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Six Ways Personalization Trends Are Affecting Museums and Cultural Centers (DATA)

Personalization trend in cultural organizations

The personalization trend is here. And it’s affecting nearly everything visitor-serving organizations do.

 

Once in a while – usually when considering topics for a trend meeting with clients – I look over collections of recent IMPACTS data and glaring patterns emerge. Sometimes these trends are obvious – like myth-busting traditional ways of thinking that data suggest are now largely irrelevant. Sometimes they come together to tell a story about sector evolution and solvency. And other times – like today- they represent a connection so glaringly apparent (because it is already in the broader business media spotlight) that I’ve mentioned it only in passing.

Personalization has been an increasing and unrelenting theme in much of the data collected regarding visitor-serving organizations – and it is begging for more attention in the world of cultural centers. Typically, conversations about personalization within these institutions are interpreted as a need for crowd-sourced exhibits/programs or more creative, online initiatives. And those can be excellent ways to actively incorporate personalization into an engagement strategy! What’s decidedly NOT excellent is assuming that personalization doesn’t affect nearly everything in regard to operations and engagement these days. This goes way beyond new exhibit development and social media stunts. 

Personalization is one of the most important trends for brand evolution today and is predicted to continue to emerge as a hard-hitting trend. And, if you haven’t heard, 2015 is the year of personalization. Personalization has been sited – alongside transparency – as an increasingly required brand attribute and a prime example of how the Internet has changed the world in which we live.

From the Share a Coke initiative to the secret sauce of Netflix, Amazon, Hulu, Spotify, and Pandora, personalization initiatives are everywhere. Most of all, personalization serves as a helpful lens through which to consider initiatives and the evolution of engagement practices.

Gone are the days of one-size-fits-all communications online and offline. Personalization is actually playing a role in nearly all aspects of visitor-serving organizations – beyond the creative development of new exhibits and programs. Personalization has lead to the emergence of the following trends:

 

1) An increased need for onsite personalization to increase satisfaction levels

Data suggest that personal interactions between staff and visitors significantly increase overall satisfaction, improve value perceptions, and contribute to a more meaningful overall experience. IMPACTS data has uncovered that a single personal facilitated experience (PFE) during a visit can have a major impact on satisfaction levels. A PFE is a one-to-one or one-to few interaction that occurs between an onsite representative of the organization and a visitor.  And not only do PFEs increase satisfaction levels, but they also increase perceived value for admission, education value, staff courtesy, and entertainment value. See the data here.

IMPACTS satisfaction by daypart PFE

Organizations may even deploy PFEs as a mitigation strategy to minimize the impact of crowding perceptions on overall satisfaction! The chart above shows data points from a representative organization with whom IMPACTS works. Keep in mind: The experiences represented by PFE and non-PFE visitors are largely the same (same facility, same content, same basic experience) – except for the opportunity to have a personalized experience with a staff member.

 

2) A growing disinterest in group tours and standardized experiences

Your organization isn’t imagining things: It’s harder to attract leisure tour groups today than in the past. This mass, standardized experience business has been in decline – and the data suggests that it’s not because the salespeople suddenly got bad at their jobs.  It’s because people do not want to go on the same old, standardized group tours.  This makes sense: During a time in which audiences are leaning toward more personlized experiences, many group tours are currently the precise opposite – every experience is commonized.

IMPACTS group tours are fun way to visit museums

The Y-axis in the chart above indicates the mean scalar variable response so as to indicate the level of agreement with the statement on a 1-100 scale.  Anything much below 60 tends to indicate a level of disagreement (i.e. “not fun”).

Perception of the enjoyment of museum visits through group tours not only started out at less-than-impressive levels when IMPACTS began tracking the metric in 2008, perception has since been in steady decline. This is also the case in regard to group tours to zoos and even cities, suggesting that it isn’t the museum group tour that’s “broken” – it’s the group tour concept itself. Similar data exists for sporting events, aquariums, theme parks…you name it. Again, the personalization trend is at odds with the standardized experience of group tours – regardless of the venue. More on this here.

 

3) The expectation of social care on digital platforms

When organizations consider social media and personalization, they often think about creative initiatives. However, this may be missing the boat. There’s an ongoing expectation for personalization that may be more critical to your organization than more creative, additive endeavors.

The buzz term for personal, customer service-like community management issocial care” and it is hugely important for all organizations. Why? Online audiences expect engagement from organizations.

Consider this data by Lithium Technologies: 70% of Twitter users expect a response from brands they reach out to on Twitter, and, of those users53% want that response in less than one hour. The percentage of people who expect a response within the hour increases to 72% when they’re issuing a complaint. And there’s more: 60% of respondents cited negative consequences to the brand if they didn’t receive timely Twitter responses. That said, it isn’t only negative comments for which audiences seek interaction…

Lithium expect response within hour of tweet

This may all sound doom and gloom, but according to the same survey by Lithium Technologies, there’s a benefit to interacting with folks on social media sites:

Lithium positive response data

 

4) Promulgating connective content with personal meaning

By now, organizations likely understand that an organization’s number of followers on social media doesn’t matter. The quality of followers is more important than having thousands who do not promulgate your messages and are disinterested in acting in your organization’s interest.

Content is no longer king. Connectivity is king. Content can operate in isolation, but connectivity requires a kind of “passion match” between the organization and the potential supporter or advocate. This “passion match” is personal, and – while indeed many exhibits or specific programs are being developed for more unique audiences – the understanding that personal connection is the goal is driving the content strategies of intelligent organizations to post not what the most people on social media will like, but what actual, potential supporters will find most meaningful.

 

5) The availability of more diverse membership structures

The concept of personalization may begin with allowing for alternate gateways to engagement and understanding that the “one-size-fits-all” approach to membership simply isn’t optimal anymore. One data-based example of this can be seen in IMPACTS work with a large (over one million visitors per year) visitor-serving organization with a mission related to conservation. More on this finding here.

IMPACTS- Benefits of membership

Adults under thirty-five provide a sneak-peak into the need for organizations to create alternate programs to cultivate new and emerging audiences. Extant data indicate that members of Generation Y are public service motivated and appreciate a feeling of belonging and connectedness with one another and with a cause. This is consistent with the responses gathered from millennials in the data above. Instead of being interested in the more “transactional perks” of membership, this generation desires a feeling of connectedness with a broader social good. Creating a range of membership programs that engage different audiences allows for more personalization in approach. Is the primary “passion match” between members and your organization actually transactional? For some it may be. But what about the increasing majority that care about impact and connectivity?

 

6) The evolution of digital platforms and technology usage

Thanks to the personalization trend, the role of email has changed. It is no longer effective for “spamming” groups of people, but rather for cultivating individual audience members based on their “passion matches.” Personalized emails deliver six times higher transaction rates, but seventy-percent of brands fail to use them.

