Sacramento Zoo Strategic Analysis

Sacramento ZooColorado State UniversityBus 621 Fall 2010Christine Bui

Zoo Industry

Over 6,000 zoos and aquariums in the world

278 zoos in the USA

223 are accredited by the Association of Zoos and Aquariums (AZA)

67 million visitors to zoos and aquariums annually

Purpose is for public education and conservation

Non-profit Organizations www.aza.orgSugaya, Hiroshi World Focus No 58

http://www.aza.org/

Why is AZA Accreditation Important?

Public Trust and Credibility Develops public confidence

by means that an institution meets or exceeds current professional standards

Provides a publicly recognized badge signifying excellence in, and commitment to, such things as animal care, conservation and education

Distinguishes AZA-accredited zoos and aquariums from "roadside zoos”

Participation and Benefits from AZA Programs Increases eligibility for grants Participation in Animal

Exchange For loan and breeding

purposes Participation in Species

Survival Plan Animal Conservation

Program Promotes industry excellence Opportunities for

collaboration and education for staff

www.aza.org

http://www.aza.org/

Who is Sacramento Zoo?

Opened in 1927 on 4.2 acres of land; today it’s 14.3 acres

AZA accredited since 1975

Society run since 1997

90 employees in 7 departments

Mission: Inspire appreciation, understanding, and respect for all living things through stimulating education, wholesome recreation, and innovative species management.

Target Audience is families with young children and people who love animals

~500,000 visitors annually; 9,000 of which are members

Over 500 animals; 124 species (37 of which are endangered/threatened and/or Species Survival Program)

www.saczoo.comMembership Coordinator Email Interview

http://www.saczoo.com/

Why the Zoo?

•Species are becoming extinct at an alarming rate (one species every 20 minutes)•There is a need for education to protect global biodiversity through conservation of species and habitats•The industry constantly struggles with the financial means to complete their mission at a successful rate•Previous employer

www.iucn.org www.waza.orgMazur, Nicole A. and Clark, Tim W. “Zoos and Conservation: Policy Making and Organizational Challenges”.

http://www.iucn.org/

http://www.waza.org/

Sac Zoo’s Product Mix and

Market

Major Product and Service Lines

•Animal Breeding Programs (Species Survival Plan)•Research and Support for Conservation Programs •Public Education

Financials and Major Trends•Decreasing revenue for the past 3 years with increasing expenditures•Increased exhibit renovation due to old age

www.saczoo.com



Industry Competitors

Santa Ana Zoo

20-acres Comparable in size to

Sacramento Zoo

215 animals

City run

Must maintain at least 50 Primates as part of an agreement when land was donated to the City for a park

Oakland Zoo

525-acres

Over 660 animals

Society run

Local Zoo competitor 90 miles away

www.santaanazoo.orgwww.oaklandzoo.org

http://www.lazoo.org/

http://www.oaklandzoo.org/

Revenue Industry Comparison 2009

52%

19%

9%

20%

Santa Ana Zoo

Visitor Services*MembershipsRestricted Donations & GrantsUnrestricted Dona-tions

30%

28%

16%

4%

5%

15%

1%

Oakland ZooAdmissions

Concessions

Membership & Annual Fund

Events & Sponsorships

Education Support & Revenue

Government Support

Other Revenue & Interest Income

35%

7%

11%

21%

3%

4%10%

1%8%

Sacramento ZooAdmissions

Concessions

Memberships

Contributions & Spon-sorships

Special Events

Education

City of Sacramento

Bequests

Other Revenue & Visitor Services

Admissions is the top revenue generator for zoos.

Other revenue generators depend on the individual zoo.

www.santaanazoo.orgwww.oaklandzoo.orgwww.saczoo.com

http://www.lazoo.org/



Expenditure Industry Comparison 2009

33%

31%

6%

5%

4%

8%

13%

Sacramento ZooAnimal Care

Capital Improvements

General & Administrative

Fundraising

Promotion & Public Rela-tions

Education

Visitor & Member Services

29%

30%

21%

6%

14%

Oakland Zoo

Animal Care, Educa-tion & ConservationPark OperationsAdministration & MarketingFundraising & MembershipFacilities, Main-tenance & Sup-plies

24%

19%

12%

17%

20%

8%

Santa Ana Zoo

Capital Im-provements

Support Services

Marketing

Education

Community Outreach

Other

Animal Care and Facility Maintenance/Operations are the two largest expenditures for zoos.

