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It's Showtime!
Entertainment companies are putting the spotlight on targeted customer strategies to improve service, build loyalty, and grow wallet share.
For the rest of the February 2005 issue of CRM magazine please click here
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Just because people love a certain kind of music or enjoy seeing a Broadway show or can't wait to place their next bet doesn't mean they're guaranteed to come back to your venue. That's why entertainment companies are now using the same approach to integrating databases and applications, automating systems to smooth the self-service process, and employing strategies to strengthen customer loyalty as are organizations in such industries as banking, telecommunications, technology, and government. In fact, industry consultants are acknowledging CRM's potential growth within the entertainment industry. David Wolf, a partner responsible for the global entertainment practice at CRM consultancy Accenture, is seeing an uptick in companies' efforts to build their knowledge of customers to then create more effective marketing campaigns. "As digital technologies emerge we're noticing more and more solutions that can go directly to a consumer," Wolf says. "Having capabilities that can do good customer segmentation and drive down into more targeted marketing, and targeted offerings into that consumer population, are capabilities that the entertainment companies are actively looking into." Here, we open the curtain on three companies within the entertainment industry to examine how they are using targeted marketing campaigns and customer-driven strategies to build loyalty. In the Key of C(RM) The End Records, a Salt Lake City-based record label and online retailer specializing in goth and heavy metal music, started out in 1998 as just another small company, with only two employees. The label, which boasts bands like Crisis, Epoch of Unlight, and Antimatter on its roster, has since grown to have a staff of 11 people. Both its record-label Web site and its mail order site now receive about 1.5 million hits a month--thanks in large part to The End's CRM initiative striking the right chord with customers. For company president Andreas Katsambas, the start-up was more like a hobby--he even had a day job. But Katsambas wanted to help some groups that matched his musical taste. In 2001 the company added mail order capabilities, supported by Katsambas going into online forums and posting messages to promote the company. That's when the label picked up its tempo. To handle the growth, The End Records needed a scalable solution that would streamline its order process. The company had used systems like Mycart.net and QuickBooks to handle part of its order process, but the lack of integration caused snags in the process. Every order that came over Mycart.net had to be downloaded and then reentered into QuickBooks, and whenever The End added or removed a product from its line, the change had to be made in both applications. Worse, credit card processing required that The End's staff manually enter information at another Web site. The average order took 20 minutes to process.
"We wanted to avoid double data entry," Katsambas says. "When someone would place an order on the Web site, we had to go and repeat the same order--duplicate it in the back-end program as well." With such a time-consuming manual routine, mistakes were inevitable. "When you have to retype everything, mistakes happen. It would take twice as long, and as we started getting more and more items it was becoming difficult to keep an inventory track," he says. "We decided that by integrating the system, it would make the procedure smoother and avoid the mistakes of duplicating data entry." After searching for an integrated solution that would meet the label's requirements, Katsambas selected NetSuite. Now The End's Web store is fully integrated with NetSuite's accounting and inventory management modules. Tweaking its order processing system allowed the label's execs to focus less on internal concerns and more on growth. As a result, the amount of orders processed has increased to the tune of 100 percent for each of the past three years. "Now that we don't have to reenter information we can process a lot more orders in about half the time," Katsambas says, adding that with NetSuite orders are processed in less than one minute. "If somebody orders from our Web site, our goal is that it should be done within 24 hours," he says. Additionally, with NetSuite customers get emails during each step of the process, eliminating incoming customer calls regarding order status. The company sends emails to customers all along the way: as soon as orders are placed, when they are processed, and when they are shipped (along with a tracking number). After analyzing the emails it received the company determined that its most frequently asked questions included inquiries on the length of time it takes to receive orders using the different shipping options, and the prices of merchandise like CDs and T-shirts. There were five questions that were most frequent; now, the answers to those five questions are included in the first email customers receive after they place an order. Within three months of making the change incoming FAQ emails plummeted 30 percent. The End Records is also using NetSuite's tracking feature to improve responsiveness. This has improved service in several ways. For example, if one person doesn't know how to answer a query, "we can assign that case to someone else that's more knowledgeable within that field," Katsambas says. "And if the full-time person goes on vacation for a week and someone temporarily takes over, they can at least see all the prior history of any communication that has been going on with an existing client." With the help of the tracking feature, the label was even able to avoid being defrauded, Katsambas says. In one case "a person placed five orders and in all five orders he claimed that he never got the package," he says. "We realized he is probably a fraud and we stopped sending him the lost orders." With NetSuite, he says, "everything became a lot more efficient." As a next step The End Records plans to institute e-marketing campaigns and to establish commission-based partnerships with record groups, supported by NetSuite's Partner Center and NetCRM. An integral part of the label's existing marketing strategy is its e-newsletter, which is sent out every two or three weeks, complete with updates and special offers. "With a new release that we think can do well, but isn't well known, we may mesh it with a big release and help both of them," Katsambas says. The label also supports its sales efforts with targeted inserts included with purchases. "Because we send so many packages out we always throw in flyers," he says. "We try and cover our ground, doing it both through the email and when we send the packages out." In such a highly competitive market, the company hones in on its target audience to maximize results. It's that target approach