Covent Garden slashes press advertising

It’s part of the new online strategy:

The last year has seen big changes to the ROH’s overall marketing approach, again driven by data. This has meant a radical reduction in spend on paid-for media (press, radio, outdoor, printed brochures), where results can’t be tracked, and instead focussing virtually all investment on digital marketing, where return on investment can be closely monitored. 

The new strategy leveraged previously under-utilised channels such as PPC (pay per click), retargeted display and paid social on Facebook and Instagram. The team has also launched a big change in its digital content strategy, focusing on video over the written word, and has embarked on rebuilding the website.

Lucy says: “Previously, social media was delivering great reach and PR but not converting to sales.” They are now using sophisticated analysis to track posts and put money behind content that gets a good reaction, then automatically ‘throwing good money after good’ – the opposite to what often happens in arts marketing, where spend is usually focused on difficult-to-sell inventory.

The paid Facebook activity alone is now regularly achieving over 1000% return on investment (ROI). For every pound they spend, they sell £1,000 of tickets…

Read on here.

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  • Loyal Covent Garden customer for 49 years says:

    After reading the whole article I am amazed to read that they have purposely increased seat prices in the cheaper seats so as to keep its loyal and frequent
    Audience members away

    • operacentric says:

      Not for the first time – I used to go quite a lot, sitting in seats in Stalls Circle that cost around £40. Views slightly obscured, sound quite poor but you were in the main part of the house (this was when Amphi and rest of house were completely segregated) and closer to the action than you ever felt upstairs.

      These seats were tripled in price overnight to the same level as most Stalls seats and I couldn’t go anymore – or rather, I went once or twice a season instead of six or more.

      Just running that maths, I realise ROH made the same amount out of me, but I saw less than a third of the performances.

      I never returned to my previous frequency of attendance and some 30 years later, I still resent being priced out that way.

  • James says:

    Wouldn’t 100% return on investment mean that for every pound they spend they get one back (rather than a thousand!)?
    So 1000% ROI would be £10 back for every £1 spent? Still impressive though.

    • Saxon Broken says:

      No, 100 percent return means they get twice what they spent (their initial investment back and then 100 percent return on that investment).

  • E says:

    A better headline for the article would have been:

    Covent Garden purposely pricing out regular attendees.

    • GW says:

      Exactly – this is truly outrageous. So much for customer loyalty. Even when they cannot sell some of their more ambitious projects due to lack of public interest they do not cut any slack for the Friends of Covent Garden. Friends but not treated like friends of the theatre. They have removed a heavy part of the standing room inventory for so called students and young people. The old ‘Young Friends of Covent Garden’ gave discounts in my youth to persuade us young keen music lovers to visit REGULARLY…those people who show any kind of loyalty to this institution nowadays are just treated with contempt. Many who had a reply for criticising the work of the ‘Friends’ by writing to Susan Fisher realised just how unaccommodating the Royal Opera House can be.

  • E says:

    Just one word about the pricing policy.

    OUTRAGEOUS

  • Elizabeth Owen says:

    When I booked a ticket recently there was no autumn booking booklet with prices and seating plan. The assistant gave me a general booklet listing dates and programme and said in a disparaging manner this is all they are doing now. Bizarre.
    I admire them for trying to save money but with the basics?

  • Von Schneider says:

    Anyone care to elaborate to an old and somewhat financially illiterate frequent ROH visitor how this pricing policy is supposed to work? Surely, the prices can’t differ for each individual visitor for the same seat based on his/her visit frequency?

    What if the most frequent visitors to the ROH tend to sit in the cheap seats – wouldn’t a price increase then also prohibit new and younger audiences from taking part?

    If the thinking is ‘we need to price out some of these old farts to make room for the younger people’ I’m afraid they are dead wrong; surely the main issue is that the total opera audience is declining and to rectify the demographic imbalance (which undoubtedly will cause issues in 20+ years) by weeding out the more frequent (and inevitably older) visitors would do nothing but reduce the total annual audience figures further.