Moreover, data suggests that static websites and homepages are no longer the digital platform motivating visitation decisions.  Increasingly, social media plays an important role in this process thanks to the personalization and perceived transparency that it provides. Simply put, folks can log onto social media sites and see how well an organization actually “walks the talk” of its mission by way of the content that it posts – and make decisions about the organization on their own.

There is buzz about the importance of utilizing mobile devises to hone in on personalization opportunities. This is a particularly good idea right now because Google has announced that there are now officially more searches taking place on mobile devices and tablets than laptops and desktops. Let the personalization trend continue!

 

Ours is an era of personalization – every experience is increasingly tailored. And data suggest that more standardized experiences suffer in comparison. It’s time that cultural centers ingrain this brand attribute into overall organizational strategy in order to future-proof their experiences and offerings, and better attract and retain donors and supporters.

 

Like this post? Here are a few related posts from Know Your Own Bone that you might also enjoy:

 

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

Visitation to Increase if Cultural Organizations Evolve Engagement Models (DATA)

Tipping pointAttendance to cultural centers is on the decline, but data suggest that forward-facing organizations may see improvements by 2020. Here’s why.

Overall, data suggest that attendance to visitor-serving organizations is in a general state of decline relative to population growth – and this may suggest a problem with the current visitor-serving organization business model. For organizations that fail to adapt their engagement strategies to respond to emerging audiences, there’s abundant reason to believe that their attendance levels may continue to stagnate or decline. However, data suggest that those organizations willing to evolve their thinking about emerging audiences and access programming stand to benefit by overcoming the negative substitution trends that are currently depressing attendance. There is a reasonable expectation that evolutionary, agile organizations will experience sustained increases in attendance as this century enters its second decade.

Here’s what your organization needs to know about negative substitution, acculturation, and access programming opportunities…and how they are shaping the future of visitor engagement:

1) Negative substitution of audiences is affecting attendance (and it is happening NOW)

While the US population continues to grow, the historic audiences of visitor-serving organizations (i.e. those audiences with the demographic, psychographic and behavioral attributes that indicate a propensity to visit) have been in a state of general decline. One of the reasons for this circumstance is the negative substitution of audiences. Negative substitution is quantified by a deficiency of “replacements” for the historic visitors who exit our markets. For every one person who exits the market, there is fewer than one person to replace him/her.

Currently, for every one high-propensity visitor to visitor-serving enterprise that leaves the market (through death, relocation, or migration), only 0.948 similar high-propensity visitors are entering the market (typically via birth or relocation). When people leave the market without a sufficient number of “replacements,” we have negative substitution.

Why is this happening? For one, affluent, educated white people (i.e. historic audiences) are having fewer children and/or getting older and/or relocating to emerging markets, and visitor-serving organizations on the whole have yet to sufficiently cultivate the engagement of a newer kind of high-propensity visitor. In other words, on the whole, we’ve done a relatively poor job becoming places where emerging audiences (e.g. millennials, Latinos, etc.) feel comfortable declaring “This place is for people like me.” We refer to this as attitude affinity – a perceptual measurement of if a particular market segment believes that an organization is welcoming to them.

Incidentally, emerging audiences (most commonly Latino and other historically underserved populations) are playing a major role in population growth. Historically “underserved” audiences are increasingly the mainstream audiences of the future…and failure to cultivate their engagement may risk a generational alienation from our organizations.

Ultimately, this downward trend demonstrates the failure of access programming within visitor-serving organizations. If the past few decades of access-motivated initiatives had been successful, then we would not be experiencing negative substitution. Instead, we would have cultivated these audience members to become our current visitors. Demographers and researchers have been writing about this inevitability for some time.  If our programming had proven responsive to this opportunity, then we would be experiencing audience visitation that increases alongside population growth. That’s not what’s happening.

 

2) Misunderstanding access programming jeopardizes long-term sustainability

Many organizations incorrectly consider “access” primarily in terms of affordability.  If simply offering a reduced admission was a cure-all to access issues, then very few organizations would still have underserved audiences at all.  The presence of a continually underserved audience indicates the failure of an organization’s access programming.  In the past, organizations could perhaps put access issues on the back burner and get it away with it – there were enough traditional high-propensity visitors to support the organization.  However, as the traditional market shrinks and historically underserved audiences grow to become an increasing majority, the issue of access can’t be de-prioritized any longer.  The future well-being of many visitor-serving organizations hinges on their ability to connect with these audiences. The reality is that effective access programming engenders trial and usage by cultivating new audiences as eventual regular visitors – an organization’s lifeblood.  Access isn’t primarily about price. It’s about eliminating every barrier to engagement.

Do the data suggest letting everyone visit for free?  No.  Of course not.  The data indicate that time is more valued than money for the vast majority of audiences.  A person thinking about visiting a zoo on a Saturday in June is very unlikely to delay their visit until a Tuesday in November simply because of cost.

Access programming is significantly less about affordability than strategic sustainability. This is where organizations are being inappropriately emotional about business matters, and misguided ideas about “affordability” are lessening the solvency of some organizations. Today, there exists compelling, data-informed science that suggest that cost is overstated as the primary barrier to engagement (schedule reliably trumps cost). Think of it this way: If $34.95 proves unaffordable to select audiences, so will $24.95 or $29.95…or any other realistic “discount” from the general admission basis. In terms of true affordability, nearly any price diminishes the visitation potential for our most affordability challenged audiences.

Price is not panacea when it comes to affordability. And affordability is not antidote for access. Price is a revenue optimization tool that provides organizations with the resources to support access programming that, in turn, cultivates the engagement of future audiences.

If you want to be relevant to the audience of tomorrow, you better be working to engage them today.

 

3) Acculturation improves future outlook (provided organizations update engagement models)

IMPACTS- HPV substitution ratios

But there’s hope! Check out this graph from IMPACTS. It demonstrates substitution ratios derived from a predictive modeling process for US visitor-serving organizations. The Y-axis indicates the antecedent term (the first value) in the substitution ratio.  Thus, an antecedent term <1.00 indicates negative substitution – for every one person exiting the market, there is less than one person to replace them.

Why does the trend improve in the future?  Acculturation. Emerging audiences tend to adopt “mainstream” behaviors over time – including, potentially, engaging with visitor-serving organizations such as museums, zoos, aquariums, performing arts centers, etc.

Think of the observed differences between first, second, and third generation immigrants to the US. For example, the first generation of immigrants may not speak the language, may have gone to school overseas, may tend to live in clusters of like ethnicities, etc. The next generation was born and raised in the United States – and may be more acculturated than their parents…but still retain certain behaviors due to household customs (English as Second Language, etc.). However, the third generation tends to be even more acculturated, with fewer traces of “old country” behaviors.

