Are Subscriptions and Memberships Dead?

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Dan Titmuss: Hello everyone. Dan here. Subscriptions and memberships have long been arts organizations’ bread and butter, helping to establish a rock solid foundation before programming even began. You could usually count on packing houses and galleries with these loyal fans. But as we all know, 2020 changed all that. Subscribers aren’t renewing at the same rates as pre-pandemic. In fact, they’re not even renewing at the same rates as last year. Our friends at JCA Arts Marketing recently reported a continued decline in subscriptions across the country. Sorry to be Mr. Doom and Gloom, but the fact is, the bulk of today’s audiences are single ticket buyers who don’t like to plan ahead. So it got us thinking, are subscriptions really dead? And if not, how can we rethink these offerings to better meet audiences’ evolving needs? In today’s episode, we’ll catch up with our subscriptions and memberships panelists from Boot Camp last year. Sara Villagio, CMO at Carnegie Hall, will lead a conversation on how everyone’s big experiments fared last season; what they learned about changes in audience behavior; and the new tactics they’re excited to try in the season ahead. But before we get the band back together to talk subscriptions and memberships, I’ll sit down with CI senior consultant Ali Blount to talk about where arts buyers are searching and whether TikTok really is the new Google. We’ve got a lot to cover, so let’s get started! So let’s kick things off with our Digital Download featuring senior consultant and podcast favorite Ali Blount. Ali, welcome back. How’s it going?

Ali Blount: Thanks. It’s good. How are you?

Dan Titmuss: I’m good. I’m excited to talk about paid search. It’s one of my favorite topics, as you know, along with fringe Game of Thrones theories, which I can go — I can talk a lot about Game of Thrones, but this is not what this podcast is about. This about digital marketing.

Ali Blount: I was gonna say I feel like we should refrain from that conversation.

Dan Titmuss: Yeah, don’t wind me up because I’ll just go for hours. So we’ve been seeing a lot of reports about social media becoming a preferred way of searching for information, which is an interesting way about thinking of search, right? Because I think we classically think of search engines as things like Google, Bing, Yahoo, Duck Duck Go, and things like that.

Ali Blount: Yes.

Dan Titmuss: There’s a big question of: are social media platforms like TikTok and Instagram kind of overtaking Google or giving it a run for its money? And if that’s the case, where should we be putting these advertising dollars?

Ali Blount: Yeah, I mean this is something we’ve heard a lot about from clients as we might expect because we are working in the social media world and people are using social media for search. So it’s a common question, and it’s an understandable one. Search is baked into the UI for these platforms. We also understand that when you have advertising dollars, you want to make sure that you’re really using them in the most impactful way. So this is why this has really come up a lot for the organizations we work with. One of the big things is at the end of the day, Google is still the behemoth. People are changing their behavior, but that doesn’t mean that they’re not searching on Google anymore. 85% of global online searches are still taking place on Google. 80% of internet activity starts with a search engine. So even if people are using social media for search — which they are very much, that is definitely how things are moving — they’re also using Google, so it’s not either or. It’s very much like an and situation. So when we’re thinking about where we want to reach people, it’s not necessarily like you want to be on TikTok and Instagram or you want to be on Google. In an ideal universe, it would kind of be all of the above.

Dan Titmuss: Yeah, and as you mentioned, Google is the biggest and our clients are still seeing a lot of success with SEM.

Ali Blount: Yes, they absolutely are. When I started — so I did a deep dive into the data here to kind of see how all of this search talk was shaking out for arts marketers — specifically arts organizations — because there are just so many examples of successful Google paid search campaigns. I would say it’s probably the thing that we have the most of, in fact, because most likely if you’re running paid search alongside any other platform, paid search is going to be your most successful. If you compare it to the other Google platforms, it’s probably going to have the highest ROI, the strongest metrics. Just to put some concrete numbers behind that, for example, ABT — American Ballet Theatre — they’ve been running — for their 2023 season, they’ve been running across all the Google platforms and paid search has the strongest ROI. It’s over 2000% right now. And the next highest platform to that is Display, which the ROI is around 1000%. So we’re talking massive ROIs in general, but the Google paid search one is just… it’s lightyears ahead of the other ones. It’s so much higher. And that’s one example. Really, that trend continues across any client, any genre, anything you see, you’re going to find typical results like that.

Dan Titmuss: I think search, in terms of on Google, behaves very differently to search on other search engines like on Instagram or TikTok because the intent is so high, especially when you’re searching for things like associated with tickets or seasons or interests, it’s directly related to a show. The intent for that is so high. Even if people are just researching, they know exactly where they want to go. And it’s important that after you’ve done all this other marketing of getting people down the funnel, through the funnel, right to the bottom of that purchase funnel, it’s important that you get that right at the end.

