Other Industries Spotlight: Leisure
How The Pandemic Drove This Soft Play Centre To Adopt An Online Only Pre-Booking Model And Do Away With Their Membership Programme
In this new series, we take a look at what the world of Exhibition can learn from businesses in other industries who are successfully using data to fuel their growth.
Gambado is a soft play centre based in Chelsea, London. Their Operations Director, Gareth Bullock, spoke to us about two major changes they made in their business as a result of the pandemic, and how data gave them the confidence to make these bold decisions.
Like cinema, along with so many other industries, soft play centres have faced numerous issues as a result of the pandemic. At the time of going to press the latest tally on the number of these businesses that have closed down in the UK since the pandemic began sits at 247. With enforced capacity limits of 30% being applied across the sector, some of these businesses couldn’t even cover their operating costs, with as little as only 6 or 7 kids allowed to attend at any one time.
At the start of 2020 Gambado were operating 3 busy sites across the capital but, due to the Covid situation and coinciding break clauses in their leases, they took the decision to close 2 of them, focusing instead on consolidation during this uncertain time and waiting until a clearer picture of the market emerges later in 2022.
ONLINE PRE-BOOKING MODEL
At 100% capacity Gambado can cater for 550 guests at their Chelsea site, but with the new limitations they have been forced to restrict this at varying levels, at one point as low as 130 guests at a time. In order to manage their operations better and ensure they stay within Government guidelines, they moved to an online pre-booking only model during 2020. Although this went against the typical behaviours seen in their industry, with online booking numbers only reaching 13% in 2019 when operating at full capacity, Gambado have seen nothing but positive results come about from this change.
Gareth:
“The culture of soft play centres has never been about pre-booking. Our business model was based on walk-ins, people who decide on the day that they are going to come to Gambado. With young kids and toddlers it’s difficult to pre-plan, and weather also plays a huge part in our attendance numbers. We operated that way for 12 years and it was very successful, but the pandemic forced us into a pre-booking model and this has actually completely changed our business for the better.”
So what benefits have Gambado seen since implementing this new way of operating?
Capacity Management: Capacity management is streamlined, creating a much better experience for customers and staff.
Customer Satisfaction: Previously, they would have 100+ people queuing in the rain to get in on a one in one out system. Now if people come, they know they will get in at their allotted time. Gambado’s NPS score is higher than it’s been in 14 years.
Reduced Staff Churn: By operating a session model of a 2 hour time slot with 30 mins in between for Covid cleaning, their staff have never been happier. There is a smaller number of people in the building at any one time and they come in ebb and flow, meaning less stress for workers.
Accurate Forecasting: Data gives visibility of how they will trade - it’s a short term picture as people typically don’t book more than 72 hours in advance but it allows for an accurate forecast
Targeted Marketing - by having all their customers book online they now have a far larger marketable database than ever before, meaning they can create targeted, customised and personalised email communications to increase visits
Increased Revenue: The ability to process customers in an organised and efficient manner is far greater, and they are now serving and processing more customers than ever before. While their current capacity limit is 300 capacity Vs 550 at full capacity, they are actually able to process more visits, whereas dwell time was previously 3 hours plus, resulting in backlogs.
In the cinema industry, there are vast differences between how countries are adopting online booking. In China, web booking averages 95%, compared to France where it is as low as 12%. While it’s not a one size fits all approach, if you adopt the methodology of nurturing people to book online you avail of the benefits that go with it, so encouraging as many as possible to pre-book and treating walk-ins as incremental can be a good way to start closing the gap.
Some theaters offer value added incentives to customers to pre-book their cinema tickets, while others charge a higher price to those walk-ins who want the flexibility to turn up on the day. Whatever your approach may be to driving people to book online, make sure you are using the correct data to determine your strategy and pricing structure.
NO MORE MEMBERSHIP PROGRAMME
In addition to implementing a pre-booking model, the capacity restrictions also forced Gambado to review their long standing membership programme.