Because population growth is being driven by births of second and third generation Americans, acculturation represents a tremendous opportunity to engage these emerging audiences – provided, of course, that organizations have cultivated a relationship with these audiences before they enter the mainstream. Significant research indicates that relationships with brands are often cast during a person’s early, formative years – a failure to cultivate the engagement of a less acculturated first or second generation audience member may effectively preclude the future engagement of a fully acculturated third generation audience member.

The good news about this data? Organizations that intelligently and diligently evolve their engagement models during this critical time stand to benefit from the positive impacts of acculturation in the near future. The perhaps challenging news? Organizations will need to be thoughtful and actively evolving before 2020 (i.e. the predicted “tipping point” in the audience acculturation projections) so as to cultivate the support of these future audiences before they enter the mainstream market.

This isn’t a “Let’s just wait until 2020 to get serious” situation. This is a “If you start thinking strategically and work hard now, then you’ll see a payoff in 2020” situation.

Interestingly (and unsurprisingly), technology accelerates acculturation. This means, of course, that utilizing digital platforms and cultivating real-time communications with emerging audiences is critical for organizations. This is also another compelling reason for leaders to listen to PR and social media staff members throwing around the word “innovation.” In many ways, the industry doesn’t need to “pivot” (that mindset created many of the challenges that visitor-serving organizations are facing today) – it needs to reset.

Organizations that invest in cultivating more strategic “access” models today will be able to take advantage of the engagement benefits suggested by the predicted acculturation trends. Yet again, the time-proven lesson proves true: You reap what you sow.

 

Like this post? Here are a few related posts from Know Your Own Bone that you might also enjoy:

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, Financial Solvency, IMPACTS Data, Myth Busting, Nonprofit Marketing, Sector Evolution, Trends 1 Comment

Group Tour Interest in Decline: Why Museums Should Invest Elsewhere (DATA)

group tours

Investing in attracting tour groups is an increasingly futile endeavor for museums. Here’s the data and what to do instead.

Many visitor-serving organizations increasingly bemoan the challenges associated with the leisure group tour market. (This being a different attendance category – and revenue line item – than school groups.) Typically, visitor-serving organizations have salespeople dedicated to the process of soliciting tour groups. In other words, their job is to get group business.

This business has been in decline – and the data suggests that it’s not because the salespeople suddenly got bad at their jobs.  It’s because people do not want to go on group tours.  This makes sense: Ours is an era of personalization- every experience is tailored.  Group visits are the exact opposite – every experience is standardized.

Your organization isn’t imagining things: It’s harder to attract leisure tour groups today than in the past. Here are three, data-based reasons to utilize full-time staff (FTEs) in a way that is more likely to drive actual visitation than futilely increasing investments in the leisure tour group market:

 

1) People do not think group tours are a fun way to visit a museum

IMPACTS group tours are fun way to visit museums

The Y-axis in the chart above indicates the mean scalar variable response so as to indicate the level of agreement with the statement on a 1-100 scale.  Anything much below 60 tends to indicate a level of disagreement (i.e. “not fun”).

Perception of the enjoyment of museum visits through group tours not only started out at less-than-impressive levels when IMPACTS began tracking the metric in 2008, perception has since been in steady decline. This is also the case in regard to group tours to zoos and even cities, suggesting that it isn’t the museum group tour that’s “broken” – it’s the group tour concept itself. Similar data exists for sporting events, aquariums, theme parks…you name it. Again, the personalization trend is at odds with the standardized experience of group tours – regardless of the venue.

We decided to look into this a bit more, and the outcomes to this inquiry were also extremely telling (although perhaps altogether unsurprising)…

 

2) Group tours do not likely have a sustainable future

 IMPACTS group tours are fun chart

Like the previous chart, the data above also demonstrate a mean scalar variable response so as to indicate the level of agreement with the statement on a 1-100 scale. Again, dipping below 60 tends to indicate a level of disagreement (i.e. “not fun”). The data here is unassailable: The market – and especially millennials – do not think group tours are fun.

Millennials represent the single largest generation in human history and will make up the largest consumer segment of the market for the next 40 years at minimum. These folks don’t think group tours are fun – and their perceptions are declining rapidly. “We aren’t trying to attract millennials with group tours anyway,” you say? Well, the general market (even excluding millennials) doesn’t think group tours are much fun either.

This trend toward the negative perception of the enjoyment of group tours – like most evolution within the industry – mirrors the general market preference for more tailored experiences. On social media, the ads that come up in your newsfeed are picked just for you. Email has evolved to become a more personalized way to tell important stories than an opportunity to “spam” with broader messages. Audiences want to decide what they think of organizations for themselves. Today, everyone’s a curator. Group tours embody the opposite of these market preferences – the regulated, homogeneity of a common experience.

 

3) There are areas in which staff resources for group tours may be reallocated in order to truly drive visitation.

I think it’s interesting that some organizations that claim to not be able to afford to augment their social teams still maintain group salespeople.  The alternative use of those same funds would likely have a better ROI more broadly engaged to support the communications effort.

Digital engagement isn’t the only area in which data suggest alternative investments may yield more visitors and donor support. Indeed, any position that supports more personalized experiences has been proven to drive both reputation and satisfaction levels within institutions. Investing more in front-line staff and deploying personal facilitated experiences is an urgent need that many institutions are overlooking.

In short: Museums often have full-time staff dedicated to managing a program that many folks don’t even want. At the same time, there are data-supported audience “touch points” that may not be receiving adequate investment. Once a month, one of us at IMPACTS seems to get asked, “What can we do to improve our leisure group business?”  The answer is: Get out of the group business (and get into the personalization business)!

 

Like this post? Here are a few related posts from Know Your Own Bone that you might also enjoy:

 
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, IMPACTS Data, Millennials, Myth Busting, Trends 8 Comments

The Evolution of Nonprofit Leadership: We Need More Conductors

Conductor 1

Nearly everything has changed in today’s digital world – including the most important duties of executive leaders in successful organizations.

I’ve recently been involved in conversations exploring the new roles of executive leadership (the Chiefs) in today’s evolved world. Everything related to managing effective organizations seems to be changing – audiences, engagement mechanisms, desired public values, and even the roles of institutions themselves. Organizations are “flattening” hierarchical structures, opening authority, and some are even letting staff members work from home. Even the role of email and websites has changed. These are all very different and far more prevalent situations than they were even five years ago. As such, the way that executive leaders lead must evolve, too.

Today’s evolved world demands that Chiefs play the role of symphony conductor rather than first chair of an instrument within their organizations. In other words, the days of the Chief as “expert practitioner” have past. It’s more important than ever that Chiefs “conduct the symphony” rather than getting lost in the weeds (a place that – let’s be real – some Chiefs have been known to camp out)!