Ali Blount: Absolutely. It’s something I talk about with all my clients all the time is: reducing friction is crucial, especially in the field we work in. You don’t want somebody to be interested in your programming, go to buy a ticket, and they can’t figure out what your website is, or if you’re the official ticket seller or not, or how to buy tickets, or anything like that. You want to make it the most seamless experience possible and paid search — also SEO — these things help us a lot with that. I keep thinking about with searching on social, what are the use cases for the arts? And I feel like the most typical one that I’ve thought of is, let’s say somebody is on Instagram or on TikTok and they see some content pop up, maybe recommended for them, maybe they’re searching and let’s say it’s ballet and they see beautiful videos from The Nutcracker from their local ballet company and they decide that they want to buy tickets to that. They’re not going to go through Instagram or go through TikTok or whatever and purchase. They’re going to turn to Google and they aren’t going to know the URL for the organization, most likely. I think that’d be shocking if they did. So they’re going to search and they’re going to search Nutcracker, insert name of ballet company here, and then they’re going to get to your website from there. And we want to make sure that when they’re doing that, that they are going to land on your specific website and it’s the top result, easiest to find, very clear that that’s the official ticket seller. So I feel like even if somebody is using social for search like that, they’re still also using Google paid search.

Dan Titmuss: And often that’s the first thing people are seeing if they’re searching for you, is the SEM and the SEO result there. And so making sure you’re getting people to the right page, even if they are getting to your website, for example, if they’re searching Nutcracker, not taking them to the homepage, taking them to a Nutcracker page and reducing that friction. And also just generally how your brand is appearing on the search engine results page. We use this metaphor a lot: Your website is your building, it’s your HQ. And so Google is often the front door, the front gate that leads right up to that. Let’s think a little bit about how people are searching on TikTok and for the sake of argument, the benefits of approaching apps like TikTok. There was an article that you sent me that was all about Gen Z and how they are searching on TikTok and certain things. And it really clicked for me that actually there are a lot of searches which are more appropriate — like Instagram. Every three months or so, I almost get a tattoo. I always chicken out at the last second. But searching for tattoo examples on Google doesn’t really make sense because they’re often the same. They don’t change around a lot.

Ali Blount: What kind of searches are you doing? What imagery are we looking for? I have to ask.

Dan Titmuss: I would like an ant tattoo. I studied ants.

Ali Blount: Of course you did.

Dan Titmuss: Yeah, I studied ants in college. That was my main thing. I did a zoology degree and so I would really like an ant tattoo, just linking back to that. And so often, I’m searching on Instagram and it’s a really good way of getting examples of things. Certainly on TikTok, the example they gave in the New York Times article was people visiting a place and things to do in this area and the search engine results page on Google can often feel like it’s so SEO-optimized and so sort of soulless about the recommendations there, and overwritten, that people trust the TikTok face-to-face personal recommendations a lot more.

Ali Blount: They absolutely do, and I think this is why this is such a nuanced conversation and it’s not us just saying, “Spend all your money on Google paid search, ignore Instagram, ignore TikTok.” Because that is absolutely not what we’re saying because there are tons of use cases where you really want to make sure that you have a presence on TikTok or Instagram as you can. Of course, we all have limited bandwidth. So as much as you can, you want to make sure you have that presence there because there are so many relevant use cases to the arts. One of the reasons I find this conversation and so many like it so interesting is because we can’t just approach it as marketers, because if you talk to somebody who is selling some other type of product, they would definitely have a different recommendation. But we’re not just marketers. We specifically are arts marketers. We are working in the industry we do, and things just work differently in our industry. What works for somebody selling sneakers or whatever is not necessarily going to work for somebody selling tickets to the opera or to theater. So for us specifically, where we do have limited resources, limited bandwidth, I would say focus on Google paid search. And I think if you do happen to have somebody who has a little bit of time to experiment, that is a place where you could just post on TikTok and kind of feel it out because who knows, we can’t predict the future. Maybe — who knows what TikTok will become in 10 years. That’s what we do is we’re always adapting to new things. So we don’t want to miss out on that opportunity and I would never want to recommend that somebody does. But in this moment right now, given our industry, I think investing in Google paid search is where to go.

Dan Titmuss: I think — yeah, it can definitely be additive, but it should never replace it.

Ali Blount: Yeah.

Dan Titmuss: Excellent. Ali, thanks as always for being here.

Ali Blount: Of course. Happy to be here. Wait, can we talk about the ant tattoo though? Are there people who have ant tattoos?

Sara Villagio: Hi everybody. It’s great to be back on the podcast. My name is Sara Villagio. I’m the chief marketing officer at Carnegie Hall here in New York City. And last fall I had the pleasure of moderating a Boot Camp panel discussion about subscriptions and memberships. It was really an open conversation about how this area of our work continues to change and there were many, many questions, but many ideas shared along the way. So for today’s podcast episode, we thought it would be great to catch up with our panelists again and see how all of their experimentation fared over the course of the last season. So to kick things off, I’m here with my friend and colleague, Sara Billmann, the vice president of marketing and communications for the University Musical Society in Michigan. Hey Sara, how’s it going?

Sara Billmann: Well, it’s a fire hose. The season opens in about three weeks, so we are definitely feeling it here on the U of M campus with students coming back and starting classes in less than a week.

Sara Villagio: That’s crazy. I have to admit, I’m glad I have a little extra time along the way. But yeah, we’re getting to that moment where I feel like it’s all systems go for the new season. But for listeners who didn’t attend Boot Camp, I’m wondering if you can just share a little bit of background and context about UMS and the types of programs you offer.

Sara Billmann: Yeah, absolutely. UMS has been around since 1879. We’re actually approaching our 145th season, which is kind of staggering. We always joke that some of those patrons have been attending for most of those 145 years, and there actually are a few who have been there for over 70.

Sara Villagio: That’s awesome.

