My last blog generated several interesting responses, which I do appreciate. I looked for and found common threads in them, and prepared this follow-up blog. Special thanks to Thomas Cott and those who took the time to comment and for continuing the discussion.
The point of my original message was about the advantages of facts over opinions and the desirability of eliminating guesswork. The flashpoint , however, centered on a preliminary finding from an incomplete data project -- that only 1% of San Francisco’s half-priced ticket buyers had previous ticket buying history with their theatre of choice.
First a word about methodology. TRG’s approach to data analysis is complex in execution but pretty simple in approach. We access facts in databases-- some 20 million households of biographic tables matched with actual purchase transaction histories. Ours is longitudinal study to track and understand patron behaviors, as defined by their transactions, over time. A patron either made a purchase or gift – or they didn’t. While you may disagree with our interpretations or conclusions, the data speaks for itself. It is not a recollection, opinion or perception but a fact. It is neither right nor wrong. It simply is.
That said, it is possible to find different, individual results in your own data. For the topic of half-priced tickets, I would expect that your results might vary widely based on how your organization used the half-priced channel and, most importantly, how you followed-up with any half-priced patrons. For example, I could imagine a situation in which an organization chooses to use a half-priced channel as their primary ticketing outlet. Patrons’ experiences would be very different in this organization than in another company that infrequently uses the half-priced channel.
Second, a word about this particular study. It is still very much a work in progress. No grand conclusions about the efficacy of the half-price channel should be based on my casual comment regarding the incomplete San Francisco study. In fact, I have every expectation that more surprises are yet to be uncovered as we complete it.
Know too: TRG has “no dog in this fight.” We aren’t for or against half-price tickets or the channel. Our only goal is to understand what’s happening in the marketplace – based on empirical data and facts. One outcome of this project will be insights on best practice usage of half-price tickets and the channels that deliver them.
Those best practices can’t come too soon. The ticket channel for deeply discounted tickets has become a ubiquitous part of life for most marketers. Too often it’s emotion, fear or assumptions founded on hope that are the basis for important inventory management decisions. This applies to every ticketing channel – not just half-priced tickets. Smart managers will use the channel in ways that help build sustainable and loyal audiences – and, on that outcome it’s clear that all discount channel participants agree.
Finally, a word about new audiences. For many years I have been ranting at industry meetings about the flawed business strategy employed by most arts and culture organizations. That is, most are over-prospecting for new audiences and under-retaining those they already have. Nationally, the numbers of new audiences each year are staggering. For example, when the doors open tonight at the typical theatre in this country, the majority of the audience will be first time visitors. And, national data suggests that 80% of them will never return for a second visit – ever. My guess (see my prior blog on guesses!) is that the half-price channel can play a powerful role in building a more successful arts organization. Finding new audiences may not be the best role for this tool. TRG’s goal is to better define best practice strategies and the best role for half-price and discount channels.
But, until we examine the data and form conclusions based on facts, we are all just guessing. That makes me crazy.
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Rick Lester leads TRG's counsel on patron behavior trends and their impact on patronage and revenue generation for organizations and communities. His pioneering work in demand management and pricing have become industry best practices. Rick's presentations on pricing, arts consumer behavior, and thriving in a tough economy are regularly featured in conferences nationwide. Early career success leading the marketing programs for the Cincinnati Symphony and The Cleveland Orchestra led Rick to senior leadership positions in the orchestra field. In each organization, Rick helped achieve records for both earned and contributed revenues. Before he founded Lester & Associates, Rick also was a freelance consultant to orchestras as well as state and national nonprofit organizations. He served as a member of the National Endowment for the Arts' Panel for Policy Review, the Pew Charitable Trusts, and the Cleveland Foundation. He holds an MBA from Queens University and a BA in political science from Drury University. He currently serves on Drury's board of trustees. He also serves as a distinguished visiting professor of arts management at SMU in Dallas.
