Case Study: How AZ turned the annual decline in season memberships around in just one summer
Dutch Eredivisie club AZ Alkmaar is living up to its promise on being an innovative club. On-field performance is fully based on data-driven insights and as of last year the club has now started to implement this approach on its business operations as well. In a recent interview, AZ explained how they use data to increase fan engagement. Now, they’ve applied the same methodology on their season ticket membership campaign and after years of decline the first results look good with already a growth of 10% so far.
Having seen the success of a data-driven approach during their half season ticket membership campaign last winter (+300% sales compared to traditional marketing approach), the club also applied a data-driven approach to the season ticket membership campaign 2018-2019. Together with their partner, data-driven marketing agency Two Circles, AZ set out a strategy to maximize results. In this article, Bas Schnater will expand on the club’s approach.
Like most clubs, AZ Alkmaar had been suffering from an annual decline in season ticket memberships. “We saw a drop in memberships every year, and assumed this was due to societal changes”, Schnater explains. As part of the new campaign strategy, the club started with an in-depth analysis of its data. It appeared the club had suffered from an average retention rate of 78% over the last 5 years. “We wanted to turn this around, as this means a decline in revenues”. In-depth analysis showed the club suffered from a retention problem over an acquisition problem. So AZ decided to disconnect retention and acquisition and decided to focus more on retaining current fans. “Normally, we always looked at the total sales numbers, but it appeared more was happening under the surface”. This meant that the last home games of the season were going to be important moments for the campaign.
Secondly, AZ conducted a survey amongst its current season members. This survey generated valuable qualitative insights on the intrinsic and extrinsic motivation of its season members. These insights translated to a communication strategy specific to the differences between the stands. “We portraited very different values to the stands. An example is the family stand, where we focused family photos and our mascots, where for our fanatics we focused on fireworks and interaction with the players”.
“We portraited very different values per stand”
Another important element was the adoption of a predictive model for retention as developed by Two Circles. From the data-analysis, four variables appeared to be significantly predictive for renewal of memberships. After that, the club formulated feasible KPI’s, being 2017-2018 members +1, via an increase of the retention score to 85% plus acquiring new members.
Using data for offline activation
On the 5th of April, AZ’s season membership campaign launched. At the beginning the club focused on segmented e-mail campaigns tailored to the four stands. “For example, we’ve made 5 variations of our campaign video, tailored to the specific requirements of the four stands, as exposed by the survey”.
One of most effective campaigns happened around the last home game. Before the match, AZ used its insights to activate non-renewed members offline. By working together with their supporter groups, AZ distributed ‘hand-written’ flyers by the most popular player at that time (again, based on survey-insights) and planted these flyers only on the seats that hadn’t been renewed yet. In the note, the player thanked the fans for a great season and asked for their support the next one. “The beauty is that all our supporter groups got behind it. Our fanatics distributed the flyers on their stand and the Supporter Federation helped us with distributing flyers on the main stand. The fans want the stadium to be sold out just as much as we do, so when I discussed my plan with them, they were happy to help. To me, this is a perfect example of optimal fan engagement”. It appeared to be effective. The campaign resulted in a major peek in sales after that match, with the flyered stands showing a significant increase in sales compared to the non-flyered stands. “What we noticed is that we now weren’t only able to reach our members who aren’t normally easy to reach via e-mail, but also that the effect of the campaign lasted longer. Where an e-mail campaign mostly has an effect-span of 24 hours, the impact of this flyer lasted four days”. The club won the last game with 6-0 on a very sunny day, with Iran international Alireza Jahanbakhsh winning the league top scorer title that match. “Obviously sportive results have a substantial impact on these things. Though I do believe as a marketing team, you have to be there to yield maximum results. It’s about leveraging the important moments”.
The retention phase of the entire membership campaign lasted until the 31st of May. Instead of having again a retention rate of 78%, the club managed to increase the retention rate to 93%. “We will still try to question what send out a survey to the non-renewals, which we can use as input for next year’s campaign”.
Acquisition of new fans
With a retention rate of 93%, AZ managed to slow down the loss of memberships and actually turned it into growth. “According to our own analytical model, we will now end up with a predicted increase of around 10% in memberships”. New fans are harder to find, although the club does have the advantage to leverage sportive results. Though, the club follows a different strategy. “The season members’ survey told us clearly that fans come to AZ for many other reason than sportive performance. I think those other motivators are crucial to understand because as a marketing team, we can’t influence sportive results”.
Now that AZ’s retention campaign has been a success and the overall campaign projection is positive, the club has learned some valuable lessons. Schnater: “Our biggest learning is that a season ticket membership campaign requires a lot of strategic planning. Where we normally had a good set plan but varied still according to the flow-of-the-day, we now fully respected the campaign planning and maximized online and offline campaign opportunities. I believe that made the difference”. But also the element of surprise seemed to have an unexpected effect. “I hoped that we would get some result from a simple flyer campaign, but I didn’t expected such a growth. I guess it was partly because since so much nowadays happens online that offline impact is still undervalued”. In the end, the results of the flyer campaign accounted for 11% of the total renewals.
“So much nowadays happens online that offline impact is still undervalued”
Another learning is the use of predictive modeling. “This was the first time we used such a model. It appeared to be accurate up to 89% in predicting the propensity. We will continue to develop this model created by our partner Two Circles to maximize predictability of retention”.