www.santaanazoo.orgwww.oaklandzoo.orgwww.saczoo.com

http://www.santaanazoo.org/



Executive Summary:Our 5 Main Points

The Sacramento Zoo is not generating the revenue needed for capital improvements and exhibit renovations

Expanding the customer demographic will increase attendance

Offering additional experiences and increasing partnerships with local attractions will attract and maintain customers

Increased investor loyalty can be accomplished through value added

Revenue streams can be strengthened through customer diversification, enhanced customer experiences, and investor loyalty retention

Problem Statement

The Sacramento Zoo is not generating the revenue needed for capital improvements and renovations.

Why this problem?

Many zoos face this same problem Easily affected by the economic status

Improvements are needed to keep AZA accreditation Accreditation is evolving higher standards for exhibits

Better housing and exhibits will increase ticket sales and enhance animal well fare

Financial stability will allow Zoo to focus on education and conservation efforts

Tools to Help Solve the Problem

Detected the Problem - Loyalty Map• Cash Flows

Developed the Macro-Hypothesis – Logic Tree

Observed Sub-Hypothesis 1 – BMG Canvas & EFAS• Illustrates current strategy

Examined Sub-Hypothesis 2- Activity Map, EFAS/IFAS, • Current position and fit SWOT/TOWS, Value

Added • Strategy formulation

Studied Sub-Hypothesis 3 – Loyalty Map & Value Added• Improves value proposition

The Problem

Raises, conferences,promotions

GrowthInspiration, appreciation,

understanding, and respectfor all living animals

Zoo Keepers w/2+yrs experience

Zoo Keepers who remainat Zoo for 5+yrs

Wild Providers andCorp. Sponsorship

Corp and Fam/Indiviwho fund exhibits

Cash for CapitalImprovements

Donation

Superior animalcare and public edu.

Profits

Families/Individualswho like animals

Fam/Indivwho are members

The Problem as a Logic Tree

Macro-HypothesisSacramento Zoo can strengthen revenue streams by increasing

value to the customer experience in order to keep up with needed improvements.

Sub-Hypothesis 1

Expanding target customer

demographics will increase the

attendance rate.

Sub-Hypothesis 2

Offering additional experiences will

strengthen existing customer

relationships.

Sub-Hypothesis 3

Special appreciation programs for

investors will retain their loyalty and

support to the Zoo.

Sub-Hypothesis 1

Sub-Hypothesis 1:

Expanding target customer demographics will increase the attendance rate.

Sources:

Sac Zoo WebsiteCompetitor WebsitesSac Zoo Employee Interview Annual Reports

Sacramento ZooSanta Ana ZooOakland Zoo

US Census Bureau

Analysis Method:

BMG CanvasEFAS

Data Types:

Industry TrendsStatistical Data

VALUE PROPOSITION

CHANNELS

RELATIONSHIPS CLIENTS

REVENUE STREAMS COST CENTRES

KEYPARTNER

KEYRESOURCES

KEYACTIVITIES

Families with young children (<12 yrs)

Customer RetentionFacebook CommunityUC Davis Veterinary SchoolCity of SacramentoAZA

Direct MailRadio/TV/Print AdsInternet WebsiteSocial Media Outlets (Facebook, Twitter, Four Square)Word of Mouth

Knowledgeable Animal and Veterinary Care StaffAnimalsZoo WebsiteUC Davis Vet School PartnershipCorporate Sponsors

Family Oriented

Recreation

Education

Animals

Accessible

Corporate Sponsors (Target, BofA, Wells Fargo, US Bank)

City of Sacramento

AZA

Individual families (Fowler, Mower, Chappell)

UC Davis Veterinary School

AnimalsCapital Improvement/ MaintenanceWages

Admissions Special Events Train RidesCarousel Rides ConcessionsDonations Gift Store Giraffe FeedingsEducation Programs

Educational ProgramsRecreational OptionsAnimal ExhibitsBreeding ProgramConservation Support and ResearchCommunity Outreach

Business Model Canvas

Current Zoo Visitor

Demographics

Women/Mothers

Age 25-352 out of 3

adults visit a zoo with a child

www.aza.org

External Factor Weight

Rating

Weighted Score

Comments

Opportunities:

Land Expansion 0.1 3 0.3 Annual meeting held about the topic

Animal Acquisition 0.1 3 0.3 Constant surveying and thought of mixed species exhibits vs. single species

