Tag: Venue Strategy

The Power of a Venue Pull Marketing Strategy

Jeremy Larochelle

 

You may be surprised to learn that all of the ads you encounter each day aren’t just to get YOU to purchase products. While this is a majority of the brand’s intent, there is an additional hidden agenda and it comes in the form of a pull marketing strategy.

 

According to the Corporate Finance Institute. “In a pull marketing strategy, the goal is to make a consumer actively seek a product and get retailers to stock the product due to direct consumer demand.” For instance, if Doritos intends to launch a new flavor of chip. Retailers may be apprehensive of allocating valuable shelf space to the product. To mitigate this risk and get them to stock their new offering, Frito-Lay may introduce a pull marketing strategy to build awareness of the new flavor, increase demand, and pull consumers to the new product, forcing retailers to place orders for the flavor.

 

The same can happen in the concert venue world in various strategic ways. One approach is the fan perspective where the venue establishes its brand in a way that pulls specific consumers through the doors to experience the ambiance and /or notoriety. This is the case with legacy spaces such as The Greek Theater, Red Rocks, The Ryman, Madison Square Garden, and The Gorge. Another is to focus on a specific segment. The Bowery Presents does this with their chain of venues that focus on indie and up-and-coming rockers.

 

There is also a pull strategy that can be established by homing in on the talent. In this method, management focuses on enhancing the act’s experience to pull them towards their stage over other routing options.

 

Ryan Murphy did just that with St. Augustine’s The Amp by crafting a positive environment for acts that visited the out-of-the-way outdoor venue. His efforts soon paid off when legend Tony Bennett’s positive experience was relayed to Stevie Nick’s team. This led to a one-off solo show for the Fleetwood Mac star. Soon, The Amp was playing host to names much larger than its capacity.  Kacey Musgraves, who packs the 20,000 seat Bridgestone Arena, legends such as Robert Plant, OAR, Willie Nelson, and Kendrick Lamar made their way to St. Augustine, FL. Helping push The Amp to the #2 amphitheater spot in Pollstar Magazine’s 2019 Mid-Year report.

 

Not too shabby for a venue with a capacity of under 5,000 and well off the routing path.

 

Murphy’s pull strategy circumvented outside variables by going direct to the source of the commodity – the artist. Their handlers very likely were pushing for larger capacity venues that could provide more revenue, more wiggle room on deal points, more efficient routing, etc. Unfortunately, many venue leaders do not understand the rigors of the road and how it impacts artists of every level and, perhaps more importantly, their crew. Giving them a special spot that has a unique vibe, history, and a feel of home can have much more power than we think. It’s not just a pull marketing strategy… it’s a compassion for the artist strategy and it can pay large dividends as Murphy and The Amp proved.

The Power of Queueing Theory for The Concert Venue

Jeremy Larochelle

Photo by Krizjohn Rosales from Pexels

 

In a recent post, I stated: “5,000 plus people trying to enter through less than four security lines is a safety concern in my opinion.” I want to use this post to help explain that statement and why I believe it.

 

I am fascinated by the science of management and even though the business of rock and roll may seem anything but. Venue operations math can help us develop ways to enhance the concert experience for fans, artists, and venue owners. One of these concepts is through the use of queuing theory.

 

Queuing theory is the mathematical study of waiting lines or queues. The formula may appear complex. However, there are a number of calculators online that will help you get the answers you need without understanding some pretty heady math that looks something like this from Portland State University.

 

 

Let’s move past these formulas and focus on how this can apply to your concert venue operations.

 

Part of the concert customer’s experience is entering the venue. This includes driving to the property, finding parking, and then going through security to gain entrance to the facility. This last element (security screening and entering the facility) present a unique challenge in that the operations team must weigh the customer experience of waiting in line against the demands of the security team to properly vet each patron. Part of establishing that balance is pinpointing how many security lanes you need per: (1) the venue capacity; (2) the arrival rate of guests; (3) the average security screen time; and (4) the cost of “x” amount of lanes, which can include equipment, such as screeners, and personnel.

 

You could achieve these results by speculating but guessing wrong could impact your operations in a few ways. For instance, your fans would likely end up waiting in line too long if you are underequipped. This could lead to lost consumer confidence and ultimately dipping revenues as word spreads about this negative aspect of the fan experience you provide. On the other hand, over equipping can lead to increased overhead and less profitability for the venue. Another unsustainable outcome. Luckily, there is a baseline to be found for virtually any venue and it is attained through a queuing theory calculation.

 

Let’s say that your venue’s capacity is 5,000. You open doors two hours before the show and a VIP lane an hour before that. You also know that a good chunk of your fans do not make it in on time due to traffic, family emergencies, etc. Taken together, you can estimate it would take four hours for the bulk of your customers to get through the gates. Your security team ensures that they can vet the average patron in 45 seconds or less and your observations say they are correct. Let’s place this information into our online queuing theory calculator.

 

We start by selecting the M/M/C model for a single queue with “C” amount of servers. Next, we need to average the number of people coming in per hour. To keep things simple, we will stick with a discrete probability. This means that we just divide 5,000 people by four hours, which is 1,250 patrons coming through the gates per hour. That is highly unlikely, but at this point, we are just looking for a baseline. We can adjust per our observations at a later time.

 

Place 1,250 under Arrivals/ Hour, which is Lambda in the calculator. Since your security team estimated they can vet each person in 45 seconds, that equates to 80 patrons per hour. Place 80 under Services/Hour, which is Mu.