that focuses The End Records on improving its customer interactions. "We know what our strong points are and we don't try to do all kinds of music," Katsambas says. It's all about "small ways to show our appreciation to the customer." Red Carpet Access Customers want what they want when they want it, and at Clear Channel Entertainment's Broadway Across America (BAA) division, that means giving them multiple ways to get the information they need, including the ability to handle certain transactions without the help of an agent. Previously, customers were only able to access the organization's Avaya-based automated customer service system after hours. But to meet its self-service-savvy customers' needs, BAA now gives callers the option to either use the interactive voice response (IVR) system or connect with a live representative. Information that customers would use the Web to locate is now also easily accessible via their phone. "They can pull down directions to a particular venue, how to park, time or day of shows, and ticketing information," says Dan Fisher, Clear Channel Entertainment's national telecommunications manager. "All of the things you could find on our BAA Web site can be, for the most part, accomplished via the text-to-speech, voice recognition, and IVR system." For callers who still prefer to interact with an agent, however, representatives are available in call center locations including Fort Lauderdale, FL, Houston, TX, and Louisville, KY, to assist with any inquiries. According to Courtney Pierce, senior vice president of sales at Clear Channel Entertainment, Theatrical Division, the company uses its Avaya IVR for more basic inquiries and tries to reserve using live agents for issues that require individual attention. Some customers "want to talk to a real live person and they want to get that golden touch feel and that's what our agents are out here to provide," Fisher says. The company tracks these demographics with information they obtain with the help of ticketing vendors, and in most cases Ticketmaster, which collects the data and then provides it to BAA. Using that demographic information the division can then select specific shows to suggest to customers based on those customers' preferences. "The more points of contact we have to communicate with customers, the better our product is valued," Pierce says. "We're very services oriented and that helps with customer loyalty." To ensure the best experience when customers do choose to speak with an agent, BAA analyzes call history and show history, as well as its staffing requirements, to properly schedule the appropriate number of agents to match call volume peaks and declines. The strategy has several benefits. First, agents have higher job satisfaction levels, because their workload is more balanced. As such they deliver improved levels of service. Second, BAA can better focus on repeat customers, which Fisher says are of prime importance for Clear Channel. One way the division does this in the contact center is to reserve seats on a long-term basis for its repeat customers. "We know where [our repeat customers] are seated right now and we will reserve through the next year that particular seating arrangement," Fisher says. "If they want to upgrade they always have the option of calling our contact center and requesting upgrades." Clear Channel's multichannel approach provides customers with communication options and immediate accessibility to the company, which is helping turn one-shot clients into lifelong patrons. The VIP Treatment Rolling out the red carpet for customers is certainly nothing new in the theater industry, nor is it a novel idea in the gaming sector. As the gaming industry swells, casinos need to find creative ways to hit the jackpot with customers and cash out the competition. Foxwoods Resort Casino, the largest resort casino in the world with more than 320,000 square feet of gaming space in a complex spanning 4.7 million square feet, uses a two-pronged approach--its loyalty card and direct mail programs--to do so. The centerpiece of Foxwoods' loyalty program is its Wampum Rewards card, which captures and calculates customer play, and then determines how many points cardholders earn. The more you play the more you receive. Customers can redeem points for casino attractions like special events, restaurants, shows, and merchandise throughout the property. In fact, about 4 million of its customers are cardholders who redeem their points for Foxwoods merchandise and services. Tom Cantone, vice president of marketing and entertainment, says, however, that the Wampum card's reach extends far beyond saying thanks to customers. "It's our main tool to collect information on our customers so we know what kind of player they are, what they like, and how to market to them." For instance, Foxwoods uses customer data to shape programs based on different levels of play. "You don't necessarily have to be a high-end customer to receive offers," says Pam Panciera, director of casino marketing. "We don't ever want anyone to feel that they have to gamble more than they are comfortable with gambling." For high-end customers, however, members of Foxwoods' player development team act as personal assistants during their stay, coordinating travel arrangements and all their other activities at the resort. Plus, there are hosts on the casino floor and at host desks to cater to customers of all levels. To keep these employees, as well as its entire staff, up-to-date on news, including events, promotions, and other pertinent property information, Foxwoods uses an internal television network called Foxwoods News Network that runs 24x7. The other component of Foxwoods' customer initiative is its direct mail program. "It's really direct marketing driven, our business," Cantone says. "I have a database of millions of people that we systemically mail to every month. They get offers and updates that hopefully provide enough interest for them to come in." Foxwoods uses data it garners from the Wampum cards to help craft those targeted direct mail campaigns. Foxwoods recently incorporated email marketing into its strategy mix. "It's another way to contact customers as more and more people are becoming computer literate," Panciera says. "This enables patrons to automate their responses to the events, shows, and rooms promotions." All emails also have links to Foxwoods' Web site to allow for online booking. Foxwoods' target approach to customer rewards and its first-class treatment of its patrons are strengthening its brand loyalty. The reason it's working, Cantone says, is that the strategy was created with the customer in mind. "It's all designed to reward [customers'] patronage." Contact Assistant Editor Coreen Bailor at cbailor@destinationCRM.com
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To contact the editors, please email editor@destinationCRM.com
Every month, CRM magazine covers the customer relationship management industry and beyond. To subscribe, please visit http://www.destinationCRM.com/subscribe/.
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