Orchestra Audience Growth Initiative

The Churn Report refers to the findings of the Audience Growth Initiative, a

$2-million-dollar customer-based strategy initiative conducted pro bono in 2008 by Oliver Wyman in collaboration with nine major US symphony orchestras: The Philadelphia Orchestra, New York Philharmonic, Cleveland Orchestra, Los Angeles Philharmonic, and the Atlanta, Boston, Chicago, Milwaukee, and San Francisco symphonies.

While the orchestras were good at attracting newcomers to concerts, they were having trouble getting people to come back for a second concert or sign up for a multi-concert subscription. It is the same customer churn phenomenon that afflicts businesses dependent on repeat-purchases and subscriptions, such as mobile phone operators, cable TV companies, airlines, and banks, and fast food restaurants.

Why does the survival of the symphony orchestra depend on its ability to reduce churn?

Because the symphony orchestra audience has been shrinking. New studies report the percentage of the US population that attended classical music events between 1982 and 2008 decline 29%. There was a steep 20% decline between 2002 and 2008. (Source: National Endowment for the Arts).

* In 1982, 21.3 million adults attended one or more classical music performances compared to 20.9 million people in 2008. If you account for the 31% growth in the US population (1982: 231,664,458 | 2008: 303,824,640), thats a startling difference.

* Between 2002 and 2008 attendance fell from 23.8 million to 20.9 million.

In addition, orchestras across the US are struggling because of the economic downturn. Subscription and ticket sales are down, government support and donations from corporations are drying up, and endowment funds have declined in value. To survive, orchestras need to figure out how to build casual, first-time concertgoers who go to one concert a year into a loyal core audience of patrons who attend many concerts a year, bringing friends and family, and donate money to the arts.

What does an orchestra need to do to reduce churn and build an audience of loyal, long-term patrons?

Orchestras need to fundamentally change how they think about their customers, their product, and their marketing. They need to:

1. Focus on serving and retaining first-time concertgoers (called unconverted trialists), while continuing their usual efforts to acquire new customers and keep their core audience of subscribers happy.

2. Give trialists a seamless and social end-to-end experience.

3. Offer trialists killer promotional offers after their first concert but always try to sell them another ticket or two before asking them to commit to a subscription.

Further information at the following link: http://www.oliverwyman.com/ow/7827.htm