Case Study: Arts Club Theatre Company

Case Study: Arts Club Theatre Company

Arts Club Theatre Company puts data to work


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The Situation:

Thanks to advances in CRM technology, arts organizations now live in a world awash with data. Getting data points is not usually the hard part. What’s difficult is taking action on what the data tells us and making changes to strategy to cause metrics to move up or down. That’s what makes Arts Club Theatre Company’s most recent success story so impressive.



This Vancouver-based theatre company has been a TRG client since 2008. In the first two years, Arts Club saw $3 million in earned revenue growth. Since then, Arts Club’s focus on building patron loyalty resulted in a further 30% increase in single ticket and subscription revenue.






"Deepening loyalty has strengthened our subscription campaign. Cultivating the “and”—subscriber AND donor—has made our patrons stickier and more responsive. Viewing our patrons through this united lens has enhanced the patron experience."

-Bryan Woo, Director of Sales & Marketing




How the most important actions for each patron were determined:

In 2014, TRG implemented its Patron Loyalty Index (PLI) analysis to quantify patron loyalty and inform next steps in the company’s strategy. Every patron who has had an interaction with an arts organization is an Advocate, a Buyer, or a Tryer. This is a holistic view of patrons, based on the total amount they spend with the organization, how frequently, and how recently. This analysis takes into account patrons’ activities across an organization, including single tickets, subscriptions and memberships, donations, and special events.

 Advocates

Advocates are the most loyal and most invested patrons. Staff are likely to know the names or faces of many of these board members, major donors, and long-time subscriber-donors.

Arts Club Theatre Company had a low number of Advocates who also weren’t investing as much as they could, compared to the study group average.


 Buyers

Buyers contribute less on a per capita basis than Advocates, but are still loyal subscribers, members, donors, or even avid single ticket buyers. They tend to invest in a variety of ways, across multiple purchase types—what we call the magic of “and.”

Arts Club Theatre Company's Buyers were investing a lot revenue-wise, but the total number of Buyer households was small. Arts Club needed more Buyers to eventually advance to the Advocate level.


 Tryers

Tryers are the largest and least loyal group, spending the least per capita. Tryers are new audience members, one-time ticket buyers or visitors, and occasional attendees.

The vast majority of Arts Club Theatre Company's households were Tryers, the least loyal group of patrons. They were above average in both household numbers and revenue numbers.

 



The Strategy:

Patron Loyalty Evolution: Advocates, Buyers, and Tryers

Arts Club now had a breakdown of the proportion of Advocates, Buyers, and Tryers in their database, as well as which specific patrons fell into which category. To take action from data, Arts Club had to understand three things:

1. What was the data really telling us?

2. Why are we seeing these outcomes?

3. How can we change to get results in this area?





Why are we seeing these outcomes?

The role of annual fund in Canadian culture.

In Canada, the culture around philanthropy giving is relatively new and not as strong as it is in the United States. Arts Club’s annual fund program had only been in existence since 1998. Many patrons had no giving history at all.

Resources focused on loyalty.

TRG performed a Resource and Responsibility Assessment, an analysis that serves as a guide and context for making resource and investment decisions, taking into account factors like staff time and budget allocations. This assessment illuminated four important findings:

  • They had invested heavily (and appropriately) in developing Tryers and Buyers.
  • They had less focus and fewer resources directed toward donors, which explained why there were many subscribers who had not yet developed into donors.
  • There were no dedicated resources devoted specifically to stewarding Buyers to Advocates.
  • There wasn’t currently bandwidth in the development department to take on the Advocates that the data indicated they could develop in the future.

 



What can we change to get results in this area?

Here’s where strategy meets tactics. Arts Club recognized that they needed to bring more focus and resources to moving Buyers towards Advocacy and in particular, to widen the organization’s philanthropic efforts as more Buyers indeed became “donor-ready.” They’ve begun to create a culture that embraces fundraising as part of a patron’s evolution, including the following initiatives:

Meet the cultivation team.

Arts Club formed a cultivation team with one staff member from marketing and one from development who work together to shepherd Buyers towards advocacy. The cultivation team had eight goals, formulated as a result of the loyalty work. They included increasing the percentage of subscriber-donors, retaining more new subscribers and single ticket buyers, and growing new entry-level donors, among others. These goals represented potential revenue of $2.3 million.

From major donor cultivation to Advocate planning.

Arts Club now had a list of Advocates, which identified those patrons who were highly invested in the theatre. They could now think about individual cultivation for patrons who were loyal, but not necessarily giving already. “There were a surprising number of non-donor Advocates,” Director of Development Kathy MacKenzie said. “We asked all the non-donor Advocates to become donors, and about 30% became donors as a result.”

The Patron Loyalty Index also enlarged Arts Club’s thinking on who they should invite to join the Artistic Director’s Circle. Before, Arts Club looked to existing mid-level donors first. Having the list of Advocates helped Arts Club identify new prospects, including those very loyal patrons who’d only made lower level donations in the past.

Annual fund campaign.

Arts Club also changed their annual fund campaign. In order to implement their loyalty strategy, they used both the lists of Advocates, Buyers, and Tryers from the PLI, as well as standard segments like donors, subscribers, and single ticket buyers. They targeted specific segments of subscribers and lapsed donors with customized messaging and offers.



Deepening loyalty, retaining new patrons

TRG ran the analysis each year from 2013 to 2015. Over the three years, the total number of patrons in the database stayed steady. The number of Buyers and Advocates increased proportionately in comparison to Tryers, indicating that Arts Club was effectively deepening loyalty and creating an infrastructure for retaining new patrons.

 

Arts Club Theatre Company Patron Loyalty Index: 2009-2015



Increased Annual Revenue

 

“Most Arts Club patrons aren’t aware that we’re a charity and that we rely on donations, grants and sponsorships to stage our productions, develop new work and train emerging artists. Working with TRG has allowed us to develop a multi-pronged approach to our annual fund campaign. We have shifted our fundraising strategy and invested significantly in our individual giving program. As a result we have more resources to invest in new play development, youth and education programs and organizational capacity.”

-Kathy MacKenzie, Director of Development


They saw an 88% increase in annual fund revenue and a 59% increase in donor households over 5 years.


The results:

 

More upgrades, fewer downgrades

 

Arts Club Theatre Company is exploring how to increase patron loyalty with TRG’s Capacity Building Consulting and Patron Loyalty Index.

How loyal are your patrons? Which loyalty metrics should you be using? Curious how your patrons fall into ABT categories?
Answer these questions with your own Patron Loyalty Index.

To explore a consulting partnership for your organization, email  .

 



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The Situation:
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Posted April 13, 2017




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