In this bad metaphor of Chiefs as conductors, the role of the CEO is to make sure that all of these departmental orchestras develop a cohesive symphony that is consistent with the organization’s overall values and objectives.

Today, organizations need conductors because even the most renowned first chair requires a maestro. Indeed, many of the most successful Chiefs have long been playing the role of “conductor” – and this skill has never been more valuable or in-demand. The world moves too quickly for Chiefs to be “expert” at everything in their department or organizations – and successful Chiefs benefit by orchestrating the collective talents of their entire team to achieve success.

Here are three reasons why the need for conducting skills has never been greater:

 

1) We are in the midst of revolution

The Digital Revolution (emphasis on the word “revolution”) is so named for a reason – nearly everything has changed. To ignore this unassailable fact is to actively refuse to evolve an organization to keep pace with the surrounding world. It is the equivalent of choosing irrelevance.

Further compounding the challenge of the revolution is that fact that it’s still happening. For example, Facebook algorithms change and the very tactic that works best one month can hurt your organization’s virality the next. New technologies create new advertising efficiencies – last season’s “tried and true” may be obsolete this season. It’s several full-time jobs just keeping up with the various aspects that go into a department. For instance, at IMPACTS, we are increasingly observing smart, forward-thinking organizations “outsourcing” aspects of their advertising strategy to more expert practitioners. This is not a knock on internal expertise – it is a compliment to the self-awareness of organizations that recognize the functional impossibility of maintaining expertise in an increasingly esoteric, evolving space. The advertising world is incredibly dynamic – it takes true experts who live and breathe it every day – to work with maximum efficacy. Increasingly, it’s simply too much for an individual working for one organization (without a grasp on the broader industry and without devoting significant resources to keeping up with day-to-day changes) to optimize an advertising plan.

Even a magical Chief who could stop time could not possibly hope to fully catch up on any one branch of their department – let alone all branches. Organizations increasingly need real experts. And organizations need Chiefs to hire these experts and trust them. Chiefs may benefit by realizing that – as awesome as they may be – it is unrealistic to think that they need to be more expert than the experts they’ve hired when it comes to the details.

When a leader plays the popular, “Now explain every aspect of this new thing to me while I fire back with actually-irrelevant, pre-digital revolution logic” game, the organization loses. If you’ve hired a good person, the only things a leader needs to consider are: “Will this work?” and “Does this fit with our organizational values?” and “Does this bring us closer to achieving our goals?”

 

2) Someone needs to preach to the choir

Sounds counter-productive, doesn’t it? In today’s world, though, it’s increasingly necessary. One of the most important roles of a good Chief is managing successful internal communications.

It’s difficult for conductors to successfully conduct when the sheet music hasn’t been distributed to the musicians. Worse yet, it’s even more difficult to sound like a brilliant symphony without hours of practice. Yet, in a rush to engage external audiences in our fast-paced world, organizations regularly underestimate the critical importance of taking a moment to get everyone on the same page. This is increasingly glossed over, and yet this is arguably more important than ever before given our real-time, digital world!

Reputation plays an important role in an organization’s success when it comes to garnering support – and managing reputation is a duty that every department – and the CEO and Board, of course – must work to carry out in concert. A good Chief communicates purpose and reinforces the “why” of the organization within their respective department and organization. Without this, nobody plays the same song at the same pace. Without first aligning internal messages – a function of relentless communication – it’s impossible for staff to successfully communicate externally.

 

3) You cannot rule from the mountaintop while stuck in the weeds

Organizations must be accessible 24/7 on real-time, digital platforms to answer questions and/or provide information from nearly all departments. The opinion of one, connected individual can have a real impact on an organization’s bottom lines.

If CEOs of the past needed to stand on the mountaintops to get a view of their kingdom, now they need to look out from space shuttles. Simply stated, today’s world demands that leaders develop a wider view of the institution and how it is perceived in order to develop strategy and confidently maintain an agile organization. If a leader is spending a disproportionate amount of time on one aspect of the organization (or one department), then they may miss the larger, more important, “big picture” aspects of the overall performance that they are supposed to be conducting.

More constantly-evolving areas of expertise (as we have in today’s world) mean more details with which Chiefs may unknowingly distract themselves. Real leaders don’t hide in the weeds – especially when their organizations need them most.

The opportunity here isn’t to simply encourage leaders to stop micromanaging.The opportunity is to clarify structures and roles to meet the opportunity of an evolved world. Today, successful leaders are conductors – they bring talented musicians together, communicate the song for everyone to play, and work hard to create beautiful music.

 

Like this post? Here are a few related posts from Know Your Own Bone that you might also enjoy:

 

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 Sector Evolution, Trends Leave a comment

Audience Acquisition: The Cost of Doing Business for Visitor-Serving Organizations (DATA)

Visit us v2

Here it is: the data-informed equation for how much money organizations should be spending in order to maximize opportunities for financial success.  

Data suggest that approximately 70% of visitor-serving organizations are not investing optimal funding in acquiring audiences.

Marketing budgets seem to be an unnecessarily emotional topic for many nonprofit organizations. Optimizing marketing investments – like admission prices – are increasingly a product of math and science (read: decidedly not “intuition” or “trial and error”). They need not be based on fuzzy-feelings and inappropriate loyalties to failing business models that ignore the realities of the outside world.

We live in a pay-to-play world where organizations have to spend money to make money. When it comes to budgeting for audience acquisition costs, many organizations seem to have fallen into that familiar trap of “last year plus 5%” that lazily assumes the continued efficacy of the same old platforms and strategies. Of course, such a strategy completely ignores shifting advertising cost factors, evolving platforms and channels, and technological innovation. Say it aloud: Nonprofits do not operate in a vacuum and cannot afford to ignore the changed economies and technologies of the world around them.

Several organizations that have made this realization have asked IMPACTS if there is an equation to inform their audience acquisition costs so as to maximize their opportunities for financial success. And, the findings of a three-year study suggest: Yes, there most certainly is!

 

The key equation for acquisition costs

Let’s first establish a few definitions and “same page” this conversation:

Audience acquisition costs are the investments that an organization makes in advertising, public relations, social media, community relations…basically, anything and everything intended to engage your audiences.

Market potential is a data-based, modeled outcome that indicates an organization’s potential engagement with its audiences. For most organizations, “market potential” primarily concerns onsite visitation. In other words, it answers the question, “If everything goes well, how many people can we reasonably expect to visit us this year? (NOTE: Market potential may not match an organization’s historic attendance – organizations “underperform” their market potential all the time…for reasons that we’ll soon explore.)

Earned revenues are the product of admissions, memberships, merchandising, food and beverage, facility rentals…basically, all revenues attendant to the onsite experience that are supported by audience acquisition investments. These revenues exclude annual fund, grants, endowment distributions and other sorts of philanthropy.