As one of the first soft play centres in the UK to launch a subscription membership back in 2015, they had built up a base of loyal clients which provided them with a valuable recurring revenue stream during their quieter months. But after analysing the data, they were able to determine that in order to optimise profitability during enforced capacity restrictions, they would have to make the difficult decision to do away with their membership programme - and their recurring revenue.
Gareth:“We originally created the membership offering after conducting a customer survey in which 99% of respondents stated that price was the biggest barrier to visiting more frequently. This gave us the confidence to look at our product and look at what is a sensible discount to apply to an annual pass holder.
Traditionally this was a business based on volume, and when we analysed the data we saw that so long as less than 45% of customers were annual pass holders, we would remain profitable. By introducing our membership model we managed to increase our volumes, even if it was at a lower yield. We also saw an increase in F&B spend, as those who were visiting more than once a month were essentially attending for free under the membership pricing structure and so they were more inclined to spend extra on their visits.”
At the time of doing away with what had up to now been a successful membership programme, 38% of Gambado’s base were annual pass holders. While still under the threshold of 45% where they originally needed to keep it, the new occupancy levels meant their numbers needed to be completely reviewed.
Gareth:
“The pandemic forced us to ask ourselves some difficult questions. Will those people with memberships still come without a programme, or are we diluting our profit margin by turning away potentially full paying customers to make room for them?”
Having easily accessible, joined up data meant that Gambado were able to make an informed decision on the viability of their membership programme, and to implement the changes to their new strategy.
Gareth:
“We’ve always been a business driven by data and trends and we’ve used this to learn over time. With the capacity now set at 300 instead of 550, we took the opportunity to focus our efforts on incentivising repeat customers who weren’t members to visit more often and increasing spend per head - which is exactly what happened.”
With no discounted membership programme, Gambado are one of the most expensive soft play centres in the country, but their customers know their product and service is superior and represents value for money - which is what they attribute their high retention rate to. Without their online booking model, Gambado wouldn’t have had the opportunity to market to those in their base who weren’t members.
Gareth:
“Our business is not driven by one off visits, which is good news as it’s more expensive to acquire new customers as it is to drive repeat business. With a 4 year average retention cycle, we run lifetime marketing journeys and nurture campaigns to target different customers for the various activities that appeal to the age of their child, from toddlers up to 9 or 10 year olds.
In place of the membership programme we also run tactical reward offers to drive customers to visit more often and during quieter periods like mid-week.”
We asked Gareth what he thought our industry could learn from a soft play centre business, given that they are aimed specifically at certain age groups and therefore more demographically driven than a theatre with multiple screens and widely varying content?
Gareth:
“Use your data to make the decisions that will drive your business forward. We previously used our finance team to collate our data, so we always had it but we didn’t know how to pull it together in a usable format. It wasn’t joined together so we couldn’t see how A affected B affected C. Before we were introduced to data analytics software we had no concept of what it could give us and didn’t realise what was out there that we were missing out on.”
Membership programmes have long been in existence in the world of cinema. Exhibitors across the globe have run membership schemes of varying degrees and many will attest to their success, but if a specific membership programme was created pre-Covid can we assume that it will remain profitable in a post-Covid world with so many new variables?
Mark de Quervain, Showtime Analytics’ Director of Client Services says:
“The pandemic has been the catalyst for change for many circuits to review the effectiveness of their different membership and loyalty programmes. A programme that performed as it should in a pre-Covid world may no longer be as effective in today's landscape.
As can be seen from Gambado’s experience, customer bases and behaviours have shifted and we can only begin to see the real impact of this when we get into the data behind the numbers. For these reasons, we are actively working with our clients to review their existing loyalty and membership programmes that may benefit from updating due to changes in customer recency, frequency and spending patterns.
Our new Customer Analytics platform including a powerful and dynamic recency frequency model is proving an invaluable tool in this review process. Now is the time to make changes to expedite recovery.”
Gambado’s POS and data analytics is provided by Fuse Metrix, a solution designed specifically for the Leisure industry.
Showtime Analytics provide a suite of data solutions built specifically for the Cinema industry. If you would like to learn more about how Showtime’s products and consulting services can help you with your Theatre’s Operations or Marketing Strategy please get in touch with us here.