Success Story | Spoleto Festival, USA
In 2013, Spoleto Festival USA took steps to understand – and remedy – flattening ticket sales and revenue from their annual 17-day event. The Festival had been facing rolling venue renovations from 2008 through 2015. Prior to 2013, the festival had relied on traditional pricing models, but leaders were now ready to look at dynamic pricing to bolster sales. Spoleto hired JCA Arts Marketing to examine their ticketing data and recommend actions to maximize revenue.
JCA Arts Marketing focused on the 2014 and 2015 festivals to help increase audience attendance and overall revenue.
Upon licensing the Revenue Management Application (RMA) for Tessitura, JCA Arts Marketing examined Spoleto’s data three months prior to their 2014 festival. The objectives: identify performances for which prices could be increased, and discounts be limited. The data predicted assumed high-selling performances, while others were surprises. The data also revealed one fifth of the tickets to any given performance were sold one week or less before that event, so JCA Arts Marketing recommended pricing increases for that period of time.
As a result of these dynamic pricing innovations, Spoleto realized:
- $52K in incremental revenue
- An average yield increase of $3 per ticket sold
- 4,600 fewer discounted tickets sold, saving $200K
JCA Arts Marketing also examined the pricing structure for the festival to determine patterns of demand across genre, venue, day of week and position in the festival. This was accomplished using a streamlined pricing grid to set a standard starting price that would set a correct value across all performances. It allowed for ease of setting prices in assigning, for example, a high score to performances in popular genres and slots in the festival and using that total score to determine what the starting price should be.
Leveraging the RMA once again, JCA Arts Marketing began examining demand as soon as performances went on sale in December. With a set routine for analyzing the data, Spoleto was able to change prices frequently without customer complaint, realizing:
- $216k in incremental revenue
- The highest % capacity sold in the past 4 years.
JCA Arts Marketing also employed Customer Behavioral Segmentation to uncover ways to increase revenue. Using a copy of Spoleto’s database, audience buying patterns were analyzed in terms of when they buy, how much they buy, and how much they pay; then the data was split on whether they are local to Charleston, or not.
As a result, Spoleto is developing a new approach to marketing and discounts for the upcoming 2017 Festival. Plans are under way to segment audiences according to when they are in the market to buy tickets, and send discount offers to only those who are price sensitive.