    A simple and immediate step to reduce the average age at the ROH would be to remodel the back section of the orchestra stalls in the manner of the Wiener Staatsoper; 150+ standing spaces with perfect sightlines with tickets available for £15 to be purchased on the day both online and at the door. No online scrambling for the young folk to get good tickets, no awkward standing spaces that dilute the operatic experience, and a nice friendly reminder from the ROH to the younger people of this country that the art form is accessible, modern, and willing to take firm steps to remain a viable business model once us older folks have passed away.

  • anon says:

    What the ROH is saying is that they’re perfecting a metric that’d allow them to maximize seat prices (surge pricing for performances that are in high demand, etc.) without relying on unproven assumptions about who can afford (or willing to pay) high prices.

    So if it turns out that young people and non-patrons are in fact more willing to pay higher prices for a one-off performance that got a lot of clicks on social media, the ROH would target those people rather than older long time patrons who may have multiple commitments to other classical groups.

  • Alex Davies says:

    I’m not an economist, and maybe that’s why I don’t understand how this is supposed to work. So, they want to put up ticket prices by enough that their existing loyal customers will not be able to afford to come to as many performances. So if someone, let’s call him Bob, normally purchases 10 tickets per year at £25 per ticket, they are now going to be charged, say, £30 per ticket, meaning that they can only afford to come to 8 performances per year. However, the tickets for the two performances per year that that person cannot afford to go to will now be purchased by a new customer, let’s call him Steve, who can afford to attend twice per year at £30 per visit. The assumption appears to be that the reason Steve has so far never been to a performance at the ROH is because Bob is buying all the tickets. I would suggest, however, that the reason Steve has never been to the ROH before is because he isn’t interested in opera or ballet, not because Bob is buying all the tickets. I’ve been going to the ROH for years and have never yet been prevented from attending a performance because I couldn’t lay my hands on a ticket I could afford. People who really want tickets, especially at affordable prices, book the minute they go on sale. I know exactly what seats I want, I’m on the website the second they go on sale, and within seconds they are in my basket.

    I do grasp the theory that if you make a product very expensive a larger number of people may be able to buy a smaller number of units per person, but this assumes that the demand is already there. The argument would go that if I manufacture a luxury brand of baked beans that sells for £5 per can, and I manufacture them in a strictly limited batch of 1,000 cans, 100 people will buy 10 cans each. If, however, I sell them for £6 per can, 125 people will buy 8 cans each. This means that if in the future demand for luxury baked beans falls by 20% I will still have 100 customers, whereas if I’d continued selling at £5 per can I’d have failed to spread the risk and would only have 80 customers left. I think that this is the argument, but it assumes that there are 125 people who want luxury baked beans at £6 per can and that the reason only 100 people were buying them before was because I wasn’t charging enough to deter my most loyal customers. This would make sense only if I made new customers stand at the back of the queue. In the context of the ROH this would mean raising prices specifically to deter people with memberships that offer early booking opportunities, and I don’t think that is what is being suggested. No, the suggestion seems to be that demand, at a very early stage in sales, outstrips supply, and that there are people desperate to buy tickets who can’t do so because loyal customers have already bought all the tickets. But since they are not specifically targeting people with priority booking, and since there are always tickets left when public booking opens, I would suggest that the problem is that there just isn’t the demand.

    Finally, this strategy would also make sense to me if it were focused solely on raising prices for the most expensive seats in order to reduce prices for the cheaper seats. That would increase demand for cheap seats, since we could assume that people who are new to opera and ballet will be more tempted by cheaper tickets. In time, those new customers would probably have more money and be able to afford the most expensive seats. But the article specifically says that the most loyal ROH customers are often buying the cheaper tickets.

    Like I say, I’m not an economist. Maybe someone can explain where I am misunderstanding how this works.

    It’s also odd that the headline of the post focuses on the marketing angle, when it is the pricing angle that has got most people interested.

    • anon says:

      That affordable ticket you just got, how did you get it?

      Because you were the first on line (on their website, by telephone, or in person).

      But the ROH is asking: Why should that ticket go to the first person on line, when there are many people on line, and when the ticket could be auctioned off to the highest bidder?

      You were willing to be first on line and pay 10£, I too got up early but just lost out to you on that ticket but I was willing to pay up to 15£, and someone else who at the last minute is willing to pay 30£.

      If the ROH can’t sell it at the highest price, well, you’re still there willing to pay 10£, so the ROH doesn’t lose by waiting, because you’ll snap it up anyway if no one else buys it.

