Sunday, June 22, 2008

For those who have been predicting it...

it seems like the time has come: Facebook Blows Past MySpace in Global Visitors in May.

Although I don't think that MySpace is disappearing anytime soon, I would continue to encourage organizations to find creative ways to capture contact information from their MySpace friends (think product giveaways and contesting).

Thursday, June 19, 2008

National Performing Arts Convention: The Value of a Seat

Notes from the session "The Value of a Seat"

Moderators: Charles Isherwood, theatre critic, The New York Times; Joanne Steller, vice president, strategic communications, Target Resource Group Speakers: Jon Limbacher, vice president and chief operating officer, St. Paul Chamber Orchestra; Phillip Matthews, director of communications, Theatre Communications Group and manager, Free Night of Theater; Ellen Walker, director of marketing and communications, Pacific Northwest Ballet

Phillip Matthews (Free Night of Theater – TCG)
-started out as a pilot program in 2005
-now in over 100 cities and expect to offer more than 500,000 free tickets this year
-1/3 of audiences made under $50k, and were non-white
-suggestion: when theaters offer complimentary tickets, they should collect the contact information for each attendee so that they can follow up with them and invite them back (as a paid attendee).

Jon Limbacher (St. Paul Chamber Orchestra)
-he felt that if an organization doesn’t have a significant, growing, sustainable audience, it should make you question your purpose
-viewed price as a really important factor in the relationship that an organization has with its patrons. They designed their pricing (most by drastically lowering their prices) to create a “philanthropic” relationship with their patrons rather than a “consumer” relationship with them.
-In their community concert series, their original prices were between $11 and $47. They lowered the prices so that 60% of all tickets are $10 and 40% are $25. They went from have houses at 60% capacity to 90% capacity.

Ellen Walker (Pacific Northwest Ballet)
-their goal is to maximize price for each seat sold
-when a performance is sold to 80% capacity, they raise all tickets by $5. Once the performance is sold at 90% capacity, they raise all tickets by $10.
-they continue to have access programs for patrons that cannot afford full price tickets.
-on average, this dynamic pricing structure brings in $200,000 more in earned revenue per year than the previous model
-the company has several hundred thousand attendees each year, and in the five years that they have had dynamic pricing, they have fielded one complaint from a patron
-there was much more internal debate over dynamic pricing then there was customer dissent

Sunday, June 15, 2008

National Performing Arts Convention: Jim Collins (Going from Good to Great)

Notes from Jim Collins' session "From Good to Great and the Social Sector." Best-selling author Jim Collins discusses his groundbreaking theory on what makes the difference between a "good" organization and a "great" one, and how to achieve superior performance in the social sector.

  • We are not imprisoned by our circumstances, but we are freed by choice and our decisions.

  • The best performing stock in the history of traded stocks is Southwest Airlines, and there isn’t an industry tougher than the airline industry. Talk about a tough circumstance, and they seemed to outperform everyone.

  • It is the wrong ideas to say that the primary path of success for arts organizations is to become more like businesses. Most businesses are average, so why would you want to strive to be average? The critical questions should be what causes an organization or a business to go from good to great, instead of modeling your organization’s behaviors after a for-profit business.

  • Greatness is a cumulative process—most major successes are built over substantial periods of time. In their studies, most major successes were twenty years in the making and on average, it took seven years of great work before a company experienced a “breakthrough.” Consider that for thirteen years Starbucks had five stores, now it seems like they are opening five stores everyday.

  • The most common cause of substantial decline was found in organizations which made large, undisciplined growth changes. They tried to do too much, too quick and were not prepared.

  • Great companies in turbulent times don’t believe that most of their successes or failures lie beyond their control. They believe that their destiny is in their control, and will not settle for excuses.

  • Who comes before what. In order to change an average performing organization, you don’t necessarily need an inspirational or motivating leader, the organization needs a leader that seeks to get the right people on the bus, and in the right seats, and the wrong people off the bus, After that is accomplished, then they settle on a collective visions. The ultimate hedge against an uncertain world is who you have with you. Invest in people first, before you invest in a plan.

