Commentary: To grow audience, kill the myth of the Average Consumer

Adrian Slywotzky, Fast Company, 10/13/11 [hat tips to Ian David Moss and Adam Thurman]

Marketing managers for major orchestras had always assumed that convincing people to give the symphony a try was the key to gaining subscribers. But when they actually studied the numbers, they discovered that getting new people wasn't the problem. Customer churn was killing these orchestras. It turns out the secret to unlocking demand for classical music is discarding the Myth of the Average Customer. Designing an offer to appeal to one archetypal customer is always wasteful -- one size fits few, not all. Instead, demand creators have to constantly focus on demand variation, asking how customers differ from one another and how those differences impact demand. In 2007, a study by Oliver Wyman (Audience Growth Initiative) found that, on average, symphonies lost 55% of their customers each year [and] churn among first-time concert-goers was 91%! The study also confirmed the solution to churn was to move beyond "averages" and to begin looking at the wide variations between starkly different customer groups -- a core audience, trialists (first-time concert-goers), non-committed (a few concerts a year), special occasion attendees, snackers (people who purchase small subscriptions for years), and high potentials (frequent attendees who haven't bought a subscription). With that data, the orchestras' new mission became more targeted. Consultants developed a series of "killer offers" for different orchestras. The BSO's killer offer for trialists garnered a response rate 34% higher than its traditional offer--equivalent to 5,100 more tickets sold over a year. The Cincinnati Symphony offered its Summer Pops trialists two choices, and the "killer offer" won, 20 to 1. And so on down the line. The so-called "Churn Report" showed that classical music itself was not the problem with declining audiences. The problem was the overall customer experience, and customer expectations were quite different for each group.

In Orlando FL, growing an audience with segmented subscription offers

OPO executive director David Schillhammer, Americans for the Arts blog, 10/18/11

The Orlando Philharmonic Orchestra's ticket sales are up again this year, shattering local and national sales trends. With several months left in the year, our box office is already seeing a 10% increase in subscriptions over this time last season, and renewal rates for freshman subscribers are over 53% and growing. This is the fifth year in a row we've had such gains. Our recipe for success? Marketing, innovative programming and outstanding customer service. In the fall of 2007, we began working with Jack McAuliffe of Engaged Audiences who pushed us to stop devaluing tickets through "buy one, get one" offers, and focus on marketing subscriptions. Specifically, he challenged us to convert one-time concert attendees into two- and three-time attendees, and then into long-term subscribers. We divided our audience into several segments. Introductory subscribers are given a 50% discount. Those renewing for the first time are offered a 30% discount. Discounts are also offered to lapsed subscribers. We focus our efforts mainly on new subscribers, because once they've subscribed for a few years, it takes less incentive to keep them engaged. But our marketing is only as good as the programs we offer [and we have continued to invest in programming]. Our success also has a lot to do with outstanding customer service, [which] doesn't stop when patrons leave the theater.

Commentary: To grow audience, pay attention to entire theatre-going experience

Anne Bonnar, 21st Century Culture, 11/13/11

The Auditoriums Meet Conference in Dublin last week convened the leaders and designers of some of the world's latest landmark performance auditoria. Some were brand new venues...but more of the venues were transformations, not only of bricks and mortar, but also a transformation of the historic top-down relationship with the audience. Whereas 20th century venues put on work, marketed it to the audiences and then, when they came, sold them a drink, 21st century venues convene with their communities, audiences, affiliates and commercial partners and together create experiences. This attention to all parts of the customer experience in attending an event is critical to the success of performance auditoria in the 21st century. The dimensions of the 'experience' includes not only the real but the virtual, and not only during the concert but before and after, and not only the individual experience but the experience in relation to others, before, during after and in the hall, the club, the bar, the car park and on facebook, foursquare and gowalla. The methods and tools for engaging with audiences have similarly been turned upside down. The Smirnoff Night Exchange segments its audiences simply -- Are you a Paparazzi or a Poser? Fanshake uses social media to generate masses of 'fans' in short spaces of time. Copenhagen Living Lab goes  deeper, applying an anthropological model to the live experience, analysing individual archetypes and their behaviours. While old school arts marketing stops when the ticket is sold, new audience engagement recognises and embraces the power of individual audience members, considers their motivations, and upsells and encourages referalls at all stages in the ritual of performance.

Commentary: To grow audience, put the focus back on the art

Excerpted from Blanka Zizka's acceptance speech for the Zelda Fichandler Award, 10/24/11

During the 1980's and 90's, the regional theater movement was very successful at building its institutions. Many theaters across the country, including The Wilma, [built] new theaters, created administrative and production positions to run these institutions, and expanded their subscription bases. Danny Newman's Subscribe Now! became the new bible. As a norm, we all fell into a system of producing 4-7 plays a year with 4-week rehearsal schedules and 5-week runs. This schedule was dictated by the subscription system. Subscription sales became the main source of income of regional theaters. The size of a subscription audience was a sign of a successful organization. If the subscription base dropped, something was wrong with the programming; Artistic Directors became responsible for the well-being of the institution and sometimes were fired by the Board if programs didn't bring in a sufficient number of subscribers and the necessary box office income. Is it possible that theaters started to program for their subscription audiences? Is it possible that we, the Artistic Directors of regional theaters, have lost our courage, spirit, idealism, and desire for experimentation in spite of the institutional growth of our theaters?... Or perhaps we have lost these qualities because of the institutional growth of our theaters? What happened to the art? Theater, after all, is the most collaborative of all the art forms. But what happened to our collaborators, to our artists? We have arrived at a strange state of affairs: Theaters don't invest in freelance artists and freelance artists don't spend enough time developing productions in the regional theaters. There's no investment in continuity, learning, or experimentation.  Can we create art this way? I don't believe we can. So, for me the big question is how do we return to creating art? I know that this has to be my focus in the next few years. I believe that we will find our audiences if our theaters produce work that takes on the complexities and issues of our lives in a courageous, bold, unexpected, and original way. We must not be afraid. Fear of failure makes us stagnate. Generosity and investment in people make us grow.

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In Sarasota FL, growing an audience with a mix of nonprofit and commercial ideas

Sarasota Herald-Tribune, 11/16/11

As it approaches its 40th anniversary, Florida Studio Theatre is [expanding] its Sarasota campus [and] nearly double its seating capacity. FST's growth comes at a time when Sarasota is positioning itself as a national arts destination, and bucks the trend of downsizing many arts groups are experiencing during the recession. The plan will expand the FST Gompertz Theatre, open two new theaters -- FST already has three intimate theaters -- and add a streetside caf�. FST's shows attract 160,000 patrons annually. Its 20,000 subscribing members is the most of any similar-sized theater in the nation, FST says. It has reached capacity for subscription sales for its popular cabaret series, and before it started using the Gompertz for one winter production each season, it also had reached subscription capacity for its mainstage series. The theater does not plan to produce more work, but to divide its season productions between the old and new theaters, allowing for longer runs. "We're combining the best of not-for-profit technique with commercial technique, which is the longer you run the show, the better your financial position," artistic director Richard Hopkins said.