Gene Carr's Patron Technology Blog

Fifth Wall Fridays: Love Your Non-Subscribers

 

Twice a month I offer expansions on the themes and topics that Michelle Paul and I wrote about in our book, Breaking the Fifth Wall: Rethinking Arts Marketing for the 21st Century. If you like these, you can buy the book from us here, or on Amazon’s Kindle or Barnes & Nobles' Nook. 

Don’t Force A Subscription

In Section I, we suggest that “some people will never subscribe, but that’s ok.” I want to elaborate, and offer some additional thinking.

Yes, I agree subscriptions are the lifeblood of many arts organizations and I’m not discouraging you from selling them. Go ahead, sell them like crazy and treat your subscribers like the lifeblood of your organization that they are.

However, some people are simply not subscribers. Their lives don’t work that way or they simply cannot make that big a commitment either financially or in terms of their time. But you probably have people who spend just as much as single ticket buyers over the course of a season, who are not subscribers.  

Once your subscription marketing has ended, why not spend as much time and effort as you do on your subscription campaign on converting single ticket buyers into multi-buyers and treating them specially as well? I’m not talking here about offering discounts or barraging people with e-mails or postcards.

Rather, make the single ticket buyer feel special. Maybe not as special as the subscriber but do something to lure them back to your theater. Maybe it’s a free drink at intermission, or free parking or some other perk that does not discount the price of your event, but offers additional value.

It seems to me like there is still a huge chasm between the subscriber and the single ticket buyer and room for innovation.

 

Does Netflix Know What Its Own Product Is?

Today’s blog post is by Michelle Paul, who is the co-author of Breaking the Fifth Wall and product manager for our products PatronManager CRM and PatronMail. I think her perspective on the Netflix changes is a valuable follow-up to my post on this subject last week. EVC

Last week, Netflix announced that it’s splitting up its two services — DVD-by-mail, and online streaming — into two separate companies. Customers who want to continue to have access to both formats will need to maintain two separate accounts.

Clearly, Netflix has taken a long hard look at the future of movies and television and media formats, and realized that someday, sending pieces of plastic through the mail will seem as laughably antiquated as dial-up Internet is today. Everyone will have a broadband connection and online streaming will be the norm. But did Netflix make a smart move by radically reinventing their business model now, while DVDs are still hanging in there, if not going strong?

Maybe. Maybe not. That depends on what Netflix’s product really is.

The events of the past week seem to indicate that Netflix sees its product as being "movie delivery." CEO Reed Hastings’ justification for splitting the business in two is that it means the company will be “better at streaming” and “better at DVD by mail.” But is that really all Netflix is to its customers?

I would argue that the value of Netflix isn't just "here's a place where you can watch a bunch movies." Netflix’s real product, the thing that separates them from whoever else comes along, is is the history and preference data that users have been able to build up in their accounts over the years. To use myself as an example: I’ve been a Netflix member since June 2004. My queue currently has just over 100 items in it. I’ve rated just 89 movies over the years, and that’s enough data for Netflix to deliver me 1,419 recommendations of other things I might like to watch. And all of those items are just about evenly split between DVD-only and streaming availability. (A super-informal poll of my coworkers suggests that these numbers are relatively normal.)

But when Netflix splits off the DVD product to Qwikster, both services immediately lose value. Now instead of having all of their historical viewing and rating and queue data in one place, users will have to log into two accounts that won’t talk to each other. If you search for a movie on the streaming side and don’t find it, you won’t be able to easily add the disc to your queue for later, and will you bother to log into a separate site to do it? Probably not, so now you no longer have the value of the queue as a place to remind yourself of things you want to watch someday. And if user ratings have to get split up by media format, the recommendation engine will inherently suffer — there will be half as much data to work with.

