Monday, September 06, 2010

Remember to Test even the "Sacred Cows"

I think I have always been attracted to arts marketing because it allows me to use both creative as well as scientific talents. To this day, I might be the only person to graduate from Missouri State University with a major in speech and theatre education and a minor in mathematics. So it should come as no surprise that I take a very scientific approach to marketing.

In every campaign I lead, I constantly manipulate variables and note outcomes in an attempt to continually improve upon previous results. The easiest variables that marketers turn to are design and pricing. How many times have you tested a carrier package? an offer? pricing strategy? Probably quite a few times. Now think about how many times you have tested different timing schemes for putting products on sale.

This was the first year in my tenure at Arena Stage where we experimented with using timing as a variable. For almost as long as we have had mini-subscriptions, we have put them on sale at the exact same time as our full season subscriptions, fearing that instead of waiting or upgrading, our potential mini-subscribers would opt to go elsewhere for their entertainment. The fear of losing potential mini-subscribers was so strong that for many years timing wasn't even considered a possible variable to test.

As a leader, you have to always remember that the fear of a potential loss will always be significantly more powerful than the possibility of a probable gain. By nature, we are risk averse, and if given a choice to pursue status quo or trail blaze, we will choose status quo each and every time unless there are overwhelming odds. But you have to be mindful of "sacred cows," and be willing to test even the most concrete of assumptions. In my career, the testing of "proven strategies" has led to some pretty remarkable results.
For our inaugural season in the new Mead Center for American Theater, we experimented with exclusively putting full season subscriptions on sale for the first four months of our subscription campaign. In addition, we developed a pricing strategy that encouraged full package purchases, and new exclusive benefits for full season subscribers, such as the ability to purchase parking in our onsite, underground parking lot. It was a test of timing as a variable--would potential mini-subscribers upgrade to the full season, wait until mini-subscriptions were available or leave Arena Stage entirely.

As we are eight months into our subscription campaign, we have some pretty interesting results:
  • we exceeded our projections for full season subscribers both in number of subscribers as well as revenue by almost 60%
  • we had three times as many subscribers upgrade their packages when compared to those that downgraded
  • full season subscriptions weren't just for renewals and upgrades--we more than tripled our projections for brand new subscribers to Arena Stage at the full season level. At this moment, 11% of our entire subscription base are patrons who have never subscribed to Arena Stage and did so in their first year at the full season level.

As our full season subscribers renew at a much higher rate than our mini-subscribers do, I anticipate that the growth that we have seen in our number of full season subscribers will benefit us for many years to come.


ScottE. said...

I'd be interesting to see how much of the increase has to do with the "variable of curiosity" that patrons have to see the new space? I don't think it's fair to say that timing is the main variable Arena is dealing with this season.

In the past X number of years, virtually all of the major players in DC have moved into new spaces, Woolly, Signature, Shakespeare, Roundhouse and Studio expanded. There has to be data to show how many subscribers renewed after their first year experience in the new spaces and how many have lapsed.

Chad M. Bauman said...


In setting this year's goals, I actually drew upon statistics from around the country from new performing arts centers that are our size. So all of these comparisons are beign made to goals that factored in an aggressive "new building" boost. So in this case, I do think it is fair to say that timing was a primary variable in these results.

Yancey Arts Consulting said...

Hi, Chad.

It's interesting to see how calibrating several variables can boost subscription, therefore, revenue targets without the need to spend more on advertising.

Aside from timing, what are other tactics, which requires no monetary resource, you've been applying to enhance the branding and sales of the Arena Stage?