Saturday, November 21, 2009

What if they are just tired?

In the last few weeks, I have been doing quite a bit of traveling. I have gotten the opportunity to speak with many of my colleagues from around the nation, and they are all saying the same thing -- ticket sales are down this year. Last year, I kept hearing that well branded products were doing very well, while less known fare was struggling. Now I am hearing that even annual cash cows (think A Christmas Carol and Nutcracker) aren't doing well. When a classic theater has problems selling Romeo and Juliet, you know something is up.

So it got me thinking about what is going on (and of course, this is just an opinion). We are all seeing reports that even though some aspects of the economy might be improving, many are still getting worse, such as unemployment. Unemployment is the highest is has been in 20 years. Last year when the stock market crashed and it became clear we were all in for what looked to be an unprecedented global economic crisis, many companies panicked. They didn't know how to project future revenue, so they opted to look at the side of the ledger they could control -- expenses. With that came the layoffs.

Those lucky enough to survive the layoffs took on responsibilities that were normally handled by two or three people. Many managers noted that the resulting model was unsustainable, but thought that most people could put up with the extra load for a short period of time, hoping that the economy would improve and that hiring would be possible. Well, it has been over a year, and unemployment is getting worse, so the unsustainable model of having one person carry the workload of three continues.

As arts administrators, I no longer believe our largest challenge is dealing with people's fears about the economy. That was so last year. Instead, we now have to deal with people who are simply exhausted, and when Friday comes, they want to do nothing more than spend the weekend on the couch in order to recuperate and be ready for the next grueling work week. Whereas last year, our largest competitors might have been other cultural destinations or sporting events, I am starting to think that our most significant future competitor might be cable television and a warm bed.

Sunday, November 01, 2009

Blogging from NAMP...

Once again I find myself at the National Arts Marketing Project Conference, which is being held this year in Providence, RI. This is my fifth conference, and instead of presenting like I have done in the past, I really wanted to listen in on other sessions to hear what is being discussed. I have been asked to blog about my experiences for Americans for the Arts so these posts can also be seen on their blog.

This morning I was lucky enough to sit in on the Every Dollar Counts: Using ROI to Prove Marketing Effectiveness session. I decided to go to the session because one of my favorite arts marketing experts was presenting--Philippe Ravanas, marketing professor at Columbia College and former VP of Corporate Communications for EuroDisney. I have seen him speak at several conferences and he is always extraordinary.

This morning he discussed a situation he found himself in when he was the Manager of Client Development at Christie's in London. Each year, they would produce a beautiful catalog of auction items that they would send to most of their database. These catalogs were highly coveted, and cost the organization $20 a piece to produce, however Philippe noticed that his ROI (return on investment) for these catalogs was poor. It was costing him too much to produce and mail these catalogs in terms of how much revenue they were bringing in. After researching the problem, he found that they were mailing these catalogs to almost every purchaser, including those people who purchased once twenty years ago and people who only purchased a minor item just to get on the distribution list, as the Christie's catalog seemed to be a popular coffee table item. He soon cut back the distribution, and only sent the catalog to his higher end purchasers. This action greatly improved his ROI on the catalog.

It brought me back to a previous blog post I wrote about the future of the subscription brochure. If you read the post, you can see that I have some serious doubts as to whether or not a subscription brochure works as a sales piece. That being said, our subscribers at Arena Stage love our season brochure because it invites them into the process. There are articles by our featured artists, a letter from our artistic director, beautiful artwork, etc. We have heard from our subscribers that they anxiously await our brochure each year, and that these brochures have become collector's items. So they perform a very valuable function in maintaining relationships with our higher end purchasers, but they aren't necessarily needed to push acquisitions. In fact, we have found that other smaller pieces with a clear central message that cost significantly less to produce and mail actually perform better for acquisition campaigns.

As Diane Ragsdale says in her article Recreating Fine Arts Institutions : "Arts leaders may be tempted to think that the solution to dwindling audiences lies in better marketing, but if arts organizations are going to survive, they have to put more than the season brochure on the autopsy table." I completely agree with Diane...but what happens if an organization isn't even willing to put their season brochure on the autopsy table?