So from then on, all the real value customers can get out of Netflix is that it will let them watch a particular movie, and that puts the company is a precarious position, because that means its business is 100% dependent on the movie studios choosing to continue to work with it. Right now, Netflix does happen to have the advantage of having a larger catalog than any other single service, but that's basically at the whims of the studios and could disappear at any time. (And does! The Criterion Collection is gone now, and Starz will be dropped in a few months.)

Without the queue — without the history — there's nothing keeping someone loyal to Netflix and nothing stopping them from switching to another service that comes along someday to make better deals with studios and end up with an equally large catalog.

I’m all for adapting to changing technology, obviously, and I too believe that DVDs will die out eventually. But in deciding that its product is simply movie delivery, and counting on the continued cooperation and negotiation with studios going in its favor, it seems like Netflix has lost sight of the real value its product provides to its customers.

Free Webtool Friday - Join.me

Yesterday we were demonstrating PatronManager CRM to a potential client and the webinar system we use wasn't working on their end. In two seconds we switched to join.me which is a free screen sharing tool that is so simple and so easy to use, that someone said "hey you should feature this in your free Webtools blog post." 

Join.me has marketing copy that explains it this way: 

 Get everybody on the same page, when they're not in the same room, instantly. Review documents and designs. Train staff. Demo products or just show off. join.me is a ridiculously simple screen sharing tool for meetings on the fly. 

We use this not only with clients, but also for people who are working together in our office, even one room away. We find it easier to stay on the phone and share a screen than to send links or walk over and stand over someone's shoulder.

You might find this useful with your patrons, or inside your office.

Let me know what you do with it.  

Why Did NetFlix & Facebook Forget the Customer?

I'm not even a NetFlix customer and I'm baffled by what's going on. I read the the press, the blogs, the Tweets and talk to loyal subscribers. I hear the rage. As an outsider, the most interesting thing has been this excerpt from the letter to by the NetFlix CEO which telegraphs what's really going on:

So we realized that streaming and DVD by mail are really becoming two different businesses, with very different cost structures, that need to be marketed differently, and we need to let each grow and operate independently. 

Say what?  You're changing because your two lines of business have different cost structures?  I'm betting that this is code for some boardroom compromise and/or pressure from investors to align its capital structure in a new way. The problem is that none of NetFlix's changes are coming as a result of customer demand. And that explains the outrage. 

And Facebook has done it too. Yet again it has Insulted its customers by making a surprise and radical adjustment to the most important feature the company offers, the newsfeed,  which now works differently and has a new name. Forgive me, but I don't recall it being broken nor any customer outcry to fix it. 

How is it that it's so easy to forget that your business should to be driven by demands of your customers, not your finance department, marketing department or even your own ego? 

Thank goodness there was something positive this week. Pandora.com got it right. An upgrade that really is an upgrade. What a week! 

Ten Years of the Future

 

This past week we celebrated Patron Technology's 10th anniversary, and though I'm not very nostalgic, this milestone got me thinking. What was it that I imagined 10 years ago about the future, that today seems obvious?  And, what will I be writing about 10 years from now that today doesn't seem obvious, but will then? 

Looking back 10 years when we started our business, there were no bloggers, no Facebook or Twitter, and the very notion of starting a company based on e-mail marketing was suspect. People referred to companies like mine as "dot bombs." After all, the first Internet bubble had burst and the "smart money" bet that the Internet was not all it was cracked up to be.

But we made our bet on e-mail marketing, and as I recall, the biggest hurdle we faced was SPAM. Everyone's in-boxes were overflowing with it. Nobody believed they should do e-mail marketing lest they be labeled a spammer.

I predicted (correctly) that the potential for e-mail to be a fantastic and inexpensive revenue generator would result in an enormous investment by corporate America to marginalize the spammers, and enable legitimate e-mail marketing and e-commerce. Today e-mail marketing seems like a completely obvious marketing tool.

In looking back I also realized I've been blogging for four years. Back in May 2007 I blogged about the future:

 

One of the emerging Web technologies I keep my eye on is streaming video. It's my feeling that video on the web will totally transform the Internet. Today, people think of the Web as mostly text and pictures, but in the future I think video will dominate.

