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2013 WASHINGTON NONPROFIT CONFERENCE. THE FUTURE IS NOW. STRATEGIES & TECHNIQUES FOR INTEGRATED PROGRAMS. Changing the Season of Churn, Churn, Churn. Eric Nelson, DCM Russell Jones, New York Philharmonic Danielle St. Germain-Gordon, Arena Stage. 2013 WASHINGTON NONPROFIT CONFERENCE.
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2013 WASHINGTON NONPROFIT CONFERENCE THE FUTURE IS NOW STRATEGIES & TECHNIQUES FOR INTEGRATED PROGRAMS Changing the Season of Churn, Churn, Churn Eric Nelson, DCM Russell Jones, New York Philharmonic Danielle St. Germain-Gordon, Arena Stage
2013 WASHINGTON NONPROFIT CONFERENCE Churn Trends in Performing Arts • Topic Overview - Eric • Symphony Perspective - Russell • Arena Stage – Danielle • Panel Discussion • Open Floor Q&A THE FUTURE IS NOW STRATEGIES & TECHNIQUES FOR INTEGRATED PROGRAMS
2013 WASHINGTON NONPROFIT CONFERENCE A state of agitation or turbulent change or development. Webster’s Dictionary THE FUTURE IS NOW STRATEGIES & TECHNIQUES FOR INTEGRATED PROGRAMS
2013 WASHINGTON NONPROFIT CONFERENCE When a nonprofit acquires a new donor and then fails to secure a long-term relationship with any true financial gain. Fundraising Success THE FUTURE IS NOW STRATEGIES & TECHNIQUES FOR INTEGRATED PROGRAMS
2013 WASHINGTON NONPROFIT CONFERENCE Increased Competition, Decreased Retention • Competition for entertainment dollars continues to increase and population growth is no longer enough to counter declining arts and culture participation rates. • The NEA • Arts & Culture have worked to understand churn trends • 57% of 2006-07 orchestra buyers were new • 55% did not return the next year • 2/3 new patrons in 2008 did not return within the next 12 months to cultural institutions in Philadelphia THE FUTURE IS NOW STRATEGIES & TECHNIQUES FOR INTEGRATED PROGRAMS
2013 WASHINGTON NONPROFIT CONFERENCE Churn, Its Human Nature • Retail Banking - 15% • Cable and Satellite companies - 20-30% • Mobile phone providers - 15-30% THE FUTURE IS NOW STRATEGIES & TECHNIQUES FOR INTEGRATED PROGRAMS
2013 WASHINGTON NONPROFIT CONFERENCE Increased Loyalty Can Be Achieved • Only 12%-15% of customers are loyal to a single retailer. That small group generates between 55%-70% of sales. 65%-95% of these sales come from members of loyalty programs. • Center for Retail Management THE FUTURE IS NOW STRATEGIES & TECHNIQUES FOR INTEGRATED PROGRAMS
2013 WASHINGTON NONPROFIT CONFERENCE Increased Loyalty Can Be Achieved • Why first-time donors give • The right thing to do • Help sustain the organization • Could afford to • Got a call/request THE FUTURE IS NOW STRATEGIES & TECHNIQUES FOR INTEGRATED PROGRAMS
2013 WASHINGTON NONPROFIT CONFERENCE The Battle Against Churn Has Begun • The Whitney Museum’s “Curate Your Own” • Arts Club Theatre Company’s Super Subscribers • Pacific Northwest Ballet’s “Add-On” gifts initiative THE FUTURE IS NOW STRATEGIES & TECHNIQUES FOR INTEGRATED PROGRAMS
2013 WASHINGTON NONPROFIT CONFERENCE The Symphony World THE FUTURE IS NOW STRATEGIES & TECHNIQUES FOR INTEGRATED PROGRAMS
2013 WASHINGTON NONPROFIT CONFERENCE Audience Growth Initiative 2008 • Why first time ticket buyers don’t come back • Atlanta, Boston, Chicago, Cleveland, Los Angeles, Milwaukee, New York, Philadelphia, San Francisco • Oliver Wyman • Jack McAuliffe, Engaged Audiences THE FUTURE IS NOW STRATEGIES & TECHNIQUES FOR INTEGRATED PROGRAMS
2013 WASHINGTON NONPROFIT CONFERENCE Audience Growth Initiative 2008 • Changing the season of Churn, Churn, Churn • 80% of first-time ticket buyers churned • Understanding what customers really value • Appreciating Judy’s Orchestra Experience • Nurturing first-timers, building loyalty and the Killer Offer • Outcomes • Surprise and Delight THE FUTURE IS NOW STRATEGIES & TECHNIQUES FOR INTEGRATED PROGRAMS
