Last month, while visiting another city, I purchased full price tickets to attend what I knew would be a superb ballet performance. I was eager to attend and although the tickets were costly, I didn’t hesitate to buy them.
The day after the performance, I received an email from the dance company with very interesting follow-up information about the performance I saw, including fascinating interviews with a featured dancer and a choreographer. This served to enhance my already fabulous experience with the company.
In the same email, I received an offer for 50 percent off tickets to another program that would take place in about two months. I had several concerns while reading this offer. Was the upcoming program expected to sell poorly, so that the marketers had to lure people to buy tickets at low prices? Are such low price ticket offers common, meaning that I may have overpaid for the wonderful program I had attended the previous day? (At the time of the performance, I thought the experience was well worth the money.) Would I consider paying full price in the future after receiving such a discount, or would I search for other discounts and only attend if I were able to “get a deal?” It occurred to me that if I lived nearby and considered subscribing, subscriber ticket prices would not be discounted as much as the offer I had just received. Why would I ever subscribe with these low prices available to me as a single ticket buyer? How is a patron to know what a ticket is really worth?
I subsequently learned from the dance company’s marketing director that a consultant who specializes in pricing advised her to offer a 50 percent discount to people who had purchased tickets one time, based on the fact that most people who come once don’t return. This situation is known in our industry as “churn,” and it’s one of the most serious issues arts marketers face. However, price is not typically the primary reason people do not return. More commonly, the issues are with the art form, the programming, or with people’s own busy schedules. It has been said by some savvy arts marketers that relying heavily on pricing strategies to grow the audience is reflective of laziness and is usually ineffective in the long term.
It is interesting (and curious) to me that the same ticket pricing consulting group that recommended luring new single ticket buyers to return a second time with a 50 percent discount later published the following in its own eblast: “Use subscriptions as a way to give your most loyal patrons the best access to the best prices. Non-subscribers should never (italics mine) get better prices than subscribers, even for low-selling events.”
I have found in my own consulting and research that subscribers are the most loyal attenders and are the least price sensitive of all ticket buyers. At some organizations where I have consulted over the years, I have eliminated subscriber discounts without losing any subscribers. I’m not sure that strategy could work well now that people have become accustomed to “getting a deal” and expect it, even if they consider the full price fair.
As for non-subscribers never getting better prices than subscribers, I think that the best way for arts marketers to think about discounting is to never say never. There are many opportunities for using discount pricing strategically and effectively, for long term as well as short term benefits to the organization. Discriminatory and dynamic pricing are covered in depth in my book: “Standing Room Only: Marketing Insights for Engaging Performing Arts Audiences.”
Finally and importantly, arts organizations need donations from single ticket buyers more than ever, as subscriptions continue to erode. It is difficult to make a strong case to single ticket buyers that the organization needs their donations when it is so readily offering two tickets for the price of one.
Watch this blog soon for a fascinating description of the new loyalty program at Teatro Piccolo in Milan, one of the finest theaters both artistically and managerially. Lanfranco Licauli, director of marketing and communications, has worked hard to create this guest blog which explains in detail their program which is geared to both subscribers and single ticket buyers.