People Trust Museums More Than Newspapers. Here Is Why That Matters Right Now (DATA)

Actually, it always matters. But data lend particular insight into an important role that audiences want museums to play Read more

The Top Seven Macro Trends Impacting Cultural Organizations

These seven macro trends are driving the market for visitor-serving organizations. Big data helps spot market trends. The data that Read more

The Three Most Overlooked Marketing Realities For Cultural Organizations

These three marketing realities for cultural organizations may be the most urgent – and also the most overlooked. This Read more

Are Mobile Apps Worth It For Cultural Organizations? (DATA)

The short answer: No. Mobile applications have been a hot topic for a long while within the visitor-serving industry. Read more

Breaking Down Data-Informed Barriers to Visitation for Cultural Organizations (DATA)

Here’s a round-up of the primary reasons why people with an interest in visiting cultural organizations do not actually Read more

Market to Adults (Not Families) to Maximize Attendance to Cultural Organizations (DATA)

Marketing to adults increases visitation even if much of your current visitation comes from people visiting with children. Here’s Read more

Community Engagement

Why Offering Discounts Through Social Media Is Bad Business for Nonprofit Organizations

There’s significant data compiled by multiple sources indicating that “getting discounts” is the top reason why people engage with an organization’s social media channels. So it seems logical that if you want to bump your number of fans and followers, offering discounts is a surefire way to go. And it works – if your sole measure of success is chasing these types of (perhaps less meaningful) metrics. But, before you go crazy with the discount offers on Facebook and Twitter just to get your “likes” up, here’s another thing that’s true: Offering discounts through social media channels cultivates a “market addiction” that will have long-term, negative consequences on the health of your organization.

I recently wrote a post called “Death by Curation” within which I shared data indicating the non-sustainable cycle that museums enter when they must rely on new, progressively more expensive “special” exhibits in the hopes of achieving attendance spikes (what has since been referred to by a reader of this blog as “Blockbuster Suicide”). In many ways, offering discounts creates a similarly vicious cycle whereby a visitor-serving organization finds itself realizing a diminishing return on the value of its visitation.

When an organization provides discounts through social media it trains their online audience to do two not-so-awesome things:

 

1) Your community expects more discounts

Here’s where your organization breeds an online audience of addicts accepting discounts…and, strangely enough, becomes addicted to offering discounts itself. Posting a discount to attract more likes on Facebook (or to get people to engage with a social media competition, etc.) will very likely result in a bump in likes and engagement. But know that in doing this, you are verifying that your social media channel is a source for discounts. Discounting for “likes” attracts low-level engagers (they are liking you for your discount, not your mission), and prevailing wisdoms increasingly suggest that your number of social media followers doesn’t matter. It is far better for your brand and bottom line to have 100 fans who share and interact with your content to create a meaningful relationship, than to have 1,000 fans who never share your message and liked you just for the discount.

I can hear the rumbling now: Some of you are thinking, “But we’ve used discounts to attract more likes and it worked” (i.e. it generated more likes). Over time, however, these low-level engagers will stop following you if you do not continue to offer discounts. That is, after all, the reason why they followed you in the first place…and you have shown them that, yes, you will post discounts on social media. This is the start of the addiction: In order to keep these likes, you need to offer more discounts.

Try this: Simply stop offering discounts. Over the course of a few months, your number of likes will go down (because these people only liked you for the discount, not your awesome, socially conscious content). They were not actual evangelists – and cultivating real evangelists to build a strong online community is the whole point of social media. You want folks who actually care about what you’re doing and will amplify your message (not the “we are offering a discount” message – which is the content that, unfortunately, frequently gets the most shares and perpetuates this cycle).

 

2) Perhaps more importantly, your community waits for discounts

Here’s where becoming an addict takes a toll on the organization’s health. Data indicates that offering coupons on social media channels – even once – causes people to postpone their visits or wait until you offer another discount before visiting you again. Worse yet, the new discount generally needs to be perceived as a “better” offer (i.e. an even greater discount) to motivate a new visit. This observation is consistent with many aspects of discount pricing psychology, whereby a stable discount is perceptually worth “less” over time. In other words, the 20% discount that motivated your market to visit last month will likely have a diminishing impact when re-deployed. Next time, to achieve the same outcome, your organization may have to offer a 35% discount…and then a 50% discount, etc. You see where I’m going with this…

Here is the debunking of another popular misnomer that some organization’s use to justify their discount tactics: You are not necessarily capturing new visitation with discounts. In fact, data from the company for which I work suggests that the folks using your discount were likely to visit anyway…and pay full price! This is a classic example of an ill-advised discounting strategy “leaving money on the table.”

