Posts Tagged ‘CPM’

USING DISCOUNT CHANNELS

April 23, 2015

“Our job is to take the emotion out of discounting” is a line I use when talking with industry peeps about our consulting client, Goldstar. And emotion should never play into your decision to use discount channels to move tickets when making money, reaching an audience, and filling seats is the goal.

At the Pollstar Conference a few months back, a national promoter told me that “if I have to use Groupon or Goldstar, that means I didn’t do my job”. What? Do all of your shows sell-out or are they even projected to? If you are like the rest of us, the answer is no. In many of those cases, there is an audience that doesn’t even know your show is coming to town, so why not use all the tools at your disposal? Once the act hits the stage, every empty seat means $0 in revenue…and not just for that seat.

Shouldn’t we be counting the zeros when average ticket price tells us nothing? We should be measuring revenue per seat like the airlines do. For instance, if the Jim Lewi Band played a 15,000 seat arena and only sold 4-tickets (to my family of course) at $500, the average ticket price would be $500 even though a majority of the house is empty. But by counting your unsold tickets as $0, you find out how much each seat contributes to your bottom line. Based on the example above with a 15,000 cap, your average ticket price is $500, but your revenue per seat is only $0.0333. Revenue per seat tells us what we really need to know.

In music, many tell us of the perception that the show is a dud if you’re listing tickets through a discount channel. The truth, this “perception” is only in the eyes of the business, not the fan. It is an emotional response we give based on protecting the act’s brand and value in the market, but most fans aren’t doing research to find the best deal like they would with other products. Maybe someday there will be a “Kayak for live entertainment” where a consumer can search for the best deal, just not yet. Goldstar, Groupon, Living Social, etc., are all marketing avenues that need a new measurement scale. CPM (cost per thousand people reached) is generally how marketing is measured. It doesn’t apply here as there is an actual sale, so the more tickets sold, the higher your CPM goes. It should be going down.

The only way you will really know is to “test and measure” results. Don’t assume that you are hurting your show or act by discounting (unless it is to your own list) when chances are you are doing the opposite. There is a lot of data to back this up. When done properly, using a discount channel helps move the primary market. If you haven’t tried it yet, you should. Otherwise, you are just guessing…and probably wrong.

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MARKETING VS. SPONSORSHIP

December 22, 2008

It has been said that some of the smartest people out there are in advertising and marketing.  Think of some of the brilliant brand campaigns of the past and you would probably agree.  So why are we in live entertainment going to corporations with our hands out looking for a check rather than partnering-up to get the word out?  Why are we not attempting to build more Branded Live Entertainment properties?

Those in sponsorship sales have been saying for years that “the dollars are just not what they used to be”.  After all this time, there is still no uniform measurement for live events or live impressions as there is for media (CPM or cost per million, etc).  So if brands are spending less on traditional media, imagine how they are looking at sponsorship in these troubled times.  Live entertainment needs to partner with brands and play to each others strengths.  We provide the entertainment vehicle while the pros from the marketing world craft the message, while using their vast arsenal of weapons to get the word out there, heard, and understood.

In the concert business, when we break the news to fans that a show is going on-sale, it usually looks something like this…

  • a) Announcement to radio of on-sale date
  • b) Spam music fans that may have purchased tickets in the past about the date
  • c) Buy ads in local weekly for print (if you still do it), run 4-8 ads for 4-days on appropriate radio stations for the “break”…plus lame promos like win before you can buy…cable TV buys and possibly some web stuff. Of course all your marketing materials look and sound exactly the same as they did 20-years ago
  • d) You put together a “maintenance plan” based on how you did on the on-sale

How many times do you think a local marketer has to run the above exercise each year?  Now imagine those same people have the time, resources, manpower, and money to promote each live event as if it were a new product launch from Proctor & Gamble.  Just think of what you could do with $20 million versus $1 million ($25,000 x 40 dates), and a radio spot where you aren’t waiting to hear…”Funny car, Funny car, Funny car this weekend only”.

Talk with you soon…

Jim