Sara Billmann: But we present a multidisciplinary season of classical music, jazz, world music, dance, and theater in anywhere from five to seven different venues. And of course since the pandemic we have also added digital programming to that as well as a number of educational and community residencies, one of which is in the neighboring community of Ypsilante that we just piloted last spring.

Sara Villagio: Awesome, awesome. And when we spoke last fall, it was the start of the 22-23 season, which I was reflecting back was actually a time, at least here in New York, when we still had pandemic-era restrictions and requirements in place. And at that point you had said things were moving faster from a recovery standpoint than you had even anticipated. Renewals were doing better than pre-pandemic level, subscriptions were going pretty well… Why do you think that was happening?

Sara Billmann: Well, I think last year — and again, we have a lot of flexibility as a multidisciplinary presenter and because most of what we’re presenting is only here for one night, maybe two nights. So there’s a lot of urgency in that. If you want to see an artist, you have to buy tickets for that particular performance. You can’t really put it off. We definitely saw huge subscription sales last year. I think at that point, I mentioned I thought it was largely driven by the fact that Trevor Noah opened our season and that was a very hot ticket. He usually performs in arenas of eight to ten to 12,000 people and we had him in a concert hall of 3,500. There was a lot of interest there and so I was a little bit nervous to see what might happen with all these new ticket buyers, but actually, over the course of the season we brought in more new ticket buyers overall for the whole season then we have in at least a decade. And so that was pretty interesting to see and we worried a bit about whether students were going to completely drop off the radar with a couple of years where there weren’t performances and there wasn’t that momentum, and we didn’t see that happen. It actually came back to right around where we were pre-pandemic, levels at about 22-23% of our total audience. So overall I think people were just hungry to get out and hungry to be living their best lives. And certainly today it is funny thinking back a year ago and we were all chewing on our nails worrying about whether we should be using mask mandates again and all of that. And that just doesn’t even seem to be part of the conversation anymore for better or worse.

Sara Villagio: Absolutely. I think we officially coined that the “Trevor Noah Effect,” and I’m just laughing because we have a Lea Michele effect going on at Carnegie Hall this season, which has been wonderful to see all those new folks come in. But I have the same question. Will we be able to retain them year over year? And the good news, at least for us, is that we’ve been able to have a data-informed conversation with our artistic team — and I am sure you did some of the same — to look at how this gives us an opportunity to bring new folks in the door, and it’s great if you can retain them a little bit too.

Sara Billmann: Yeah, and it was actually pretty interesting. I did go back a couple of weeks ago and looked at all of the new subscribers that we had last year and looked at their renewal rate based on whether or not they had Trevor Noah and I will say new subscribers generally have a lower renewal rate than people who have been coming for years, but those who didn’t have Trevor Noah had a renewal rate that was about 25% higher than those who did. So there’s definitely an effect there. But overall, I think it was actually fairly modest.

Sara Villagio: It would be interesting to go back when another season has passed and see if any of those folks came back just as single ticket buyers even.

Sara Billmann: It will be. Absolutely.

Sara Villagio: Because it speaks to them still being in the family and can you get them back another year, even if not this one. So one of the other things you were trying: you all had moved away from offering as many fixed packages as you’ve had in the past, and you were streamlining options. How did that end up turning out?

Sara Billmann: Pretty well overall. Last year — actually, I don’t even remember how many fixed packages we had — but we even narrowed it further this year and I think it’s been okay. The drawback of doing that is we definitely see a much, much higher renewal rate from fixed package subscribers. For us it’s close to 90%, whereas the choose-your-own series is more like 60 to 65%. So of course when you start to remove that choice… But that’s largely about people who want to renew the same seats. And so in the end, I think the people for whom that’s a major priority, it’s just a smaller group. And giving people the agency of being able to choose what works for them, when it works for them, all of that… it really — I think the flex model is really helping us. And interestingly, I went back and looked at our flex subscription sales where we are right now compared to pre-pandemic in 2019 and we’re literally within five packages.

Sara Villagio: So they’re almost exactly the same. They’ve returned to those pre-pandemic levels.

Sara Billmann: They did.

Sara Villagio: Interesting. Did you lose any folks when you streamlined your fixed package offerings? Did anyone drop off that were upset about seats or anything else like that? Or was there a way to fit them in?

Sara Billmann: They really weren’t. The ecosystem, the people who had the fixed packages were kind of grandfathered in. The two that we really kept where it was the same seat renewal, that was the matter, but anybody can build a flex package that’s all one genre if they wish to do so.

Sara Villagio: Right. That’s good. That’s great that people were willing to go that way even if they were disappointed that they didn’t have the fixed offering. I’m curious, other than I guess just the flexibility of those packages — the create-your-own — is there anything else that you think is drawing people in?

Sara Billmann: It’s always interesting to me how many people wait until single ticket day to buy a subscription. And then we started to notice that a few years ago, and actually decided that rather than punishing people for doing that, we were going to reward them and welcome them in as subscribers. So we set up our system so that if somebody buys five different events on our single ticket day, it automatically flips over into a package when they’re considered subscribers and they get the full benefits and all of that. And that allows us to do slightly different messaging to those people. But I think aside from being able to choose the events, it’s really the flexibility of knowing that they can turn back tickets and exchange them for something else.

Sara Villagio: I’m curious, do you continue to offer create-your-own packages, flex packages, after the single tickets go on sale? Are they available throughout the season or do you cut it off at some point?