Petting Zoo 0.1 1 0.1 Mixed feelings fr management

Partnership w/ Museums

0.05 1 0.05 Does 1 free admission day coordinating with 3 local museums

Technological Advances

0.05 2 0.1 Social media outlets and medical enhancements

Threats:Local competitors 0.1 1 0.1 Larger Zoos have larger variety and sized

animals. Prioritization of recreation level among customers

New Entrants 0.05 1 0.05 Difficult industry to enter without capital

Economic Status 0.3 2 0.6 Financial position easily influenced by economy

Animal Death 0.05 3 0.15 1/3 of animals are at or near the geriatric stage

Dull Visitor Experience

0.1 2.5 0.25 Little change over time, no older age demographic specific experiences

Totals 1.0 2.0

Local Competitors/Attractions

Over 20 Museums, Parks, and Science Centers in the Sacramento Area 12 are located within a 10 mile radius of the Zoo

Local attractions also are targeting the same demographic as the Zoo Families with children

Two larger zoos are within a 2 hour drive from Sacramento Oakland San Francisco is also a major tourist city

Sacramento Zoo is priced in between attractions

Demographics of Sacramento County

8%

26%

55%

11%

Age (Years)

Under 5 6 to 18 19 to 64Over 65

83% of people over 25 years old have a High School degree

25% of those people have a Bachelor’s degree or higher

Median Household Income $56,882The largest age group of

individuals living in Sacramento are between 19 and 64 years old. US Census

Bureau

What are the Demographi

cs Doing Now?

• Teens and Young Adults like to “hang-out” with

friends• At Home• At Movies, Mall, or

Game Centers• Grab a bite to eat• Hike• Other Social Events

• They’re looking for cheap and easy

entertainment where they can hang out together

How do we Target the New Demographics?

Emphasize the Zoo as a “Hang-Out” spot as a form of outdoor entertainment Market Special Events for age groups through Social

Media Networks or Fliers at School Singles or Date Night Wii Bowling Night Movie at the Zoo Mini Concert Series of local bands Ice Skate Rink

Student Admission Rate

Discount on Food/Snacks with Student ID

VALUE PROPOSITION

CHANNELS



KEYPARTNER

KEYRESOURCES

KEYACTIVITIES


Students and Young Adults


Customer Acquisition

Direct MailRadio/TV/Print AdsInternet WebsiteSocial Media Outlets (Facebook, Twitter, Four Square)Word of MouthSchool/University connections


Family Oriented

Recreation

Education

Animals

Accessible

Group Oriented


City of Sacramento

AZA







Expanded Client Base leads to customer acquistion

New Value Proposition of group oriented fun and recreation

Increased attendance rate from new demographics

Findings & Analysis 1

Sub-Hypothesis 1:

Expanding target customer demographics will increase the attendance rate.

Sub-Hypothesis 1 is TRUE!

What did we discover from using the BMG Canvas and EFAS?

• Local competition is attracting the same customer demographics as the Zoo

• Zoo can expand their customer demographic to include students and young adults

• New value proposition will be cheap, group recreational fun, and entertainment

• This will result in an increased attendance rate

Sub-Hypothesis 2

Sub-Hypothesis 2:

Offering additional experiences will strengthen existing relationships.

Data Types:

Industry TrendsStatistical Data

Sources:

Sac Zoo WebsiteCompetitor WebsitesSac Zoo Employee InterviewLocal Attraction Websites

Aerospace Museum

CA State RR Museum

Crocker Art Museum

Analysis Method:

Activity MapEFAS/IFASSWOT/TOWSValue AddedTrade OffsBMG Canvas

Current Activity Map

Education Conservation

Animal Care

Recreation

Docent Tours

Kid’sSummer Camp

Cell Phone Safari

Zoo Mobile

Seasonal Shows

Enrichment

Behavioral Training

VeterinaryCare Staff

Access toMedical Eqpt

Partneredw/ UCD Vet School

Animal Care Staff

Giraffe Feeding

Train

Special Events

Parties

Carousel

Local/Global Support

Local Research

Member ofAssociations

Green Team

Wedding

Corporate

Partneredw/ Jiffy Lube

Birthday

Annual Trip

Animal Exhibits


Rating

Weighted Score

Comments

Opportunities:















Totals 1.0 2.0

Future Activity Map

Education Conservation

Animal Care

Recreation

Docent Tours

Kid’sSummer Camp

Cell Phone Safari

Zoo Mobile

Seasonal Shows

Enrichment

Behavioral Training

VeterinaryCare Staff

Access toMedical Eqpt

Partneredw/ UCD Vet School

Animal Care Staff

Giraffe Feeding

Train

Special Events

Parties

Carousel

Local/Global Support

Local Research

Member ofAssociations

Green Team

Wedding

Corporate

Partneredw/ Jiffy Lube

Birthday

Annual Trip

Animal Exhibits

Behind the scenes tour

Keeper Talks Partner w/

Schools

Other AniFeeding

Graduation

Volunteers

Teen Activity

Podcasts

Overnights

Animal Acquisition

Guest Appearance

Petting Zoo


Rating

Weighted Score

Comments

Opportunities:















Totals 1.0 2.0

Internal Factor Weight

Rating

Weighted Score

Comments

Strengths:

Distribution/ Media Channels

0.1 3 0.3 Use of all social and local media channels for announcements/events

Animal/Vet Care Knowledge & Training

0.1 4 0.4 Low turnover rate, 5+ yr experienced staff, lots of CE opportunities

Community Outreach 0.05 3 0.15 Functions for elementary, elder, disabled, low-income groups

Educational Programs 0.1 3 0.3 Variety of programs offered for visitors (on/off grounds)

Maintenance Department

0.05 4 0.2 Knowledgeable staff, In-house vs. Outsourced labor

Weaknesses:

Employee/Department Relations

0.1 1 0.1 Employees in one dept don’t know employees in another dept. Some dept have bad relationship resulting in high turn over rate.

Funding 0.15 2 0.3 High Corporate Sponsors only stay for about 2 yrs

Customer Experience

0.15 3 0.45 Visitor Service League was created to enhance customer experience

Financial Position 0.1 2 0.2 Increasing expenses with decreasing revenues

Breeding Program Success Rate

0.1 3 0.3 Animal and exhibit resource dependent. Use to breed a lot of birds, but now it’s rare.

Totals 1.0 2.7

IFA EFA

Strengths Weaknesses

Opportunities •Use media channels to notify customers of zoo news, programs, deals, partnerships w/ museums•Send Keeper staff to CE for training on new species to be acquired

•Add petting zoo and acquire multi-species animals to increase customer experience and stabilize financial position

Threats •Further develop educational and community outreach programs to increase visitor experience and keep local competition/new entrants at bay•Provide Keeper talks/behind the scenes tour to offer a different experience than local competition

•Create customer/investor/employee loyal by increasing value added to reduce financial strain

SWOT/TOWS

Value Added

Willingness to payCostCurrent

Current Price

Value captured by Zoo

Value captured by customer

Cost Willingness to pay

New Current Price


Value captured by customer

Offering Additional ExperiencesAdds value to current customer experienceStrengthens current customer relationships

Trade OffAdditional costs maybe required to offer the additional

experiences

IncreasedSame

VALUE PROPOSITION

CHANNELS



KEYPARTNER

KEYRESOURCES

KEYACTIVITIES




Customer Acquisition



Family Oriented

Recreation

Education

Animals

Accessible

Group Oriented

Special experiences

Multi-Attraction Discounts


City of Sacramento

AZA



Local Attractions




Behind the Scene Tours Guest AppearancesPetting Zoo


Increased value through new activities

Increased customer retention

Increased revenue

Increase partnerships


Sub-Hypothesis 2:

Offering additional experiences will strengthen existing relationships.What did we discover from using the Activity Map, EFAS/IFAS, SWOT/TOWS, and Value Added?

• Customers are willing to pay for additional experiences

• Adding a petting zoo and partnering with local attractions for discounts will strengthen current relationships as it adds value to their experience

• This will increase admission and revenue sales• These added activities will differentiate the Zoo from

local attractionsSub-Hypothesis 2 is TRUE!

Sub-Hypothesis 3

Sub-Hypothesis 3:

Special appreciation programs and perks designed for investors will retain their loyalty and support to the Zoo.

