert to full premiere) you get free Revue Stanley Premiere (GI Upgrade) ST full + GI $99 $ 358 $ 358 637 same deal + 1 extra GI show Granville Island Premiere (Stan Upgrade) + Revue GI full + ST $199 + $60 $ 408 $ 418 10 (Convert to full premiere) you get free Revue Granville Island Premiere (Stanley Upgrade) GI full + ST $199 $ 348 $ 358 45 same deal + 1 extra GI show 1,081 NON-PREMIERE Stanley + Revue ST full + $60 $ 319 $ 319 54 get GI for $99! Stanley + 6Flex ST full + $329 $ 259 $ 259 6 get GI for $99! Stanley + 4Flex ST full + $139 $ 259 $ 259 165 get GI for $99! Stanley Only ST full $ 259 $ 259 3,368 get GI for $99! 3,593 Granville Island + Revue GI full + $60 $ 209 $ 219 49 get Stanley for $199! Granville Island + 6Flex GI full + $329 $ 149 $ 159 6 get Stanley for $199! Granville Island + 4Flex GI full + $139 $ 149 $ 159 5 get Stanley for $199! Granville Island only GI full $ 149 $ 159 371 get Stanley for $199! 431 Revue + 6Flex $60 + $329 $ 389 $ 259 6 get Stanley for $199! Instead of 6flex Revue + 4Flex $60 + $139 $ 199 $ 159 3 get GI for $99! Instead of 4flex Revue only $80 $ 80 $ 80 18 get GI for $99! 27 Passport only $699 $ 699 $ 699 22 NOTHING 22 6Flex + 4Flex $329 + $139 $ 468 $ 358 47 See Stanley and GI for $358! 6Flex only $329 $ 329 $ 199 580 See Stanley for $199! 627 4Flex only $139 $ 139 $ 99 170 See GI for $99! OTHER
    57. 57. 3,012 new Premium Subscribers (14,250 total) 21% of all subscriber units 30% of total subscription revenue 119% increase in seated subscriptions to mid series 4,475 vs. 2,043 53% increase in total subscription revenue to-date 20% increase in subscription per capita revenue – households investing more! Two-year results (as of 12.13)
    58. 58. Renewal Is Not Enough
    59. 59. Chapter Four: So happy together 1. Sustained support, year after year Active donor/investors 2. Patron family matriarchs and patriarchs Leadership identified within Advocate group 3. Portfolio management is a must. Patron management team; customized benefits
    60. 60. Single Ticket Buyers New Subscribers Renewing Subscribers Renewing Subscriber- Donors Per Patron Yield $53.84 $156.05 $341.51 $550.42 Cost of Sale 20% 25% 3% 3% Renewal Rates 23% 46% 69% 88% Monetizing Loyalty A performing arts example
    61. 61. Organizational Commitment to Patron Loyalty
    62. 62. HIGHLOW LOW HIGH LOYALTY TRUST TIMETryer Buyer Advocate
    63. 63. Patron Loyalty A Love Story www.trgarts.com

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