Sara Billmann: Yeah, we usually cut it off at the end of September.

Sara Villagio: Got it.

Sara Billmann: And it’s interesting though, because between that date — for us, single tickets almost always go on sale right around the 1st of August — and in that eight week period we’ll probably end up selling around 300 packages.

Sara Villagio: That’s a lot.

Sara Billmann: Which is like 15% of our total. So right now, where we are within a hundred packages of where we were last year at the end of September, and just based on the trends of what I’m seeing every week, I think we’ll surpass that.

Sara Villagio: That’s fantastic. That’s great news. I don’t think the higher quantities deter people though. I remember when we launched Create-Your-Own, when we launched it in the iteration it is now, it was the 18-19 season. Carnegie was a bit further behind on this offering and the way it exists today, but we really had a lot of internal debates about the three versus the four versus more than that and ultimately landed on four because — at least what we understood of others’ offerings — it didn’t deter people from subscribing and that four-packs seemed to retain people year over year more.

Sara Billmann: Oh, that’s interesting.

Sara Villagio: Like perhaps spending enough time with the organization at different concerts, they felt they just were seeing the value or feeling it differently. So yeah.

Sara Billmann: The one thing we do do is… parking is one of those things on campus like, it is everywhere. That is always in high demand and seemingly short supply, and so we actually offer free parking to our subscribers if they buy at least six events.

Sara Villagio: Oh, that’s brilliant. I love that.

Sara Billmann: That will sometimes be the way of just getting people to add one more thing to their package and it’s worth it for us.

Sara Villagio: Do they get free parking for all of their events in their package?

Sara Billmann: They do.

Sara Villagio: That’s fantastic.

Sara Billmann: But the dirty little secret is that most of the parking is university parking and a lot of the people who subscribe have faculty or staff parking permits, so they don’t actually end up using that benefit even though they want it.

Sara Villagio: Well, it’s like many things, right? It’s psychological. We think we need something.

Sara Billmann: Absolutely.

Sara Villagio: Maybe we don’t actually. I keep hearing a theme in everything you’re saying though, which is that you’ve simplified a lot and actually your audience has responded in kind. Simplifying the discount levels, the number of events, how many packages you’re offering. There’s a theme of simplicity and I just kind of can’t help but reflect that that is part of what it takes to cut through the noise right now. And perhaps for a long time the performing arts offered the most complicated version of subscribing, whereas now we’re competing with the Netflix, the Hulu, the curated boxes that you can get in the mail and it’s simple. So I think everything you’re saying points to really keeping the message simple so that it’s as easy for a new person to come in as it is for a returning person to decide to commit again.

Sara Billmann: Yeah, I think that’s right. I mean, the hardest thing for us is pricing because we can’t just have the same price for every concert in the season.

Sara Villagio: I empathize.

Sara Billmann: And that’s really difficult, but one of the other experiments that we did this past year, which we spoke about at Boot Camp a year ago, was a pay-what-you-wish pricing model, and we specifically did that for our Freight House, Ypsilanti Freight House residency, which was largely community-inspired and community-focused programming. And so we did pay-what-you-wish for every event that we did there, and that was really, really interesting to see. I don’t think anybody is making a lot of money off of pay-what-you-wish, but that’s not the point of it. It’s really about accessibility and we were committed to this residency and committed to this community and just wanted to see what happened. And so that’s been exciting too.

Sara Villagio: That’s so interesting. Okay. I am asking this as someone who’s never run a pay-what-you-wish campaign before, or ticketed an event that way, but I’m just curious. Did you see a huge range of what was actually paid for tickets or did it end up feeling fairly close together?

Sara Billmann: We saw a range. It wasn’t a huge, huge range, but in line with what I would’ve expected. Partly, I think, because we set anchor pricing and sort of said, “This is a pay-what-you-wish event. This concert would typically cost X.”

Sara Villagio: Interesting.

Sara Billmann: That’s where the average tended to be. It’s funny that you talk about simplicity because on the backend, that whole process between pay-what-you-wish and free with registration and a free ticketed event, which needed a completely different setup on the backend — it was really, really complicated. But for the patron, I think it was actually pretty seamless and pretty easy to figure out.

Sara Villagio: That’s a balancing act unto itself. It’s like, how complicated can we make our backend to make the front end simple for the end user?

Sara Billmann: I do have to tell you one of the things I’m most excited about for the fall. We spoke last year about student sections at performances and trying to develop one of those, and with Tessitura, it’s pretty much impossible to have both reserved seating and a general admission section, but we came up with an idea that we’ll be piloting for the first time in three weeks, and we’re doing it for five or six shows throughout the season, which is, we’re calling it the M Zone because in Michigan, everything has to be M, right? And we’ve set aside 40 tickets for what we think are going to be the most popular shows of the season for students, and they are in the very front section of the main floor. So they will be highly visible.

Sara Villagio: That’s awesome.

Sara Billmann: And really great seats that we’ll be selling for $20 a piece. One of the things we hear a lot from subscribers is there are no young people in the audience. And sometimes there are… I mean, last year for the Berlin Philharmonic, we had over a thousand students in the audience for each of two performances. But oftentimes they’re in the balcony or they’re in the mezzanine, so they’re not visible. So we wanted to really turn that on its head and put them right front and center, and then we’re figuring out some kind of surprise element, experiential element that will make those tickets even more coveted. The plan is to put them on sale about a week before the concert itself so that we know that they’ll actually show up, because students sometimes don’t do that, right? But it’s something we’re really excited to try this year and see if we can figure out a way to give students more visibility and get them more interested in what we’re doing.

