All posts by RT

Huge challenge to international ticketers (and you?)

This could be a big Whoa! moment for international ticketers, and the many venues that use their services.  On 6 October 2015 the European Court of Justice ruled that the so called  ‘Safe Harbour’ agreement between the EU and the US was invalid.  At a stroke this meant that EU Data Protection laws, commonly applied across the single-market, including the UK, meant that EU citizen’s data could not be transferred to, pass through, or be processed on servers in the US.  It is simply no longer legal to transfer customer data between servers in the US and Europe.

Irish case with consequences

The Financial Times noted the impact this decision had, coming from a Facebook data protection case in Ireland: http://www.ft.com/cms/s/0/521a2c58-6c3e-11e5-8171-ba1968cf791a.html#axzz3nyaRHFxe

For some providers, this may pose a huge challenge because, though they could have server farms in Europe as well, the nature of  global infra-structures is complex.

This all starts with Edward Snowden

You would be right in guessing that this all starts with Edward Snowden.  In doing the right thing in exposing what the US’s NSA and the UK’s GCHQ was doing in monitoring data traffic around the world, it also revealed that the US Government did not feel obligated to comply with the customer privacy terms of the ‘Safe Harbour’ agreement with the EU.  Smart Insights reported the details: http://www.smartinsights.com/marketplace-analysis/digital-marketing-laws/implications-for-marketers-of-the-end-of-the-safe-harbour-agreement-smartinsights-alert/

Fundamental implications for The Cloud

However, this European Court of Justice ruling impacts on ‘The Cloud’ in a way which many have feared since the activities of the NSA and GCHQ were revealed.  Many globally focussed companies – Facebook, Google, Amazon, Apple, Microsoft are the quintet regularly mentioned – run a global infra-structure which hosts, routes and links data anywhere in the world.  Your version of Word or your Google documents or your ‘customer wallet’ are as likely to be in the US as anywhere.  But that includes hotel chains, airlines, and of course ticketers.  Now the EU want a ‘Walled Garden’ around the EU to protect their citizens under applicable EU laws.  That quintet are all said not to like this.  There is huge consternation in the US about the way this impacts on global business: Internet advertisers for example cannot route tracking into the US.

What can individual venues do?  Check that your system supplier or system host is confining your service and data and applications such as payment gateways, etc. to EU based servers.  What can international ticketing companies do: ensure EU customer data is retained and processed only within the EU – fast.

A Dynamic Increase in Revenue at the MAC, Belfast

I wrote this Case Study for Baker Richards because I am particularly interested in how arts organisations are incorporating dynamic pricing into their every day operations, especially for smaller venues with simpler pricing structures.  The most surprising finding for me was that the MAC was operating dynamic pricing manually  because their new ticketing system had not been able to implement it.  You can read the original with illustrations here: http://bit.ly/1Pgjbjn

Back in 2011 after the surge of early adopters of ‘revenue management’, the conversation, in the US and the UK, turned to dynamic pricing and how to make it happen, especially for smaller venues. That was the challenge that the new MAC in Belfast, due to open in April 2012, brought to Baker Richards, in a joint commission with Deloittes, working on their income projections. The “old” MAC had closed in 2010, and Aine McVerry, Director of Marketing and Communications, points out that the new venue was a very different building, so they felt they were opening without a legacy and with a new ‘brand’.

Up front and honest

Aine says that “dynamic pricing felt right for the new MAC brand, doing things at the cutting edge of international practice, but importantly being very open and transparent to people – up front and honest. It communicates that we are fresh and modern, with real flexibility, and people know the rules about our ticket prices”.

As an arts venue, there were the expected parameters of needing to offer accessible seat prices, some discounted tickets for specific categories such as students and pensioners, and the need to encourage early booking – not just for cash flow but to help focus marketing. As a new venue, with modern auditoria and great views from most seats, they weren’t intending to charge separately for different parts of the theatres.

Relying on their extensive research and analysis, Baker Richards was able to confirm that for most organisations, there is a core of people willing to pay the top price for what the audience perceives as the best seats to see something they really wanted to see; and crucially that where there was demonstrable demand – a surge in purchases – ticket prices could rise within a reasonable range. Essentially, if you see seats at a particular price are selling out, you can increase their price and enhance income.

Baker Richards defined a simple pricing strategy that would enable prices to rise dynamically in response to demand:

  • Set a range of Standard ticket prices from low to high, £12 to £22 at the MAC, with an agreed number of tickets to be sold at each price according to whether demand was expected to be Peak, Mid, or Off Peak according to day, date and time, moving sales up to the next price when the agreed number is sold.
  • Set a limited number of specific best seats at a top “Premium price” on sale from day one, ideally with added service benefits (in the case of the MAC £22 tickets, with pre-booked booths with waiter service in the bar)

Part of the original strategy included a number of “Take a Chance” tickets where the price is fixed low and customers are allocated into available seats on the day in order of purchase, in order to maintain accessibility for the most price sensitive customers throughout the sales cycle. However, this was found not to be necessary and removed from the schedule after the first year.

So in April 2012 the MAC opened in Belfast with a dynamic pricing strategy which was straightforward to explain to the public, clearly incentivised advance booking, and made sure core enthusiasts could book the best seats from the beginning, without diminishing the value of those seats or the revenue from them. Children, students, pensioners, all got discounts.

The biggest initial challenge was that dynamic pricing only works where there is demand, and in some cases the pace of sales did not trigger increases. So over the next couple of years as the MAC built demand, and attenders learned the financial benefits of booking earlier, the inner workings of the pricing strategy were refined. This fine-tuning alone created a 15% increase in average income per performance.

 fine-tuning alone created a 15% increase in average income

In order to encourage more early booking and reflect the intended movement of prices, it was agreed that Standard seat prices would always increase to £15 two weeks before a performance, regardless of demand. And premium prices were increased to £25 and increased in number reflecting people’s actual seat choice. Also reflecting people’s seat choice, some specific seats were capped to £17, so not rising to the highest price – you might say honestly matching price to the experience in a seat.

