Marketing Assignment
Bag O'Donuts Theater has been operating for 20 years. In recent years with the uncertainty of the US economy and reduction in arts coverage in the media, they have seen their subscription sales flatten and their single ticket sales decline. The results have been a reduction in staff resulting in less capacity for marketing.
Leadership of Bag O'Donuts Theater has decided to explore the implications of reducing their programming. Presently they produce 8 productions one of which is a non-subscription holiday program (a Bag O'Donuts tradition). They are considering reducing the total number of productions by 2 and beginning to include the holiday program in the package. However, they need to bring in the same amount of subscription revenue.
Theater Stats:
Size of House: 250
Number of Productions: 8
Length of Run: 23 performances, Holiday is 30
Current Attendance & Revenue
1,500 subscribers
Average Tickets Per Package: 6
Total Revenue: $270,000
Single Tickets Sold: 14,550
Total Single Ticket Revenue: $509,250
Total Revenue: $779,250
Projected Performance Schedule:
Number of Productions: 6
Total Revenue Target $800,000
In 3 to 5 pages, please answer the following questions:
What are the financial implications of the following:
• Moving the Holiday Production to the Subscription, considering impact on renewal rate, subscription sales, and single ticket sales.
• Cutting two productions out of the Season, considering the message to various audience segments. Please identify the segments and what their anticipated response would be and a message for Bag O'Donuts.
• How can pricing change and what is the message and implications in order to gain more revenue with fewer productions and changing what is in the package.
• Is there anything else that they should be considering that is completely off their radar?