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Digital Connectivity

The New Realities of Advertising Costs (Hint: You Are Getting Less Than You Think)

Budget expenses

Many nonprofit organizations misunderstand the increasing costs of advertising – and it’s costing them dearly.

It’s that season when organizations are preparing their budgets for the upcoming year. For many of us in the communications space, tis the season of spreading tough-love  in the hope that nonprofit organizations don’t hamstring themselves with a flawed “save one’s way to prosperity” approach to budgeting for marketing expenses – especially social media and advertising. Increasingly, advertising is not an optional expenditure – it is a basic cost of doing business for any organization that relies on the time, engagement, or concern of audiences (…which happens to be most organizations).

When it comes to budgeting for a necessary advertising investment, a tremendous challenge confronting many nonprofit organizations is a reliance on precedent behaviors to inform our future planning efforts. The advent of digital technologies amplified by an increasingly platform agnosticism market have rendered many of the traditional “rules” of advertising obsolete. The communications world – and, in turn, the advertising world – is in a period of significant revolution and reinvention. A dogmatic beholdenness to the past is likely to leave an organization forever behind.

Here are two important points that your organization should keep in mind when it comes to the basic cost of advertising:

 

1) The cost of advertising has increased dramatically in recent years and many organizations are not keeping pace with inflation

Though you may be spending more, you are probably getting less return on your advertising investment than you were a few short years ago. The few percentage points that organizations add to their advertising budgets each year is simply insufficient when contemplated in the context of the escalating costs of advertising.

For instance, in my experience, even forward-thinking organizations keep their annual ad budgets relatively stable (“Hey, this is how we’ve always done it!”) and will sometimes add 5-10% if there’s a special program or campaign taking place that they’re trying to promote. The thing is, while organizations think that they are spending more (because they are actually spending more), they are increasingly getting less.

Take a look at the chart below. The chart indicates examples of observed advertising costs during the last five years.  For relativity purposes, the escalating cost factors have been standardized and charted as index values.

 IMPACTS cost of advertising

“Blended CPM” indicates the growth in costs “blended” across all media types (i.e. broadcast, radio, print, digital, outdoor, etc.) as observed by the actual media plans of twelve IMPACTS clients.  CPM is an acronym representing the Cost per One Thousand impressions.  Thus, the average observed costs to advertise have increased by 41% in the five-year duration ranging from years 2010-2014.

As additional examples of advertising costs, within the same five-year duration, the chart indicates that the costs of a 0:30 second advertisement during the Super Bowl and Grammy Awards broadcasts have respectively increased by 60% and 105%.

We are living in an increasingly personalized world that emphasizes speed and convenience. We can simply TiVo, Apple TV or On-Demand our way out of most ads on our favorite television shows because we watch these shows at our convenience. Because of this, programs that folks watch live (e.g. sports, news, award shows, etc.) command premiums when compared to the costs of similar programming a relatively few short years ago.

In the simplest terms: Yes, on average, your organization will need to have increased its advertising budget by at least 40% in order to match your advertising efforts of five years ago. If you’ve added less than 40% to your budget, then your organization may actually be achieving less advertising impact than you were in 2010.

In the end, it’s a lesson in business and economics: You cannot just throw a bit more money at something year over year and get mad when you don’t get correspondingly “more” in return. If you’re not increasing the budget at the rate of what things cost, then you’re actually getting less. This lesson seems particularly challenging for nonprofit boards to understand when they are confronted with a proposed increase in the advertising budget. “So, if we spend more money on advertising, how much more support will we get?” is a perfectly reasonable question posed by many a board member. However, the question from board members probably ought to be, “If we don’t sustain significant investments in our audience acquisition strategies, how many visitors will we lose…and what will be the costs of trying to re-acquire them in the future?”

 

2) The first thing that organizations often cut is marketing (despite the increasing importance of funding in this area)

Compounding matters is the fact that – despite an abundance of the well-publicized reasons why it is a terrible idea – many organizations trying to balance budgets still seem to cut the marketing budget first.

This may be particularly relevant for visitor-serving organizations (museums, theaters, symphonies, gardens, aquariums, zoos, etc.) as these types of organizations are having a rough time meeting attendance goals. The anxiety associated with this causes organizations to deny data and do a lot of dumb things (and maybe some more dumb things) that will hurt them even more in the long run, and cutting marketing budgets in the Information Age is another one of them.

It’s a tough pill to swallow for traditionalists and specialists within organizations, but marketing is increasingly important for the survival of your organization. For many of the most successful organizations, marketing is at the center of strategic conversations. It’s a big change for many entities! And, organizations aren’t solely deciding that this should be the case…the market is deciding for them. As I say in nearly every post: Organizations can sometimes determine importance, but the market determines relevance.

Mix one part “not keeping up with the cost of advertising” with one part “cutting your marketing budget” and watch your audience awareness dwindle to record lows. For those persons in the nonprofit sector who may continue to balk at the idea that they need to spend more to acquire, engage, and communicate with their audience than they did five years ago, I ask you: What makes advertising exempt from the most basic laws of inflation? Again, these cost increases are the most basic costs of doing business.

 

For marketers, it is a tough road ahead: The “This is how we’ve always done things” and “Last year plus five percent” approach to budgeting and media planning that permeates many organizations is an increasingly doomed strategy. In a way, this post isn’t exclusively about marketing or advertising. It’s about a new way to think about the constantly evolving world that we live in. The world waits for no one. We need to keep pace or risk being left behind.

 

Interested in getting blog posts, tips, and some silly social media geekery periodically delivered in your Facebook newsfeed? Like my Facebook page (or ) Or for more regular sharing of nonprofit marketing information, follow me on Twitter

Posted on by Colleen Dilenschneider in Digital Connectivity, Financial Solvency, Myth Busting, Nonprofit Marketing, Sector Evolution, Trends Comments Off on The New Realities of Advertising Costs (Hint: You Are Getting Less Than You Think)

Why Talking About The Future of Museums May Be Holding Museums Back

Marketoonist- Risks

What if we took some of the time that we spend patting ourselves on the back for thinking about “the future” and use it to better adapt to the world we are living in right now?

Before I jump in, I need to come clean and admit that I’m not innocent here. I’ve been (proudly) called a futurist for visitor-serving organizations and I even say that, for a living, I help “future-proof” nonprofit organizations. Some of my favorite resources and those that I believe to be the most thoughtful focus on “the future” (like the Center for The Future of Museum’s blog – which is worth checking out for its valuable thought-fuel). But here’s the thing:

While those ideas shared by our industry’s most engaging thought leaders and go-to resources may be “future-facing” (as in, they are sure to increase in relevance in the future) they are not actually about the future. Yes, it is a matter of language that is confusing things. Using the word “future” when we are talking about the “present” may be harmful to organizations because of what the word “future” means. Many resources focusing on “the future” are actually communicating about emerging trends that are happening right now…and when we call them “the future” we do our organizations a grave disservice.

Here’s why:

1) Things that get characterized as “the future” within the museum industry generally are not about the future at all

Check this out: Embracing millennials, mastering community management on social media, opening authority, heightening engagement with onsite technologies, breaking down ivory towers with shifts from prescription to participation, engaging more diverse audiences, utilizing mobile platforms, understanding the role of “digital,” breaking down organizational silos…These are things that we frequently discuss as if they are part of the future. But they aren’t. In fact, if your organization hasn’t already had deep discussions about these issues and begun evolving and deploying new strategies at this point, then you may arguably be too late in responding to forces challenging our sector today.

 

2) Calling it “the future” excuses putting off issues which are actually immediate needs for organizational survival

What if we called these things “The Right Now?” Would it be easier to get leadership to allocate resources to social media endeavors or deploy creative ways to grow stakeholder affinity by highlighting participation and personalization?  Are we excusing the poor transition from planning to action by deferring most investments to “The Future?”