 

Four years later, this, too, seems pretty obvious. 

So what is it today that we'll look back on and think is obvious?  I have several answers, among them "cloud computing" and Customer Relationship Management (CRM.) These are things we're now betting our business on and that Michelle Paul and I wrote about in our new book Breaking the Fifth Wall. 

After a decade, the reason this business still excites me is that technology is continuing to empower small organizations (and companies and entreprenuers) to do things that used to be only possible at larger, well-funded organizations.

And in an arts industry which is dominated by small and mid-size groups, this is a huge ray of bright light in an otherwise very dark economy.

I'm going to continue to write about the future and I hope you'll follow me on Facebook, Twitter, or sign up to receive these posts by e-mail above, and forward this article to your friends and colleagues.    

Finally, if you have your own memory of technology from 10 years ago, please comment. I'm guessing your memory is better than mine!  

 

Fifth Wall Fridays: What's Playing Now?

Starting today, twice a month I'll offer expansions on the themes and topics that Michelle Paul and I wrote about in our book Breaking the Fifth Wall: Rethinking Arts Marketing for the 21st Century. You can buy the book, or get a digital version here. 

What’s Playing Now?

Section III of the book is all about your website, the public face of your organization online. If you’re presenting any kind of live events, the information about the very next performance should be clear and easy to find towards the top of your website, and it should be completely up to date.

If you’ve got multiple performances or events going on, list them in chronological order or at least make sure there’s some internal logic so that viewers don’t have to hunt for the information they need. While it’s okay to have a link to “learn more” about an event, the basic information about what and when it is taking place– and how to buy a ticket - should be visible without making anyone click their mouse.

And take down old events immediately after they happen! If your site is built on a kind CMS (content management system), you can program it to automatically change what’s posted – but if not, make sure someone’s on hand to change it as soon as the curtain goes up.

 

 

Top Insights from the Top Tech Conference

Last week, the Moscone Center in San Francisco became the epicenter of the technology world as 30,000+ attended salesforce.com’s annual Dreamforce conference. CEO Marc Benioff announced that Dreamforce is now the biggest technology conference in the world. And his company, with 104,000 customers worldwide and $2B in revenue, isn’t riding the technology wave -- it’s creating it.

The four-day conference included six hours of keynotes and hundreds of breakout sessions. I’m going to try to distill all this down to only three insights, and in the next few weeks I’ll add more on my blog. (You can read my blog here or sign up to get e-mail updates from it, separate from this monthly newsletter.)

I want to give credit where it’s due. These ideas were inspired by a few of the best speakers at the conference, including Dan Zarrella, author of Zarrella's Hierarchy of Contagiousness; Eric Schmidt, Chairman of Google; Brian Halligan, CEO of Hubspot; and Tim Campos, CIO of Facebook.

1. Social is Eclipsing Search: If you still think Facebook and the whole social thing is just another sideshow, you’ve got to update your thinking. The narrative goes something like this:

The first generation of the Internet was all about publishing, and finding stuff online was the equivalent of looking in a card catalog. That’s pretty much the frame of reference that Yahoo adopted, manually creating a directory by categorizing the web’s content. And that’s how early search worked and how Yahoo became huge.

Then Google came along at a time when there was enough content on the web that sophisticated algorithms became the best way to efficiently help you find what you were looking for. Google’s key insight came from its ranking system: Google realized that if a particular website on a given topic was frequently searched for and clicked on by others it must be more relevant than some other site on that topic. The crowd became the arbiter.

But now enters social: a new phase of the Internet where people are finding information in a different way. Content creation has exploded. According to Schmidt, we create as much information in two days now as we did from the dawn of man through 2003. And with so much data out there being indexed, social is turning out to be a better way for people to find things.