Whilst always striving to ‘keep it simple’, the MAC also experimented with discounting. They started out with a £5 ticket for under 25s but initially found this discounted price was denting their anticipated income and dropped it in 2013/14. It then found this was a disincentive to this young target segment and brought it back in 2014/15. More recently a group booking benefit for 4 or more seats was introduced to incentivise full cars and people carriers, with considerable success, though it soon became apparent that this needed to be changed to a fixed cash discount rather than a percentage off, in order to limit the impact on yield from top price seats.

 ticket yield was up 30% and average income up 36%.

In practice what does all this mean? The obvious benefits are that MAC is experiencing much higher ticket sales income than it projected before opening in April 2012. When demand is there, the dynamic pricing mechanism works. A key to this is transparency: on-line it is possible to see what the price is for each performance in a run, and customers seem to respond by booking earlier, flattening the usual curve as attendance increases over a run, particularly seen with earlier in the run attendances for their Christmas productions. By August 2015, sales analysis was showing that in the main auditorium “Downstairs” ticket yield was up 30% and average income up 36%.

Have there been challenges from audiences in Belfast? The under 25s didn’t like losing their £5 tickets. And some audiences buying on the door for music events by outside promoters were surprised to find ticket prices higher than they expected, despite the simple explanation in the brochure – there is now a clear statement of the ‘on-the-door’ price. Have there been challenges for the venue? Despite enthusiastic monitoring and action by a “fantastic” Box Office Manager, Aine says “automation of the dynamic mechanism would have been easier – sometimes high demand has taken tickets before our staff could move the prices up”.

But since April 2012, over three and a half seasons now, the dynamic pricing strategy Baker Richards developed has demonstrated at the MAC that it can work in terms of bringing in much greater income in response to demand, while maintaining accessible prices. Aine says the funders were initially nervous about dynamic pricing, a new initiative in Northern Ireland, but in practice “audiences were re-assured by both accessible prices and a clear transparent strategy, which reflected our brand and values; that may be marketing speak, but it worked in delivering better income for us and satisfying audiences”.

As the MAC learns from their audiences’ specific behaviour, the prices will steadily rise, perhaps faster, as bookings come in, and income will keep on growing.

Roger Tomlinson

September 2015

Baker Richards & JCA announce Segmentation Engine

Initially available for Tessitura system users – launched at their conference this week – Baker Richards and JCA Arts Marketing are releasing what they are calling a Segmentation Engine to help arts marketers profile and segment their customers more accurately, making it “more viable for marketing, development and ticketing professionals”.

to help arts marketers profile and segment their customers more accurately

The new web tool takes data from ticketing systems transactional and donor data so it can be configured to automatically score and profile customer records on the basis of the classic ‘recency, frequency, and value’ criteria and other variables, and, if users wish, tagged with socio-economic and demographic segmentation profiles.  Key factor is that this is then written back into the customer record and enables selection for direct marketing or donor campaigns based on real behavioural data. So e-campaigns can be immediately generated to targeted lists from an instant segmentation.

Their announcement says:

“The Segmentation Engine is a new web application that allows anyone to create a sophisticated audience, visitor or donor segmentation. It brings together transaction and donor data to provide a full picture of patron behavior and allows users to create and customize a range of behavioral variables. The tool then automatically generates a range of alternative segmentations, based on those behavioral variables, and creates tags which are imported back to the organization’s ticketing system to populate patron records with variables and segment information. This allows organizations to:

  • Incorporate a deeper understanding of their patrons as input to strategic planning.
  • Deliver more targeted communications to increase Return On Investment (ROI).
  • Manage customer relationships more effectively.

The Segmentation Engine builds on extensive experience in undertaking highly detailed data analysis and consulting for hundreds of arts organizations worldwide. It is currently available for users of Tessitura® software, with wider distribution to follow.

Baker Richards and JCA are also joint developers of their Revenue Management Application, used by over 80 licensees worldwide to optimize their pricing decisions, and of the arts data warehouse that drives The Audience Agency’s Audience Finder dashboards, which benchmark customer and ticketing data across over 100 arts organisations in the UK.”

This looks to be an intriguing development in the light of the Segmentation Wars we have blogged about before.  We need tools that use real data on customer behaviour and take directly into account their individual ticketing history, attendance patterns, and relationship with the arts organisation, such as whether they are Friends or donors.  It will be good to see this available to more system users than just Tessitura.  Tim Baker will be talking about this and all things pricing at the Ticketing Professionals Conference in Birmingham at the ICC on 25/26th February 2016.

Baker Richards say that “Segmentation is one of the hottest topics around for arts and cultural organizations seeking to improve their communications and Customer Relationship Management (CRM) strategy”.  For more information:

For North America contact JCA: Susan Hornung, +1 212 981 8418, susan.hornung@jcainc.com

For Rest of the World contact Baker Richards: Debbie Richards or Rachael Easton, +44 122 324 2100, debbie.richards@baker-richards.com or rachael.easton@baker-richards.com

Segmentation Wars?

There was an under-current of discussion at the Arts Marketing Association’s great  ‘Stay Curious’ conference in Birmingham this July. Kicked off by The Audience Agency’s breakfast briefing about Audience Finder and Audience Spectrum, with the former now free to UK arts and cultural organisations (previously only free to Arts Council England National Portfolio Organisations), and reinforced by the frequently repeated references to Morris Hargreaves McIntyre’s Culture Segments from the conference stage. There are pilot MHM projects in the Northeast and in Auckland, NZ and we await the results. With consultant Katy Raines also talking about segmentation, this subject is clearly rising high up the agenda.

Andrew @TicketTattle Thomas and I have wondered in the past whether in practice the application of a ‘profile’ to a customer record really makes that much difference compared with reliable factual information on the customer from their purchase behaviour.  This is very much a matter of statistics. Those of us with long memories remember working with CACI in the early 1990s on what we hoped would be an Arts ACORN, combining ticketing history data with CACI’s socio-economic and demographic data. Duncan May, now at ATG, worked closely with them on building the profile. But in the end they said the results were not statistically significant and an Arts ACORN did not emerge.

