SIP Task Force Update Round Robin – Crystal City November 7, 2006

SIP Task Force Created at the direction of the Member Services Committee of the PBS Board Stemming from a discussion of Member Services Survey: FY 05’s SIP’s Importance vs. Satisfaction gap Member Services Committee reviewed and approved: Task Force Members Purpose Statement Timeline Member Services Survey SIP Programming: Imp.Sat. Gap FY FY

SIP Task Force SIP Task Force - Members Steve Bass – OPB Terrell Cass - WLIW *Mary Ann Donahue – WNET Cynthia Fenneman – American Public Television Joyce Herring – KACV (PBS Board Member) Kelly McCullough – KAET * **Susan Moritz – IPTV (DAC Chair) *Mike Seymour- The Programming Service Allan Pizzatto -- Alabama PTV (OSBE Chair) Rick Schneider – WPBT (PBS Board Member) * **Daren Winckel - WGBY (DAC Member) * overlaps with Pledge Programming Advisory Committee ** overlaps with DAC

SIP Task Force PBS Staff Sylvia Bennett John Boland Wayne Godwin Paula Kerger Rick Lore Gustavo Sagastume Beth Suarez Beth Walsh John Wilson

SIP Task Force SIP Task Force Draft Purpose Statement The purpose of the SIP Task Force is to examine the role PBS Fundraising Programming (SIP) plays in its client stations’ fundraising efforts. Its chief purpose will be to recommend new measures of success for SIP and develop strategic recommendations to achieve those measures.

SIP Task Force SIP Task Force Draft Purpose Statement This work goes beyond programming to include other areas such as scheduling, messaging, lifetime value of a member, and net vs. gross revenue from on-air pledge. And recognizing that pledge is a collaborative effort between PBS and the stations, the Task Force will also examine the factors within control of the stations to maximize the benefit of SIP Programming in their over-all development efforts.

SIP Task Force SIP Task Force Timeline Task Force Meetings in May, July, & Sept Early preview & feedback Development Conference Draft recommendations shared and feedback received at PBS/CPB Round Robins Final Task Force recommendations to the Content Policy Committee of PBS Board January Incorporated into FY08 PBS Plan & Budget for system-wide feedback March 2007 New measures employed beginning (FY08)

SIP Task Force FY06 reported a record high ~$151MM pledged on-air Pledge minutes & days pledged were down slightly SIP programs account for approx. 70% of pledge dollars raised FY06 Pledge Stats: Gross Dollarsup 5% Minutes down 5% Days down 1%

SIP Task Force Why isn’t $151,000,000+ more “satisfying?” Gross dollars are increasing, but the margin appears to be shrinking… Renewal of pledge-acquired members is down (averaging 21% first-year renewal rate) Traditional vs. Big Premium/Event Programs: question of effect on retention? How do we strike a balance? Margin depends on cost of premium and pledge level. Tickets and bundled premiums tend to drive the margin down and the net up. How? 60% of $300 nets you more than 80% of $100 ($180 vs. $80)

SIP Task Force SIP’s Old Goal: 7 to 1 Return on Investment (Gross) SIP’s New Proposed Goals: Adjusted Gross Revenue (AGR) ROI Target for SIP Portfolio % of Programs that attract retainable members Qualitative Measures for Pledge Message Member Services Survey – Importance vs. Satisfaction (old measure, new results!) AGR= Pledge Level – (premium cost and S&H)

SIP Task Force Adjusted Gross Revenue Return On Investment Goal for SIP Portfolio Replace old 7 to 1 gross *SIP’s Current AGR ROI is 10.5 to 1 What should it be? *~$151 million x 70% (avg. % attributed to SIP programs) x 85% (avg. Adjusted Gross Revenue margin) = ~$90MM return on a program investment of ~$8.5MM = 10.5 to 1 AGR ROI

SIP Task Force % of Programs that attract retainable members Pledge programs need to acquire new, “renewable” members To what degree do certain pledge programs attract “renewable” vs. “non-renewable” members? Research to come… What is the appropriate accountability for SIP when it comes to member retention? FY05 renewal rate of 1st year on-air acquired members = 21% (FY01 24%) Direct mail acquired members = 48%. Direct mail acquisition response rates have dropped below ~1%.

SIP Task Force Qualitative Measures for Pledge Message SIP Station Survey What does the client think? Qualitative Audience Research Focus groups, in-depth interviews, etc… Establish Baseline, set goals, track results Applies only to SIP commissioned pledge events Even a “good” program & message can go “bad” if overly-repeated. The stations’ schedule plays a big part in how the message is received.

SIP Task Force Member Services Survey – Importance vs. Satisfaction (old measure, new results!) If successful, the gap between Importance & Satisfaction should narrow… Or will it? Are the system’s expectations of pledge satiable? Short term:Increase satisfaction with SIP Long term:Lower importance of pledge in overall fundraising mix

SIP Task Force In addition to new measures, the SIP Task Force will make recommendations Areas for additional research Target analysis of lifetime value of member & program pledged correlation Connect to CPB’s Prime Time Research Best Practices Station goal setting “True net” calculation template Schedule considerations The real cost/benefit of tickets as premiums Quality Pledge Message more SIP and Stations have a shared responsibility for optimizing on-air pledge.

SIP Task Force Discussion/Feedback Questions/Answers The Task Force needs to hear from you to make sure we’re headed in the right direction…

SIP Task Force Update Round Robin – Crystal City November 7, 2006