I hadn’t been to the Orchestra since I was a kid, so I bought 2 tickets for a Mozart concert That day, work got completely crazy so I couldn’t make it. I tried calling the orchestra to exchange the tickets, but I was told my only option was to “donate” them! I decided to give it another shot 3 months later when my favorite composer, Tchaikovsky, was playing Parking was a nightmare. It took us 25 minutes to find a spot! BO analysis & clustering Customer experience Offer design & testing Imagine my surprise when 3 days later the orchestra called me to ask if I wanted to buy a subscription. I told them no and then 3 weeks later they called for a donation! Though I don’t think I am ever going back, they continue to flood me with mail, phone calls and emails. What a drag! By then, it was too late to have dinner. I was starving at intermission but the bar was super crowded, didn’t have any food and a drink was $12! The musicians played very well but I knew nothing about two of the pieces played Buy & Donate Now Judy’s orchestra experience“This was my first time back to the Orchestra since I was a kid, but it is likely to be my last” Illustrative
Core product Music enhancement Hall access Social experience Transactional Repertoire Enriching experience Music information Access Social outing Planning & purchasing • During the season, the selection of works is appealing • During any given performance, the selection of piece(s) is appealing • The selection of performances within a subscription series is appealing • Attending a concert is stimulating • Attending a concert is entertaining • Attending a concert is always a special experience • I can feel a connection between the artists and myself when they perform • I feel a connection between myself and my fellow attendees • I look for information on the music before a concert • The Hall is easily accessible by public transportation • The policy regarding latecomers is appropriate • I feel safe in the Hall’s surroundings • I always find friends / family members to go with me • I always top the concert with a nice dinner or drinks • I don’t mind going alone to a performance • I can easily get schedule / price information on the Orchestra’s website • Purchasing tickets is easy BO analysis & clustering Customer experience Offer design & testing Live commentary • Pre-Concert discussions increase my enjoyment of the concert • The conductor’s personal comments enhance my enjoyment of the concert Exchanges Bar Parking • Exchanging tickets is easy • The Orchestra’s bar offers the refreshments that I want • The service at the Orchestra’s bar is fast and friendly • The Orchestra’s bar is good value for the money Hall • There are enough parking options near the Hall • Entering / exiting the parking lot is fast • The Hall is easily accessible by car • The auditorium architecture and décor are appealing • The lobby is attractive • The auditorium acoustics are state of the art Orchestra prestige and quality Special effects • The Orchestra brings us famous guest conductors • This Orchestra is one of the nation’s leading Orchestras • The Orchestra brings us famous guest soloists • The musicians’ level of play is always outstanding • Special lighting and/or visuals enhance the music Ability to attend “The orchestra club” Contemporary music • My health permits me to attend concerts whenever I want • I never miss a concert I have tickets for • Being able to talk about concerts give me some “prestige” at work / with friends • I enjoy meeting other attendees during the Orchestra’s receptions • I love events where I can meet the performers and the directors in person • I enjoy contemporary orchestral music • I like the sound of contemporary orchestral music • I understand contemporary orchestral music • I am very interested in not so well-known composers Factor analysisFrom the 78 attributes tested, we have identified the 16 most robust factors that influence customer behaviors 14 © Oliver Wymanwww.oliverwyman.com
“Killer” offer BO analysis & clustering Customer experience Offer design & testing • 3 familiar & unfamiliar pieces • Quality seats • Bring a friend for free • Free drink • Free exchanges • Saturday night • Favorite composer • Famous instrumental soloist • Conductor’s insights in advance +40% share of single tickets Base “Killer” “Killer” offer for Unconverted trialistsDefined using the optimal levels for most attributes, the “killer” offer increases share of single tickets by an extra 40% for Trialists Base offer • 3 familiar & unfamiliar pieces • Quality seats • Weeknight • Romantic music • All orchestral / no soloists • Program notes on the website Source: Oliver Wyman Strategic Choice Analysis® survey, Box office data for weighting of orchestra, cluster and churn, unweighted N = 1,908