      • Saxon Broken says:

        That sounds great. Except for some new productions, I don’t know if it is any good. I can buy it for £10 when it first goes on sale (before it is reviewed). Or it can be sold at the last minute either for £30 (if the reviews are good) or to me for £10 (if the reviews are not so good). But if I see the reviews are bad, I just won’t buy the ticket, even for £10.

  • Robin Worth says:

    The claim is idiotic : no way can anyone spend £1 to generate £1000 of revenue

    Who says this kind of nonsense? And who believes it?

    You would be doing well to get a ten times return on marketing investment, and doing even better to be able to demonstrate it credibly

  • Don Pasquale says:

    Firstly you should read the scathing comments about this article posted on the original site.
    Secondly from a social media management perspective she is committing every sin in the book by focussing on the absurd ROI .Social media is such a fast changing fickle world that whatever the Royal Opera does will be out of date. ROI is fake in this world. Just read or listen to Gary Vaynerchuk a guy that really knows about this stuff.
    Furthermore I do not believe for one minute the drivel spouted about the data.

    • Vaquero357 says:

      Dittos. Happening all over the business world. Social media “engagement” is the hot new thing, soaking up all the advertising and marketing resources. I’m not saying it doesn’t have some value. My question is: how often does seeing something in one’s social media feed prompt a person to go to a website and *buy* something? Or are they just kinda scanning, half paying attention, to kill time, occasionally clicking on a funny cat video, as a form of passive entertainment.

      I’d just like to find some credible sources who can speak with real authority about what’s going on here. Be looking up Mr Vaynerchuk for sure.

  • Vaquero357 says:

    But….opera plays to a primarily older adult demographic, people like my parents. And if you advertise through social media, you ain’t never gonna make contact with them!

    As for the £1000 return per every £1 spent on this new whiz-bang marketing. Sounds too good to be true. And whenever a deal sounds that way, it usually is. I’m betting somebody’s feeding somebody excessively optimistic numbers.

    But then given what a Covent Garden seat costs, I guess they’re selling one ticket for every £1 of electronic advertising spent. Hmmmm, right?

    • Saxon Broken says:

      Actually, I suspect they are doing the following.

      They see I look up opera on the web to see which tickets to buy. They attach an opera advert to my webpage when I am browsing. I buy a ticket to the opera. They believe their advert generated a sale.

      But, I would have bought the ticket anyway…

      • Vaquero357 says:

        Spot on, sir! I’ve sometimes been dogged for weeks by banner ads popping up on unrelated sites for something I browsed/bought elsewhere. Just means I’ve been lazy about dumping my browser’s temp files.

  • Lausitzer says:

    Of course. And the thousand per cents are pointless bragging anyway as long as they don’t tell the exact amount of money they spend on Facebook marketing.

    The so far last one of the comments under the original article also indicates what their problem appears to be: Regularly sold out. Or, more specifically, having too few seats they are willing to sell at affordable prices. Being usually close to 100 per cent capacity sounds good, but it also results in the discussed decision to turn away regular Bob (and his money!) to get in newbie Steve.

  • Hey Figaro says:

    There’s no mention of how much Baker Richards (the marketing consultancy) has been paid for their efforts – probably a large percentage of the ‘increased’ revenue.
    No-one considers that sidelining long-standing and loyal patrons is an issue – which it is, given the slow decline in subscription sales, and the need to maintain a reliable audience who will support the RO though thick and thin. Loyalty matters, even more so in this fickle digital age.
    And most critically of all: is no-one looking at the quality of work on stage? If the product doesn’t drive ticket sales, no amount of hype and marketing can substitute for it. If the work is no good (and then if the press/discerning social media says it’s no good) then people won’t come, however hard you push it at them. And if they come once, and discover that it’s not very good, they certainly won’t come again. You can only seduce people a certain number of times with fancy marketing before they go elsewhere.
    It’s sheer madness to let digital statisticians and media marketers run theatres. Let them run supermarket grocery supplies and sell widgets to car dealers because they know nothing about art. It’s the art that sells, so make it the very best and people will come.
    How on earth did the RO allow itself to become a victim to this snake-oil fraudulence?

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