Revenue / 05.10.18
Increasing Revenues in the Most Profitable Way
While it may seem obvious, it’s worth repeating: Both profitability and growth are necessary to run a successful business. But what can you do to increase revenues in the most profitable way? At the 2018 INTIX conference in Baltimore, three panelists answered that question by presenting a three-pronged strategy around the digital journey, branding and real-world strategies ― and explaining how they work together.
“Every business, whether they are in the ticketing industry or any other industry, typically wants to grow year to year,” said Tom Wheaton, vice president of sales for accesso ShoWare. “It’s a measuring stick. But the thing we need to ask ourselves is how do we do it in a profitable way? It’s not enough to increase revenue; there needs to be attention given as well to profit, the return on your investment.”
Laying the foundation for the panel and today’s mobile revolution, Wendi Yanez, sales director for accesso ShoWare, shared some facts and stats:
- Global digital ticketing transactions are forecast to reach $32 billion by 2019.
- Twenty billion mobile devices have been sold worldwide.
- Average smartphone shopping cart abandonment is 84 percent.
- Consumers want responsive design — they do not want to pinch and expand the screen to see information.
- Sixty-four percent of users want webpages to load within four seconds — 10 seconds is too long.
- Forty percent report that they will turn to a competitor if your website does not offer a good e-commerce experience.
The Digital Journey
The ticket office is now literally in the hands of your customers, and expectations for e-commerce are high. It has to be fast and simple or they will move on to something else.
“Patrons want the convenience of online sales. They want to shop 24/7, when it is convenient for them. As an organization, you should really want this as well, because the online or self-service sale is where your patron is doing all the work,” said Yanez.
Increasing profits isn’t only about increasing revenue. It’s also about keeping operating costs down. “A ticket office sale represents the highest cost per conversion. An online sale, on the other hand, is the lowest cost per conversion,” said Yanez.
With that in mind, it’s a no-brainer that increasing online conversions represents an incredible opportunity for organizations. But how do you do that?
One way is to reduce shopping cart abandonment, which Yanez describes as a lost opportunity. “I think customers have certain expectations when purchasing online,” she said. “As long as you understand this, you can begin to create better strategies to complete the sale.”
Here are some reasons why people don’t follow through on a purchase:
- Fifty-six percent abandon carts due to unexpected costs. “In ticketing, it could be costly facility fees, order fees or processing fees. A patron can commit to purchasing a $50 ticket, but by the time they get into the basket and all the fees are added, they can no longer afford it and may abandon the cart at that point,” said Yanez.
- One out of four patrons will drop out of a sale if it is too complex. “Honestly, I am amazed at how often I see complicated checkout processes,” said Yanez. “How hard should I have to work to buy a ticket or something else online? Oftentimes there are too many steps to go through, like having to set up an account just to be able to shop, adhere to super complex password requirements, or suffer through an unspecific error message. Sometimes you have no idea where you went wrong on a form, but the system won’t tell you, so you can’t get to the next step in the process.”
- Fifty percent will cancel their purchase if their payment method isn’t available. This one really bothers Yanez, because she said she’s had the experience herself when trying to pay with American Express. “If you are not offering a certain payment type because you think it is more expensive, it could be hurting your sales,” she said.
The bottom line: Don’t give patrons any reason to rethink their purchase.
Amber Patton is the Ticketing and Box Office Manager at the Pullo Center in York, Pennsylvania. Her theater has approximately 1,000 seats and hosts a wide variety of entertainment, from comedy and concerts to Broadway shows. She has direct experience implementing strategies to reduce cart abandonment and increase sales. The tips she shared with INTIX 2018 attendees include:
- Fewer screens. “We wanted one, two, three screens at the most to get through [the purchase process],” said Patton. “You want to be able to enter a promo code with the snap of a finger too.”
- Security certificates. “We added them to every page so people know they can trust our site. They know their information is safe and secure,” said Patton.
- Signposts. “If the patron forgets to include something, [our website] highlights it in red and tells you exactly what you are doing wrong,” said Patton. “Not everybody is familiar with buying tickets online. You want to make sure that you are encouraging all people of all ages and abilities to purchase tickets through your website.”
Many in the audience were surprised when the panelists revealed the average conversion rate for online platforms is only 2 percent. This means just two out of every 100 visitors will buy something. Tom Wheaton suggests aiming for 10 percent to 12 percent. Again, and the question kept coming back to this: How do you accomplish this? Responding to an audience question, he stressed the importance of retargeting and analyzing metrics.
“Have a monthly metrics meeting with your team to pick three or four things you need to look at and want to understand more. Pick something to change. Not a lot of things — just one or two things. Look at the metrics and how things are trending,” Wheaton suggested. “See how that works over the next month or quarter and then pick something else to change. The more you do it, you will see conversions increase and figure out best practices.”
In addition to metrics, the panel revealed how just a few simple improvements in website design can grow sales.
A good digital journey begins with responsive design, which means that regardless of the device you are using, the content will automatically respond to the correct screen size.
“It means that you are not getting a stripped-down version of it either,” said Yanez. “You are getting all of the functionality, but it is redesigned to fit your screen, no matter how small it is. It’s an important distinction. The goal is to provide your patrons with all the tools they need to do things like bundling, discounting, activating coupons and getting access to member benefits. And it has to be simple and easy to use, no matter the device.”