  • #1 Responsibility of a Leader: Make sure that key leadership roles are filled by the best people who are committed and capable of success.

  • Great leaders must understand that sometimes the work is too important and critical to be nice. If you know that someone or something isn’t working, make an adjustment as soon as possible.

  • In their research, they found that the one key difference between good leaders and great leaders was humility.

  • Many people in an organization don’t have enough power to push through a good idea on their own, but there are numerous people in an organization that have enough power to stall or stop a good idea. Great leaders do not seek consensus decisions, but the right decisions. Leaders need to architect an environment to get enough people behind a good idea to send it forward. (He noted that great decisions usually were never made by consensus).

  • Non-profit organizations needs to put metrics in place to measure success. In the for-profit world, this isn’t an issue because success is measured on return on invested capital. However, non-profits aren’t measured in the same way. You should know how to tell if your organization is doing well or not. The organization needs to show enough results so it is apparent that the organization is successful, because people (primarily donors) want to support winners.

  • Every great organization is clear on who they are and what they do. They also know when they should say no to something that is beyond their scope no matter how “tempting” the proposition is.

  • Great companies manage themselves in good times like they were currently in turbulent times. You need to be disciplined enough to build reserves during prosperous times.

  • An organization could approach a significant change by using all of its gun powder to launch a large canon ball at its target. This usually results in finding that you aim is 30 degrees off, you haven’t hit your target and have no more gunpowder to fire another canon ball. What you should do is use a small amount of gunpowder to fire a small bullet at your target. When you see that you are 30 degrees off, make the adjustment and you will have enough gunpowder to fire another shot. Hopefully you will find that your aim is off by a smaller degree, maybe 15 degrees. Make an adjustment, reload, aim again, and repeat until you hit the target. Once you hit the target, then get out the big canon ball. You should advance strategically so that you never miss big.

Thursday, June 12, 2008

TCG Conference: Kinney Zalesne (microtrends)

Notes from the TCG Opening Plenary Session: Kinney Zalesne, co-author, microtrends: the small forces behind tomorrow's big changes: hear about some of the emerging communities whose tastes and lifestyles are shaping our future.

Microtrends are the small forces behind tomorrow's big changes. 25 years ago, the market depended on megatrends for change. Megatrends were universal forces that swept through and affected everyone (such as changes in technology). Today there is such an exploration of choice that microtrends (small forces--maybe less than 1% of the total population) can cause major trends in the marketplace.

Old Economy -- "The Ford Economy": one size fits all. The Ford Company were the masters at inventing and designing one black car that could be manufactured 1 million times and could serve the needs of a large number of people and this satisfied the consumer demand.

New Economy
-- "The Starbucks Economy": highly tailored to your personal desires; one can get almost anything they want, the way they want it; think about all the different combinations of coffee drinks that you can order at Starbucks.

People are changing things in their lives that only a couple of decades ago was thought to be unchangeable:
1. Cosmetic surgery is now a $12 billion industry in the U.S. because we now have a large number of choices we can make in regards to how we look. Some of the largest growing segments for cosmetic surgery is teenagers and men.
2. We can now pick our gender. Beyond sex reassignment surgery, a growing number of people find the traditional categories of male and female too constraining (they call themselves unisexuals). 100 corporations and 75 universities have banned discrimination on gender identity, and unisex bathrooms are popping up all over the place.

In all areas of our lives, there is an increasing amount of choice. We can no longer wait for megatrends, we must now focus on microtrends.

Microtrends Contradict:
- We have more affluent couples now than ever, but they were staying in the workforce longer
- We have more scientific knowledge than ever before, but there are 2 to 3 religions created in the world each day.

Microtrend Mindset:
- We must be comfortable holding inconsistent ideas in our heads at the same time (trends are going in every direction at a fast pace)
- We must respect the true breadth and complexity of human beings.