Degrees of statistical significance was of course Peter Verwey’s mantra

Degrees of statistical significance was of course Peter Verwey’s mantra at the Arts Council of Great Britain about the use of the Target Group Index data at postcode sector level. As a lottery funding assessor I read quite a few marketplace analyses in business plans which were written on the basis that a small number of people in a rural catchment area were for example factually “contemporary dance attenders” when in practice such data was only a projection and unreliable in a small population at that level. One of the benefits of Audience Spectrum is to build in real attendance data from across the country to inform the accuracy of the profile – I must declare an interest as an adviser to The Audience Agency. And MHM’s Culture Segments uses some qualitative “golden questions” to get at attitudinal and motivational factors.

 Just how much information did we already have on customers

At the AMA conference Andrew and I also had a few quiet conversations with honest folk who wondered why segmentation profiles were apparently so important, just what difference could it make, how should they use it, and would it in fact really make a difference for them? This took me back to 1993 and the conversations with Duncan May, Christopher Travers, John Matthews, Vivienne Moore, Jonathan Hyams and others when I was writing BOXING CLEVER. Just how much information did we already have on customers in the new computerised ticketing systems and what should we be doing with it? My late colleague Tim Roberts mused 20 years later, after two editions of FULL HOUSE, published in multiple languages, that people were still not understanding frequency of attendance or using it to segment attenders according to their behaviour, and our 15:35:50 frequency formula remained neglected (and you can refine data today much better than that simple formula).

Michael Nabarro of Spektrix has blogged about arts organisations needing to get their heads around customer data, and they and PatronBase have expanded the tools to make analysing customer behaviour and grouping people together easier. If you want to, you can directly add in segmentation profiles. Of course, going back to 1993, we knew that actually it was not the group that was important, but each and every individual customer; CRM consultant Helen Dunnett reminds everyone about the “niche of one”: they know about their relationship with your arts organisation, but do you know about your relationship with them, and do you use that data in the ticketing system to drive the tailored communications to them?

The ticketing system suppliers are mostly collaborating with the proprietary segmentation tools emerging, but in most cases these are projecting on to individual customers a profile derived from large samples. In the past when there was just ACORN and Mosaic we wanted to test out which was “better” for targeting. But Stuart Nicolle (“You can get 35 pieces of data from 7 collected in the customer transaction”) with his “Balanced Database” tool at Purple Seven demonstrated repeatedly that real data could be used to focus and sharpen marketing effort, contacting fewer people with bigger results – we know, Helen Dunnett and I helped carry out a test at Colston Hall in Bristol with him.

“just push the button” marketing

Peter Verwey joked about one day reaching the stage of “just push the button” marketing. We are not there yet, and we can watch the segmentation wars, while recommending that people should perhaps concentrate on their actual customer data for targeting until something proven to be better comes along.

 

Roger Tomlinson

August 2015

Jack Rubin: ‘pilot’ or ‘captain’ of the good ship Tessitura?

His name has been inextricably central to the Tessitura message since it launched fully fledged into the ticketing marketplace in 2000, with its unique ‘not-for-profit’ business model and radical way of working with its co-owning users. I think he sees himself as a ‘pilot’ in the shipping sense, nudging with his experience and knowledge the Tessitura crew in the right strategic direction; others, including me, credit him as ‘captain’ leading and motivating the crew and keeping focus on their mission, especially good at articulating that “fitness-for-purpose” of the system as a solution and the Network as a community.

service levels in the 1990’s inhibited by the available technology

Tessitura, the system, came out of New York’s Metropolitan Opera (The Met). Like many other arts organisations, they saw their service levels in the 1990’s inhibited by the available technology, and their patience with their suppliers meant they were always behind the customer curve as the on-line wave broke. That turned to impatience, and, unwilling to wait for consultants and techies to fix it, they decided to develop their own in-house solution, creating a unified ticketing, CRM, marketing and fund-raising system. They appointed Chuck Reif as Senior VP of Technology and allocated a budget of $5M over 3 years to build their unified system. They succeeded where others failed. Chuck of course remains in charge of Tessitura technology.

Originally called Impresario, The Met wanted to achieve some return on their investment and licensed the system to a couple of other users, and even investigated the possibility of selling it. This is where Jack enters the system’s history in 2001. From a background in finance and marketing in international corporations, being involved in some start-ups and acquisitions, and having worked at Hotels.com to help take them public, he was running a venture capital backed Internet e-commerce solution, and was one of the people The Met talked to about the future of their system.

Jack was invited by The Met to facilitate a discussion with other interested not-for-profit arts organisations, leading to a meeting in Santa Fe with 35 people from 7 different arts organisations. Was there a business model that could work better for them, certainly better than the increasingly problematic investor-driven model that was causing problems for former market leaders in ticketing systems – evidenced for me by the difficult times with Tickets.com?

Was there a business model that could work better for them, certainly better than the increasingly problematic investor-driven model

That Santa Fe meeting drew up a mission statement which is virtually word for word in the Tessitura mission statement of today. There was a confluence of need, critical to their success, for arts organisations to deal with a changing world, changing communications, with Internet, email and new e-commerce models. The goal was about making arts organisations more successful by working smarter and working with an “enterprise solution”.

The seven organisations that were the early adopters of Tessitura invited Jack to form a new company with Chuck Reif, but not one that could be commercially morphed into something else. They set up a not-for-profit corporation with a Board from the users of the system, creating the co-ownership Network model. The Met saw themselves as helping benefit arts and culture while getting some of their investment returned through licensing, initially at a higher level than is now charged today.

It is worth saying that the targets for growth were modest, originally for 50 users, reflected in the Network’s decisions to be a virtual organisation, with Jack as the front man presenting the system and its business model to potential users, and Chuck and his team concentrating on keeping the technology at the leading edge. Users felt trust and confidence in the business model, but wanted the system to exceed their expectations, with core functionality as the key to meeting their needs.