To compound matters, instead of hastening the re-visitation cycle, the “waiting for a discount” phenomena may actually increase the interval between visits for many visitors. The average museum-going person visits a zoo, aquarium, or museum once every 19 months. If you offer a discount, while you may not attract a larger volume of visitation to your organization, you may accelerate your audience’s re-visitation cycle on a one-time basis. This sounds great…until you realize the significant downsides to this happening: Your audience just visited your organization without paying the full price that they were actually willing to pay and they likely won’t visit your organization again for (on average) another 19 months. On top of all this, IMPACTS data illustrates that the steeper the discount, the less likely visitors are to value your product and return in a shorter time period.

Think of it this way: A visitor coming to your museum in May 2012 would likely visit again in December 2013 (i.e. in 19 months). Let’s say that you offer them a discount that motivates them to visit in October 2013. Now, you’ve linked their intentions to visit to a discount offer…and decoupled it from what should be their primary motivation – your content! And, by doing so, you’ve created an environment where content as a motivator has become secondary to “the deal.” In other words, you will have moved your market from a 19-month visitation cycle to a visitation cycle dependent on an ever-increasing discount. Can your organization afford to keep motivating visitation in this way?

So, how do museums get addicted to discounts, too? Well, we sometimes confuse the response (i.e. a visit) to the stimuli (i.e. a discount) with efficacy. Once a discount has been offered to motivate a visit, we regularly witness the market “holding out” for another discount before visiting again. And what are museums doing while the market waits for this new discount? Sadly, often times the answer is that they are panicking.

If you run a museum, you’ve probably spent some time in this uncomfortable space – we observe the market’s behavior (or, in this case, their lack of behavior), and begin to get anxious because attendance numbers are down. What’s a quick fix to ease the pain of low visitation? Another discount! So we offer this discount…and, in the process, reward the market for holding out for the discount to begin with. This is the insidious thing about many discounting strategies: They actually train your audience to withhold their regular engagement, and then reward them for their constraint. We feed their addiction and, in turn, we become addicted ourselves to the short-term remedy that is “an offer they can’t refuse.”

Like most addictive – but ultimately deleterious – items, there is no denying that discounts “work” – provided that your sole measure of the effectiveness of a discount is its ability to generate a short-term spike in visitation. But, once the intoxicating high of a crowded gallery has passed, very often all that we’re left with is a nasty hangover. My advice to museums and nonprofit organizations contemplating a broad discount strategy on social media: Just say no!

 

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Posted on by Colleen Dilenschneider in Community Engagement, Digital Connectivity, Financial Solvency, IMPACTS Data, Myth Busting, Nonprofit Marketing, Trends 6 Comments

Death by Curation: Why the Special Exhibit Isn’t So Special Anymore (CASE STUDY)

Museums often develop a cycle wherein they rely heavily on visitation from special exhibits – rather than their permanent collections – in order to meet their basic, annual goals. This is a case of “death by curation” – bringing in bigger and bigger exhibits in order to keep the lights on. Museums often fail to recognize that the best part of the museum experience, according to visitors and substantial data, is who folks visit and interact with instead of what they see. Understanding that a museum visit is more about people than it is about objects can help museums break the vicious cycle of “death by curation,” and help them develop more sustainable business practices.

 

The Myth of the Special Exhibit Strategy

It’s no secret that a true blockbuster exhibit can boost a museum’s attendance to record levels. However, a “blockbuster” is rare, and the fact that these blockbusters spike attendance so dramatically is an important finding: Blockbusters are anomalies – NOT the basis of a sustainable plan.

We know the story well: a museum decides to host an exhibit and develops exhibit-related messaging to promote visitation to the exhibit. The museum sees a spike in attendance, which dips when the exhibit closes. The museum wants to hit these high numbers again so it hosts a “bigger” exhibit and hopes for the same visitation spike.

This is the beginning of a costly, ineffective cycle. Here are two misbeliefs that perpetuate this less-than-sustainable practice:

1. The museum comes to believe that it cannot motivate visitation without rotating increasingly “blockbuster” exhibits. And, by doing this, museums train their audiences only to visit when there is a new exhibit. Thus, they risk curating themselves into unsustainable business practices.

2. If the museum is successful with this strategy of rotating blockbuster exhibits, then the exhibits grow grander (it’s hard to keep improving on a “blockbuster” – have you ever known a sequel to cost less than the original?), and the attendant costs grow at unsustainable rates…but become conceptually necessary for the museum to keep their lights on.