Repertoire Music information Social experience Exchanges Access Relationship building Compelling offers Don’t surprise me: I want pieces that ‘ring a bell’ Initiate me: Really? Interesting to know! Let’s socialize!: I want to have a good time with my friends Me too!: I want flexibility No hassle: I just want to park and forget about my car Don’t ask me to marry you after the first date: I don’t want to commit yet Such a good deal: A no-brainer to go another time Enough familiar concerts to choose from during the season Enough background to enjoy the performance Enjoyable pre- (and post-) concert experience Socializing opportunities at the concert Easy to exchange tickets, even for single tickets Easy to get to and park at the hall One step at a time Right discount/ promotional offer combination Defining a new and comprehensive value proposition for “Unconverted trialists”
2013 WASHINGTON NONPROFIT CONFERENCE Pensacola Symphony • Retention strategies • Single ticket holders received email thanking them for purchase • Program notes about the music, written by the Music Director • Tips on where to park and eat before concert • Buy one get one free drink offer • Killer offer • By one get one free • $10 ticket offer for all local Air Force and Navy THE FUTURE IS NOW STRATEGIES & TECHNIQUES FOR INTEGRATED PROGRAMS
2013 WASHINGTON NONPROFIT CONFERENCE Pensacola Symphony • Outcomes • Added 300 more subscribers • 12.8% attended three or more concerts previous season • 9% had attended two concerts • Annual Fund goal was met thanks to 10% increase in donors who attended two or more concerts. THE FUTURE IS NOW STRATEGIES & TECHNIQUES FOR INTEGRATED PROGRAMS
2013 WASHINGTON NONPROFIT CONFERENCE Additional Results • Patrons buying two or more concerts after receiving the Killer Offer • Baltimore Symphony increased sales by 10.4% • Orlando Symphony by 22.6% THE FUTURE IS NOW STRATEGIES & TECHNIQUES FOR INTEGRATED PROGRAMS
2013 WASHINGTON NONPROFIT CONFERENCE Key Learning • Consider single ticket buyers • Build loyalty around what matters to your customers • Frequency trumps tenure The Future • Surprise and Delight THE FUTURE IS NOW STRATEGIES & TECHNIQUES FOR INTEGRATED PROGRAMS
2013 WASHINGTON NONPROFIT CONFERENCE Further Information • League of American Orchestras • www.americanorchestras.org • Symphony magazine • www.symphony.org • Jack McAuliffe, Engaged Audiences LLC • www.engagedaudiences.com THE FUTURE IS NOW STRATEGIES & TECHNIQUES FOR INTEGRATED PROGRAMS
2013 WASHINGTON NONPROFIT CONFERENCE Arena Stage THE FUTURE IS NOW STRATEGIES & TECHNIQUES FOR INTEGRATED PROGRAMS
2013 WASHINGTON NONPROFIT CONFERENCE Arena Stage • Donor loyalty was put to the test due to a recent venue renovation • While construction was underway performances took place in venues across DC and NOVA THE FUTURE IS NOW STRATEGIES & TECHNIQUES FOR INTEGRATED PROGRAMS
2013 WASHINGTON NONPROFIT CONFERENCE Arena Stage • Difficult to keep donors engaged during renovation • Re-opened in Oct. 2010 • Subscriber numbers have grown significantly • 15,300 subscribers THE FUTURE IS NOW STRATEGIES & TECHNIQUES FOR INTEGRATED PROGRAMS
2013 WASHINGTON NONPROFIT CONFERENCE Arena Stage • Larger pool of donor prospects • Using research to build engagement appeals • Bi-weekly Board Screening effort • PLI • Learn history and motivating factors • Wealth Engine • Monthly screenings • Integrated with Tessitura- capacity visible in header of patron account THE FUTURE IS NOW STRATEGIES & TECHNIQUES FOR INTEGRATED PROGRAMS
2013 WASHINGTON NONPROFIT CONFERENCE Arena Stage • Planned giving • 2 events-Coffee with Artistic Director and matinee performance • One on a weekday for those who are retired, one on a weekend, for those still employed • Sent invitation to: • Current members of the Full Circle Society • Gave to Individual and/or Special event campaigns 08-13 with a total giving of $1000 or more • Gave to Individual and/or Special event campaigns 08-13 with a total giving of $1000 or less with a giving capacity of $100K+ • SW Residents with $500K+ giving capacity THE FUTURE IS NOW STRATEGIES & TECHNIQUES FOR INTEGRATED PROGRAMS
2013 WASHINGTON NONPROFIT CONFERENCE Panel Discussion THE FUTURE IS NOW STRATEGIES & TECHNIQUES FOR INTEGRATED PROGRAMS
2013 WASHINGTON NONPROFIT CONFERENCE Q&A THE FUTURE IS NOW STRATEGIES & TECHNIQUES FOR INTEGRATED PROGRAMS
2013 WASHINGTON NONPROFIT CONFERENCE THE FUTURE IS NOW STRATEGIES & TECHNIQUES FOR INTEGRATED PROGRAMS Changing the Season of Churn, Churn, Churn Eric Nelson, DCM Russell Jones, New York Philharmonic Danielle St. Germain-Gordon, Arena Stage