Case Study | TPAC Achieves Huge Subscription ROI Via Segmentation Strategies
For the past few seasons, Tennessee Performing Arts Center (TPAC) has engaged with JCA Arts Marketing on analyzing customer behavior. In the summer of 2017 this culminated in the development of a customized segmentation strategy. This strategy categorized their audience based on shared transactional behaviors in an effort to communicate more effectively with those patrons. The launching of this strategy began with the 2017-18 subscription acquisition campaign and the goal of increasing ROI through targeted messaging.
The first step was to split up the audience into groups most likely to subscribe and then determining the best offer for them. Previously, a season brochure with the same messaging regarding Full Season subscriptions had been sent to every patron who may have expressed interest in purchasing a subscription. We wanted to be more sophisticated for 2017-18. Through use of the Segmentation Engine and the custom segments that had been developed, the following audience members were identified as most likely to subscribe:
- Lapsed Broadway season ticket holders for 2014-15, 2015-16, and 2016-17
- Custom Segments:
- Loyalists – Attended 5+ performances annually, attending 4 of the last 4 years
- Enthusiasts – Attended 3+ performances annually, attending 3-4 of the last 4 years
- Regulars– Attended 2+ performances in 3 of the last 4 years
- Dabblers – Attended 2+ performances in 2 of the last 4 years
- Oncers– Attended one performance over the last 4 years
The first action was to send a Full Season acquisition brochure to those most likely to subscribe to the entire season. The messaging focused on recognizing the patron’s dedication to Broadway and that subscribing would allow them the best seats and best deals for that valued experience.
The Full Season brochure went out to the lapsed subs (3,412), Enthusiasts and Loyalists (427) for a total of 3,839 total recipients, and saw:
- 236 Households purchase = 6.1% response rate
- 420 Packages = 5% of all packages sold
The piece cost TPAC $2,133.13 to make and revenue from the piece was $138,505 giving them an ROI of 6,393%.
The second action was to send a brochure to patrons most likely to purchase a Flexible Package. The messaging focused on the flexibility of being able to select only the shows the patron was interested in and that locking them in ahead of time would guarantee the best price.
This Flexible Package piece was sent out to Regulars, but only Regulars with an average ticket spend that was within the high to mid-range. Further filtering was done in the Segmentation Engine to identify those people. This was a total of 5,066 recipients. And saw:
- 179 Households = 3.5% response rate
- 420 Packages = 5% of all packages sold
The piece cost TPAC $2,090.70 to make and revenue from this piece was $113,810.50 giving them an ROI of 5,344%.
The final action was to send a postcard to patrons with less engagement and frequency who might be interested in a Flexible Package. The postcard showcased the season and the flexibility and savings of the Flexible Package without the full copy of the brochure.
This postcard was sent out to Regulars with a lower average ticket spend, as well as Dabblers & Oncers, with an average ticket spend in the mid to high range for a total of 28,071 recipients. And saw:
- 188 Households = .67% response rate
- 396 Packages = 4.7% response rate
The piece cost TPAC $5,897.64 to make and revenue for this piece was $101,166.50 giving them an ROI of 1,615%.
Here are the total results of the 2017-18 campaign compared to the results of the 2016-17 campaign:
We can see that in 2017-18, subscription acquisition pieces were sent to 87,886 fewer patrons than the previous year, but saved $9,327 in cost and brought in an additional $22,313 with more households responding and packages sold. The total response rate increased by 533% and ROI increased by 211%. This work proves that through analyzing customer behavior and better segmenting of audience messaging, it is possible to greatly increase revenue and reduce costs.
Are you confident in your segmentation strategy?
Sophisticated audience segmentation strategies allow you to target the right people at the right time with the right message. Without a strong strategy, you might be leaving money on the table. We can help.