Basically, we’ve created a beat-around-the-bush way of talking about hard things that separates successful and unsuccessful organizations. For many less successful organizations struggling to find their footing in our rapidly evolving times, their go-to euphemistic solution for “immediate and difficult” seems to be “worth thinking about in the future.” When we call it “the future,” we excuse ourselves from thinking about these issues right now (which is exactly when we should be considering if not fully deploying them).

Contrast this deferment strategy with those of more successful organizations who invariably and reliably “beat the market to the spot.”  It isn’t pure chance and serendipity that underpins successful engagement strategies – these are the product of ample foresight, planning, investment and action…all of it done many yesterdays ago!

 

3) The future implies uncertainty but trend data is not uncertain

Moreover, common wisdom supports that “the future” is uncertain.  “We cannot tell the future.” Admittedly, some sources that aim to talk about the future truly attempt to open folks’ brains to a distant time period. However, much of what is shared by those we call “futurists” is not necessarily uncertain. In fact (and especially when it comes to trends in data), we’re not guessing.  I’ve sat in on a few meetings within organizations in which trends and actual data are taken and then presented as “the future” or within the conversation of “things to discuss in the future.” Wait. What?

Certainly, new opportunities evolve and trends may ebb with shifting market sentiments…but why would an organization choose uncertainty over something that is known right now?

 

4) We may not be paying enough time and attention to right now

I don’t think that referring to “right now trends” as “the future” would be as potentially damaging to organizations if we spent enough time being more strategic and thoughtful about “right now trends” in general.  Many organizations seem to be always playing catch-up with the present.  If organizations are struggling to keep up with the present, how will they ever be adequately prepared for the future?

 

5) Talking about “the future” sometimes provides a false sense of innovation that may simply be vanity

To be certain, we all need “wins” – especially in nonprofit organizations where burnout is frequent and market perceptions are quickly changing. The need for evolution is constant and the want for a moment’s rest may be justified. That said, it seems as though talking about “the future” (which, as we’ve covered, is actually upon us) is often simply providing the opportunity for organizations to pat themselves on the back for “considering” movement instead of actually moving. To have the perceived luxury of being able to think about the future may give some leaders a false sense of security that they aren’t, in fact, constantly trying to keep up with the present.

 

Talking about “the future” seems to mean that you are talking about something that is – yes – perhaps cutting edge, but also uncertain, not urgent, not immediate, and somehow a type of creative brainstorming endeavor. While certainly brainstorming about the actual future may be beneficial (there are some great minds in the museum industry that do this!), it may be wise for organizations to realize that most of what we call “the future” is a too-nice way of reminding organizations that the world is turning as we speak and you may already be a laggard organization.

Think about your favorite museum or nonprofit thinker. My guess is that you consider that person to be a kind of futurist, but really, you may find that they are interesting to you because they are actually a “right-now-ist.” They provide ideas, thoughts, and innovative solutions about challenges that are currently facing your organization.

This is all a long way of saying something incredibly simple, but astoundingly true: The future is now.  Let’s start treating it that way.

 

A quick aside: Speaking of “the future is now,” I’ll be conducting a free webinar with Blackbaud tomorrow (August 14) at 1pm Eastern entitled “Get Strategic: How to Connect With Members in a Digital Age.” You can sign up here!

Interested in getting blog posts, tips, and some silly social media geekery periodically delivered in your Facebook newsfeed? Like my Facebook page (or ) Or for more regular sharing of nonprofit marketing information, follow me on Twitter  

Posted on by Colleen Dilenschneider in Myth Busting, Sector Evolution, Trends 5 Comments

Six Reasons Why Content Is No Longer King (And What Now Holds the Throne)

Know Your Own Bone - Connectivity is King

“Content is king” is confusing people and the reign is over. There’s a different ruler in town that is driving successful organizations: connectivity.

“Content is king,” said Bill Gates famously as the chief executive of Microsoft in 1996.  And for a while, there was little reason to disagree with Mr. Gates’s assessment – so much so that this mantra has been used by marketers the world over.  It makes sense: You need content to inspire folks to act in your organization’s best interest (i.e. become a member, purchase a ticket, make a donation, etc.).  But the reign of content has ended and – while still important – the saying is becoming quickly outdated in today’s increasingly digital world. In fact, the repetition of this saying is causing, cultivating, and excusing misunderstandings among organizations’ staff members. 

Let’s clear the air and work together to update the saying so that it can be more effectively applied to the purpose of inspiring action in today’s world. There’s a new king in town. Today, connectivity is king.

 

1) The concept of content as king is causing some problems

Let’s get one thing straight: Content is not unimportant. Compelling content creates the bridge that often inspires connectivity. However, our misbelief that content remains supreme is causing certain organizational problems that risk growing more deeply-rooted each day. Here are some symptoms of the outdated notion that content remains king that may actually jeopardize an organization’s solvency. Each of these conditions are symptomatic of a content-centric organization that deeply believes that what it outputs is more valuable than its outreach.

 

2) Connectivity is about your organization and its relationship with other people (Content is just about your organization)

The marketing channels about which the “content is king” saying may have originated were one-way communication channels. In other words, they were channels that generally gave your organization a “mouth” (e.g. television, radio, billboards, etc.). However, today’s most effective and efficient marketing channels have mouths and ears. That is, they provide a means of supplying feedback for the organization in addition to being soapboxes (e.g. social media, peer review sites, email, etc.).  Thus, it makes sense that the driving force in cultivating a desired behavior may have evolved to be more about linking up with an individual by way of a shared passion or situation than about an organization itself.

In other words, content is not necessarily about your audience. Cultivating connectivity, however, breeds and helps to strengthen a relationship with your brand and organization. Connectivity happens when an organization presents a passion or platform that resonates with a potential constituent. It’s about both the organization and the potential constituent. It’s the passion/subject/topic/mission/sentiment that bonds (or interests) the constituent to what your organization stands for.

 

3) Connectivity is necessarily relevant (Content can be irrelevant)

Connectivity is definitionally personal in that it is depends on something being of personal interest to an individual.  That  means that connectivity is necessarily relevant. Content, on the other hand, risks self-orientation that may not answer one of the most important questions that communicators should ask themselves from the perspective of potential constituents when they put out content: “So what?”

 

4) Connectivity is prerequisite for action (Content can operate in isolation)

Remember (because I mention it in nearly every post): Your organization can sometimes determine importance, but the market always determines relevance. In other words, you can talk…but unless people are connected to what you’re saying, nobody may be listening. Simply put: Without connectivity, nobody cares about your organization.

Connectivity is a prerequisite to action (e.g. signing a petition, securing a donor, summoning support, selling a ticket). Content, however, can easily operate in isolation if it isn’t thoughtful and/or doesn’t inspire connectivity.

 

5) Content can be the bridge that provides a pathway for connectivity (but if connectivity is not present then your content is pointless)

This is where connectivity emerges as the true “king” in today’s environment. Certainly, content is critical. Arguably, there could be no connectivity without content. However (and this is where folks are getting confused), there can be a great deal of content without connectivity.  Not all content is connective.

Connectivity that’s created through a shared interest in a topic, idea, mission, purpose, or sentiment aligned with your organization’s brand and values is powerful.  Otherwise, your content will likely fall on deaf ears…and certainly not inspire engagement and supportive behaviors

 

6) Connectivity is about your whole organization and its mission (Content is viewed as marketing jargon)

Because “content” tends to fall under the conceptual categorization of one-way communication, the idea of “creating content” often falls to the marketing or public relations department. This isn’t necessarily a bad thing.

But what IS a bad thing is when people “not my job” content creation. Today, communication and content creation is an every-department job.  Worse yet, the problem of silo-ing the important work of creating connectivity is often exacerbated within organizations due to some staff members’ ridiculous associations with the word “digital.”

 

Connectivity can be sparked when the content being communicated communicated is deeply-rooted within your organization and mission. It may seem strange to some leaders, but the ins and outs of your day and your passions matter to your audiences. Often, to audiences, the transparent, unvarnished insights of how and why you do what you do in pursuit of your mission is every bit as important as what you are doing.