 

Now let’s pick security lanes. Place four under the Number of Servers (C) and click Calculate. You will receive the following warning. “The queues will tend to infinity as Lambda is greater or equal than 4 times Mu.” This is telling us that you do not have enough servers to operate efficiently. It is NOT telling you it can’t be done. Rather, it is saying that there will be a back-up of the line. Remember, we are looking for a balance between customer experience, safety, and cost from which to start our ops planning. Further trial and error by selecting servers reveal that the optimal number of lanes is 16 based on these variables. At this level, your customer would walk directly into one of those lanes and spend (on average) 1.782 minutes waiting in line and another 45 seconds being screened. For a total service time just shy of three minutes. That is where you find the best customer experience at the lowest operations cost for a safe entrance into your venue.

 

Remember, this is your starting point. It is not saying anything less than 16 lanes for this size venue will fail. Rather, it is telling us that any number of security screeners below that will lead to a back-up of your line. I used a more advanced Excel calculator to find the average time your customer would wait if you only had four open lanes and found it to be between 27 and 30 minutes. This gives us a window. At four lanes, your customer could wait a half hour to get in while 16 lanes could lead to a zero wait time for the majority of your guests.

 

It is now up to you and your team to determine the balance between how long you want those customers to wait against the cost and logistics of adding more lanes. To do this you must take into account the price of additional screening stations (equipment and manpower) and if you have enough entrance points to accommodate their use. You could then analyze your open doors’ timeframe and how the line flows. Do more people come in at a certain time? Do you find that a large percentage of your clientele do not make it before the show? Finally, you could survey your customers about their experience. Did they have an issue waiting in line longer than 10, 15, 20, or 30 minutes? With this additional data, you are now more equipped to strike a balance between cost, customer experience, and the safety of your guests.

 

It all starts with queuing theory.

Using Venue Math to Find Your Baseline

Jeremy Larochelle

I wanted to demonstrate how data, research, and math can help venue managers and marketers book concerts.

 

 

To do that, I took research on music adoption from The Verge and consumer behavior experts. Then, applied some rudimentary math skills to demonstrate how one could likely pinpoint eras of music that would better align with a concert venue’s marketing strategy.

 

Works Cited:

Ong, T. (2018, February 12). Our musical tastes peak as teens, says study. Retrieved from https://www.theverge.com/2018/2/12/17003076/spotify-data-shows-songs-teens-adult-taste-music

Solomon, M. R. (2019). Consumer Behavior: Buying, Having, and Being (12th ed.). Hoboken, NJ: Pearson.

 

 

Claquing and Social Behavior During the Concert Experience.

Jeremy Larochelle

 

In 1820 Paris opera fans Sauton and Porcher started a unique business.  For a fee, they would attend your opera and applaud at a designated time during the performance. This became known as claquing. The venture was so profitable that the duo expanded and by 1830 claquing had become a key part to the operatic experience. Teams of claques were established that included a chef de claque leading a team of claquers with additional options. There was the pleureuse, who would weep on cue and the bisseur who would belt out encore as the show ended.

 

Seems kind of ridiculous doesn’t it.  After all, opera is such a refined craft in live entertainment. Why would they resort to such antics?

 

Quite simply, it works.

 

As author Robert B. Cialdini, Ph.D. points out in his book Influence – The Psychology of Persuasion. Claquing, much like laugh tracks during sitcoms, creates a social call-and-response. One in which the stimuli. E.g. the claquer lets other opera-goers know. “Hey, now is the time to clap.” Running off of his cue (and that reaffirming positive stimuli) clap…or boo… or scream “encore” they do.

 

While claquing has all but faded from the operatic experience its far-reaching superpowers can still be witnessed at nearly every live concert you attend. Look around as the band finishes their last song. At this point, many people are wondering “should I stand and applaud?” They survey the other patrons and may notice someone a few rows away rise. Still unsure, they remain seated. However, as the rising crowd encroaches their position something changes. What was a question of “should I stand and applaud” turns to “what will those around me think if I don’t?”

 

Social influence at its finest.

 

Claquing demonstrates to us that we aren’t really in total control when within these large social situations.  In a previous post, I discussed positive stimuli response and how vital it is during our decision-making process. Dr. Cialdini reminds us that positive stimuli response is so important in a situation such as a concert where we are out of our comfort zones that these stimuli produce (as he calls it) click, whirr moments where we instinctively follow the crowd. This is an important social behavior lesson for operations managers because it gives us insight into how we can use the crowd to create more profitability in our venues. In that same post, I talked about the “see a beer… want a beer” phenomenon. Where concert goers will increasingly move towards the decision to purchase a beer as more people within their proximity hold a frosty brew. If operations managers look for ways to motivate pockets of consumers in highly visible areas to purchase they could reap big rewards. Say, for instance, if a small pocket of scattered patrons the second tier up in the center are sent a mobile coupon for $2 off their beer purchase for the next fifteen minutes. Enough will scurry across their aisle and down or up the steps to the vendor. On the return trip, they are displaying their beer in hand and with it gaining the attention of a collection of consumers looking for a positive stimuli response to go grab a brew. It is quite likely that $2 off bet could pay off big thanks to a click, whirr moment.

 

Regardless if you are claquing for applause or pushing for more beer sales, social behavior is a powerful strategy in the concert space. Find ways to enact social responses and you could see profitability rise.

The Most Important Revenue Driver for Your Venue – Ancillary Sales

Jeremy Larochelle

 

Unlike ticket sales, which are fixed. Ancillary income can include multiple revenue streams and is only limited by your operations team’s imagination. In addition, ancillary income can help you keep the doors open and make money in less-than-ideal concert situations.

 

Demographics Aren’t a Catch-All

Jeremy Larochelle

 

Too many entertainment managers misuse the phrase demographics as an excuse to sound marketing-savvy when they don’t understand entertainment strategy. Jeremy discusses how to properly use this marketing term for your venue.