Sara Villagio: I love that. I mean, there’s all kinds of swag opportunities that I’m imagining now. I mean, I think you’re right about audiences wanting to see that the music lovers, the attendees around them are shifting alongside what’s on stage over time. So I think you’ve hit on something that’s emotionally important to a lot of people actually.

Sara Billmann: And to be honest, I’ve never been as pessimistic as a lot of people about audiences growing older because I think when I look at surveys from a decade ago, the average age was about the same as what it is right now.

Sara Villagio: I totally agree with that. I agree.

Sara Billmann: And maybe some of that is just with being in a university campus, we always have this infusion of newer, younger people coming in, but I think there’s more of a life cycle issue rather than an age issue that is hitting people.

Sara Villagio: I totally agree with that. Well, it was great to catch up again after so long. It’s always great to catch up with you, but I always learn something new when we have one of our conversations. So we’ll wrap it for a moment and I’m excited to toss it over to our friends at Steppenwolf next. So PennyMaria and Allan, I’m so excited to reconnect with you both. For those of you who didn’t attend Boot Camp last year, PennyMaria Jackson is Steppenwolf’s director of marketing and communications, and Allan Waite is their ticketing and sales director. When we last spoke, you had some really interesting experiments lined up for the 22-23 season. So I’d love to just start by taking a step back and asking you to share with the listeners who didn’t attend Boot Camp, just if you could share a little bit of context about Steppenwolf and the types of programs you offer to set the stage, so to speak.

Allan Waite: Yeah, so we’re an ensemble-based theater located in the Lincoln Park neighborhood in Chicago. We’ve got three venues, three theaters on campus. And then in terms of the season, we have five to six main series shows, which are our member series shows where we sell subscriptions or memberships. And breaking that out in terms of subscriptions, or what we call memberships, we’ve got a classic membership option — which is our fixed seat — and a flex membership option, which is our flexible model.

Sara Villagio: I was just curious, you had decided, I think if I’m remembering correctly, to bring back the flexible membership options. So could you talk a little bit about why Steppenwolf decided to do that?

PennyMaria Jackson: Of course, of course. When I joined, yes, we actually wanted to kind of revitalize the flexible membership option. So it never really went away, but with the impact of the pandemic, it saw a decrease like everything else. Knowing how times were changing and really trying to figure out the right strategy to really get memberships back up, we decided to examine and make adjustments to that flexible membership and then relaunch a campaign. So we actually put some more resources behind that in order to see if we could get a strong positive result. And we did. We had a great ROI as far as that was concerned, and our flexible revenue goal, we actually exceeded that.

Sara Villagio: That’s amazing. Congratulations.

PennyMaria Jackson: Thank you. Thank you. It was a lot of work from the team.

Sara Villagio: This is a very feel good conversation so far. Go on.

PennyMaria Jackson: Thank you. Thank you. Well, I think so much of the time we’re focused on what used to work and we knew that we had to quickly change our approach as we entered this new era. And so that’s what the team did. We adjusted the prices. We came up with marketing language that really highlighted why this type of membership was exciting and different, and we really tried to appeal to a younger demographic, which was a part of the initial goal of these flexible memberships, which came out of work that was done with the Wallace Foundation.

Sara Villagio: That’s great. I mean, I think the messaging piece is so interesting. Can you talk a little bit about how you think you were able to translate what you were hoping to in marketing messages?

PennyMaria Jackson: Yes, yes. You wanted to be very intentional about this, and for me it was very important to foster a sense of agency. We wanted to center the patron. We know that society is a “me me me” society lately, so how can we create this experience for returning and new patrons and make sure that they felt like they weren’t buying a membership to a theater, but they were having some sense of ownership in their theater? This is their home at Steppenwolf, the theater that made Chicago theater a thing. Right?

Sara Villagio: Love that.

PennyMaria Jackson: And so we even changed the phrasing to “your Steppenwolf, your membership, my membership.” So making sure that people were at the center of this. And we think that’s part of the reason why we saw that dramatic increase, and that confirmed that we were headed in the right direction and we should continue investing in this area. And I think we also made sure that we used images that showed the lobby full of energy again, right? “Hey, we’re back. Please come back and help us rebuild.” And so I think audiences really appreciated that and took advantage of the offer.

Sara Villagio: That’s great. So now would you say that you were able to retain a lot of the folks who came in on those flex offerings, or did you see a lot of brand new people come in, or maybe a mix of both?

Allan Waite: We are finding that we’re seeing those members that had left us in the 19-20 season have returned in smaller numbers than we anticipated, but they have to some extent come back. And just in terms of how we look at that sort of total pie, what makes up our classic and our flex membership — When we end this season, we’re about 86% classic memberships, 14% flex memberships, and when we project out into next season, we are projecting a smaller percentage of that to be classic members. We’re projecting about 82% of that pie to be classic fixed seat members, and we’re projecting about 18% of that to be flexible members. And so really, the decrease in classic and the increase in flex is really our opportunity in that sort of evolution of what membership means and what membership looks like. Sort of focusing on that grouping of people and engaging that group as they’re either returning to us in a different capacity from being a classic member, or new to us and sort of trying us out. And so with flex memberships, we’re sort of accomplishing both of those sort of on-ramps for two sort of groupings of patrons.