Microtrend Examples:
1. Long Attention Spanners
-growing group of people who want more information not less
-will listen as long as you engage them
-1/2 million Americans run marathons (they want to complete a long journey)
-Foreign Affairs Magazine has increased its subscribers by 13%
-Best-selling novels are on average 100 pages longer than they were 10 years ago

2. Young Knitters
-Teens and 20 something knitters grew from 3 million to over 6 million between 2002 and 2004
-They want old fashioned entertainment in a high technology world

3. Non-profiteers
-non-profit sector is growing far faster than the for profit or public sectors
-more than 12 million people make their living in the non-profit sector
-these folks are social entrepreneurs and people on a mission
-for profits are looking at the non-profit sector for how to attract employees

4. Southpaws Unbound
-1 in 6 people are left-handed
-more businesses are making products for left-handed people
-parents used to worry about their left-handed children and they wanted their kids to conform to society so they could fit in (and thereby taught them to use their right hands). Now parents celebrate their children's individuality.

The microtrend world is fragmenting more around issues, which is putting more pressure to find the values that bring us together--what makes us human? The arts explore these issues.

Tuesday, June 10, 2008

Web Channel Marketing and Advertising Survey

I have just arrived in Denver for the National Performing Arts Convention and the TCG Conference. I will be blogging from both conventions, and I can't wait for the official kick off later today.

On my way from DC to Denver, I reread the results from a survey that Arena Stage participated in a couple of months ago, and found a couple of surprising things that I figured I would share with you.

Bil Schroeder, Director of Marketing & Communications, at South Coast Repertory commissioned Klear Sky to study marketing and advertising practices at some of the larger regional theaters in the nation. Participating organizations included South Coast Rep, Center Theatre Group, Huntington Theatre Company, La Jolla Playhouse, Arena Stage, Steppenwolf Theatre, Seattle Rep, Goodman Theatre, Actors Theater of Louisville, Yale Rep, and several others.

Below are some results that I found to be interesting:

1. The average numbers of e-mail sent per month by survey participants was 6.3, but on the high end, one organization on average sends 13 emails per month. We can only assume with so many e-mail campaigns sent per month that this organization uses highly segmented and targeted campaigns.

2. There was one question on the survey that was misinterpreted by most of the respondents. The question was: "What is the average number of online impressions you have per month." I answered for Arena Stage, and I went back into our online impression reports from the past three months from every place online that we advertise. On average, we had 3,145,182 online impressions every month. Arena Stage had by far the most, with the average being 1.6 million of impressions. However, one organization reported only having 13,000 online impressions. Online advertising is relatively new, and this misinterpretation shows me that we aren't all on the same page on how to measure the impact of online advertising.

3. "Single ticket direct mail advertising has stayed the same or increase for 80% of the respondents. This remains a strong channel for advertising even with the rise of online and email advertising." I found this surprising because our direct mail campaigns at Arena Stage have decreased mostly because we are finding much higher ROIs on other types of campaigns, especially with the cost of the stamp constantly going higher and printing/delivery costs skyrocketing because of the fuel crisis.

4. Only 40% of respondents reported spending less on newspaper advertising over the past three years, which I found shocking. The state of the newspaper nationally is abysmal. Most newspapers are bleeding subscribers, and raising rates on advertising, so in essence we are paying more for less. However, it seems that less than half of the companies have reduced their expenditures which suggests that some folks like to stick with the tried-and-true techniques even as they become less and less effective.

5. Out of all the respondents, the organization that had the oldest website had their last redesign in February 2003. Most of the organizations have had a major redesign since December 2006. A note from Klear Sky says "websites that are older than three years run the risk of feeling dated and old." I always thought that the life span of a website was around four years, but now it looks like it is three years or less.

6. In 2004, I started speaking at conferences about using social networking platforms to promote arts organizations. At that time, most people didn't know what MySpace was. In this survey, 87% of the respondents reported to using MySpace and Facebook to promote their organizations.

Thank you to Klear Sky and South Coast Rep for publishing the information from this incredibly helpful survey.