The Network’s membership model is now based on variable licensing costs and annual membership fees according to turnover – in 14 years only 4 membership fee increases. Licenses are for a lifetime, unlimited, without charges per user or any transaction fees, and all Tessitura functionality is bundled in so Tessitura does not play the module game that some suppliers do (there are some add-ons available which are separately charged).

147 people on the Tessitura team worldwide, working in 8 countries

So in 2015 there are 147 people on the Tessitura team worldwide, working in 8 countries, with over 515 organisations using the system. The team did not include a marketing person until 2014. And over 200 of the user organisations in fact share their system with other organisations, such as the Wales Millennium Centre model in the UK; the largest of these has 14 regional theatres in Philadelphia sharing their system. Since 2001, retention has been over 99% for users and 85% for staff from their first employment. Tony Barnes has been regional operational director for the UK and Europe for 10 years now.

Jack reports to a Board drawn from license holders – small, medium and large – covering geographies, genres and skill-set, driven by a desire to lead innovation, provide great service, and keep costs down. That innovation is driven by a Member Advisory Committee, working with Chuck and the Tessitura development team, that prioritises the ‘road map’ for development. 70% of ideas come from users and 30% from the team, who spend their lives on the road with Tessitura users. They deliver a new release every year in a transparent process, with new code posted to a ‘sandbox’ so users can review and test, see every change, and help prioritise and identify enhancements. Some users then beta test the latest version as it goes through quality assurance. Hundreds of enhancement requests, big and small, are also submitted each year, and many of them are also added, in addition to the big road map-driven items.

by users, for users

Reflecting the co-ownership model, they chose to hold an annual conference from the beginning, driven by a planning committee of the users (apparently 200 people on it for this year’s this month) as Jack says “by users, for users”. This is now quite definitely the world’s largest arts and cultural conference, with much more than ticketing on the agenda, since it is cross genre, cross functions, cross geography, and open to all ideas. There are twelve concurrent tracks, covering all functions such as ticketing, philanthropy, web, CRM, marketing, etc.  Reflecting this, American opera singer Renée Fleming will give their keynote on August 18th in Orlando on topics for which she has long been a strong advocate – audience development, community engagement and arts education.

Indeed Tessitura is becoming a TEDx of arts and culture with its free webinars sharing knowledge on a global scale with the Innovator Series and posted on a Tessitura YouTube channel.

secret sauce

Unusually for a ticketing/ CRM system supplier, Tessitura has a VP of Community, headed up by Don Youngberg who leads what is effectively a full time community team.  Community is their “secret sauce”, since the Network has proved to be founded on sharing to help each other and make each other better. That seems to irritate other ticketing system suppliers, who see Tessitura relating to CEOs and Artistic Directors, and running a conference that attracts people from all parts of user organisations. There are also large regional conferences: in November, the Tessitura Network European Conference will be in Nottingham with likely 350 or more attendees; there will be an Australia/New Zealand conference in April 2016 in Sydney.

Tessitura has behaved differently from other ticketing systems from the beginning, since you might say it has been clear from the beginning that it is not just a ticketing system. Chuck Reif came to the UK for six months to install the first UK clients, working on localisation and specific needs. Given that users see this as mission critical, the “enterprise solution” has delivered both “out of the box” configurable functionality, and a platform on which users can build their own customer experience tools. So far they say the users have not found a technological restraint in Tessitura. And they continue to innovate to help arts organisations facing financial challenges and to enable audience development and to raise funds via philanthropy and memberships. Tessitura was designed from the onset to be equally strong for fund-raising as well. The biggest release in the history of their software is about to roll out to complete a major expansion of the system and the user interfaces.

Tessitura has added a small services division to help provide techie and database administration skills to user organisations, and now has an enterprise consulting division on marketing and fund-raising to help build the business capabilities of user organisations.  Jack says their success is partly because they avoid a corporate culture and focus instead on anti-bureaucracy and on collaboration, with themselves as partners, not vendors.

Jack talks well about the Tessitura Network and his belief that the right staff with the right business model can deliver the success the users want. With strong staff retention, they have a sabbatical system, with a 7 week paid break every 7 years to help staff re-charge and re-think. Jack seems to me to have been the Network’s leading salesperson since the effective consortium was formed, and he has certainly been reticent about adding marketing people (first one in 2014) and expanding client development functions (some churn in this function in the UK), and he remains careful about the solution and how it is presented. With the team all wearing their Tessitura logo dress shirts, focussed on the corporate mission and values, and with a coherent core message, and users that all have a good word about “their” system, you can see why arts and cultural organisations sign up to join something much more than a ticketing system.

How much credit do we give Jack Rubin for what has been achieved?  He has certainly made a big difference.

There will be some live streaming from this August’s Tessitura Conference, week of 17th August 2015: http://www.tessituranetwork.com/live

Roger Tomlinson

August 2015

How bad before intolerable?

I am a frequent attender at the Arts Picturehouse in Cambridge.  It has an audience that seems to book the majority of seats in advance online – the Box Office is rarely staffed and the few people on the door buy tickets from the bar or merchandise counters.  That audience takes advantage of reserved numbered seats and the ability to take drinks into the auditoria in glasses (not plastic).  There is also a very successful membership scheme which eliminates booking fees, gives some free seats and discounts on tickets, and there are wine and snack packages.

Until 2014 the Arts Picturehouses chain was independent, but was then taken over by CineWorld.  At first we saw little change in Cambridge, except that operation became somewhat more chaotic and staff less informed – especially if asked about the many live relay streamings.  Not knowing the actual performance time or interval details is unhelpful to audiences attending a screening due to take nearly 5 hours.

the online booking service seriously deteriorated

However, in February 2015, the online booking service seriously deteriorated.  With failing bookings online, beleaguered staff when phoned said it was due to the introduction of a new website, and later that it was a change in the ticketing system.  Arts Picturehouses were apparently migrating from their Newman system which had fully met their needs, to Vista, used by Cineworld, which plainly didn’t.