There’s a reason why marketing messages increasingly perform poorly in terms of engagement: People want to know what’s really going on…not simply receive your sales pitch (which, frequently, is the charge of the marketing department).  The most connective content often comes from other departments who represent the core of what you do. The marketing team’s best role is strategically making the balance of your organization’s content accessible (i.e. inspiring connections).

 

Let’s stop aiming “to content” and instead aim to connect.

If you supply content, they will come? Nope. Not necessarily.

If you supply connectivity, they will come? It’s much more likely.

At our best, our organizations do more than provide education…even more than provide memorable experiences in the case of visitor-serving organizations.  We provide and facilitate meaningful interaction – connectivity.  By connecting people to people, people to places, and people to ideas, we transcend mere content and provide pathways to engagement.  People – not artifacts – change the world.

Content isn’t dead, but connectivity assuredly is king. 

Long live the king.

 

Interested in getting blog posts, tips, and some silly social media geekery periodically delivered in your Facebook newsfeed? Like my Facebook page (or ) Or for more regular sharing of nonprofit marketing information, follow me on Twitter  

Posted on by Colleen Dilenschneider in Community Engagement, Digital Connectivity, Myth Busting, Nonprofit Marketing, Sector Evolution, Trends 4 Comments

The Role of Email Has Changed. Here Is How to Evolve Your Communication Strategy (DATA)

RIP email

llustration by Sam Manchester/The New York Times

The efficacy and best practices related to email as a marketing channel have changed. Data suggest that email is less effective in reaching large quantities of people than it was even a few short years ago. But, can an organization use email to reach the right quality of people? Maybe.

I recently shared updated data from a Media Consumption and Usage Study conducted by IMPACTS that demonstrated a trending decline in the overall, weighted value of email as a marketing channel.There’s been some additional buzz about the decline of email, and worries about this changing platform seem to be lingering – especially in light of the big data I recently shared at MuseumNext. “I see that there’s a decline in email,” one attendee noted. “Email is working just fine for my organization.”

Indeed, organizations shouldn’t give up on the platform – especially if it is helping their organization achieve its goals – but it’s important to recognize the changes taking place that alter your market’s perceptions and usage of email:

IMPACTS Public sources of information 2011 - 2014

 

1) The overall efficacy of email as a communication channel for reaching mass audiences has dwindled

It used to be all about email lists – buying them, swapping them, getting people on them – and then “spamming” folks with marketing messages. It was about quantity of people more than the quality of people. Not anymore. Thanks to the increasing and massive trend toward personalization in marketing messages (due, in large part, to “touch points” made possible via social media), email is now a less effective method for engaging large quantities of people. The data indicate that mass messaging holds lesser value to audiences…and we observe people “opting-out” and unsubscribing to content that is not particularly relevant to them.

And folks can afford to opt out because – unlike the earlier days of email – there are much more personalized, real-time information channels promising greater connectivity readily available to them.

 

2) Email may now be better utilized for cultivating current audiences that already have an affinity for your organization

Email’s relative stability in terms of trust and amplification potential indicate that while it may not be wise for it to be your organization’s primary engagement or audience acquisition channel, it may still offer value by adapting its application to better serve current constituencies. Email should be approached as an “opt-in” opportunity for those who are budding brand evangelists. In other words, this communication method may be better suited for moving potential stakeholders through an engagement funnel instead of as a means to engender general awareness of programs, events, etc.

 

3) Your organization should not necessarily stop sending emails

Just because a channel’s weighted value is changing doesn’t mean that it’s wise to abandon the platform – especially if it is working for you in terms of helping to meet your financial and mission-related bottom lines. What this does mean is that your email strategy should not be stagnant – when it comes to email, a sound strategy may be to “ride the wave until it crashes.”

Obviously, people still use email; however, they are using it in different ways and expect more personalization than email typically delivered in the past. Know this. Adjust. Watch the market. If something is still working, then, hey, it’s still working! That said, (and as is true with all communication channels) sending email for email’s sake without understanding how or if it is contributing to your goals remains an unwise idea.

 

4) Start exploring other channels that will help achieve your goals

While it’s not a bad idea to keep “riding the wave [that is email] until it crashes,” it would be advisable to concurrently cultivate engagement on other platforms in preparation for the inevitable crash. Heretofore, if your organization has been relying heavily on email, then it may be a good idea to consider building communities and strategies on other platforms so that you aren’t stuck with antiquated outreach tools that the market deems obsolete. Alternative channels and platforms that capitalize on real-time, ongoing, personalized communication generally involve social media or other web-based platforms…now is the time to start developing capabilities and capacities in these arenas before it’s too late.

 

5) Understand that email has changed and will keep changing.

Email has maintained its perception in regard to trust (i.e. how trustworthy it is perceived to be as a communications channel) and amplification values (i.e. how easy it is to share the message). You can see the data broken down by reach, trust and amplification here. It makes sense that amplification has not changed as it’s just as easy to hit “forward” today as it was in 2011. As other platforms evolve, how people view and use email will evolve as well. It is not used for the same purpose as it once was thanks to new information channels. The roles of organizations’ websites have also recently changed due to the presence and capabilities of social media. Know that things are changing and the relative strengths of communication channels are certain to keep changing, too.

 

An exciting aspect of leading an organization in today’s world is the incredible access provided by web-based platforms and how digital assets (and how the market perceives and interacts with them) constantly evolve. Wise organizations realize that the world is moving and it is unwise to maintain the same strategy for communication platforms year after year without considering changes in the market.

In sum, email is not dead…but it has certainly evolved. Many organizations have not caught up. If they don’t then, well, you know what Darwin had to say on such matters…

Darwin on change

Interested in getting blog posts, tips, and some silly social media geekery periodically delivered in your Facebook newsfeed? Like my Facebook page (or ) Or for more regular sharing of nonprofit marketing information, follow me on Twitter  

Posted on by Colleen Dilenschneider in Community Engagement, Digital Connectivity, IMPACTS Data, Myth Busting, Nonprofit Marketing, Trends Comments Off on The Role of Email Has Changed. Here Is How to Evolve Your Communication Strategy (DATA)

The Real Reason Some Nonprofits Stink at “Digital” (And Why It Is Getting Worse)

Dilbert vagueness plan

Within some organizations, “going digital” is causing more problems than it’s solving. This isn’t because of the people who work in digital. It’s because of the people who don’t.

I’ve posted briefly on the dangers of separating “digital” and “marketing,” but this topic arose quite explicitly on the very first day of the annual MuseumNext conference last month and was inspired by a presentation from museum pro, Koven J. Smith. (Sidenote to make good on a promise:  the slides from my keynote at MuseumNext are available here.)  Though the seeds of this article blossomed at a museum-oriented conference, the threat is relevant for many nonprofit organizations and businesses in general.

“Are you saying that ideally nobody in museums should have “digital” in their title?” one person asked in regard to a point in Koven’s talk. He paused for barely a moment. “Yes,” he stated simply.

This idea was a small part of his argument (check out more of his rich thought-fuel here), but I think he’s onto something big…something that I observe everyday in my work with well-intentioned nonprofit organizations: We are breeding a culture of misunderstanding around the important role of “digital” in the future of our organizations and, frankly, it imperils the vibrancy of the very future that we are trying to ensure. “Digital” has been allowed to become an “other” (i.e. “not within my scope of work” and/or “something I don’t ‘get’”) for certain individuals in certain organizations, and, like most “others,” digital (as a concept) is misunderstood, abused, and used as a scapegoat for an organization’s cultural and structural shortcomings.

Dramatic? Maybe…but until we solve this issue, how can organizations steeped in these misunderstandings remain relevant and thrive in the future? Here’s why conceptually separating “digital” – as the rest of the organization understands it – is a problem that is making it harder for nonprofits to succeed.

