It’s time for an exercise in thinking like an orchestra manager. Here’s the setup:
- Your orchestra is loosing its audience and you’re considering the benefits of using a technology based product to help build it back up again.
- Like all orchestras your marketing dollars are limited and the man-hours you can use for writing grant proposals are at their limits.
- You hear about two new technology based audience development initiatives, each in initial stages of deployment but having a certain amount of promise.
- One option has received some positive national media attention in a prominent New York City newspaper (and a little bad press too) but the other option is already up running on a regular basis with a few orchestras.
Although this scenario is for demonstration purposes, the technology based products it’s examining are very real. The two products are the palm device driven Concert Companion device and a web based application called ORBIT (Organization Relationship Building Invitation Tool).
Yes, we’re comparing apples to oranges here but this variety of fruit both come from the same basic orchard and their purpose is the same: to fill you up (your concert hall that is).
But before you can make a decision, you need to know more about the products. So I contacted the gentlemen that run each company to find out as much as possible about the two products: Roland Valliere of Concert Companion and Jon Hardie of SymphonyWorks (the developers of ORBIT).
As a manager, you’re going to want to know some essential details of each product:
1. What is it and what does it do?
Concert Companion (as described on their web site): “The Concert Companion is an exciting new interpretive aid or “experience enhancement” for classical music audiences. Using state of the art wireless technology, Concert Companion delivers explanatory text, program notes and video images to hand-held devices in real time with the music.
Concert Companion provides a value-added experience akin to museum audio tours – except Concert Companion is a visual enhancement of an aural experience, instead of the other way around – making the music accessible to a greater number of listeners.”
ORBIT (as described by Jon Hardie): ORBIT is a proprietary web-based, research-driven, permission marketing software package which attaches transparently to the organizations website. ORBIT enables multiple ticket buyers to select performances, send personalized email invitations to their friends and associates, and track their invitee responses to performances over the course of the season – electronically – all in exchange for their email address.
ORBIT users then purchase tickets through the organizations website. Each Organization, in turn, customizes and administers the ORBIT website through a set of website and database management and administration tools.
In essence, the Concert Companion is a device that helps listeners learn more about the music they’re listening to while they’re listening and ORBIT allows listeners to use the orchestra’s website to create a social event.
2. How much does it cost?
Concert Companion: According to Roland, the device is still in a development stage so the cost for an orchestra to rent about 200 of the Concert Companion devices (and related technical support personnel) is about $25,000 per program.
However, Roland says that these costs will decline significantly, as (1) the content library is created; (2) the cost of Wi-Fi enabled PDAs decreases and (3) the costs can be amortized across more orchestras doing more programs.
ORBIT: The fee for licensing ORBIT for an entire concert season is based on the orchestra’s annual budget and runs $1,500 – $4,500. There is also a small annual web hosting fee.
This fee includes regular season upgrades and personalized customization but the individual orchestras can also manage the day to day aspects of ORBIT using a full complement of administrative web tools and database management sources. Phone and electronic tech support are also included in the fee.
Here’s where we obviously run into the first big difference between the two products: cost.
The Concert Companion is something like a precision sniper rifle as it targets ticket buyers for specific concerts. But even if Concert Companion comes down in price as quickly and as much as Roland predicts, let’s be generous and say 75%, that’s still a per-program cost. If you want to use Concert Companion five times during a season, it will still end up costing you over $30,000 as a turn-key solution (having the people from Concert Companion show up to handle everything and bring their own palm devices).
Whereas the ORBIT software is a more like a “fire and forget” tool that’s always shooting (so long as your web site is up and running). Once it’s set up, you wait for ticket buyers to use it at their own pace and frequency.
3. How will it grow our orchestra’s audience and will it pay for itself?
Concert Companion: In order to subsidize the cost for using the Concert Companion, orchestras will need to either charge a secondary fee to use the device and/or include the cost into the ticket price.
According to the most recent data gathered by Concert Companion orchestras with an annual operating budget of $10,000,000 and up are performing to 70% capacity on average for their classical subscription concerts (down from 80% ten years earlier). If Concert Companion drives: (1) 5% increase in subscriptions; (2) 2.5% increase in single tickets; (3) 5% increase in subscription renewals; percentage of capacity sold will increase to 82.5% in five years (it’s like compounding interest).
ORBIT: According to data gathered by Symphonyworks, it has a return on investment for each orchestra that will pay for it self with significant multiples in the first season. Specifically, the ticket buyers that use orbit to invite their friends in conjunction with those friends that respond may typically spend 250% more than season ticket subscribers. So it only takes a handful of ticket buyers to cover the expense of purchasing ORBIT.
Going on line in late July, one of the initial orchestras to use ORBIT, the Boston Symphony Orchestra, identified 75 ticket buyers in the last few weeks of Tanglewood who used ORBIT to successfully invite friends to attend a concert.
This appears to be the one point where both products are only able to offer theoretical evidence to support their claims. But that’s also the nature of being new and why term “risk” is used in the business world.
I’m interested in hearing what sort of conclusions everyone is coming to. Do you think either product is a worthwhile investment? Both? Neither? Send in an email and share your opinions.
Looking for more information on both products? Then stay tuned because I’ll be publishing another article that goes into much more detail about the Concert Companion and ORBIT. We’ll learn about the impetus behind their development, how much it cost to bring them to life, and where they plan to go for the future.