how to increase earned revenue

Yale CabaretSurvey Analysis by:Paul Jessen, Lisa Law, Athan Slotkin, Devon Smith, Adam Stone

Agenda

Client Description

•Mission: to provide a laboratory for Yale School of Drama students’ daring and illuminating experimentation.

•New 1-hour show every week•8PM and 11PM Thursday – Saturday

•Food and drinks available for purchase

Business and Research Problems

Management Decision Problem

How can the Yale Cabaret increase earned revenue?

What types of communications, product offerings, and product pricing will increase revenue?

Increased revenue could result from:

Price

Volume

Frequency

Marketing Research ProblemCabaret Attendance/Tickets:

What are customers' motivations for attending or not attending the Cabaret?

What are customers' consumption patterns for the Cabaret?

What are customers' perceptions, attitudes, and awareness of the Cabaret?

What types of marketing efforts by the Cabaret are most effective with customers?

How does the Cabaret fit into customers' weekend entertainment decision-making process?

How do potential customers decide what to do in the evening?

Food/Drinks:

What are customers' consumption patterns for food/drinks at the Cabaret?

What are customers' perceptions, attitudes, and awareness of the food and drinks at the Cabaret?

What are customers' motivations for ordering or not ordering food and drinks at the Cabaret?

Methodology

Answering the Market Research

Problems

Overall Brand Perception

20%

30%

40%

50%

60%

70%

80%

90%

100%

Percent saying the following adjectives describe the Yale Cabaret "closely" or "very closely"

Attendees Non-attendees

Sources of Information

Very Likely62%

Likely25%

Somewhat Likely10%

Unlikely3%

How likely are you to recommend the Cabaret

to someone else?

•Net Promoters = 59% (Very Likely – Somewhat Unlikely – Unlikely – Very Unlikely

Word of mouth from friends

Cabaret Website

Cabaret posters/flyers

Yale Drama Weekly eNews

Online reviews/blogs

Importance of Communication Channels for Cabaret Information(by % Very Important or Important)

Satisfaction

Shows Food/Drink Overall0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Very dissatisfied

Dissatisfied

Somewhat dissatisfied

Somewhat satis-fied

Satisfied

Very satisfied

Factors Driving Satisfaction

A linear regression model shows that 63.4% of variance in overall satisfaction can be explained by the following factors:

1. Show satisfaction (p-value=0.000)2. Atmosphere satisfaction (p-value=0.000)3. Food and drink satisfaction (p-value=0.000)4. Size of tables satisfaction (p-value=0.003)

All factors have a positive correlation with satisfaction rating.

Overall satisfaction =0.098 + 0.514(show satisfaction) + 0.243(atmosphere) + 0.152(food/drink satisfaction) + 0.111(size of tables)

Barriers to Attendance

• Nearly 50% of respondents claimed lack of knowledge prevented them from attending

• Cost does not appear to be a barrier

• Only 4% of respondents said they did not attend because they do not like the theater

Reason Non-Attendees Did not Attend Cabaret(by % of Respondents)

Knowledge

Time

Never Invited

Never "Got Around"

Cost

Distance

Don't Like

0% 10% 20% 30% 40% 50%

Factors Driving Frequency

A linear regression model shows that 64.7% of variance in the number of performances attended can be explained by the following factors:

1. Whether someone is a YSD student (p-value=0.000)

2. Whether someone bought a 10-ticket package (p-value=0.000)

3. Whether someone is a non-student Yale affiliate (p-value=0.021)

4. Overall satisfaction rating (p-value=0.000)5. Size of tables satisfaction (p-value=0.012)

All factors have a positive correlation with frequency.

Ln(performances attended last season)=-0.768 + 1.90(YSD student) + 1.03(bought 10-ticket) + 0.241(Yale affiliate) + 0.181(overall satisfaction) + 0.098(size of tables)

Size of Table Satisfaction

44.6% of the variance in table size satisfaction can be explained by the following factors:

1. “Seating arrangements” satisfaction (p-value=0.000)

2. Importance of “how crowded” restaurants are (p-value=0.013)

3. Not eating at Cabaret due to poor service (p-value=0.058)

4. Not wanting to eat with strange people at Cabaret (p-value=0.032)

Seating has a positive correlation with table size satisfaction; all others have a negative correlation.

Size of table satisfaction = 2.98 + 0.562(seating satisfaction) - 0.118(how crowded) - 0.0949(poor service) - 0.080(don’t like eating with strange people)

Willingness to Pay-Tickets

• Single Tickets - $15, $10 for Students• Non-Attendees WTP suggests that 50% of respondents are willing to pay

approximately $15 or higher.• 10 Ticket Package - $65, $45 for Students

• Non-Attendees WTP indicates that 50% of respondents are willing to pay approximately $75 or higher.