 

1) It constantly reaffirms that “digital” is about platforms or technological skillsets and not about people (and it actually IS all about people)

Digital engagement and engagement are one in the same – they are both about people and behavior. Likewise, digital fundraising and fundraising are synonymous in successful organizations. Again, they are both about people and behavior. Digital touch can be as powerful in inspiring audiences as physical touch.  “Digital” is a way of communicating and connecting, not “knowing java” or “mastering Facebook’s newsfeed algorithm.” Sure, those skills may have value in the digital world, but they aren’t the point of “being digital.” Communication goals on real-time, digital platforms should serve the exact same purpose and mission as the rest of the institution.

An online donor is still a donor. For visitor-serving organizations, a website visitor is still a visitor (a person connecting with your brand and mission). The difference is the platform (“connection point”), and the goal is the same as “in real life.”  Digital – when it is used with audiences – IS “real life” and organizations will benefit from treating it as such.

 

2) Believing “digital” is about technology instead of people and behavior breeds a desire to simply translate real life to the digital realm (and that is generally a bad idea and waste of resources)

This, too, was a very popular topic of conversation amongst the thought leaders at MuseumNext: The very real-time nature of digital platforms necessitates different behaviors online than would take place in similar offline situations. For instance, a businessman may not check out your collections (if you’re a museum, for instance) at 10am in his pajamas “IRL.”  But, he can do so digitally…and that changes how we need to think about collections, engagement, social care, image rights, accessibility, membership retention, donor cultivation, and donor discovery. It’s not a one-way track wherein we simply “copy and paste” what’s onsite onto the web. That’s not engaging and it misses opportunities. If we didn’t deeply believe that “digital” was aligned more closely with technological skillsets than brand strategy, then we probably wouldn’t still be making these mistakes (i.e. posting our collections to the web or starting a simple blog, patting ourselves on the back for it, and wondering why nobody engages with it.)

 

3) It excuses leaders for being out of touch with the market (which is a glaring sign of bad leadership)

To paraphrase another point made at MuseumNext: It’s okay (and maybe even cute) if your grandmother doesn’t know what Twitter is or how exactly it is used. It’s absolutely NOT okay for today’s leaders, fundraisers, curators, and administrators to not be minimally facile with Twitter, Facebook and basic platforms or means of modern day engagement. Ignorance isn’t cute. It makes you less qualified for your job.

A basic facility with engagement platforms doesn’t mean everyone needs to be tweeting up a storm 24/7 – but if someone claiming a position of influence or leadership doesn’t understand what Twitter is, its benefit as a social force, or how people use it, then you’re dealing with a willfully ignorant, disconnected person. Good tip for organizations whose solvency depends on making connections with the market: Don’t hire people who live in holes.

Tough love moment (which I’ll admit may be funny because I’m an energetic, camp counselor type): I’m talking to you, people who say “digital just isn’t my thing” and write it off as something that isn’t worth your time to minimally understand. You sound stupid. Personally, finance isn’t my innate passion – but I’m a professional, functioning adult and, as such, I make an effort to understand the basics of how the world around me works.   There are no excuses for choosing ignorance and disconnection – especially for people in the nonprofit realm who often claim “education” and “engagement” as their raisons d’être.

 

4) It makes digital teams a dumping ground for nebulous projects

Koven Smith MuseumNext It’s difficult to read, but Koven‘s slide references a quote that was made jokingly, but may be indicative of a larger point: “If my co-workers say, ‘I don’t get this,’ it’s automatically in the digital department.”

When the digital department becomes a dumping ground for all things tech-oriented, an opportunity is lost. “Digital” is not necessarily the same as “IT.” Again, it’s about people, strategy, engagement, and utilizing new platforms in creative ways. When “digital” devolves into a language that certain employees cannot speak or a thing that they’re allowed not to understand, they become more removed from the world that we live in. That excuses and further cultivates an out-of-touch team… and that could be deadly for the future of your organization.

Does this mean everyone needs to run out and learn code? Again, no. Not even a little bit. But join the conversation and start thinking more strategically about organizational goals and creative engagement. It’s okay if you don’t know CSS (of course), but understand what the CSS is trying to achieve.

5) It silos marketers from content (which makes it harder to make connections to audiences)

“Digital” often resides somewhere around marketing within organizations – and that’s good! But if “digital” is considered too much of an “other,” then it forces web engagement teams to operate on their own. Social media is an every-department job, and often, creative engagement is as well. Marketers have no connective content without the aid of other departments. Basically, if we conceptually divide “digital” from the strategic functions of the organization, then we lose the very benefit of being “digital” – creating connections to people and creating meaning that will inspire a desired behavior (e.g. donation, visitation, participating in a beach clean-up, etc.).

 

Basically, when people in organizations stubbornly section out “digital” as something associated simply with technological skillsets, they are admitting to being out of touch with the very people that they are trying to serve. (P.S. Museum visitors and most bigger nonprofit donors for other kinds of organizations profile as “super-connected” with broadband access at home, work, and/or on mobile). When it comes to the inevitable pace of innovation, there is no comfort in yesterday.

If you don’t care to “get” digital, then get out of the way. Your organization is trying to effectively serve a social mission and it has important work to do.

 

Interested in getting blog posts, tips, and some silly social media geekery periodically delivered in your Facebook newsfeed? Like my Facebook page (or ) Or for more regular sharing of nonprofit marketing information, follow me on Twitter  

Posted on by Colleen Dilenschneider in Community Engagement, Digital Connectivity, Myth Busting, Nonprofit Marketing, Sector Evolution, Trends 8 Comments

Is your Nonprofit Living in the Past? Nine Outdated Ways of Thinking That Are Hurting Your Organization

Where complacent brands go

If any of these outdated beliefs still linger within your organization, then your nonprofit may be suffering both in terms of finances and mission delivery. It’s time to retire these obsolete practices once and for all:

 

1) You separate marketing and digital marketing because you think they are different

This is generally indicative of an organization that thinks “digital marketing” is more about mastering tools and platforms (e.g. Facebook) than mastering a long-term engagement strategy to strengthen your organization’s brand and mission.

Symptoms may include:

  • Digital initiatives that may appear cutting edge but don’t actually contribute to your organization’s mission or financial bottom line
  • An inability to activate online communities to behave in your organization’s interests despite having numerous fans on multiple platforms

 

Treatment: Certainly, organizations benefit from having a team that excels in online community management and maintains a thorough understanding of social media tools and digital engagement opportunities. That said, it is critical that these team members maintain constant involvement with the broader marketing and public relations leadership so that they may be empowered to integrate a strategy for ongoing engagement that yields returns rather than simply utilizing social media tools for social media’s sake.

 

2) You identify online donors and you treat them differently than offline donors

A donor is a donor. The means of conveying funds to an organization is irrelevant…it’s like treating a donor differently because they used a check for a gift instead of a credit card.  Basic courtesy and “real life” donor cultivation techniques should prevail regardless of how a person chooses to give. A donor who gives online shouldn’t be any less deserving of a personal thank you than a person who gives face-to-face, yet, somehow, the reliance on automated gift acknowledgments remains a practice for many organizations. Similarly, because a donor gives onsite may not mean that the individual does not expect the organization to recognize them when they interact on social media.

Symptoms may include:

  • A general lack of donor retention
  • An even greater lack of donor retention for those identified by the organization as “online donors”
  • Difficulty transitioning donors to the next level of giving

 

Treatment: Gather information and cultivate “online donors” just as your organization would cultivate “offline donors.” Similarly, if a “real life” donor engages with the organization online, acknowledge them and value their digital endorsement and communication. Treat donors online the same way that you would in person – just because something can be automated online doesn’t mean that it should be! Personalized touch points and cultivating the relationship are still critical practices.

 

3) You think marketing and fundraising serve independent functions

Marketing no longer serves as simply the megaphone for an organization. Today, marketing often provides critical touch points that serve to create meaning for audiences and connect them to the organization. This isn’t very different than fundraising.  A failure to recognize the importance of marketing and fundraising working in concert to achieve an organization’s goals may have negative consequences.