Analysis Method:

Loyalty MapValue AddedBMG Canvas

Sources:

Sac Zoo WebsiteCompetitor WebsitesSac Zoo Employee Interview Annual Reports

Sacramento ZooSanta Ana ZooOakland Zoo

Data Types:

Statistical Data

Loyalty Map









Donation


Profits



Future Loyalty Map









Donation


Special Programs



Value Added

Willingness to payCostCurrent

Current Price


Value captured by Investors

Value captured by Investors

CostWillingness to pay

New Current Price


IncreasedSame

Offering Special Programs to Investors

Adds value to their support to the Zoo

VALUE PROPOSITION

CHANNELS



KEYPARTNER

KEYRESOURCES

KEYACTIVITIES



Customer RetentionFacebook CommunityUC Davis Veterinary SchoolCity of SacramentoAZACustomer AcquisitionCorporate Sponsors



Family Oriented

Recreation

Education

Animals

Accessible

Special experiences


City of Sacramento

AZA






Tours Guest AppearancesPetting Zoo


Increased financial support (donations)

Strengthen Sponsors relationship/loyalty

Increased value gained through special experiences

Increased number of Sponsors


Sub-Hypothesis 3:

Special appreciation programs and perks designed for investors will retain their loyalty and support to the Zoo.

What did we discover from using the Loyalty Map and Value Added?

• Decreasing profits is deterring investors from their support

• Special appreciation programs and perks will increase their value gained

• Sacramento Zoo will be able to retain investors’ loyalty and continue receiving funding for capital improvementsSub-Hypothesis 3 is TRUE!

Conclusion: Summary of Findings

Expanding customer demographics will increase attendance and therefore revenue

Offering additional experiences will strengthen existing customer relations by providing a higher valued experience

Special programs geared towards investors will strengthen their relationship with the Zoo for continued support

Conclusion: By expanding the customer demographics and offering additional experiences to customers and investors, Sacramento Zoo will strengthen their revenue streams in order to fund their capital improvements.

Recommendations

Create a strategy to target students and young adults Market the Zoo as a “Hang-out” place: cheap, group fun,

entertaining

Offer experiences that will make visiting the Zoo more memorable and valuable Add Petting Zoo, tours, special guest appearances Offer multi-local attraction discount passes

Design special programs and perks for investors to strengthen their loyalty and value gained for their continued support Reservations to annual events and trips abroad Investor related tours/programs

Risks and Impacts of Recommendations

Recommendation 1

Create a strategy to target students and young adults

Market the Zoo as a “Hang-out” place: cheap, group fun, entertaining

Pros Increased customer base and admissions/revenue Special events will increase brand recognition

Cons Can be difficult to move away from family oriented value proposition Can be difficult to target teenagers Events are in the evening/night

Major Risks May loose family oriented atmosphere and current customers Effort put into special events may backfire for the demographics


Recommendation 2

Offer experiences that will make visiting the Zoo more memorable and valuable Add Petting Zoo, tours, special guest appearances Offer multi-local attraction discount passes

Pros Increased customer base, admissions, revenue, partnerships, brand recognition, and

community image

Cons Requires additional staff and resources (finances and animals) to make it happen May not benefit local attractions enough to participate in partnership Targets current demographics Can be difficult for new demographics to see the value if partnered with other family

oriented attractions

Major Risks Costs associated with additional experiences can offset revenue gained for Zoo May not result in increased admissions/revenue for the Zoo if customers choose to

go to the other better attractions


Recommendation 3

Design special programs and perks for investors to strengthen their loyalty and value gained for their continued support Reservations to annual events and trips abroad Investor related tours/programs

Pros Will retain investors for longer durations Will have the support to complete capital improvements and exhibit

renovations

Cons Costs associated with paying staff overtime or hiring additional staff for the

programs

Major Risks Special programs may not be high enough value for investor retention

Decisions Requested by Management for

Success Strategically weigh the pros/cons of each recommendation

See that there is value to be gained by each one for increasing revenue

Pursue targeting other age demographics

Develop strategies to retain investors for longer periods of time

Commit budgets and resources for implementation of new strategies

Persuade local attractions of benefits gained through partnerships

Make it happen!

Executive Summary: Our 5 Main Points

The Sacramento Zoo is not generating the revenue needed for capital improvements and exhibit renovations

Expanding the customer demographic will increase attendance

Offering additional experiences and increasing partnerships with local attractions will attract and maintain customers

Increased investor loyalty can be accomplished through value added

Revenue streams can be strengthened through customer diversification, enhanced customer experiences, and investor loyalty retention

Questions?

Thank You!

Sacramento Zoo Strategic Analysis

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