Sara Villagio: Well, it sounds like you’re also projecting for slow growth and change, and I think that’s just as important, even as we think about how we communicate with internal stakeholders. This is the timeline you’re moving on, and it gives you room, it sounds like, to include that in your projections, but not also feel overcommitted to it or to make it bigger than it actually is. It’s like this is solely coming up as part of the offerings, it sounds like. Which is great. I think slow growth is healthy.

PennyMaria Jackson: Exactly. This is a change that we’re making for the future and that change, that building, takes time. On another positive tip, I will say that in April we launched our membership campaign, our classic membership campaign, but even through that, we have already seen a tremendous amount of sales as far as flex memberships are concerned.

Sara Villagio: Oh, that’s great. That’s exciting.

PennyMaria Jackson: Yeah, it’s really exciting and it’s really encouraging as we try to figure out what the next step is going to be for the future of theater.

Sara Villagio: And it sounded like at one point there was this concern about possibly cannibalizing on the fixed offering, but it doesn’t sound like that’s actually happening, if I’m hearing you correctly. It sounds like slow growth, but not in a way that’s deterring anyone from purchasing that core product that you have.

PennyMaria Jackson: Exactly. People continue to purchase at that classic level. I think what we need to keep in mind is that anyone who purchases a membership, they’re usually doing that because of the benefits. And so the classic members, they want the same seats they’ve had for a certain number of years.

Sara Villagio: The theme of the seats keeps coming up! Okay, go on.

PennyMaria Jackson: They want to attend on the same night and know that they’re going to see so-and-so for each play. And so for them, that is a valuable piece. When we talk about a lot of the flex memberships, they tend to be younger and they really appreciate the ability to call the box office and say hey — or do it on their own online — hey, let me get two tickets for this Friday. And knowing that we’re going to prioritize them as flex members and they’ll have access to very good seats.

Sara Villagio: What’s funny about that is I wonder, over time, if folks who come in at this point in their lives who enter as a flex person might end up evolving into the person who really cares about their seats later on in their lifecycle and relationship with Steppenwolf, because this theme came up with Sara also when we were talking about UMS, and it’s certainly true at Carnegie as well, that we have these long-term subscribers and in your case members who really care about where they’re seated. And I just wonder the more you attend, do you have more of a specific taste for the seats that you find yourself in? So I don’t know, maybe that’s a selling point for all of us to the right people at the right time. I’d love to also turn to the research you were talking about. You were getting ready to commission research about the lapsed members and understand further why they were hesitant to return. Have you wrapped up the research? Is there anything you want to share about what you learned through the process?

PennyMaria Jackson: We learned a lot. We got a lot of confirmations…

Sara Villagio: Sounds juicy!

PennyMaria Jackson: Indeed. And then there were also a few surprises. Overall, we learned that we haven’t completely lost all of our lapsed patrons, whether or not they’re attending in the same way. They still appreciate the history. All segments of our audience really know and understand the value of our company and what we’ve contributed, which is really amazing. But at the same time, people know that because we’re so edgy, sometimes that means that the work is a little heavy and difficult to understand. And so that was an important confirmation for us as well. We’ve communicated that with artistic and the current season is a little lighter, a little easier to digest, but also as a marketing team, we’ve been able to understand that we need to provide more context for audiences coming into the experience so they’re prepared when they arrive for the play. We’ve also learned that overall habits have just changed. Other research has showed this, but we wanted to make sure that it was also true for our audiences. And it is also very telling about the way the world is changing, is that our younger audiences, a lot of our flex members, they really appreciate and value that diversity and inclusion aspect both on stage and off stage. So they want to know that there are lots of different types of people working on productions, whereas a lot of our older classic audience members, that’s not a high priority for them, and they’re really interested in seeing more of the classic work, which doesn’t always provide as many opportunities for people of different backgrounds or different gender identities. And so we kind of see where we as an institution need to balance that change and kind of help navigate folks as we continue to progress and grow. I think one of the things that was really helpful for us also to understand is that we have a very vocal segment of our lapsed patrons who kept saying, “We’re not coming because of X, Y, and Z.” And so these are people who would call and write. And so we were like, oh my gosh, so many people aren’t attending anymore because of Covid concerns, commuting, and crime. But when we did this research, which was both qualitative and quantitative, it really let us know that that’s a very tiny segment.

Sara Villagio: Oh, that’s so helpful. And what a relief actually.

PennyMaria Jackson: It’s a relief.

Sara Villagio: Those loud ones are hard to tune out and return to the appropriate volume.

PennyMaria Jackson: Indeed. But we know that those are barriers that one, we don’t have as much control over anyway, but two, that we don’t have to spend as much time focusing on that. We can support our members in other ways.

Sara Villagio: I’d love to just ask you, one of the first things you shared was about giving the audiences context for what they were going to experience, and I’m just curious if you have an example of something that you think was effective or helpful for audiences?

PennyMaria Jackson: Yeah, yeah.

Sara Villagio: Sorry to put you on the spot with that one, but it was such a good point. I was like, I want to ask this.