Symptoms may include:

  • Inability to identify new, potential donors
  • Few donors actively engaging with your organization online
  • Difficulty transitioning persons with interest in the organization into meaningful donors

 

Treatment: From an org chart perspective, marketing and fundraising departments certainly need not be one entity. However, it is critical that these departments (and the organization as a whole) recognize that the path to success in terms of donor identification, member retention, and donor cultivation lies in an intimate, real-time relationship between marketing and fundraising experts. The fundraising team (next-level meaning-makers) needs the input of the marketing team (and their real-time touch-points with audience members) to identify potential donors and aid their cultivation through an engagement funnel. In fact, social media is the new force empowering giving decisions.

 

4)   You think marketing performs a service function for the organization

If you still think that marketing plays a service role within your organization, then it’s time to catch up.  The role of this team has evolved from being the one-way voice of the organization (i.e. its mouth) to being its eyes and ears as well. More than ever before, it is the job of the marketing department to know, listen, and build relationships with your constituents. By necessity, successful marketing teams are increasingly expert about your audience.

Symptoms may include:

  • Low interest and engagement in initiatives and programs
  • Perceived irrelevance of your organization by the market
  • Difficulty getting attention from audiences
  • General lack of general success of new initiatives

 

Treatment: Consider the input of the marketing team before moving forward with initiatives instead of demanding that they “market this” (maybe not-so-great idea) after its actualization.

 

5)   Your social media managers operate in a silo 

Social media is an every-department job so access to the rest of the organization – especially experts – is critical for creating compelling content. A bad idea: Hiring an outside company to run your social media if you are an organization that builds reputation based upon being “expert” or builds affinity by telling powerful stories that are best communicated with the passion of an insider (which is basically all good stories).

Symptoms may include:

  • Several marketing-related messages on social platforms (which generally do not perform well)
  • Lack of audience engagement on digital platforms
  • Inconsistent social media posting
  • Lack of compelling stories that adequately communicate the passion of your nonprofit
  • Social media posts that demonstrate mission drift

 

Treatment: Make sure that folks working within your organization embrace the importance of sharing stories and are open to aiding social media managers in creating compelling content. Also, do your social media yourself or with a partner that has ongoing access to your entire organization. Your stories are your lifeblood.

 

6) You think the more followers, the better

This one is no surprise by now: The number of social media followers that you have is not necessarily indicative of the strength of your online community. It’s far better to have 1,000 followers with a genuine passion for engaging with your organization and sharing your message, than 100,000 fans that don’t help your organization reach its goals. In fact, having a lot of inactive followers dilutes your community and makes it appear as though you have bad content because not many people are interacting with you, despite your high fan number.

Symptoms may include:

  • An inability to activate fans to act in your organization’s interest despite high fan numbers
  • Distraction from achieving the organization’s true goals due to fixation on unimportant metrics
  • An inability to retain true fans due to superficial content that yields more “likes” than real affinity

 

Treatment: Quit focusing too heavily on fan count (and certainly do not dilute your community by buying fake fans). Pay attention to metrics that matter, and share content that inspires true evangelism. Instead of “the more followers, the better,” think “the more meaningful engagement related to our mission, the better.” If and when those ambitions cross, then that is great.

 

7)   Similarly, you think your number of website views adequately measures online success

It doesn’t. In fact, data suggest that online audiences are more likely to carry out desired behaviors (like making a donation, buying a ticket if you are a visitor-serving organization, etc.) if they are sent to social media platforms or peer review sites (TripAdvisor, etc.).

Symptoms may include:

  • Distraction from actual, meaningful metrics
  • Preoccupation with a metric that is not indicative of success
  • Directing audiences to platforms that are less likely to result in a desired behavior

 

Treatment: The role of your website has changed. Consider website views in the greater context of your overall digital engagement strategy. Understand that this number does not show the folks who are engaging with your brand or researching it on other sites.

 

8) You deny the necessity of brand transparency

This means purposefully leaving your key evangelists out of the loop in regard to big decisions and happenings – it’s always a bad idea. Thanks to the web, we live in a “show and not tell” world and potential constituents make decisions about your brand based upon what you “show.” In sum, transparency is a critical value for successful online communications

Symptoms may include:

  • Negative sentiment or reactions from audiences on social media channels
  • Audience misunderstanding of or disbelief in an organization’s goals or objectives for a given project
  • Lack of trust in organization
  • Constituents “opting-out” of involvement with the organization

 

Treatment: Question someone who tells you to purposefully hide critical information that may aid audiences in understanding your brand or internal thought-processes (whether it is an internal or external person). Times have changed. As is the case in real life, organizations are consistently finding that, indeed, honesty is the best policy.

 

9) You need an industry example before carrying out an initiative that may help you meet your goals

Web engagement best practices are constantly evolving – and so are the platforms upon which engagement often occurs. This means that – from time to time – your organization may come up with an idea for online engagement that may help your organization better reach its goals…but your idea hasn’t been tried before. Far too many organizations prefer not to invest time and resources in a new opportunity unless there is an extant case study available for analysis and consideration. Invariably, it is the laggard organizations – ever fearful of innovation – who are left behind while admiring others’ bold inventions.

Worse yet, some organizations would seemingly move forward with very bad or detrimental ideas simply because they’ve seen other organizations launch a similar initiative.  If your organization is more comfortable copying mediocrity than innovating success, then prepare to soon be irrelevant.

Symptoms may include:

  • Lack of original engagement ideas
  • Lack of superlative perceptions of your organization among audiences
  • Missed opportunities to build affinity and cultivate evangelists
  • Execution of initiatives that do not match the goals of an organization

 

Treatment: Just because an organization carried out an initiative doesn’t mean it was successful or that it is a surefire win for your organization.  View the initiatives of others with due scrutiny or admiration and act accordingly with regard to your own organization’s goals and values. Also, if your organization has an idea for a new initiative that hasn’t been done before, perform a SWOT analysis and if the strengths outweigh the weaknesses, consider giving it a shot. You just might end up being an industry leader.

 

If these old notions still permeate your organization, it’s time to change.

 

Interested in getting blog posts, tips, and some silly social media geekery periodically delivered in your Facebook newsfeed? Like my Facebook page (or ) Or for more regular sharing of nonprofit marketing information, follow me on Twitter

 

Posted on by Colleen Dilenschneider in Community Engagement, Digital Connectivity, Financial Solvency, Fundraising, Myth Busting, Nonprofit Marketing, Sector Evolution, Trends Comments Off on Is your Nonprofit Living in the Past? Nine Outdated Ways of Thinking That Are Hurting Your Organization

The Evolution of Marketing from a Service Department to a Strategic Collaborator

marketing fairy dust

If your organization still treats the marketing team as a “service” department instead of a critical, strategic resource, then it’s time to catch up.

Audiences now expect organizations to operate from the outside-in (the market determines the relevance of your organization), and no longer from the inside-out (internal experts attempt to declare the market’s preferences). If you’re making major decisions without first contemplating the market, then your organization may be doomed to fail.

Before the social media revolution, marketing often played a “service” role in organizations. That is, it was a department tasked with delivering the messaging that originated from other departments. The exhibits team decided to bring in an obscure exhibit about so-and-so’s this-and-that? The marketing department was at their service to get people to visit the exhibit. The CEO decided that he wants to take up a public-facing initiative of interest to him? The marketing team would have to find a way to deliver the news. This is what I mean by marketing playing a “servicing” role in the organization. In an outdated way of thinking, departments would make decisions and say, “Okay, Marketing – market this.”