Now, changing systems and the likelihood of some short term disruption is possible, and this runs the risk of upsetting some customers, but surely five months is too long a time to not get it right?  Especially for members.  For a period, advance booked screenings of streamings could not be accessed, and tickets weren’t accessible for many events.  The basics can be frustrating.  Are the seating plans accurate in layout and in showing availability – apparently booked seats remain empty through a screening.  And increasingly they offer only “General Admission” screenings, removing one of their core USPs.  Membership numbers are repeatedly not recognised , denying access to discounts.  QR codes to validate tickets have mostly disappeared.  Often the purchaser will see an error message that their transaction was successful but they can’t send the tickets through.  We now have to phone very often to complete/check our transaction.

I hope they didn’t think we were just “bums on seats”

The staff on the phone acknowledge the difficulties – it is as bad for them as for the public – and are endlessly patient in resolving the issues, usually satisfactorily. But the core of the business has been disrupted, and relations with customers badly damaged.  Arts Picturehouse customers are not just consumers of movies, and the chain markets itself as a different and more engaged experience.  So why risk alienating the audience with apparently bad technology?  I hope they didn’t think we were just “bums on seats”.

What do we put customers through when we give them an unsatisfactory purchase experience?  Andrew Thomas and I will be reviewing how you can use Google Analytics to help optimise the purchase experience in the Digital Hub at the AMA Conference in Birmingham, or visit us at Consultants Corner on Tuesday afternoon 21st 2-5pm at the Rep – you don’t have to be attending the conference:  http://theticketinginstitute.com/consultants-corner-pre-ama/

Roger Tomlinson

Disruption from Ticketing Technology?

There is change coming through the ticketing sector as the impact of Internet Ticketing, e-commerce on mobile devices, and software developments enabling ‘platforms’ and live interfaces comes through. The roles of ticketing system suppliers, inventory holders and ticket agents are changing.

 S.T.A.R. seminar

The S.T.A.R. seminar in London on 6 July 2015 had a panel session on the implications of the integration made possible by APIs (Application Programme Interfaces) for ticketing systems, enabling inventory to be served up live through multiple channels and websites, with opportunities for affiliates and outlets. That explanation is enough for some people to be concerned about the potential for disruption to traditional models of ticket sales for primary sellers and their ticket agents. What are the implications for ticketing?

Moderated by Andrew Sharp, formerly of ENTA, one of the pioneers of integration, the panelists included Richard Howle (Really Useful Theatres), Doug Smith (Ticketmaster), Merritt Baer (TodayTix), Rob Williams (The Ticket Factory) Noel Edwards (Songkick), and Bart van Schriek (Ingresso). It was Merritt Baer who confirmed that the West End theatres in London were much further ahead than Broadway in New York in terms of technology enabling new partnerships and working together to widen distribution and access to ticket sales. Andrew Sharp pointed to connectivity changing consumers’ access to ticket purchase so changing the business practices.

 customer-focused transactions

Merritt Baer thought the key was customer-focused transactions. The TodayTix App relied on immediate purchase to speed last minute sales, especially to younger audiences, with a great simple user experience. The average age of their users is 32, with purchases completed in under 30 seconds – and their customers their greatest ambassadors on social media, etc. For TodayTix designing a premium user experience was the core to success – not adapting to processes but guaranteeing the best simple quick purchase, relevant to the customer. Last minute purchases have been growing for a decade, with late availability of inventory increasing. If you set out to deal directly with theatre attenders only on their smartphones and tablets, there is a huge opportunity: “all e-commerce is now pre-dominantly mobile”. Ticketing had been slow to adopt.

Rob Williams of NEC’s The Ticket Factory confirmed the significance of the age factor. There is a fundamental shift over how generations think about privacy and the acceptable degree of intrusiveness to match offers to people. Younger audiences regarded the ‘joining-up’ to reach them with the right offers as essential. He saw the power of the API inter-connectivity in driving change, then disrupting business models, leading to marketplace changes such as Uber. Rob acknowledged the difficulty of disruptive change: ‘the world is bad”. In fact ticketing systems are good and the future is bright, and new entrants using the APIs were making change.

 grinding back-office administration

But Doug Smith rightly reminded everyone of the grinding back-office administration for events, which still in many cases relied on promoter-generated hard tickets, so that the fast front-end left behind the back-end, likely to annoy customers who wanted certainty – tickets at home – quickly. Doug pointed out that Ticketmaster still had a secure room with over a million high value tickets in it, and staff still had to look up transactions, print labels, find the right tickets, and dispatch them. “And people complain about what is the booking fee for”.

The S.T.A.R. panel acknowledged that dynamic pricing is now day-to-day practice, applied through multiple channels immediately. Bart van Schriek of Ingresso, the early adopter of live integration, said ultimately pricing transparency in hotels and airlines will come to ticketing, based on inside commissions, not booking fees. If the point of APIs and integration was to serve up live access to inventory, then administrative practices needed to change and standards were needed to manage the ticketing and make the most of the devices the majority of purchasers were using. It was now possible for local and global e-commerce interfaces to create single marketplace, opening up opportunities for consumers, which could only be beneficial.

 who is judging the values and setting the terms to make sure the APIs deliver the benefits of wider access to ticketing to the customers?

However, Richard Howie of Really Useful Theatres was asking who is judging the values and setting the terms to make sure the APIs deliver the benefits of wider access to ticketing to the customers?  The APIs were enabling deep interfaces between ticketing systems and agents, creating business efficiencies, but the customers needed to benefit.

Coming at it from the perspective of the artists who wanted to engage more directly with their fans, Noel Edwards of Songkick and CrowdSurge said fans and artists wanted seamless ticket purchase direct from artists, which depended upon connecting fans to artists (& vice versa). Some artists want to sell only to fans and keep tickets off the secondary market, wanting pre-registration & recognition before access to sales. Clearly controlled access to the inventory was very important.

