How to grow the revisitation rate of your entertainment venue

With the global Coronavirus pandemic crippling the entertainment and leisure industry over the past 10 months, owners are going to be desperate to make up as much of the lost income as possible. We’re hopeful that with the rollout of the vaccine across the world, there is finally a light at the end of the tunnel.

We’ve previously covered how food and drink can be a great way to boost the money your venue brings in, but with this article we’re going to focus on something called revisitation rate, why it’s key to your venue’s long term success and how to improve it.

The lifecycle and initial growth of a Trampoline Park or Family Entertainment Centre

Over the last few years BookNow have been looking at visitation data from a variety of trampoline parks and family entertainment centres (FECs) around the world. What we have discovered is that there is a direct correlation between annual revisit rates and the success of a business when hitting maturity (circa 3 years). KPIs from one of our recent clients revealed that 96% of customers visited less than four times per year whilst 81% came once.

Our experience suggests that many parks operate roughly a 3-year product cycle. With maturity and decline often beginning between years 2 and 3.

Looking at Trampoline Parks specifically, the initial launch of any Trampoline Park normally leads to overtrading which delivers often large and fast cash deposits. The longer this lasts the more improved your cash flow will become for a significant re-investment when you hit the inevitable decline.

So, what is revisitation rate?

Our experience suggests that whilst overtrading during this launch period remains key, it is at this point that you should be exploring your revisitation rate as your major key performance indicator. Revisitation rate is defined as your total customer pool (live customers on a rolling 12 month basis) divided by your total annual ticket sales. As an example, should you have an existing customer pool of say 300k and 600k annual sales, your rate would be 2.0.

During your launch and growth phase, depending on location, you would expect to experience steady growth of your customer pool before the market becomes mature. Leaving your revisitation rate as the only key performance indicator that can now affect your outcome.

What is your your revisitation rate

Over several months, you should be able to monitor this as a trend during your first 3-year cycle. Seeing a revisitation rate in excess of 2 should signal a growth phase in the business, and more importantly an increase in cash flow which should allow you to set aside capital for investment later. Once you begin to see a period of reduced revisitation (1.4-1.5), our experience suggests it is time to re-invest. Seeing your revisitation rate drop below 1.4 should be concerning, whilst anything towards 1.0 is potentially catastrophic, leaving your park with an inability to invest enough capital during year 3 to increase the revisitation rate back above 1.4 or higher

However, this remains the likely outcome during year 4 if your plans are not in place and delivered at the right time during your cycle. Choosing the correct investment plan is largely dependent on your overall business strategy, but we believe that a significant re-investment in the ballpark of 350k is what is required to drive the revisitation rate back towards 2.0.

Be prepared and the results will follow.

Natural drop-off rates will occur during your 3-year cycle due to children maturing and finding alternative interests. This is where continually focussing your efforts on recruiting the younger generation requires ongoing marketing and brand building.

Dive deeper into your KPI information and it will highlight the reason customers attended a Trampoline Park in the first place (i.e. birthday party, first time jumper following initial launch, rainy day activity etc.) This vital information will determine the likelihood of customers returning and should be monitored.

Remember your competition is still far wider than you think

Do you regularly run a competitor analysis? The competition in the leisure industry is far wider than one might imagine. Your park may actually face stiff competition against local theme parks, cinemas, soft plays, national parks, adventure playgrounds and rival trampoline parks. Some of which can operate more effectively throughout all seasons.

What can you do to stand out from the competition?

Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will stand out from competitors. Research shows that by adding additional facilities such as bowling, climbing walls, Bear Grylls extreme climbing areas, ninja warrior or soft play or a revamp of the trampolines then market leaders in this space tend to see a return on investment (ROI) during the first 3-year cycle.

As previously covered, food and beverage areas can be the difference between a customer returning or not. It can significantly increase your ROI as parents want to grab a snack, lunch or coffee whilst their child is jumping.

Family entertainment centres are a social environment for parents, which offers an opportunity to create a welcoming environment for adults and potentially increase your revenue. The small details are important and will have an impact on your revisitation rate. If staffing levels are appropriately managed for on and off-peak periods to avoid lengthy waiting times, tables are cleared and allow for table ordering then this will create a welcoming place this will all contribute towards repeat business. In addition, vending machines are a great earner for those customers on the go.

If you have multiple facilities with slightly varying equipment for all ages, you could consider a 3-year rotation on the kit to freshen things up. Providing clean and modern equipment instils consumer confidence and is a trigger for repeat business and recommendation.

Loyalty schemes or memberships are another solution that can be managed by our software. In addition, rewarding loyalty or providing monthly or annual memberships are both relatively unexplored in this market. And, both strategies can provide you with further insight into your customers that you wouldn’t usually get from casual usage. This will provide you with opportunities to tailor offers/discounts to a customer’s specific needs and you will reap the rewards. Think big data.

Why stealing market share might not be the best long-term solution.

Some parks opt for a short-term fix by essentially trying to increase their customer pool which involves lowering prices and doing better deals than their competitors. This may lead to some small fluctuation in your pool but is really only a temporary solution that isn’t very sustainable. Resist the temptation to drive market share from your competitors by running offers such as discounted food and beverages, extra jump time, buy 10 jumps, get one free and so forth. 

This may yield some quick wins to generate cash for the business, but realistically in the long-term with lack of brand loyalty in this industry, the results will remain short-lived. Furthermore, this potentially leads to the customer pool becoming conditioned to only buy offers, thus effecting yield and more importantly your revisitation.

Data remains key.

Whatever your focus, the collection of data is still key. Regular audits of your customer pool, revisit rate and net gain should make it into your monthly board meetings.

Seasonal periods need to be considered in your data too. The summer months will see a natural dip as outside activities take preference. Whilst the winter months will continue to be your bread and butter by filling the ‘rainy day’ void.

BookNow can stay on top of your figures with its custom reporting software. Due to both our partnership with the world leading Salesforce software and our experience, we can provide custom built KPIs and Dashboards pertinent to your Trampoline Park(s) which can be used to forecast your annual revisit rate to provide the insight you need to make the relevant business decisions.

Ultimately understanding your revisitation rate allows you to be as customer-centric as possible, by adding real value and educating your customers. In turn, you inspire brand loyalty and create brand ambassadors willing to showcase your product especially through social media channels. 

To find out how BookNow Software can support you as you grow your revisitation rate, just send us a quick message on the form below and one of our helpful team will be in touch as soon as possible.

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