Here’s the equation to maximize your market potential (as suggested by the recently completed three-year study):

 IMPACTS audience acquisition equation

Expressed another way: Optimal Audience Acquisition Costs = 12.5% of Earned Revenues. For example, if your organization generates annual earned revenues of $20 million, then this would suggest an annual audience acquisition investment of $2.5 million.

Further, additional analysis would suggest that 75% of the audience acquisition costs should be earmarked to support paid media (i.e. advertising). So, of the $2.5 million suggested above for audience acquisition, nearly $1.9 million should support paid media.  The remaining 25% (or, in this example, approximately $600,000) would support agency fees, public relations expenses, social media, community engagement – all of the programs and initiatives that round out an integrated marketing strategy. Forget to invest that 25% at your own peril. Earned media is critical for success and many social media channels are also becoming pay-to-play.

And now the other side: Why such a large percentage allocated to paid media? Again, ours is an increasingly pay-to-play world. Rising above the noise to engage our audiences frequently means investing to identify and target audience members with the propensity to act in our interest (e.g. visit our organizations, become members, etc.). There is tremendous competition for these same audience members – from the nonprofit and for-profit communities alike.  Think of the most admired and successful campaigns in the world – do Nike and Apple rely on 3am cable TV “bonus” spots that they get for a reduced rate and that don’t hit target audiences? Nope. While earned media plays a major role in driving reputation, paid media plays an important role in a cohesive strategy – and doing it right costs money.

 

The equation in action

How does the study suggest this equation? Check out the chart below. It indicates the relationship between performance relative to market potential (i.e. how well the organization actually performed when compared to its market potential) and the audience acquisition investments made by 42 visitor-serving organizations (including aquariums, museums, performing arts organizations, and zoos) over a three-year period:

IMPACTS - Audience Acquisition

The data strongly suggests that there is a correlation between an optimized audience acquisition investment and achieving market potential. It also indicates the perils of “underspending the opportunity” – a modest investment intended to achieve cost-savings may forfend exponential revenues. (Though the data never has – and likely never will – support it, many organizations seem to foolishly hold dear to the notion that they might somehow “save their way to prosperity.”)

Additional analysis indicates that the studied organizations invested an average of 7.9% of earned revenues toward audience acquisition…but only achieved 76.0% of their market potential. However, the organizations achieving ≥95.0% of their respective market potentials invested an average of 12.7% of their earned revenues toward audience acquisition.

In no instance did an organization investing less than 5.0% of earned revenues on audience acquisition achieve greater than 60.0% of its market potential.

Overall, the data suggests that the “sweet spot” for audience acquisition investment is in the 10.0-15.0% of earned revenue range. Splitting the difference (and further supported by the findings of organizations achieving ≥95.0% of their market potential in the study) gives us our 12.5%.

NOTE: Before we start parsing the nuances of media planning and creative approaches to advertising, let’s baseline the conversation by acknowledging that each of the studied organizations were led by competent persons operating with the best of intentions. Yes – “great creative” matters – but it doesn’t offset an inadequate marketing investment. Sure, a viral social campaign helps…but it doesn’t negate the importance of other media channels. In other words, there aren’t exemptions from the need to invest in audience acquisition for visitor-serving organizations that rely on earned revenues.

If your organization is struggling to meet its market potential, it may have less to do with all of the usual suspects such as parking, staff courtesy, special exhibits, pricing, etc. and more to do with an antiquated view of the necessity of meaningful marketing investments. Can your organization overspend? You bet. However, that doesn’t seem to be the problem confronting most visitor-serving nonprofit organizations. If your organization is struggling to meet its market potential, then it may be that in today’s pay-to-play world, you simply aren’t paying enough to play in the first place.

 

Like this post? Here are a few related posts from Know Your Own Bone that you might also enjoy:

 

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Posted on by Colleen Dilenschneider in Digital Connectivity, Financial Solvency, IMPACTS Data, Myth Busting, Nonprofit Marketing, Sector Evolution, Trends 15 Comments

The Four ‘R’s of Brand Credibility for Nonprofit Organizations

4 rs of brand credibility with title

When it comes to inspiring engagement, there are four criteria essential to creating and maintaining meaningful connections with potential supporters, donors, members, and visitors.

During a recent meeting with executive leaders (the “Chiefs” – or, affectionately – the “Cs”) of a mission-driven visitor-serving institution with which I am involved, I was asked, “What makes us [our institution] seen as a credible actor by the market?”

It’s an excellent question – and information from several KYOB posts came flooding to me all at once. Fortunately, there’s sufficient analysis about what informs positive brand perceptions and relationships to pull out four, key factors that contribute to sustained, meaningful engagement in the digital age. Combine these factors with the more tactical four Ts of digital engagement, and you’ve got a good basis for a successful organization’s public-perception strategy.

Considering how your organization approaches its audiences within these four realms is likely critical for the successful achievement of your mission and financial goals alike:

 

1) Relevance

Being relevant isn’t just about being active on Facebook and (although that can help). Being relevant means connecting with audiences though mission-based content. In today’s world, content is no longer king. Connectivity is king. Connectivity happens when an organization presents a passion or platform that resonates with a potential constituent. Therefore, connectivity is about your organization and its relationship with other people, while content is only about your organization. Connectivity is necessarily relevant, while content risks operating in isolation if it fails to engage its hopeful audiences. Connectivity – or sharing an implicitly understood “So what?” with a potential supporter – is prerequisite to action. Simply put: Without connectivity, nobody cares about your organization. Don’t just aim to be “important,” aim to be relevant.

 

2) Resonance

Resonance occurs when an organization “walks its talk” and actually shows the values that it tells. Resonance is about creating meaningful impact – and successfully communicating that impact – so that the shared passion that makes an organization relevant (see #1) can be justified and solidified by supporters. We live in a world in which the market – and especially potential donors and supporters – make decisions based on their own perceptions of how an organization achieves its mission. 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. Visitor-serving organizations that highlight their mission outperform organizations marketing themselves primarily as attractions for a reason: They do what they say they are going to do and people can see it, thus, reaffirming their decisions to support the organization. It all boils down to this: An organization must be continually delivering on its promise of relevance in order to resonate with supporters. As mission-driven organizations, this is our sweet spot. Nonprofits are increasingly competing with for-profits and we may risk relevance as an entire industry if we fail to deliver on resonance.