In other words, we humans look to each other first for recommendations and interesting information. We look for suggestions or recommendations from people who have similar interests as we do and trust them as much or more than any search tool. This kind of crowd-sourcing of information is a more powerful, more trustworthy, and more effective approach to dealing with the glut of information out there. We see this happen on Facebook.

This idea was repeated in a separate session by Dan Zarrella, who proclaimed that tweets with links to articles are the most frequently shared kinds of posts. We want to learn from credible sources, and our friends (or as Seth Godin would say, our “tribes”) are the most credible to us.

If you’re an arts marketer, I hope the relevance for ticket-buyers is screaming out at you. We all know that “word of mouth” is the most powerful marketing tool there is. And social media is nothing more than word-of-mouth in digital clothing. If you’re not making social a key part of your marketing strategy and your technology already, you will be soon enough.

Key takeaway: Social is not a fad; it’s an entirely new paradigm that cannot be ignored or minimized.

2. Old Technology Platforms and Systems Cannot Adapt

What you find in a technology paradigm shift (such as the one going on now) is that two things happen: the companies doing the disrupting get traction right away from “early adopters,” but their competitors sit on the sidelines waiting to see if there really is a new paradigm.

And when something truly revolutionary comes along, the companies doing the disrupting have a better chance of succeeding. Why? Because the incumbents have existing customers and infrastructure and are afraid or unwilling to throw out what they have and start over. Instead, they go for Band-Aid approaches, bolting on features to their platforms and then claiming they are just like the new model.

However, history has showed that these companies tend to die out, because they cannot adapt quickly enough to the future. We’re seeing this play out right now. A few years ago, the Blackberry was the industry leader in mobile devices. Remember when Obama became president and they tried to take away his Blackberry? It was front page news. But then along came the paradigm shift -- the iPhone with its downloadable apps, and suddenly the Blackberry was playing catch-up. Blackberry made a superficial move to this model, but still clung to the past, offering the same old phone with “apps” just bolted on. The same thing happened with Microsoft. It tried to re-purpose an old paradigm (Windows) onto the phone, but it
was too late. It’s hard to play catch-up with innovation

We are in a new paradigm shift right now to open systems and cloud computing. Operating 100% in the cloud is how salesforce.com, Amazon, and Netflix are running, and they are pulling the entire industry that way. Old, closed software systems that are reliant on a single technology company that limits your choices and your options are dying.

Any company that is not inherently open is at a disadvantage against companies that are operating in open systems where plug-in apps and ecosystems of developers can help them do what they want. (In the case of salesforce.com’s AppExchange, there are over 100,000 plug-in business applications that have been installed nearly 1 million times -- and our PatronManager CRM is one of them.)

How will this play out in your decision-making about technology? First, you have to recognize the paradigm shift and decide which side of it you want to be on. As you make choices, focus on the platform first and the system second. To use a crude analogy: if you’re out shopping for a new home, you should first decide what neighborhood you want to live in before you start comparing the quality of the appliances between two houses.

Key takeaway: In a paradigm shift to open systems and cloud computing, choose technology built for this reality.

3. CRM: Delighting Your Customers Using Data

Whenever I speak at conferences, I try to explain that CRM (customer relationship management) is not something you just add on to your ticketing or fundraising system, like adding milk to your coffee.

It’s a philosophy -- a new way of thinking about marketing and service, a new way of relating to your customers. The old school of marketing was all about mass: print ads, mailings, and postcards, broad marketing approaches designed to reach as many people as possible, and you hoped that a small portion of them would bite your bait. And it was all about the new -- getting new people in the door all the time. There was little focus on customer retention.

CRM has an entirely different philosophy. It says that if you have all the data about your customers in one place, tracking all of their interactions with your organization, you can win their hearts in a much more effective way. It suggests that creating raving fans out of your customers can be accomplished by treating them specially, personally. (Read Delivering Happiness, a book about Zappos’s customer service manifesto.)