What I see is that the change, however slowly, however late, is coming through, and there is enough evidence already that some of this is disruptive. We have yet to see the major technology platforms such as Google and Apple enter ticketing, though Amazon Local has started and is widening its offer. The big question remains with marketing – no one wants to buy a ticket unless they know an event is on and they are persuaded to attend. Ticketing as we now know it is most vulnerable to the direct relationships to fans and attenders if the way they engage is also the way they gain their tickets.  Marketing could change the rules of the game.

 

Roger Tomlinson

July 2015

Tightening net of UK consumer regulations

Friday June 13th 2014 was thought to be a bad day for ticketers in the UK, when the European Union Consumer Contracts (Information, Cancellation and Additional Payments) Regulations 2013 came into force, specifically stopping certain practices and requiring up-front transparency of the total cost of a ticket purchase. Goodbye to revealing fees and charges at check-out and using pre-checked boxes in the sales process.

It looks like Thursday 1st October 2015 will get a similar reputation when the new Consumer Rights Act 2015 comes into force. DLA Piper took the S.T.A.R. seminar in London on 6 July 2015 through the details of the new Act, mostly received in silence as the implications sunk in.

Secondary ticketing impacted already

Actually for secondary ticketers and ticket touts, the key date has passed – 27 May 2015 – and just to demonstrate that they are serious, the new UK Competition and Markets Authority (CMA, replacing the Office of Fair Trading) has already taken action resulting in the four largest UK secondary ticket platforms – GetMeIn, StubHub, viagogo, SeatWave – giving undertakings to comply in future. Will that be worth the paper it is written on? The Advertising Standards Authority have confirmed they are watching out: “hiding or omitting information about charges that consumers have to pay is not only misleading it’s simply unfair”.

The Consumer Rights Act 2015 sets out to consolidate in UK law in one statute, as long promised by the Government, the wide range of UK consumer protection regulations, some with less clear implications for e-commerce and digital content; in fact not all regulations are encompassed. In most cases the originals are not repealed but the new Consumer Rights Act over-rides or clarifies their provisions. There are three parts as set out by DLA Piper:

  1. dealing with goods, services and digital content
  2. dealing with unfair contract terms
  3. dealing with miscellaneous matters including enforcement and re-sale requirements (where secondary ticketing and touting is impacted)

It is clear that this Act impacts widely on ticketing as business to consumer contracts, from the initial advertising and information given out about the events, through the detail of the purchase process, to the terms and conditions of purchase, and what might happen in the event of cancellation and refunds.

anything said or written to the consumer prior to the contract/purchase

The things that leaped out for attention as DLA Piper talked it through were:

  • anything said or written to the consumer prior to the contract/purchase becomes part of the contract (including phone conversations by sales staff, and things such as “view from seat”)
  • liability cannot be excluded for not providing the service in accordance with the information provided
  • liability cannot be restricted to below the price paid

The 7-day “cooling off period” in those 2013 Regulations from which tickets are exempt, however applies to goods and services packaged with the tickets such as merchandise, downloads, etc. and refunds must reflect the reasonable value.  Terms and conditions need to handle and explain this.

Since the Advertising Standards Authority started in 2013 acting on the 2001 (!) guidance from the Office of Fair Trading on the presentation of ticket prices, fees and charges, ticketers should be ready for the clarity this new Act brings on unfair prices and subject matter, and aware that the Advertising Standards Authority and CMA are monitoring. Unfair terms are where they are contrary to the requirements of good faith, make a significant imbalance in the rights and obligations under the contract, and are to the detriment of the consumer. Run that “No refunds or exchanges under any circumstances” past those.

Enforcement of all this typically falls to Council Trading Standards officers, but the new Act permits “private designated enforcers”; just who are those? Interestingly, the Courts are given the duty to consider the fairness to the consumer, even if it was not raised in the enforcement action, so a trader’s overall conduct will be drawn in.

 secondary ticketing and touts covered

Secondary ticketing is defined in the Act as “where tickets are offered for resale, rather than where the first sale of the ticket is made by or on behalf of the event organiser”. There is separate BIS guidance (and more is coming on Unfair Contract Terms):

http://www.businesscompanion.info/en/quick-guides/services/the-sale-and-resale-of-tickets

Secondary ticketers now have an obligation to:

  • clearly state where the ticket is (seating or standing area) with information to identify that seat or area, so typically row and seat number
  • any restrictions on that ticket limiting use to particular persons (child or student, etc.)
  • face value of the ticket
  • statement of the seller status, including whether the seller is the secondary ticketer or the event organiser

It is now illegal to blacklist sellers or cancel tickets unless certain conditions are met, which does cover where the event organiser excluded resales. Operators of secondary ticketing facilities must report illegal use to the police as soon as they identify such activity; and also report to the event organiser unless that would prejudice criminal investigation. Seems like they’ll be reporting themselves to the police in some cases.

 Looking forward to Thursday 1st October 2015?

DLA Piper’s exposition clearly stimulated lots of discussion in the S.T.A.R. networking break, with quite a few concerned about what sales staff said to ‘close the sale’ which might easily be wrong in detail and could lead to chargebacks. Looking forward to 1st October 2015?

Karl Vosper: UK Champion of SRO

Karl Vosper is inextricably linked to SRO as its champion in the UK since 2002. That will confuse some people from the start. SRO, from Standing Room Only, is developed by TopTix in Israel, but was originally distributed in the UK from 2002 as Artifax Ticketing under that name. Then distribution was transferred to Blackbaud, and, aligning the product name with others in their portfolio, became The Patron Edge. It was not until May 2010 that TopTix UK was formed, with Karl as managing director and SRO, now in Version 4, became the recognised name.