 

3) Reputation

Certainly, all of these points may play a role in providing the foundation for an organization’s overall reputation. However, “reputation” – or, what other people say about you (in marketing parlance think, “third-party endorsements”) – plays a particularly important role in driving success. In fact, data suggest that an organization’s “reputation” is a primary motivator for engaging high-propensity visitors (i.e. those who demonstrate the demographic, psychographic, and behavioral characteristics that indicate a heightened likelihood to visit a museum, symphony, historic site, or other visitor-serving organization). So, what comprises an organization’s reputation? Good question. Regular KYOB readers know that I talk about this…a lot. The answer is a little bit of paid media (e.g. promotions and advertising) and a lot bit of reviews from trusted sources (particularly word of mouth and earned media – both of which are often facilitated by social media). In fact, reviews from trusted resources are 12.85 times more influential in terms of your organization’s reputation than is the advertising and promotions that likely make up the lion’s share of your media budget. If you’re really good, other people will talk about you…and the things that other people say about you (i.e. reviews from trusted sources) play a bigger role in enhancing reputation than does anything that an organization pays to say about itself. In order to achieve favorable reviews, an organization will benefit by first aiming to be relevant and resonant.

 

4) Responsiveness

“Social care” is a term for carrying out relationship building and customer service practices on communication platforms (digital and otherwise). Social care is expected by audiences in today’s world. Social media isn’t a one-way communication channel like a television ad or print ad or direct mail brochure – which data suggest are decreasing in overall marketing value when compared to the web and social media. In order to successfully execute engagement strategies, organizations must be “real-time” responsive to their online audiences. While social care and nurturing audience relationships composes one of the three key elements of social media success, it’s only the tip of the iceberg. The “responsiveness” goal is to be an active listener and display transparency in order to elevate levels of trust in the organization. Being responsive demonstrates that the organization cares about its community of fans and supporters. Most importantly, it demonstrates trust in audiences – and that trust has the potential to be returned to the organization.

 

Think about how you engage with your favorite nonprofit organizations. You may find that these four Rs of brand credibility play an important role in your own perceptions of organizations. It’s funny that so few nonprofits take a moment to step back and consider how they want to be viewed by their target audiences and supporters, isn’t it? How an organization is perceived in this digital world of heightened noise – wherein every type of organization seems to have a social mission – is neither the cause of success nor the outcome of an organization’s success. It’s both.

The four Rs of brand credibility move in a cycle. It’s important that organizations realize that they play an important role in making their own cycle ascend upward instead of spiraling downward. It’s time to step in and maximize our opportunity for success – and that means understanding the important role that we play in driving it

 

Like this post? Here are a few related posts from Know Your Own Bone that you might also enjoy:

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, Nonprofit Marketing, Sector Evolution Leave a comment

The Game Has Changed: Nonprofits Now Compete with For-Profits (DATA)

Arm wrestling for profit

An organization’s nonprofit status may carry neither the perceptual weight nor the relevance that many leadership teams imagine…and nonprofits may be sabotaging their own opportunities for support because of it.

All organizations – not just nonprofits – are now in the business of promoting “social good” in order to gain support. The recent Super Bowl was an excellent example. From McDonald’s “Pay With Love” commercial, to Dove’s #LikeAGirl campaign, to all of the emotional daddy-love commercials tugging at our heartstrings, the world’s biggest advertising stage was full of attempts to demonstrate meaningful brand values. The integration of social values within business operations and communications – “corporate social responsibility” – is one of today’s most prominent business trends. And, this trend has a profound impact on nonprofit organizations because, today, the market demands transparency and authenticity to encourage support (e.g. donation, ticket purchase, etc.). The market increasingly expects organizations to articulate and demonstrate a “why” (or “so what?”) beyond “to make money.” In fact, many studies demonstate that social responsibility is no longer optional for businesses.

In other words, if your organization imagines one of its key differentiators to be its social responsibility, well, then your thinking may be at complete odds with the way the market perceives and evaluates all organizations (i.e. nonprofits and for-profits alike).

Consider this: A nonprofit organization’s “competition” for funds and market share isn’t limited to a similar organization down the street. It’s increasingly a myriad of entities within the for-profit sector. And, generally, these entities have a leg-up in allocating financial resources to help communicate and support their social missions.

Here are some considerations for organizations to remain relevant and meaningful in our age of social good for business’s sake:

 

1) Consider that people may not even know that you are nonprofit

“Wait. What?!” For many individuals working within nonprofits, this can be a big shock. However, time and time again in my work at IMPACTS, the data indicate that the majority of the same public that organizations endeavor to serve do not know that many nonprofits are actually nonprofits.

IMPACTS perception of VSOs as nonprofit

A majority of people – including visitors! – are unaware that these organizations are nonprofits. As the data indicates, the market’s lack of regard for an organization’s tax status extends to all types of visitor-serving organizations – so no one is immune to this condition. The question is: Does it matter? Well, if you consider your organization’s tax-exemption as a primary differentiator in a crowded, competitive market, then this data may be very alarming. However, if you tend to accept that the market is infinitely more interested in what you actually do as an organization than it is in the esoterica and vagaries of the US tax code, then this finding isn’t nearly so troubling.

We all know how challenging it can be to make a lasting impression. In the few precious moments when we hope to engage with our audiences, is the foremost thing that we hope to communicate about our tax status? And, if so, does the market even care? Which leads me to…

 

2) Audiences are increasingly sector-agnostic

The fact that people are confused about the nonprofit status of many organizations likely doesn’t matter.

Data suggest that 91% of global consumers will chose to associate with and support brands and organizations that provide some sort of social benefit over a product that does not. For nearly all brands right now, it’s cool to be kind.

For-profits are well aware of this and many have (or have had) campaigns that tie directly to a purpose, prominently including: Patagonia’s Common Threads Initiative, Bank of America and Khan Academy’s Better Money Habits, Coca-Cola’s Ekocenter, and Toyota’s Meals Per Hour, and LifeBuoy’s Help a Child Reach 5. That’s just the tip of the iceberg. These initiatives are focused and generally easy to communicate and understand. This may be why the Pepsi Refresh Project didn’t do very well by comparison – and that also may be why many true nonprofit organizations are struggling when it comes to communications. But I digress…

While many of these types of initiatives include a nonprofit beneficiary, the fact remains (and, indeed, becomes glaringly obvious): People don’t need to donate directly to a nonprofit to support something that they believe in. They can simply buy fast-food fried chicken.

And, with that, BAM! We’ve attached the idea of “giving” to a traditional economic utility curve. This model is arguably more sustainable because the consumer actually gets something (a product or experience) in addition to the feel-good attached to supporting a cause. Whether nonprofits like it or not, this model changes the way people think about supporting causes.

It’s great that some nonprofits are benefiting from these campaigns. They are an opportunity for securing support from a for-profit company and can be very successful partnerships! However, many organizations neglect to consider what all of this may be doing to the general market’s attitude toward nonprofits. I’m absolutely not saying that these partnerships are a bad idea. I’m saying that to move forward, it may be best to recognize (and accept) this evolution we’ve helped to create in the market’s perception and their related progression toward a more sector-agnostic world.