What of the hopeful thought that visitors to blockbuster exhibits will become regular museum-goers? It is largely a myth. An IMPACTS study of five art museums – each hosting a “blockbuster” exhibit between years 2007-2010, found that only 21.8% of visitors to the exhibit saw the “majority or entirety” of the museum experience. And, of those persons visiting the sampled art museums during the same time period, 50.5% indicated experiencing “only” the special exhibition. This data indicates that these special exhibit visitors are not seeing your permanent collections and, thus, are missing an opportunity to connect with your museum and become true evangelists.

Even members, whom museums often assume are more connected to their permanent collections than the general public, have been trained to respond almost exclusively to “blockbuster” stimuli. To wit: The National Awareness, Attitudes and Usage Study recently completed in April 2011 indicates that of lapsed museum members with an intent to renew their memberships, 88.6% state that they will renew their memberships “when they next visit.” Of these same lapsed members, 62.5% indicate that they will defer their next visit “until there is a new exhibit.” In other words, museums have trained even their closest constituents to wait for these expensive exhibits in order to justify their return visit.

 

Case Study

I like to think of this as a sort of “Pavlov for the museum world” – except instead of inspiring behavior with a bell, we’ve decided to provide Monet, Mondrian and Picasso as stimuli. This is all perhaps well and good…but it isn’t sustainable.

Consider the 20-year attendance history of a museum client of IMPACTS (the company for which I work). Can you spot the “blockbuster” year?

In this example (which I selected because it is representative of the experience of many museums), the “blockbuster” exhibit of year 2004 resulted in a 47.6% spike in visitation. But, what is perhaps most telling is how quickly – post-blockbuster – the client’s annual visitation returned to its average level. Does this suggest that the client shouldn’t pursue another blockbuster? Well, they did. But, not with the expected results.

Let’s consider the same chart again – this time with the special exhibits costs by year also indicated:

Still drunk with success from their blockbuster exhibit in year 2004, this museum went to the “tried” (but, not necessarily, “true”) blockbuster formula in year 2009. As you can see, in terms of visitation, history decidedly did NOT repeat itself. This where it becomes additionally important to acknowledge that “expensive does not a blockbuster make.”(See the domestic box office receipts of “John Carter” for recent proof).

Another fun fact that will surprise absolutely no one in the museum world – audiences are fickle! Their preferences shift quickly and they become increasingly hard to please. In fact, first-time-ever museum visitors rate their overall satisfaction 19.1% higher than persons who have previously visited any other museum. In my business, we call this “point of reference sensitivity” – the market’s expectations, perceptions and tolerances are constantly shifting and being re-framed by its experiences. Think about it yourself: The FIRST kiss goodnight – a forever memory! The hundredth kiss goodnight – (still sweet, but) been there, done that.

 

Break the Cycle: Invest in People and Interactions

Knowing that who a visitor comes with is the best part of visiting a museum provides power for museums to break this cycle.

Instead of relying on the rotation of expensive exhibits, many successful museums instead invest in their frontline people and provide them with the tools to facilitate interactions that dramatically improve the visitor experience. Improving the visitor experience increases positive word of mouth that, in turn, brings more people through the door. Importantly, reviews from trusted resources (e.g. WOM) tend to not only inspire visitation, they also have the positive benefit of decreasing the amount of time between visits. In other words, people who have a better experience are more likely to come back again sooner.

The power of with > what has other positive financial implications for museums. If the institution focuses on increasing the overall experience (which, again, is a motivator in and of itself – as opposed to the “one-off effect” of gaining a single visit with a new exhibit), then the museum’s value-for-cost perception increases. In other words, it allows the museum to charge more money for admission without alienating audiences because these audiences are willing to pay a premium for a positive experience.

(For you mission-driven folks shaking your head about how this potentially excludes underserved audiences, this is where your accessibility programs will shine. It allows them to be more effective and increases their perceptual value as well.)

This isn’t to say that new content and engaging exhibits are not critical to a museum’s success. It is to say, though, that times are changing. To sustain both in terms of economics and relevance, museums must evolve from organizations that are mostly about “us” (what we have is special and you’re lucky to see it), to organizations that are primarily concerned about “them” – the visitors.

Like it or not, the market is the ultimate arbiter of a museum’s success. Those of us with academic pedigree, years of experience, and technical expertise may well be in a position to declare “importance,” but it is the market that reserves the absolute right to determine relevance. In other words, while curators still largely design the ballots, it is the general public who cast the votes. And, in the race to sustain a relationship with the museum-going public, the returns are in and the special exhibit isn’t so special anymore.

Posted on by Colleen Dilenschneider in Community Engagement, Financial Solvency, IMPACTS Data, Myth Busting, Nonprofit Marketing, Sector Evolution, Trends 11 Comments
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