The route to now is interesting. Karl started out in the box office at the Central Theatre in Chatham in 1993, who were to be the first arts venue to take Venuemaster from Synchro Systems in Newcastle under Lyme. At 19 he had to go out and buy his own computer to learn about what he would have to deal with at work. This was the time of the big move from DOS to Windows in 1997 and Synchro quickly decided they needed him on their team and he joined their staff, in charge of arts venues in the south with a 360 degree role from sales to implementation and support. After migrating the Royal Opera House to Venuemaster in 1999, ROH decided they wanted him on the inside instead of working for their supplier.

Artifax brought SRO into UK

At Artifax the enterprising Timothy Nathan wanted to add an integrated ticketing product to his suite of tools for arts venue planning, scheduling and operation, and chose SRO from TopTix in Israel whose SRO Version 3 was then cutting edge leader in terms of much functionality. Karl joined the team there and they were quickly successful, securing the South Bank Centre as a user. They became a by-word, reflecting the Artifax approach, for hands on help and support.

Blackbaud wanted a ticketing system too

At this time Blackbaud in the US and the UK was looking for a ticketing system after an unsatisfactory acquisition of Intellitix, in a plan to expand its portfolio of solutions to combat the rise of Tessitura in the US. The hope was an integrated ticketing, marketing, CRM, and fund raising suite of tools would help arts organisations work smarter. They decided they wanted the distribution license for SRO and the team from Artifax was TUPed across to Blackbaud.

Karl is unwilling to talk about this period, but I know personally from my own experience and a visit to the Blackbaud HQ in Charleston that senior management were concerned about the level of hands on help and support they needed to supply for ticketing, and the continuous user’ demands for better interfaces and deeper integration. When some users in the UK asked me to help arbitrate on their behalf, I was concerned to discover that ”billable time” was a key target for Blackbaud services management, responsible for support, on which bonuses were dependent. A big change in culture from Artifax.

I knew that Karl had acquired something of a reputation as the users’ champion at this time, with a friendly approach which often meant things got fixed on-the-fly instead of at the billable rates. I was once in a meeting at which his senior managers tried to persuade me there was not a serious problem in relation to credit card processing, when Karl simply confirmed that there was. This was doomed, and in 2007 he offered his resignation. Blackbaud insisted he stay on and he became the global product manager for ticketing within Blackbaud, liaising with TopTix in the development of SRO and the new Version 4. Then Blackbaud proposed at the end of 2008 he lead on the development and release of a new ‘general admission’ (GA) alternative product called Altru, now Blackbaud’s primary ticketing product. After Blackbaud decided they would not run a pilot project to introduce SRO Version 4 to the arts marketplace, Karl resigned in 2009, required to have six months “gardening leave”.

 TopTix UK launched in May 2010

John Pinchbeck had been freelancing for TopTix in the UK in the commercial entertainment sector and sport, since the distribution license for SRO held by Blackbaud was for the not-for-profit sector. So in May 2010 they formed TopTix UK led by Karl. At this time they had to work in parallel with Blackbaud, but their exclusivity for the not-for-profit sector ended and Blackbaud finally withdrew from supplying and supporting SRO in 2014. In the period before this many users realised they could switch their support to TopTix directly and many did so, with many ex-Blackbaud staff joining Toptix as a result.

I have detected here a “part of the problem, or part of the solution” dilemma for some users. Karl and some of his colleagues were seen as initially helpful, but unfortunately problems seemed to mount up during the Blackbaud years. Ironically, switching to TopTix direct support and finding these could be quickly fixed did not prove satisfactory to some people.

 “part of the problem, or part of the solution”

This situation was amplified in 2014 with Blackbaud withdrawing, users wanting to migrate to SRO Version 4, and Blackbaud’s credit card processing solution Logic TPS also being withdrawn at, interestingly, exactly the same time as Blackbaud’s withdrawal.  TopTix had used the YesPay credit card processing solution but unfortunately this had run into problems of PCI DSS compliance and in June 2014, YesPay could take no new customers, with 40 Blackbaud users due to lose their service in August.

By any standards that is an emergency, with just two months to find an alternative gateway supplier, to build and test interfaces, obtain approvals, and set up and test 40 separate users. For those two months Toptix staff were entirely on the road, already in the middle of a sequence of 9 go-lives for new users and migrations for existing users, and inevitably there were ”dropped balls” on the way.

SRO: “Best Kept Secret”

Where to go from here? My colleague Andrew @TicketTattle Thomas and I have thought in the past that TopTix could be described as “the ticketing industry’s Best Kept Secret”. There are now 250 users of SRO Version 4 around the world and over 40 in the UK, Including the Buckingham Palace operation for the Royal Palaces with 3.5 million tickets sold per annum through 80 points of sale. One of the advantages of Version 4 is that it is architected for large-scale, multi-user, multi-venue setups. The “Rules Engine” combined with the middleware capability gives it exceptional tools, helping provide City-wide solutions, such as adopted in Leicester. That means it can be the right system for people wanting an “enterprise solution”, providing an application that can integrate and interface with all their other software and solutions, and provide the ”database of truth” for the 360° view of the customer. If you can get your head round it, the Rules Engine delivers an astonishing configurability of functions and processing.

‘annus horribilis’

But that “annus horribilis” in 2014 has dented their reputation in the sector, and quite a few users still can’t make up their mind on the “part of the problem, or part of the solution” dilemma. Karl has taken a lot of steps to address this. They have stopped working virtually and opened a new office in Clapham with a new staff structure and expanded staff. In the restructuring, two people were made redundant, some left, but more have been taken on in new roles. Industry stalwarts Pete I’anson (ex The Lowry and AudienceView) and Ken Paul (ex Delfont Mackintosh, NIMAX and ENTA) have joined. In addition to their 9am to 9pm office-based support, there is a user forum and a dedicated website that is helping users to network together and share solutions on a ‘self-help’ basis. Karl worries that while many venues have got 5 or 6 users logged onto this, there are still users who do not engage, and often these are the ones who have problems that could be easily solved.