 

3) Having a mission is money

It’s time that nonprofits remove the emotion that may be elicited by the use of the word “mission” so close to the word “money” and tackle this one head-on. I’m talking mostly to organizations that do provide a service, product, or experience and indeed operate – at least a little bit – based upon the concept of a more traditional utility curve (i.e. visitor-serving organizations).

Visitor-serving organizations that highlight their mission financially outperform those marketing primarily as attractions. At IMPACTS, we check in on this data every quarter and the connections between how well audiences believe that an organization achieves its mission continues to correlate with financial performance.

Yes, nonprofits are arguably and increasingly competing with for-profits – but not on how well these entities can be for-profit-y. For-profits are competing with nonprofits regarding how conceptually nonprofit-y they can be!

Transparent, social-good acting, for-the-best advocating, morally-sound, socially-valuable…the same perceptions that may have been traditionally associated with successful nonprofits are among the biggest wants of for-profits in today’s world. If your marketing team is all about discounts and sweepstakes and only posting about how people should “visit us!” tell them to knock it off. That’s not good business, and it’s not the sweet spot in which these organizations need to shine.

 

4) Demonstrating impact and prioritizing transparency are more important for nonprofits than ever before

Donors increasingly make decisions based more on the values that an organization shows by way of their actions and real-time communications on social media then what an organization tells in ads and individual status updates. The web empowers potential supporters to make their own decisions about organizations based on their overall perception of the brand. Organizations that don’t walk their talk generally suffer. Extreme cases are those of McDonalds and SeaWorld.

Right now, nonprofits risk being perceived as second-rate at achieving the very positive attributes that define them (i.e. being about more than making a buck).

Sharing compelling mission-related stories and providing real impact is at the heart of many nonprofit organizations, and its how they’ve kept the lights on for decades. In fact, people care more about how they feel when they give than how organizations spend their money. The reality is that many for-profits have more resources to elicit the very emotions that nonprofits try to summon…and that “giving” could be going somewhere else.

 

Nonprofits are masters of tugging at heartstrings and making the world a better place. Now – more than ever before – it’s up to all nonprofit organizations to do more than tell. It’s time to show how well we do what we do best. Our increasingly sector-agnostic world has changed the game. Organizations need to decide if they still want to be a valuable player and, if so, update best practices accordingly.

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

 

Photo credit:  © Nikolai Sorokin | Dreamstime.com

Posted on by Colleen Dilenschneider in Financial Solvency, Fundraising, IMPACTS Data, Myth Busting, Sector Evolution, Trends 1 Comment

Three New Pricing Realities For Visitor-Serving Nonprofits in The 21st Century (DATA)

Admission tickets

Want to keep moving your mission moving forward and your doors open? It’s time to end the debate on these pricing-related topics.

As the visitor-serving industry (museums, theaters, symphonies, historic sites, etc.) broadly struggles with declining attendance trends and a potentially unsustainable reliance on kindness and not commerce, “getting your price right” is more important than ever to nonprofits who depend on the gate to support their missions. Too high of a price may serve as a barrier to visitation. Too low of a price risks leaving money on the table and all of the attendant fiscal challenges associated with failing to maximize earned revenues.

Much is happening in the world that changes/challenges the way that traditional visitor-serving nonprofits operate: social media and technology, the need for real-time transparency, and changing demographics in the United States and beyond are just a few, prominent factors influencing our industry. And, these factors are changing everything from internal operations to membership products and the role of fundraising. And, unsurprisingly, the information age requires embracing new realities related to pricing.

Let’s end the debate on these three pricing-related topics and get on with the business of running effective businesses that enable meaningful missions:

 

1) Pricing is NOT an art (Pricing is now a science)

Determining the optimal price of admission is no longer a trial and error process. In fact, it’s anything but a “guess” (however well-educated). Data is playing an increasingly important role in the way that institutions operate for good reason.

A near-decade of research including hundreds of interviews with US visitor-serving nonprofit organizations strongly suggests that many pricing models are the product of “unintentional collusion” (AKA “the blind leading the blind”). This deeply-flawed model fails to contemplate two critical factors when it comes to informing a pricing strategy: (i) the fact that a proximate (or competitive, or peer) organization has established a price does not necessarily mean that it is an optimal price; and (ii) the market tends to view organizations – however “alike” they may be – in very unique terms, and this uniqueness frequently extends to pricing.

Unintentional collusion looks something like this:

IMPACTS unintentional collusion

Thanks to readily available data and analyses, there is no reason to base pricing on anything beyond an organization’s own, unique equities. For every organization, there is a data-based “sweet spot” in which admission prices are optimal.

Let’s consider a quick example of what an optimal pricing strategy looks like when charted (Note: This particular example is from a performance-based entity, but this way of considering pricing applies to any type of admission):

 IMPACTS ticket price analysis example

In the above example, the data-informed analysis suggests that pricing less than $75 for a ticket to the performance (more specifically, to a “premium” seat at a non-matinee, live performance) would be “value advantaged” – a polite euphemism for leaving money on the table! However, anything above $75 pushes the price into the “value disadvantaged” realm – a place where the price poses a needless barrier to entry (and, generally, one where the increased per capita revenues will not offset the decline in attendance). For every category of admission, every organization has an optimal price – one that is neither value advantaged nor value disadvantaged.

Organizations guess their price (without leveraging data to inform their pricing strategy) at their own risk. Getting the price wrong can alienate potential visitors and supporters if it’s too high, and make it difficult to raise prices to an optimal value over time if price starts too low.

Looking for ways to help support a price increase? Well, data suggest that a whiz-bang new exhibit or facility expansion isn’t necessarily coupled to an increased price tolerance. Instead, efforts to improving an organization’s reputation or the overall satisfaction of visitors are much more reliable indicators of increased value for cost perceptions.

 

2) Admission pricing is NOT affordable access (Admission enables affordable access)

A thought that sometimes emerges once an organization’s optimal pricing has been quantified is strangely, “but that’s too expensive to provide affordable access!” Admission is not a substitute for affordable access. Admission and affordable access programs are completely different things…and an organization needs to establish its optimal pricing strategy in order to support effective affordable access programming.

In other words, if you subsidize price in the name of affordable access (i.e. artificially lowering the price to create a value advantaged pricing condition), you are limiting your organization’s ability to fund quality programs that DO provide true affordable access. Making your entire pricing strategy an “affordable access program” leaves money on the table as folks pay an admission price below what they (the market!) indicate they were willing to pay for your experience.

When it comes to the truest definition of affordable access, an admission price point of $15 or $20 or $25 is functionally irrelevant to many of our most under-served audiences…most any price at all may pose an insurmountable barrier to visitation.