It doesn’t work like that anymore. The most successful organizations with which I have the opportunity to interact consider the marketing team before the organization solidifies even minor public-facing plans. Why? Think about it…

 

1) The marketing department is now the ears of your organization and not just its mouth

Gone are the days of the marketing team playing the role of a one-way megaphone for an organization. Thanks to the 24/7 nature of the web, organizations that do not actively listen to their audiences, provide ongoing transparency, or engage in social care (that is, provide real-time responses to online inquiries within the organization’s community) suffer from a decline in reputational equities (and reputation is a driver of visitation and also plays a role in philanthropic decision-making). In short, the marketing department is no longer your organization’s way to talk at your audience, this department provides the opportunity to listen to and connect with your audience.

 

2) Connecting with audiences every day forces your marketing department to become expert in the wants of your constituents

Have you ever really looked at some of the interactions on your organization’s Facebook page that your marketing team nearly always seems to respond to with tact? Those responses are necessarily considered and thoughtful. I very rarely see a marketing person write something that illustrates what they may actually be thinking at times (“Sir, this basic information is all over our website, is extremely findable in a Google search, and is addressed in the comment below… but sure, I’ll respond during my dinnertime to supply this answer to you in a timely fashion and I’ll even thank you for asking!”) In other words, communicating on social platforms often takes time, skill, and consideration. By interacting with your audiences every day and successfully managing online communities, a good marketing team member necessarily becomes expert in your market’s wants, confusions, desires, hold ups, and preferred methods of communication.

 

3) Organizations sometimes determine importance but the market always determines relevance

This is an absolutely critical concept for modern-day nonprofit organizations to grasp in order to achieve financial solvency (and, thus, why I mention it in several posts): If audiences that truly matter don’t consider what your internal experts declare as important to actually be important, then you won’t succeed in garnering support. Your organization may claim that something is important, but that does not make it so to your audiences. The marketing team may be able to tell incredible stories, but if “important” content is not innately relevant, the job is much harder – and may be impossible in some cases.

 

4) Initiatives have an infinitely greater chance of success if marketing has been involved in their development rather than briefed after their finality

Because the marketing department knows your market and because the market determines your success, it’s unwise to treat this team as a “service” department rather than a strategic department. We currently live in a very connected world and we no longer have to “guess” what our audiences want or need in order to support our missions (see point #2). Thus, it makes almost no sense that a department within an organization might arbitrarily pick an initiative or exhibit (determining importance) without considering the market (ensuring relevance).

 

Although the role of marketing is changing and, in turn, the way that organizations think about their marketing departments has changed, that does not mean that this is the single most important department by any means. Marketing is an every-department job that only works with the help of others to bring expert content to potential supporters through the filter of how audience are best engaged.

Digital engagement provides an incredible opportunity to get to know audiences, break down ivory towers, engage in open authority, and build greater personal connections to nonprofit missions. In order to achieve success, organizations must listen to their audiences, relate to them, and provide value to individuals – and community management should be contemplated before an organization makes public-facing decisions.

If an organization is in the woods shouting its own importance and nobody is around to hear it, does it make a sound? Who knows…but, more importantly, who cares? Our organizations have both mouths and ears. It’s time to use them both.

 

Interested in getting blog posts, tips, and some silly social media geekery periodically delivered in your Facebook newsfeed? Like my Facebook page (or ) Or for more regular sharing of nonprofit marketing information, follow me on Twitter

 

Posted on by Colleen Dilenschneider in Community Engagement, Digital Connectivity, Myth Busting, Nonprofit Marketing, Sector Evolution, Trends 2 Comments

Why Social Media Is The New Force Empowering Giving Decisions

Donate button

Nonprofits recognize that being on social media is good for public relations, but it’s increasingly driving innovation in the fundraising space by informing giving motivations. 

By now, even the most laggard of organizations understands that digital fluency is a pillar of any strategy seeking to engage audiences, cultivate constituent relations, and secure donors.  More than a “next practice,” digital engagement is essential to the relevance and solvency of the contemporary nonprofit organization – simply keeping the doors open requires investments of time, talent, and treasure on digital platforms.

But social media is playing an important role in how people relate to and understand nonprofit organizations beyond simply their ability to converse on Twitter or post pretty pictures on Facebook.  In our progressively crowd-sourced, collectively intelligent, peer reviewed world that values trusted endorsements foremost among reputation-enhancing communication channels, social media is emerging as one of the most important tools in the fundraising toolbox.

The William and Flora Hewlett Foundation recently announced that it is ending its eight-year, $12 million funding relationship with sites like Charity Navigator, GiveWell, and GuideStar – sites that attempt to aid donors in making philanthropic decisions based on “data-informed” factors.  An assessment concluded that, “While the foundation’s effort succeeded at producing more information about charity performance, it did little to change donor’s decisions: They continued to give with their hearts, not their heads.”

In many ways, this acknowledgment of the limited efficacy of these sites in influencing donor decisions is a simple response to a decision that the market had already made years ago – these sites simply have not proven meaningfully influential in terms of motivating “data-informed” giving.  Worse yet, many sophisticated donors recognize the type of data aggregated by these sites as somewhat specious – do lower administrative costs resultant from hiring a lower salaried (and, perhaps, correspondingly less talented) CEO really indicate greater organizational effectiveness than an organization that invests more in its people? An objective final analysis may well conclude that these sites did more to harm philanthropy than advance it by promulgating less meaningful metrics as substitutes for actual performance, and, thus, did nothing more than confuse an already incredibly complex field.

If the Hewlett Foundation’s decision recognizes the dwindling influence of these sites, then what are the information resources that impact and inspire our giving motivations? Increasingly, social media is playing a critical role in distinguishing effective organizations from less effective nonprofits for the review and consideration of the giving public.  Much like the initial aim of sites like Charity Navigator, social media sites empower potential donors to evaluate nonprofit organizations – but they do it with their own hearts and minds, and develop their own criteria for what makes a worthy organization.

Here are three ways that social media engagement on real-time, digital platforms is changing the nonprofit sector and empowering potential donors to make more intelligent giving decisions:

 

1) Social media increases the expectation of transparency  (which increases nonprofit accountability)

On social platforms, organizations are “judged” in real-time. Gone are the days of hiding from crowds in order for the CEO to spend a day crafting a response to a crisis. An organization’s tone, transparency, timeliness, and “touchability” (the four T’s of online engagement) may be observed 24/7 on social media sites. Steep expectations of speedy responses to online inquiries demand that an organization has its ducks in a row all the time – not just when there is an urgent need. In short, how good (and timely!) your organization is at carrying out social care matters.

 

2) It is harder for nonprofits to hide a lack of impact (so organizations must show progress or risk losing donors)

Studies reveal that demonstrating impact is a key driver of giving decisions. Right now, it’s cool to be kind and many organizations are sinking or swimming based on their perceived abilities to actually carry out their missions. Because digital platforms are real-time and supremely enabled to demonstrate transparency, it is easier for a potential donor to determine if a nonprofit is actually taking steps to fulfill its stated mission. Or, rather, if your organization suffers from mission drift, a potential donor may be able to see this based on content posted on social platforms. This one takes some thought for nonprofits because – when it comes to social media – many focus on metrics that mean nothing instead of true key performance indicators. It’s easy enough to increase your fan count, but increasing it with the right people who are willing to act in the interest of your organization and its mission is key.  The best way to get the right people to follow your nonprofit? Focus on your mission and impact.

 

3) Failures are more visual  (so nonprofits must consider potential market reactions)

Have you ever been to an industry conference of for-profit organizations?  While the presentations may feature a smattering of self-serving, promotional case studies, they more often overflow with learning from failures and missteps.  In the for-profit world, failure is a sort of badge of honor viewed as a healthy part of the innovation process (provided, of course, that one learns from the failure and applies this knowledge to a consequent effort).

For nonprofit organizations, making a “mistake” or even sharing a true, hard lesson at a conference seems verboten. “What if admitting that we don’t do everything right all the time results in fewer donors?” “The CEO won’t fund our presence at this conference so that we can share something that we did wrong!” As a result, nonprofit conferences may be good for networking and very, very useless for actual learning as they are generally self-promoting, self-congratulatory hot air festivals by nature (…or perhaps simply by our own perceived necessity).

