TRG blog: A “major donor” has many faces

A “major donor” has many faces

Photo: Wooden tops, Tate Modern by Howard Lake
What are you passionate about? How could we tell?

Those questions kicked off a TRG webinar April 18th that addressed the issue of patron loyalty -- how we as arts managers can drive revenue from audiences’ love of the arts. Sean Kelly, VP of Marketing and Communications at Seattle’s 5th Avenue Theatre led the webinar with Laura Willumsen, TRG’s Senior Consultant and told the story of how patron passion for The 5th is driving the company’s loyalty program.

Clearly, it’s difficult to see an individual’s passion for the arts when you are looking at patrons only through the lens of individual campaigns. Most arts managers see their season as a string of performances with seats to fill, or days of an exhibition with a visitor goal to hit, or an annual fund effort to bring in donations. “Audience engagement” and “donor cultivation”, when viewed as campaigns, are just a large number of indeterminable and unending tasks.

But when you get down to the patron level—what they buy, how they give, how much they spend, even psychographic factors—it is easier to see individual patrons’ love of the artform and how it translates into value for your organization. Loyalty analysis at the patron household level illuminates steps you might take to deepen loyalty for an individual or group of patrons.

For 5th Avenue Theatre, TRG scored and ranked every patron in the database, using a tool called the Patron Loyalty Index™. The results show why it is so important to look at individual patron records: just 180 patrons made up 11% of 5th Avenue’s revenue last year. 

This might be surprising, but it’s typical of the clients we work with—often a relatively small number of the organization’s most loyal supporters (we call them “Advocates”) make up a large portion of total revenue.

A $1000 donor has many faces. Those 180 patrons weren’t, in every case, who the 5th had thought of as their largest supporters. “We were incredibly surprised,” Sean said. Some of the surprises in the 180 included:
  • A subscriber who sees most of the 5th’s productions 15-20 times, but only makes a $1,000 annual gift. His transactions don’t make him “look” like a major donor, but his value to the organization since 2007 is over $30,000.
  • A couple who attends the gala and who, since 2007 have spent nearly $40,000 on that event. But they, like the subscriber mentioned above, only make a $1,000 annual gift, so their real value to the organization—over $90,000—is hidden. Previously, The 5th didn’t include gala purchases in evaluating who is a major donor, missing this very valuable (ranked #31 among the 180) couple altogether.
  • A $1,500 annual fund donor who organizes and pays for large groups of subscribers, resulting in nearly $55,000 in ticket purchases each year. She is the #5 biggest revenue generator for 5th Avenue Theatre.
These types of patrons fly under the radar of traditional marketing-development operations, which often silo subscribers, annual fund contributors, and major donors—not to mention those who are highly involved in gala-type events, educational programs, and other activities.

While looking at your entire database on an individual level isn’t feasible, looking at certain portions proves very valuable. Looking at who’s closest to becoming an Advocate and who might be upgraded can help boost revenue substantially, as well as reduce over-reliance on a small pool of supporters. And, of course, knowing who your most fervent advocates are can help you keep them loyal. As Laura said in the webinar, “Retention starts feeling really important when you imagine how many Tryers [one-time visitors/attendees] you would need to replace just one Advocate.”

Knowing your loyal patrons is very different from guessing or worse, assuming. At 5th Avenue Theatre, knowing is the basis of an exciting patron-centric approach to developing and keeping loyal patrons.

Sean and Laura went further in-depth on the value of retention and how to go about it in the webinar, The Loyalty Business Model. Click to watch a recording of the webinar. View the slides from the webinar below:

Do you have a story about a supporter whose value you didn’t realize at first? Comment below.

Posted May 9, 2012

Related Articles
04.18.2012 TRG Webinar: The Loyalty Business Model
3 Principles for Increasing Patron Loyalty
Case Study: 5th Avenue Theatre, Part 1
Case Study: 5th Avenue Theatre, Part 2
Patron Loyalty 101
Upcoming Webinar: The Loyalty Business Model
What Marketing-Development Collaboration Really Needs

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