0.0% 20.0% 40.0% 60.0% 80.0% 100.0% $-

$10

$20

$30

$40

$50

$60

Non-Attendees WTP - Single Ticket

0.0% 20.0% 40.0% 60.0% 80.0% 100.0% $-

$50

$100

$150

$200

$250

$300

$350

$400

Non-Attendees WTP - 10 Ticket Package

Drivers of Food/Drink Spend

Logistic Analysis predicts drivers of food and drink consumption:

Food:•Non-student Yale affiliation (18x undergrads)•Non-Yale affiliates (43x undergrads)•Satisfaction with show times•Less frequent performing arts attendance

Drink:•YSD affiliation (88x), non-YSD graduate

students (6x), non-student Yale affiliates (19x), non-Yale affiliates (14x)•10-ticket buyers

Barriers to Food/Drink

Purchases

• Cost is primary barrier

• Customers don’t think of the Cabaret as a restaurant.

• Customers are concerned about the food + show aspect of Cabaret.

Reason Attendees Did Not Eat at the Cabaret(by % Strongly Agree or Agree)

Cost

Not "Real" Restaurant

Show Going On

Knowledge (Arrival Time)

Time

Knowledge (Menu)

Strangers Around

Atmosphere

Service

0% 10% 20% 30% 40% 50%

Willingness to Pay – Food

• Entree – Approximately $17• Non-Attendees WTP suggests that 50% of respondents are willing to pay

approximately $15 or higher.• Small Plates and Appetizers – Approximately $6 – $8


0.0% 20.0% 40.0% 60.0% 80.0% 100.0% $-

$5

$10

$15

$20

$25

$30

$35

$40

Non-Attendees WTP - Entree

0.0% 20.0% 40.0% 60.0% 80.0% 100.0% $-

$2

$4

$6

$8

$10

$12

$14

$16

Non-Attendees WTP - Small Plate/Appetizer

Recommendations-Price

Recommendations-Volume

Recommendations-Frequency

Questions?

Appendix

Feature Satisfaction

• Consumers tend to be most dissatisfied with anything relating to the kitchen and bar, perhaps due to a perception of the Cabaret not being a dining experience

• Those who do go to the Cabaret tend to be highly satisfied with the show; hence the need to get customers in the door

• Show satisfaction and ticket price inelasticity seems to present an opportunity to move away from 10-ticket packages and price up

Satisfaction with Cabaret Attributes(by % Strongly Agree or Agree)

Atmosphere

Time of show

Production quality

Ticketing process

Service

Selection of shows

Quality of drinks

Quality of food

Size of tables

Seating arrangements

Kitchen/Bar hours

-30% 0% 30% 60% 90%

Segmenting the Market

•Cluster analysis of consumer behavior/attitude data in any form failed to produce distinct, meaningful, stable customer segments

•Distinct: On standardized or non-standardized scales, cluster centroids were too close together to suggest real differences in behavior and attitude•Meaningful: Cluster centroids often contained

confusing or contradictory combinations of factors/variables, producing no actionable results•Stable: 20-25% of individuals were reclassified

based on changes in linkage method, distance measure, and K-means reclustering

Free Response Suggestions

Only do 1 show per night Have breaks during the show to get food/drinks Do something pre-show Student discount on food Keep table reservations More types of beer Waitlisted people get to order/eat Post-doc or staff night early in season More food options at late night Run shows for 2 weeks Budget night w/ fixed price (all included) More vegetarian options Online ticket purchases for YSDUse YDC and GPSS to get word out

Eating OutAttribute Importance for Eating Out(by % Very Important or Important)

Value for money

Convenient location

Crowdedness

Menu selection

Refreshed menu

0% 20% 40% 60% 80%

• Consumers need to perceive that they are getting value for their meal both in food quality, ambience, and reservation time

The Combo Package

Very Likely30%

Likely31%

Somewhat Likely21%

Unlikely14% Don't Know

4%

Would you purchase a package of ticekts, food, drinks for a fixed price? • Consumers seem to be

interested in purchasing a fixed price package of tickets, food, and drinks for a reasonable price. This could be an opportunity to increase margins, and better predict food purchases for the evening, thereby alleviating some operational issues.

Willingness to Pay – Dessert and Beer

• Dessert – Approximately $3 – $5• Non-Attendees WTP suggests that 50% of respondents are willing to pay

approximately $7 or higher.• Beer – Approximately $4 – $6


0.0%

20.0

%

40.0

%

60.0

%

80.0

%

100.

0%

120.

0% $-

$2

$4

$6

$8

$10

$12

$14

$16

Non-Attendees WTP - Dessert

0.0%

20.0

%

40.0

%

60.0

%

80.0

%

100.

0%

120.

0% $-

$2

$4

$6

$8

$10

$12

Non-Attendees WTP - Beer

Willingness to Pay - Wine

• Glass of Wine – $4• Non-Attendees WTP suggests that 50% of respondents are willing to pay

approximately $6 or higher.• Bottle of Wine


0.0%

20.0

%

40.0

%

60.0

%

80.0

%

100.

0%

120.

0% $-

$2

$4

$6

$8

$10

$12

$14

$16

Non-Attendees WTP - Glass of Wine

0.0%

20.0

%

40.0

%

60.0

%

80.0

%

100.

0%

120.

0% $-

$10

$20

$30

$40

$50

$60

Non-Attendees WTP - Bottle of Wine

Population Validity

Undergrad5%

YSD9%

Graduate61%

Yale Non-Student

11%

Unaffiliated Yale14%

School Affiliation

Population Validity

Did you attend this year Did you puchase a 10-tix0%

10%20%30%40%50%60%70%80%90%

100%

Yes No