PennyMaria Jackson: No, it’s totally fine. So for example, as we’re planning our upcoming season, which starts just in a month, we’ve been even thinking about the way we communicate before the show. So not necessarily just putting resources on the performance description page, but putting that in an email before the show. We have, for example, opening night dinners with board members and funders where the artistic team will kind of give a couple of speeches. And so our marketing team was like, “Hey, can we record this? Can we share this as a little intro that people can listen to before they come to the theater?” So that’s something else that we’re looking to implement this year as well. We started practicing with it.

Sara Villagio: That’s very cool. And I love that because it’s efficient. It’s like, all right, this is already happening. Let’s capture it. Let’s see if we can recycle and repurpose it for another group of people who may not get to be in the room for that exact experience on that exact night. That’s exciting. So again, going back to our panel discussion last fall, you had said that the membership model was fractured even before the pandemic. So you were talking about rectifying what was already headed our way. And there’s no doubt, obviously, all of these things are changing, these models. We have to react to what audiences are seeking. How has Steppenwolf started to rightsize projections to bring them more in line with the landscape that you’re facing?

PennyMaria Jackson: When we talk about projections specifically, one of the main things we’ve had to account for is the breakdown of capacities and how we plan for that. So for example, pre-pandemic, we knew that at least half of the house, if not more, would be covered because of memberships, so it was already half filled. We no longer have that. So we are taking that into account for each show along with all of the other components that help us determine what the actual revenue can be for a particular show. This means that we’re also having to adjust our budgets when it comes to single ticket sales, and as we all know, it costs more to acquire. So that part has been quite challenging, but we’ve been looking to community building and partnerships to help us kind of offset that. For example, now we’re going to the next season having pre-show, institution-wide conversations about potential collaborations well in advance of the actual production so that we can make sure that we’re not only placing ads for new audiences we want to reach, but that we’re actually working with organizations who can help us reach those people in an authentic way.

Sara Villagio: To hit, though, too — I think what you’re describing about a collaborative approach, working with organizations, is another way of providing that context you were talking about earlier. So I think it’s just a really great way to provide experiential opportunities for people to do that together. I love that. Alright, Allan, over to you.

Allan Waite: As we’ve gotten through this sort of first full year since our last conversation, we have acquired, we’ve acquired new members, new flex members, we’ve reactivated flex members, and now as we think about this sort of 2.0 phase for us, it’s now: how do we engage this group of people? And what we’re really now doing is we’re being very sophisticated in our communication to flex members. We’re being honest to ourselves and making sure the benefits that we’re offering them are benefits that they’re able to utilize. Things like early access before tickets go on sale to the general public. And so we’re now going to start to pay particular attention on utilization with credits and making sure this group is engaged in attending the shows. And so that’s sort of 2.0 for us, as we sort of steward this group over the course of the next year. It doesn’t stop our efforts from campaigns around acquisitions. None of that work stops. This is sort of… now that we have this group, what’s this journey and let’s go on this journey together.

Sara Villagio: I love that. I mean, it really hits on that kind of community building element that you’re both talking about and that it’s not a transactional relationship, that you’re actually building relationships over time with people. And it sounds like it really means something because why else would people continue to participate? And it sounds like you all and your team are equally invested in building that relationship, which is really exciting.

PennyMaria Jackson: And then also according to our research, we have learned that it is no longer as easy as it used to be to move patrons across different groups. And we’ve learned that that means our lapsed patrons, for the most part, they are staying where they are. Some of them are coming back as single ticket buyers. Some of them have come back and returned as flex members, but we’re no longer going to utilize all of our resources to try to get them back. What we’re now doing is speaking to those multi single ticket buyers who are already attending multiple performances and trying to take advantage of deals and get them to understand how that flex membership can get them that in advance.

Sara Villagio: I really like the idea of focusing on the folks that are actively engaged and maybe just accepting that some of the folks from before may not be at a point in which they’re willing to commit, and that’s okay. It’s sort of like if you can get more out of your efforts and your energy in this other group of constituencies who are attending more regularly, it sounds like you’ll have the results. So this is a great conversation. Thank you both. I’m really happy to spend some more time with each of you talking about this. I have one last question that I think is on a lot of arts marketers’ minds. So with that, I think we will bring Sara B back in. The band’s back together. This is really exciting, and what a great couple of conversations. Thank you all for taking the time to do this with me. It’s actually really fun to reflect back and think about, as I said to Sara, it’s like we were back still in the era of pandemic things the last time we all got together and there were so many unknowns ahead of us and now everyone’s seasons are back up, the halls are full, things are moving in the right direction. So it’s really exciting and wonderful to hear about that. I wanted to pose to all of you the question that we all get asked sometimes, the age old debate. What if some board member came up to you and said, why are you bothering with this subscription thing anyway? Do these still matter? Are they in fact dead? I just had to ask the question and I’d love to hear your reactions at this point about that.

PennyMaria Jackson: I’ll go first and I’ll adamantly say they are not dead. They are evolving, they are changing. It’s the same way when the TV came out, everyone said radio was going to die. That did not happen. We just need to change our expectations. We need to adjust our budgets and we need to make sure that we’re offering people what they want in order to create memberships that are really meaningful.