Karl says the need is for more organisations to understand that ticketing is no longer just a sales operation and, in a sense, “the system does not stop when the box office closes”. He sees the need for users to understand the up-selling and extended sales and customer service opportunities of SRO, and take advantage of the Rules Engine. Instead of just talking about making tickets available through more channels, selling tickets in the bars and cafes in venues, plugging SRO4 into facebook, recognising members, subscribers and offering them additional benefits, he wants to see more organisations adopting this philosophy with the tools that they already have available. He remains convinced that SRO is a tool to empower organisations and he wants to help them to challenge the people who interface with the customers to make a real difference.

 users have to become the champions now

Karl acknowledges that TopTix had to address their relationship with their users following the events of last summer, so they come to see again that SRO is championing meeting their needs every day. I wonder if that means the users have to become the champions of SRO now?

 

Roger Tomlinson

June 2015

The motive power in Spektrix

When Spektrix burst into the ticketing sector in the UK in 2008, signing RADA, it looked to be a welcome if disruptive innovation.  In many ways it was the first fully fledged Software as a Service (SaaS) system, browser-based, single iteration, multi-tenant, with a polished and clever user interface – sliding tabs at the side of the screens hugely extended what could be done quickly from one place – and a “no up-front cost” with charging based entirely on usage, calculated as a percentage on income.  It was immediately changing the basis of competition between system suppliers and emphasising true “ease of use” for operators.

The motive power behind that launch was Michael Nabarro, a Computer Science graduate from Cambridge University who had gone on to manage the University’s ADC Theatre for 3 years.  When he arrived in that job, the ADC Theatre used to hang off the Cambridge Arts Theatre’s ProVenueMax system from Tickets.com.  The ADC decided to install SROv3 from Artifax as an in-house system.  This system, originating from TopTix in Israel, was transferred from Artifax to Blackbaud as the UK licensee.

Michael and his colleague and co-founder Matt Scarisbrick learned some tough but necessary software lessons at the ADC.  They had needed to apply considerable technical skill from their computer science knowledge to make SRO work as they wanted, especially on the web, and of course found that every upgrade broke their customisation.  They also began to understand just how important the back-end of any system was to what they wanted the front-end to do.  They also discovered how the support and help you got from your supplier made a crucial difference to your ability to use the system effectively.  It seems to me that there were some abiding lessons which had much influence on the Spektrix to come.

Michael and Matt formed the Spektrix company in 2007 and took 18 busy months to reach a workable system they could supply.  This was entirely funded by family – Daniel Nabarro is non-executive chair – with Matt as CTO and the key technical partner who designed the architecture which has enabled the system to grow in volume so rapidly as SaaS while meeting the needs of a huge range of clients.  Michael leads on the direction of the product and ensuring the functionality meets user needs with that usability which makes such a difference.  Some venues choose the system almost exclusively because of that user interface.

Back in 2009 the revenues started to flow and Michael ensured the company did not need to take on additional investors by re-investing in on-going software development from revenues.  From the beginning support and help to users were a key component of the Spektrix approach, initially promising whatever additional development users needed, and going the extra mile to help people get what they wanted from the system.  That commitment to support is a significant cost factor, and at 47 people they are now a large employer amongst ticketing system suppliers in the UK, with small teams in Manchester, New York, as well as in London, where they are heading to move to their sixth office in UK as the team expands.

Spektrix staff have always been drawn from the sector which Michael believes adds a significant dimension to how they can understand and work with users.  He himself went on to do a lighting design course after his degree, and periodically works professionally as a lighting designer for theatre productions, maintaining that close connection between ticketing and the art it serves.

Michael and I have disagreed about their revenue model from the beginning.  I don’t like the usage-based model, based on a charge on income, because it takes more money from venues the more successful they are, and I believe it becomes relatively expensive over time.  Michael is adamant that for the arts he never wants to skimp on the support and training and the continuous development; therefore the cost of providing the system drives the revenue model.  Now they continue to charge based on usage, but with a £10,000 per annum minimum, because they never depart from their full service supply model, now on a per year license model, so the commitment is for one year at a time.  Obviously some of the earlier adopters have different deals, and as a matter of principle Spektrix honours those deals with all the original users and their terms.  And the usage-based model does not appear to have inhibited their sales to arts organisations.

Spektrix have achieved some ambitious targets quite quickly, signing up some larger scale clients such as Town Hall Symphony Hall in Birmingham and recently Chichester Festival Theatre, as they add functionality and drive growth.  There are now over 200 users and 2,000 live terminal log-ins, with about £140M in ticket sales in 2014.

Michael’s ambition is to make a big difference over the next 10 years by deploying technology so the arts can work smarter and be more successful, and that means Spektrix will expand the solutions it provides.  They have already added a fully fledged fund-raising and donor management module with some great tools which go beyond what the established competitors have to offer.  Michael sees huge room to expand the software capability – covering the areas it makes sense for Spektrix to do, and to offer a full Application User Interface (API) so users can develop connections to third party solutions. In the debate about ‘enterprise solutions’ and ‘platforms’ in the ticketing sector, Michael does not see Spektrix delivering everything.  Instead their continuing strategy is steady growth and they are not building to sell the system quickly, but more to consolidate the capabilities provided to users.

That user interface continues to be a particularly special quality, with a concentration on making complex tasks as simple as possible, especially in marketing and CRM, where the system now incorporates Culture Segments and tools to profile and select customers based on behaviours and attitudes.  That focus on how the users use the system and get the best from it is a crucial emphasis that Michael champions.

Michael Nabarro is now CEO of Spektrix, still only with family investors, and Libby Penn is UK MD and they have a separate US subsidiary with a team in New York led by Gavin Berger, with Adam Rubin (ex AudienceView) on sales. Sadly they have withdrawn from the Spanish marketplace where the ticketing model there and the turmoil in the local economy stunted their growth.  You get the real sense that Spektrix learns lessons and applies them to future benefit, and the large US marketplace is proving very interested in the ways Spektrix works smarter.  Clearly, Michael and Spektrix are motivated to deliver much more.