Social media demonstrates that the market’s reaction to strategic decisions demand that organizations consider their constituents. Remember when Susan G. Komen for the Cure cut funding for Planned Parenthood and social media exploded? Susan G Komen still hasn’t recovered financially – and a large part of this may be due to ongoing social media conversations.

The Komen situation may have revealed a fundamental incongruity with the personal agenda of the organization’s leadership and its stated mission.  A critical aspect of the failure stemmed less from an unpopular, controversial decision and more from the response (or immediate lack thereof) to the market’s reaction.  The lesson is that we need to be ever more “outside-in” in our consideration of a situation and not confuse our internal ability as supposed experts to declare “importance” with the market’s absolute right to determine “relevance.”

The public nature of social media demands that organizations consider market reactions. It makes leadership think twice about the people whom they serve and how they go about their business. It gives the market a voice, and threatens to punish organizations that do not consider the folks who actually matter to the relevance and vitality of your organization.

 

Yes, social media takes time, talent, and treasure – but it’s worth the investment. Those very things that make it hard for some organizations (transparency, demonstrating impact, having the market as the true boss to the boss) will actually help us move toward a stronger, more intelligent service sector that is more effective and efficient at achieving social good.

Getting smart about social media isn’t about adapting to technology. It’s about people. It’s about showing of the true identity of your organization. If you don’t value social media, then you don’t value your audiences.

Hewlett’s funding decision recognizes an inalienable truth: People don’t want a middleman telling them what to do with their money. They want to decide how they feel about your organization for themselves.  Social media is your seat at the table for this conversation with donors.  Speak now.

 

Interested in getting blog posts, tips, and some silly social media geekery periodically delivered in your Facebook newsfeed? Like my Facebook page (or ) Or for more regular sharing of nonprofit marketing information, follow me on Twitter

Posted on by Colleen Dilenschneider in Community Engagement, Digital Connectivity, Financial Solvency, Fundraising, Myth Busting, Nonprofit Marketing, Sector Evolution, Trends 5 Comments

The Relevance Test: Three Key Concepts to Future-Proof Nonprofit Organizations

Ivory tower

Ivory towers are proving fragile.

Many visitor-serving organizations benefit from “outside-in” thinking and have ceased depending solely on experiential intuition and other “inside-out” ways of thinking that have previously – and perhaps alarmingly – allowed a kind of Ivory Tower mentality to infiltrate many museums.

The dawning of the Age of the Internet has brought about many necessary changes in the way that people think and behave, and, thus, what people have come to expect from the organizations that they support. Digital, real-time tools now allow for transparency, the ability to communicate ongoing impact, and the ability to personally connect with organizations 24/7. Indeed, the market now expects – demands, really – transparent insights from organizations.

These changes shape the way that we interact and connect within our communities, create meaningful experiences, manage new demands for open authority, and inform our overall expectations of visitor-serving organizations.

While recognizing the progress that has been made, here are three new conflicting perceptions that visitor-serving organizations must internally resolve in order to remain relevant in our ever-evolving era:

 

 1. Prescription vs. Participation

What does your organization offer? Stale, outdated organizations offer a form of prescription. Today, however, if your organization believes that it is offering a form of treatment (i.e. to “teach” something, or to get people to believe something), then your organization is prescribing its experiences to folks who haven’t asked for a diagnosis. In short, if you haven’t first proven your relevance to people (let alone your unique relevance) then it’s hard to be relevant.

Offering participation and exploration encourages visitors to be active and uncover their own “truths”…for themselves. Thanks in large part to the amount of information available on the web, people expect to explore and make decisions for themselves. This is a big reason why open authority (basically, organizations finding ways to “open” their authority to the public) is increasingly important for visitor-serving organizations – and all other organizations for that matter.

This may trace back to the mission statements of visitor-serving organizations. Organizations aiming to “inspire” or “cultivate” may manifest themselves more dynamically than organizations aiming to “educate,” “demonstrate,” or “present” (exhibits, for instance). The former examples empower visitors; the latter examples remove this power. Many of our nation’s most prominent visitor-serving organizations’ mission statements are still self-oriented (and innately less relevant and impactful) rather than people or community-oriented. This may deeply affect how your organization functions…and, more critically, how your constituencies relate to your organization.

 

2. Tuition vs. Admission

Why are visitors paying to visit you? Most organizations call it “admission” – but is that how your organization internally considers the transaction?

When it comes to the overall satisfaction of a visitor’s experience, entertainment plays a leading role, and education is often used as a secondary or post-visit justification for visitation. Organizations that prioritize providing an educational experience may benefit by ensuring that it does not come at the cost of an entertaining experience.

Believing conceptually that your organization offers a form of “two-hour tuition” also demonstrates a misinformed viewpoint as to what makes a visit meaningful to your audiences. Namely, data demonstrate that who you are with and the memories folks make are more important that what they see at a visitor-serving organization. If you think that the thing that truly matters is the nuance of your unique collection of Monets, then you’re missing a bigger, data-supported benefit of what you offer your visitors: memories, experiences and opportunities for personal interaction.

 

 3. Institution vs. Community

What do you work to strengthen? Imagine how it would affect internal perceptions of your organization if you replaced every mention of the “institution” with the word “community.” Board members would sit at meetings and question, “How does this support our community?” and “What do we need to do to help our community prosper and grow?”

Because the market is the actual arbiter of your organization’s success (And, yes, I have been reminding you of that in nearly every single post), you need your followers infinitely more than they need you. Though it’s difficult to remember at times, your visitors could survive without your organization (though, yes, the world would be a little more drab and your mission more underserved)…but you cannot survive without your stakeholders. You need donors, visitors, supporters, evangelists…if you’re not cultivating them, then you aren’t serving your institution at all.

Ignore your community (both onsite locally and the potential national communities that you may serve digitally), and you risk ignoring the lifeblood of your institution. In other words: If you misunderstand or underestimate the deep connection between your institution and the socially-motivated community that you’re cultivating, then you risk rapid irrelevance.

 

Visitor-serving and other types of organizations must evolve – but this need for change extends beyond the obvious technology-enabled issues related to digital engagement. Perhaps the most important ways that organizations are evolving are more fundamental, more systemically pervasive than tactical: Ivory towers are proving fragile.  Instead of protecting and insulating an organization, they imperil and isolate its advancement.  Our opportunity comes not from on high (read: “in the tower”). It is born on the frontlines and lives at eye-level.  The organizations that thrive will connect and merge with the outside world.  “Inside-out” is yesterday.  “Outside-in” is tomorrow.  You choose where you want to be.

 

Interested in getting blog posts, tips, and some silly social media geekery periodically delivered in your Facebook newsfeed? Like my Facebook page (or ) Or for more regular sharing of nonprofit marketing information, follow me on Twitter

Posted on by Colleen Dilenschneider in Community Engagement, Myth Busting, Sector Evolution, Trends 2 Comments

There Is No Mission Without Money: Why Cultural Organizations Need To Get Smart About Pricing Practices

museum admission line

This article concludes a four-part series intended to help visitor-serving organizations understand and respond to emerging trends that will impact their financial and mission-related goals. Learn more about the series here. 

Austerity measures and the loss of heretofore “reliable” funding mechanisms pitched many European cultural organizations into a tenuous financial state and catalyzed a conversation concerning the sustained solvency of visitor-serving enterprise worldwide. In an increasingly competitive market where volume-based strategies (such as an ever-increasing attendance) are less likely remedies to the new economic reality that emphasizes earned revenues, 2014 will mark the year when organizations will need to “get smart” about leveraging data to develop intelligent, efficient price indices. In turn, analysis of an organization’s pricing structure will likely – and necessarily – foster additional discussion concerning the creation of more effective affordable access programming.