“The big thing is organizing your content,” said Patton. “You want to make sure that everything is really easy to access. Don’t try to put everything on the landing page. Write clear titles. Have a good menu system with nice dropdowns. Include FAQs. Most importantly, update your content regularly.”
The second part of the session dealt with branding. Tom Wheaton kicked it off by reminding the audience what that really means.
“Branding is not your logo,” he said. “Your logo is just a representation of the way people recognize your brand, but it is not the brand. Your brand is built around your core values as an organization and how you communicate those values to people. Brand is all about the customer experience. How do you make them feel when you sell them a ticket or anything else? It is the engagement, the interaction, and whether it is favorable or not will reflect on your brand. It is also your reputation. The service you provide, the experience you provide is your brand too. After the fact, what are people saying about you? All of that encompasses brand.”
Having made that abundantly clear, he turned the discussion back over to Amber Patton, who helped oversee a rebranding of the Pullo Center a couple of years ago.
“At the time, we realized nobody knew who the heck we were,” she said. “We tried to think of ways to make ourselves stand out. We looked at the unique qualities we have and began to position ourselves as an intimate setting where you can see a rock concert while sitting just 25 feet from the stage. We also offer eclectic entertainment: everything from rock music to comedians to Broadway shows. And, we are community oriented and do a lot of outreach. We also believe in personal interaction. At the end of a show, our entire staff is in the lobby thanking people for coming and getting feedback. All that is our brand.”
Wendi Yanez brought the discussion back to website design to show how even online security is part of branding. “A secure website positively enhances your brand and creates an environment that is conducive to online sales,” she said. “It establishes trust.”
No discussion about branding is complete these days without talking about social media, and that, too, said Patton, was at the top of their minds. “When I took over social media, we were only on Facebook. Now we have them all, at least all the free ones, and we’ve made sure that we have consistency in our branding across all channels.”
When the discussion turned to email marketing, Yanez stressed the importance of tracking ROI, noting that:
- Eighty percent of email drives customers. They want to trust your brand and they want to hear from brands they trust. Frequency can be a factor in some cases too.
- Twenty-one percent of consumers enjoy receiving weekly promotional emails. Note the word “promotional” as incentives are key.
- Eighty percent of smartphone users actively check email on their phones. “Emails need to be responsive or, at minimum, be small-screen friendly and continue to promote that same brand across all of the different channels. You want the email to be just as beautiful as a full-page newspaper ad or glossy mailers,” said Yanez.
- Fifty-six percent of consumers will unsubscribe if the content they are receiving is no longer relevant.
- Eighteen times more revenue is driven via relevant segmented emails versus a standard blast.
Yanez said one of the most straightforward strategies when looking to segment audiences is to look for similar events. “If a customer previously purchased tickets for a musical, concert or opera, chances are they will be interested in another show from the same genre.”
Another strategy, she said, is to provide a special offer or reward for your most loyal customers, the other long-standing patrons you curated and worked so hard to earn. Always be thinking about how to monetize information you get from a patron. You could do an offer for your VIP guests on their birthdays, for example. “Again, it all goes back to personalizing the guest experience and building a solid relationship with your patrons,” said Yanez.
And it’s not just your loyal customers you should be tracking. Marketers have found success reaching out to their least engaged patrons. Studies have shown that fifty percent of email recipients who ignore your first approach will read a second email. “So, it’s worth trying again,” Yanez said.
She offered an example that worked really well for a client. “They went through their database to see who purchased a ticket last year, but not this year. Then, they put a $20 soft credit on their accounts and emailed them saying ‘We want you back.’ It was a soft dollar marketing campaign that really moved the needle.”
The three panelists also agreed that video marketing is important to give people a behind-the-scenes glimpse and make them feel as if they are part of the story. “That’s what people want,” said Wheaton. “They feel part of your brand when you give them an inside look. That connection is priceless.”
And don’t forget the marketing power of a blog. All the panelists agreed that blogs are important, too, as they can help drive people to your website and events.
Increasing Revenue With Real-World Strategies
The discussion then turned to real-world strategies and tools — to help sell more tickets and give customers more options, like packages and bundles, higher-value premium offers, memberships, gift cards that can be used online, and more.
One benefit of a Pullo Center membership is the ability to purchase tickets in advance of the public on-sale. They’ve more than tripled their membership since providing this as an incentive. Patton also reaches out personally to every member throughout the season to get feedback on what they like or don’t like, which helps her make future improvements.
Other suggestions include:
- Strategic partnerships with local hotels and restaurants, which doesn’t cost anything but can encourage sales, especially to groups.
- Selling tickets through online travel agencies like Expedia.
- Upselling and cross-selling beyond just tickets. Consider preferred parking or concession vouchers. “Anything that enriches the experience and encourages that impulse buy,” Yanez said.
- Strategic use of coupons. Consider giving them to certain groups to attract more sales.
- Charge a higher fee for seats purchased from the ticket office to encourage online sales.
- Encourage customers to make a donation by rounding up their purchase. “This can be anything from rounding up to the next dollar to offering different giving levels. From our experience with some of our clients that are using this, it has been a huge success,” said Yanez. “We found that people were not just rounding up to the next dollar but actually giving five dollars or more. For one of our performing arts clients, 50 percent of their 1,915 donations received in a calendar year were five dollars or more.”
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Tags: Paperless , Social Media , Mobile , INTIX 2018