The idea of customer retention is quite simple: have the same people buy tickets year after year.
But, it is not that easy, and on the other side of retention is attrition: the rate at which your patrons leave, never to buy tickets again.
It is natural to experience some attrition, but, if the two sides of retention and attrition are not well managed, it can make the difference between a trickle and a torrent of lost patrons.
THE VALUE OF RETENTION
Most arts administrators know it is an endless and costly search to acquire new ticket buyers.
- It is estimated to cost 5 times more to obtain a first-time ticket buyer than it does to keep an existing customer.
- The Harvard Business School reports a 5 percent increase in customer retention can increase profits by at least 25%, and possibly up to 95%.
- A returning ticket buyer is likely to spend twice as much as a newly acquired patron.
- 9 out of 10 first-time buyers are not likely to return.
So it doesn’t take much to recognize the sound economic necessity of retaining your ticket buyers from one year to the next.
IT’S YOURS TO EARN
To a great extent, retention is tied to the loyalty your ticket buyers feel towards your company. But that implies the relationship flows from the customer to your organization.
It is much wiser to reverse the direction of the relationship: retention comes out of the emphasis and investment you place on customer service and overall experiences.
You have to earn that loyalty.
PUTTING IT INTO PRACTICE
- Customer retention needs to be embedded in the marrow of your organization and the actions of its people. Don’t wait until you are about to launch a new ticket campaign; instead work on retention throughout the year, so your ticket buyers are there when you need them.
- Your front line staff should be your ambassadors of customer retention and contributors to your patrons’ experiences. Give guidelines to your team, but give them flexibility to be responsive to situations as they arise. Fast, courteous service is key to great experiences.
- Get to know your ticket buyers through your data. Create a picture of them and understand why they attend your performances. Delve into the data to learn the attrition patterns. If you discover the patron life cycle is shorter than you thought, you have an opportunity to work towards extending the relationship.
- Use surveys to help collect information, so that you can better understand your ticket buyers. Go beyond basic satisfaction questions, and ask about their interests and motivations. And continually ask for feedback.
- When you receive feedback, you need to listen to it. A customer may not always be right, but their perceptions and opinions are right to them and that is what matters most. Try to understand the root cause of negative feedback, as there may be more to it than you were initially told.
- Relationships are based on interactions. If the interactions are few and far between, the relationships will have little substance and no staying power. Find frequent and varied opportunities to connect with your tickets buyers in order to deepen the relationships.
- Communicate with your patrons; don’t talk at them. Give your patrons value, and provide them with information. If you only focus on ticket sales, you will never build relationships. Also, communicate frequently, as you never want to give your patrons an opportunity to forget you.
- You know the service you want to provide to your customers, but do you know what they are actually experiencing? That subscription form that took so long to design may not be as user-friendly as you thought. The “on hold” music on the telephone may be completely inappropriate to your company’s brand.
- Set goals. Go back to your data and look at how many people bought tickets over two years and how many bought tickets in the first year only. What is your retention rate? Now consider what you will do in the next year to improve that rate and set a goal accordingly. If you reach a retention rate of 75% or 80%, you are doing well.
FINAL QUICK TIPS
- Send personalized welcome cards to first time buyers.
- Surprise people with unexpected gestures. It doesn’t have to be expensive – it is surprising the joy a little piece of chocolate can bring.
- Send a thank you email to your patrons following a performance.
- Immediately after a first-time experience, send new ticket buyers an incentive to return for an upcoming performance.
- Above all, be proactive.
A lot of money and time goes into finding new ticket buyers, and the majority will not return. Invest in your current patrons and you save time and money on marketing, you have more people attending your performances, and you have a stronger bottom-line. Designing a customer retention strategy is not difficult or costly, but it does have to be deeply rooted throughout your organization. Customer retention is a mindset. Add greater loyalty and increased satisfaction to the already mentioned benefits, and you are well on your way to a long-term relationship with your patrons.
Thanks for reading. Paul