Nonprofits are increasingly competing with for-profit organizations as private companies capitalize on shifts in market behavior toward supporting social causes. The market – and especially millennials – are also increasingly sector-agnostic, meaning that simply being a nonprofit doesn’t necessarily indicate to audiences that your organization is providing more social value than a private company.   This is one of the reasons why visitor-serving organizations that highlight their mission outperform museums that market themselves primarily as attractions. 

It’s time to pause and think about your organization’s relevance – and relevance is determined by the market and the support that your organization is able to summon. In short order, museums that cannot survive a “natural selection” and appeal to audiences will sink due to lack of support (relevance), while those that remain solvent and vital (while also pursuing their mission), will enjoy sustained success.

 

1) Here’s why your organization needs to think about revenue and pricing right now (and more than ever before):

 

A) In general, fewer people may be attending your organization because of negative substitution of traditional visitors so increasing attendance may prove challenging in the near-term.

Visitor-serving organizations’ (VSOs) “historic” visitors are leaving the market at a faster rate than new high-propensity visitors are entering the market, creating a negative substitution phenomenon that does not paint a bright future (or present, for that matter) for VSOs. In fact, for every one historic HPV that leaves the market, they are being replaced by 0.989 “new” high-propensity visitors. That may sound like a small difference, but these people add up! Keep up your hard work reaching your traditional audiences and – for no fault of your own – negative substitution factors would suggest that an organization currently serving one million annual visitors will attract 946,000 visitors five years from now (that is 54,000 fewer people, and a likely corresponding decline in membership and program participation). This troubling “glide path” also considers that you’ll be doing everything that you can do to meet your current audience’s needs, and continue to market to them like exceptional rockstars! This data suggests that the key to long-term organizational solvency is to evolve our engagement strategies to include your emerging high-propensity visitors.

The good news: If museums begin to target and cultivate new audiences now, we should start to observe a broad attendance turnaround in year 2019 as emerging audiences (such as English as Second Language households) continue to acculturate into the “mainstream” market and if millennials (who will dominate the market in terms of number and purchasing power) have been engaged by VSOs. But the attendance trend still stands: In spite of overall population growth and even if your organization does its very best and starts evolving right now (as you should in order to get things back up when the market is ripe around 2019), there’s a good chance that your attendance numbers may flatten out these next few years.

 

B) Expensive special exhibits are often financial drains when compared to the potential alternative uses of these same funds.

Despite clear data that utilizing special exhibits to cultivate visitation is an ineffective long-term strategy and has particularly costly and detrimental consequences for organizations, many VSOs (and museums, in particular), get wrapped up in this bad, bad practice when times get tight.

In my world, we refer to organizations that prioritize special exhibits over building affinity for permanent collections as committing “blockbuster suicide.” And – though I won’t throw any organizations under the bus by mentioning their names – I’ll bet that you can think of an organization or two that has “committed suicide” in this way and is now in quite a financial pickle.  These museums train even their closest constituents to wait for expensive exhibits in order to motivate a return visit. Not only is this plan ineffective and ridiculously short-sighted, but it’s also very expensive.

In an economy that increasingly relies on maximizing earned revenues from a finite audience, the margin of financial success is very small. Many organizations cannot afford expensive vanity projects that do little to improve net revenues but add significant costs to their financial model.  Alternative uses of funds that focus on improving the visitor experience frequently realize better returns than the costs to actualize a “special” exhibit.  While many organizations have become very astute at calculating per capita revenues, it may also be wise to similarly calculate the per capita operating costs attendant to serving your visitors.  We reliably observe that exhibits increase per capita operating costs at a level that exceeds any short-term increase in per capita revenues.  In other words, there is little evidence to recommend the viability of special exhibits as a sustainable revenue maximization strategy.

 

C) Visitor-serving organizations that discount to increase word of mouth and drive attendance experience the backlash of negative reputational equities.

What about social media? Can’t we use that to drive attendance? Yes, data suggest that utilizing social media to increase reputation in order to drive attendance is effective and indeed you should! However, when times get tight financially, we see many organizations resort to offering discounts via social media…and offering discounts via social media is a big mistake. This practice cultivates a “market addiction” that has long-term, negative consequences on the health of your organization.

Moreover, the more steeply you discount, the less likely visitors are to return. (Here’s the data again). People also tend to value what they pay for. Those who visit your organization at a discount are also statistically less satisfied with their experience and report more negative reviews than those who come in at full price (Hey, you devalued your brand first!). So much for crossing your fingers for better word of mouth as the result of a discount…

 

 

2) Now look at how most organizations decide how to price for admission:

Many organizations price their admissions based on what we at IMPACTS have termed “unintentional collusion.” Take a look back in time to your most recent conversation about pricing. The origin of your pricing framework probably went something like this:

IMPACTS unintentional collusion pricing

This happens because organizations misunderstand a fundamental principle of pricing.

Museums actually have different reputational equities and thus differing values that the market is willing to pay for a unique experience. If you’re a zoo that is charging the same admission as a nearby children’s museum (or vice versa), then your organization may be ignorantly “leaving money on the table” by relying on the comparative price of a neighboring or “like” organization. Each museum actually has an optimal price index (often best derived as the result of data-based price analyses) wherein the optimal price to visit an organization maximizes revenues without demeaning attendance potential. Along these same lines (and for the reasons stated above), I’d like to offer up a concept that is increasingly critical for the long-term health and vitality of many VSOs:

The amount of revenue that your organization secures is more important than the amount of attendees that walk through your door.

Many executive leaders and board members have a shockingly hard time understanding this necessary – and completely pragmatic – evolution in visitor-serving “business” practices. Many have been hardwired over time to think of success as the number of people that walk through the door. (Why do we even think this way anyway?! It’s an outdated preoccupation with a relatively meaningless nonprofit output.)

The most direct and savvy way to reap the benefits of your labors cultivating evangelists and working to increase your reputation?  Utilizing it to increase your revenue. And when attendance plateaus at the time that your brand is at its most premium, the most efficient way to do this is to adjust your admission price accordingly.

 

3) Optimized pricing will necessitate conversations about affordable access programming that serves lower-income and other underserved constituencies (in other words, programming that actually works)

If your organization has been value-advantaged (“leaving money on the table”) when it comes to your admission price, then raising the price of tickets may, indeed, increase the barrier for low-income households to attend your organization. Because affordable access is often a key part of many organizations’ missions – or even required in order to be eligible for certain grants and government funding opportunities –  getting smarter about pricing will mean getting smarter about affordable access programs as well.

Experience at IMPACTS has shown time and time again that many affordable access programs are extremely inefficient. Specifically, many affordable access programs achieve startlingly little in terms of providing targeted benefit to low-income households and, instead, allow discounted access to those who would otherwise be able and willing to pay full price. These programs are neither capturing low-income households, nor are they increasing revenues so that museums may more effectively and efficiently fulfill their missions. They are glorified discount programs that organizations offer so that they may check off a symbolic box of “affordable access.”

As visitor-serving organizations realize the need to pay attention to pricing and maximize their investments, there will be incentive to re-evaluate affordable access programs so that they actually work. Namely, that they provide an opportunity for low-income households and other targeted underserved audiences to visit the organization without concurrently discounting admission for those who would be willing to pay full price for your unique experience.

All of this is a long way of saying that nonprofit organizations are finally going to have to think about money and stop defending outdated nonprofit dogmas that tend to demonize revenue as a “necessary evil.”  Museums, zoos, aquariums, performing arts and other cultural organizations are big business – accounting for $135 billion in annual economic activity and more than 4.1 million jobs.  Instead of considering volume of visitation as a key performance indicator, we ought to instead focus on meaningful outcomes and recognize that our collective ambitions to achieve social good require revenues.  In other words, there is no mission without money. 

 

*Photo credit: Telegraph, AP (The photo choice has nothing to do with the Metropolitan Museum of Art’s pricing!)

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Posted on by Colleen Dilenschneider in Community Engagement, Financial Solvency, Myth Busting, Sector Evolution, Trends 3 Comments