Customers today are consuming information in a multitude of ways, online and off. Unless you can reach them across all of these systems and aggregate that data and match up offers that reflect their interests and needs, you’re simply swinging at curveballs but never connecting with the bat.

The task of a marketer today is to engage with customers by sending them targeted messages and offers. For instance, do you know who your first-time attenders are in your audience? If you do, do you treat them differently than anyone else? Do you send targeted offers, welcomes, follow-up e-mails, whatever? First-time attenders are worth segmenting and coddling, because getting them to come a second time is more cost-effective than forgetting about them and finding a whole set of new people the next time.

Key takeaway: The job of marketing has changed, and CRM is a philosophical paradigm shift that is enabled by new technology, but goes beyond the technology itself.

This is a lot to digest, and yet, it is merely the tip of the iceberg. I would invite you to pass this article on by sharing it above or by following me on Twitter at @genecarr or by signing up for my blog if you want to hear more about this between now and next month’s newsletter.

 

The Most Affluent Are Most Wired

The IAB study released last week looking at the digital media habits of "affluents," those with incomes over $100K a year, offered some statistics that should be pretty motivating to any arts or non-profit trying to raise money from, or sell tickets to people in this demographic. 

Here's the headline along with my invitation for you to read a summary of this remarkable study: 

New IAB Study Finds That Higher-Income Americans—Hardest to Reach Via Traditional Media—More Likely to Be Aware of New Products, Companies and Sites After Viewing Online Ads

It turns out that affluents are twice as likely as the general public to own an iPhone, and 79% of them say their lives have become "intertwined" with technology." 

The article concludes: 

"And the new research shows that when it comes to digital media, the old paradigm has been superseded: the wealthiest Americans use digital media far more than their less affluent counterparts.”

Next time you're at a marketing or fundraising strategy meeting, and someone starts knocking down ideas for improving or increasing your web marketing saying,  "But our audience is old, they aren't online," ask them to match up the demographics of this "old" audience and see how it lines up with this study. 

That should change the conversation. 

 

 

http://www.iab.net/about_the_iab/recent_press_releases/press_release_archive/press_release/pr-080111

Free Webtool Friday - Jing

In the past few years at conferences I attend there are sessions
devoted to free webtools, and they are always incredibly popular.

Since we use a lot of free applications to run our office, I thought I'd start sharing some of them with you. Starting this week and every other Friday for the next few months, I'll highlight a free webtool that we use here in our office, or something that's suggested to me.

Eventually, we'll publish these in a formal way. If you know or use these services, or have others that you want to suggest, simply comment below. 

The first one is Jing.com, a product that enables you to share screenshots and screencasts quickly and easily. I'm a big believer that people learn in different ways, and I happen to be a visual learner. You may find in communicating with your customers that text may not work as well as a picture from the web or from your computer's desktop.

The Jing application downloads to your computer and runs in the background. In a few clicks you can take a screenshot, add highlights and arrows. Then you can save it to a server in the cloud, and send along a link in an email or on your website.

Jing comes in a few versions, and you can read about the free version here.

 

Department for Culture, Media and Sport

Did you catch this headline a few days ago?

Theatre more popular than sport in Great Britain, survey says.

It didn't surprise me, coming from the country that produced Shakespeare, but what did was the fact that the research had been done by a goverment agency: the Department for Culture, Media and Sport. This is a government agency in the U.K., and its website states:

"Our aim is to improve the quality of life for all through cultural and sporting activities, to support the pursuit of excellence and to champion the tourism, creative and leisure industries."

Maybe one reason why more people attend theatre in the U.K. is that the Brits lump their culture together with other mass-market activities like tourism, leisure, and sports. The arts are considered a part of daily life, contributing to the economy, and, I dare say, are considered "entertainment."  

What would happen if we did that here?  I bet we would think differently about national policy to support the arts. Maybe the oft-quoted justification that the arts are simply "good for society" would be folded into a much larger and more relevant and richer context.