Heart & Soul
However, marketing exclusively based on past purchases does not a successful long-term business model make. “That’s sort of a slam-dunk approach,” Frady explains. “But it’s not large enough a lot of times to make scale happen. You have to go wider, and you have to go with other artists who are related potentially to that first artist.”
So, Live Nation also uses an artist look-alike function, which analyzes patterns in musical preference data and identifies complementary artists—those who customers will have a high probability of liking based on their past purchases or existing preferences. In doing so, the company is able to cast a wider net for ticket sales on any given show.
“The key lesson we’ve learned is that segmentation is everything,” Frady emphasizes. “[It] really drives response.”
Of course, Live Nation is careful not to inundate customers’ inboxes with marketing communications. Frady says individuals who have signed up to receive the company’s electronic communications without expressing an artist preference typically receive one e-mail a week—the Live Nation Set List e-newsletter customized for the recipient’s local market. Those for whom Live Nation has artist preference data on file may receive a maximum of three communications in a seven-day period.
But Frady stresses that frequent communication with customers is a priority for Live Nation. It promotes brand recognition and trust, in addition to helping the company maintain accurate and up-to-date customer information. “E-mail addresses change over time,” he explains. “We want to ensure deliverability of our database, so we e-mail it weekly.”
And Live Nation has the numbers to back up this philosophy. According to Frady, working with e-mail services provider Zustek, the company has achieved a deliverability rate in excess of 98 percent and an inbox (as opposed to junk folder) rate of more than 97 percent.