Allan Waite: I would have to agree. Subscriptions and memberships, they aren’t dead. I think that as we go into the next season and beyond, what that evolution of this program looks like — there are patrons that are interested and still want to have this connection and that still want to have this relationship with organizations and we need to meet that moment where they are. So I don’t think they’re dead. I think they’re going to be with us, but adapting to the new normal is important.

Sara Villagio: Thank you. Sara, what do you think?

Sara Billmann: I think that anything that contributes 35% of our revenue budget is not dead. It’s still kicking and going strong. And just last night I was reading a story in the Washington Post about how Gen Z is collecting CDs even though they have no way to play them, which is kind of interesting.

Sara Villagio: That’s hilarious.

Sara Billmann: But everything goes in cycles. And I think Allan’s right, and PennyMaria’s right, that we have to be evolving and paying attention to what’s going on around us and be prepared to adapt, but I don’t think they’re dead at all.

Sara Villagio: Awesome. Yeah, I’m feeling a “hell yes” coming out of this conversation that we’re continuing with our offerings.

PennyMaria Jackson: Me too.

Sara Villagio: Yeah, I mean… a couple of things. I think maybe Allan, you said it. Just hitting on the relationship that people want to have with our organizations, and this is one way they continue to do it. So it’s really makes me feel very positive and happy inside to hear all of you saying this as well. So one last question for all of you. I’m excited personally to hear what you are looking forward to testing and learning in the strategy for your upcoming cycles of new seasons as it relates to subscriptions and/or membership offerings. So if there’s anything you want to share with our listeners about what you’re looking forward to testing out in the year ahead, that would be amazing.

Sara Billmann: The one thing that we’ve been kind of toying with is for the past several years, every other year, we’ve had a kind of contemporary theater festival that’s been concentrated in a three-week time period. And we’ve played around with when we’ve gone on sale with that, just because it’s more contemporary theater. Is it when we announced the rest of the season, is it closer to the performances? We’re actually thinking about changing up the structure of that altogether so that it’s not in a concentrated time period. And that’s largely in response to what we’ve seen from audiences. Very few of the people, even though we called it a festival, actually went to more than one of the events of the four or five. So that’s going to be our big experiment next year is, can we increase the interest and momentum for attending multiple performances if the time period is spread out from three weeks to eight or 10 or maybe even 12?

Sara Villagio: That’s a great question, and I think probably applicable to many of us and our listeners. Thank you for sharing. Alright, PennyMaria? Allan?

Allan Waite: Of the things that we’re excited to test is different types of engagement to members. That’s some feedback that we got in our research and trying to understand and meet that moment for engagement and what that looks like to members. So that’s something that I’m excited to start to dive into. And then I think another piece of this is seeing if we can find any — with our specifically Black card program — seeing if we can find any tidbits in the way they’re using their credits on productions. So are we seeing any correlation in single ticket sales with the way flex members are redeeming for shows? And start to get an understanding, and using that as maybe some indicators on how single tickets will perform. But I think that that is sort of the evolution now as we think about Black Card flex members and starting to get that data and starting to look at that. And those are two things I’m excited about.

Sara Villagio: Great. Alright, PennyMaria.

PennyMaria Jackson: So yes, definitely that context and engagement piece is really important for us. I think the main takeaway there that we want to learn is if audiences are more informed when they arrive to experience these productions, does that kind of imbue them with a greater sense of agency? And does that result in them being more prepared to talk about their experience and advocate for us and evangelize for us, and get their friends and family members to come and attend performances? So I’m curious to see what the two prongs of that are. Are audiences now having a better experience? And does that in turn result in them helping to sustain the theater? So that part is really important.

Sara Villagio: It really speaks — I mean, there were a few themes that came up throughout all of our conversations, one of them just being the old standby of evolution, not revolution. All of you are talking about making changes along the way that aren’t necessarily massive upheavals to what you’re doing, but are just making adjustments, tweaking things, listening to your audiences, sharing things with your artistic colleagues and your other colleagues who might be able to help make a difference. But all of those small changes add up along the way and make a difference. So kudos to all of you for doing that. I love that because I have to remind myself all the time, it’s not just about one big idea that’s the solution to everything. It’s about a lot of small ideas adding up to make meaningful change. And the other two points just being, I think community — and each of you spoke about how you’re connecting with your communities of constituents in different ways and creating opportunities for shared understanding about the arts, the experience that you’re delivering to audiences. And it’s really inspirational to hear it. And I now have a million new ideas and questions. So I just wanted to say thank you one more time to all three of you. You are all professionals in our field who I admire greatly, and I feel very fortunate to have shared both an in-person stage and now a virtual follow-up stage with all of you. So thanks for taking the time.

Dan Titmuss: Thanks for listening to CI to Eye. This episode was edited and produced by Karen McConarty and co-written by Karen McConarty and Krisi Packer. Stephanie Medina and Jess Berube are CI’s designers and video editors, and all four work together to create CI’s digital content. Our music is by whoisuzo. If you enjoyed today’s episode, please take a moment to rate us or leave a review. A nice comment goes a long way in helping other people discover CI to Eye and hear from experts in the arts and beyond. If you didn’t enjoy today’s episode, pass it on to all of your enemies. Don’t forget to follow us on Facebook, Instagram, LinkedIn, and YouTube for regular content to help you market smarter. You can also sign up for our newsletter at capacity interactive dot com so you never miss an update. And if you haven’t already, please click the subscribe button wherever you get your podcasts. Until next time, stay nerdy.