CAPTURE DATA, CAPTIVATE NEW AUDIENCES
This fall, TRG Arts is releasing a video series on the 6 metrics that arts leaders should be tracking and managing. View all the videos in this series here>>
New audiences are the Holy Grail for most arts marketers. Over the last few decades, our field has developed countless campaigns to engage community members and convert them to audience members. In recent years, strategies and technology initiatives aimed at new arts patrons have grown stunningly sophisticated.
Once we get those new audience members in our doors, however, one critical question arises. It’s a question we might not like to think about. Yet, it’s a question that can impact our audience and revenue numbers for years to come.
How is our organization working to keep those newbies that we worked so hard to attract?
If you’re having a hard time answering that question, you’re not alone. The good news is that you can jumpstart your new audience retention plan today, with two simple data points. The first step to recovery is realizing that you may have a problem. And that starts with data.
If you can measure something, you can manage it. This post is part of a series for artsmarketing.org on the six metrics that arts and cultural organizations should be tracking in order to assess their current situation, stabilize their business model, and start generating working capital. You can see the first two metrics here. This month, I’ll examine the next two metrics in the series which have to do with how you’re retaining new patrons once they’ve come for a first time.
Metric #3: Data capture rate
If we want to cultivate an arts patron, we’ve got to know their history with our organization first. That starts by collecting their contact information. In the above video, David Seals of TRG Arts explains why capturing contact information can mean serious revenue gain—or lost opportunity. He’ll also review what contact information you should collect and tips for collecting it at the point of sale.
Why measure data capture rate?
Every record in your database tells a story. Each visitor, member, and donor has a different and unique relationship with your organization. Do you have the full story of patronage at your organization? That depends on how well you’ve been collecting patron data. It starts with capturing the contact information for your patrons. From there, you can link purchases made by the same patron. Eventually, you know the history of and context for the patrons who engage with you.
Your data capture rate tells you not only how complete your patron history is, but also indicates your potential for re-engaging audiences. If a new patron comes to your venue, you have the ability to invite back them again only if you have their contact information.
How to measure data capture rate:
You’ll need the following numbers from your database or CRM system:
- Find how many of your patrons were new this year or season. You can usually find this in your database by searching for how many records were created this year.
- Then, find out how many of those new patrons have complete contact information in your database. You can find this by analyzing blank fields.
Then divide the complete records by the total records, like so:
For example, if I work for a museum which sees 10,000 new visitors this year, and I capture the names and contact information for 1,700 of them, my data capture rate is only 17%.
A note: When I say “complete contact information,” I mean street address, phone number, and email address. You might ask: “why do I need to collect ALL of that information? Isn’t email address enough?” It’s a good question. TRG has found that the organizations which run multi-channel campaigns get the best results. Running a multi-channel campaign that involves direct mail, email, online re-targeting, and telemarketing keeps you from leaving money on the table.
I also hear arts professionals say that direct mail is increasingly ineffective, and that mailing addresses are harder to collect. I’ve seen those articles, too. But, the evidence is mixed. In general, the volume of direct mail is decreasing significantly year after year. This means that you have less competition at the mailbox than ever before. A recent study from Temple University found that direct mail is better at eliciting an emotional reaction from recipients, holds their attention longer and plays a more direct role in their decision-making. This might be especially important in the arts, where the productions and exhibitions we market have an intrinsic, emotional value.
What data capture rate tells you:
This number can be a warning sign. Any patron for whom you don’t collect contact information is a patron that you can’t contact again. That means you may be missing out on revenue for any patron with blank contact information fields.
In the video above, David illustrates why collecting contact information isn’t a “just-for-the-heck-of-it” type initiative through the example of a museum. Museums typically collect less than 15% of their visitors’ contact information. When you take into account the typical response rate and average revenue gained from campaigns to new visitors, you can actually calculate the revenue you’ve lost. In our hypothetical example, it was over $100,000. To see the calculation, watch the video, or read this blog post.
What can you do if your data capture rate is low? Find creative ways to collect data, ways that your audience will find fun, useful, and convenient. Here are three ways you might approach this:
- Your greatest opportunity is likely by incentivizing patrons to purchase online in advance. It’s much easier to get contact information online than by phone or at the ticket kiosk. With any ticket purchase, let the patron save money if they buy online. A discount of a few dollars is often much less that the money you’d lose by not being able to contact the patron again.
- If that’s not an option for your organization, check out this list of ideas for data capture at your venue.
- And, consider creating incentives for your box office staff to collect contact information. Create a quarterly or annual goal for data capture rate and reward staff with a pizza party, gift cards, or fun prizes if they meet the goal.
Metric #4: New audience churn rate
Churn. Attrition. Turnover. Call it what you will; the fact is, you’re losing new patrons. With few exceptions, arts organization over-prospect for new audiences and under-retain them. In the above video, Jim DeGood of TRG Arts explains why retention matters, how to measure your risk, and a simple 4-step process for retention that you can implement at your own organization.
Why measure new audience churn rate?
New audience churn rate answers one simple question: How many new ticket buyers or visitors do we lose each year?
Why is this number important? Well, if you’re like most organizations, your marketing department spends a lot of time and money attracting new audiences. But are you also spending time and money on keeping them once you’ve got them? Many organizations don’t.
When TRG studied this metric with a group of performing arts organizations, we found that, on average, 4 out of 5 patrons bought one ticket and never purchased another. That’s 80% of newbies. When you’re trying to build a sustainable organization which relies on engaged, fanatical audiences, this is really bad news.
You’re going to end up spending a lot of time and energy filling and re-filling what is basically a leaky bucket. When you start focusing on loyalty and retention, you can begin to focus on patching up the holes instead.
How to measure new audience churn rate: Find these numbers:
- What was your last completed season or year? Go back one year from that and find how many of your patrons were new. You can usually find this in your database by finding out how many patron records were created that year.
- Second, figure out how many of those patrons didn’t come back last season.
Then divide the number of patrons who didn’t come back by the number of new patrons, like so:
This is the most basic way to measure this data point. You can also go back several years and see how many haven’t come back for two years, or even five years. The patrons who have attended in the last two years are much more likely to continue attending. After that, you may have lost them for good.
What new audience churn rate tells you:
The most useful application of this metric? It tells you if you really and truly have a challenge attracting new audiences. Most organizations think they have this problem, but most actually do attract enough new audience members a year. On average, 50% of households are new, according to our research. The problem starts when 80% of those new households don’t return. It gets worse if you’re not able to attract enough new patrons each year to replace the 80% who churned through.
When you get more patrons to come back and lower your churn rate, you can begin to grow loyalty—and revenue—for your organization.
Remember, too, that relationships take time. Loyalists are made, cultivated over time—not born. A loyal relationship is like a romance. You wouldn’t ask someone to marry you on the first date. Similarly, most patrons first move through ticket buying and subscribing before they think about making a donation, the highest-ROI activity for arts organizations. For most first-time patrons, the right next step is a second ticket or visit—a “second date.”
In the above video, Jim explains the example of Seattle Repertory Theatre, which created a 4-year program to cultivate new patrons from first-time buyer to renewing subscriber. Read more about that case study here, or watch the webinar here.