What if you aim to provide affordable access for the community? Won’t a high admission price deter folks? The data suggest “no” – at least not the people who were able to pay in the first place – but that doesn’t mean it’s not a good idea to develop true access programming to better engage constituents for whom price is barrier while also considering strategic promotions that celebrate your community. Speaking of which…

 

3) Discounts are NOT promotions (Promotions serve a purpose beyond cheap access)

Promotions celebrate community while discounts devalue your brand. These are very real and very different things. The biggest differentiating factor is the question “So what?” If the point of providing a discount is simply admitting folks for a lower price, then the discount is a bad idea that devalues your brand. (And, as a reminder, data suggests that all discounts provided through social media are bad business for nonprofit organizations.) However, if an organization’s answer to “so what?” is “to celebrate a community” and that purpose is made clear in external communications, then the program that you are describing is a promotion. The feature of a promotion may include a special pricing opportunity – think special pricing for mothers on Mother’s Day, or differentiated pricing for local residents.

Discounts make people say, “I got in cheap.” Promotions make people say, “I feel valued.” Discounts are not only meaningless, but data suggest that they also lead to less satisfying overall experiences and even increase the time before a return visit! While this may be surprising to some folks, it’s classic pricing psychology in action.

IMPACTS intent to revist

 

 

If visitor-serving organizations aim to keep providing inspiration and education to the masses, then the first imperative is to exist – and it’s hard to exist (let alone thrive) in the long-term without a sustainable revenue strategy that optimizes pricing.

Pricing strategies – and even pricing psychologies – are not mysterious so let’s stop guessing. The data is not uncertain.

 

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

Posted on by Colleen Dilenschneider in Financial Solvency, IMPACTS Data, Myth Busting, Sector Evolution 4 Comments

The Critical Role of Reputation in Nonprofit Success (DATA)

KYOB Even clean hands damage surfaces

A brand for a company is like a reputation for a person. You earn reputation by trying to do hard things well. – Jeff Bezos

The reputation of an organization drives its impact and solvency. Or, is it those things that create a good reputation? Reputation is neither the cause of success, nor the outcome. It is both. It’s a chicken-and-egg issue, and that may be why some organizations tend to focus on only one side of the equation.

 

Organizations can – and should – keep tabs on and aim to influence their reputations in order to experience greater success in terms of both solvency and mission-impact. If your organization is like most, you don’t have a single position devoted to managing reputation…and likely think that this responsibility should rest somewhere fuzzy within the marketing department. Today, with an ever-increasing emphasis on transparency and potential supporters wanting to make their own assessments on the worthiness of organizations, an organization’s reputation plays a more important role than ever before.

Managing reputation isn’t an issue of structure, skillset, or tasking – it is an outcome of a successful workplace culture. Here are five reasons why your organization will benefit by integrating discussions concerning reputation management into its culture:

 

1. A good reputation shows why your organization exists (and naturally attracts people who share a passion for your mission)

“People don’t buy what you do, they buy why you do it…The goal is not to do business with everybody who needs what you have. The goal is to do business with people who believe what you believe.” –Simon Sinek

This was said by Simon Sinek during his TEDx talk on how great leaders inspire action that has been viewed over 20 million times. (It’s 18 minutes long, and is one of those inspiring, change-your-thinking videos that makes you want to send it to everyone with whom you’ve ever worked…or even marginally talked shop.)

If your organization is doing its job correctly, then the reason why staff members come to work every morning should be apparent. Your mission messaging should trump marketing as an attraction if you are a visitor-serving organization. In essence, your reputation is a reflection of your organization’s character and culture – and organizations will benefit by making sure that their reputation is strong, consistent, and, thus, without need of “hard selling.”

“If I take care of my character, my reputation will take care of me.”- Dwight L. Moody.

 

2. Reputation drives success (by way of donations, relationships, attendance)

A good reputation means greater odds for the long-term financial sustainability of your organization (provided that you remain true to your values and address “crisis” with expediency, sincerity, and transparency).

For visitor-serving organizations, reputation plays a particularly important role in driving visitation. Data suggest that an organization’s “reputation” is a primary motivator for visitation for high-propensity visitors (i.e. those who demonstrate the demographic, psychographic, and behavioral characteristics that indicate a heightened likelihood to visit a museum, symphony, historic site, or other visitor-serving organization). (Regular KYOB readers are likely rather familiar with the data below!) Because museums are currently suffering lower attendance as an industry, the importance of understanding this relationship is especially urgent.

IMPACTS decision making utility model

A strong and stable reputation based on what you do best plays a logical role in building stronger relationships with other organizations, sponsors, politicos, and supporters.

 

3. Reputation conversation necessitates acknowledgement of the importance of online engagement

What makes up an organization’s reputation? Good question. Regular KYOB readers know that I talk about this…a lot. The answer is a little bit paid media (e.g. advertising) and a lot bit of reviews from trusted sources (particularly word of mouth and earned media – both of which are often facilitated by social media). In fact, reviews from trusted resources are 12.85 times more influential in terms of your organization’s reputation than is the advertising that comes out of a media budget.

IMPACTS -Diffusion of messaging Repuation

 Because real-time, online platforms play such a critical role in both cultivating and maintaining reputation, it is nearly impossible to intelligently discuss reputation without also contemplating (online and offline) engagement strategies. It means that organizations will need to talk about social media as it relates to organizational goals and the behavior of breathing human beings instead of reducing the conversation to “likes” and technological skillsets…and that’s a good, necessary thing.

 

4. Understanding your reputation requires understanding your audience (another best practice increasingly necessary for success)

In order to understand the strength of an organization’s reputation, that organization actually needs to listen to people outside of the organization. No, a person inside of the organization cannot determine current reputation. Create an image and build a culture to create a desired reputation? Sure. But nobody in the organization can talk about the organization’s reputation without first listening to feedback from your audiences. Only your market can lend insight into current perceptions of your organization.

Paying attention to the market is critical and it’s one of the main reasons why marketing has evolved from a service department to a strategy-oriented department.

 

5. Reputation management falls to everybody (because it falls to nobody)

Most organizations do not have a Chief Reputation Officer (aside from, perhaps, an overworked CEO), but there is budding conversation about why some organizations may want to consider it.

Reputation management is fundamentally different than a role that might be found within a marketing and communications department. It involves strategically managing and monitoring relationships with distinct constituent groups – including groups related to development, visitor services, community outreach, and government relations functions.

 

Even if an organization does appoint a committee or a position related to reputation management, we live in a time when not having the whole organization on board with your vision (or your “why” – see point #1) can lead to a fragmented reputation. Today, Benjamin Franklin’s words have never been truer: “It takes many good deeds to build a reputation and only one bad one to lose it.”

In sum, an organization’s reputation is one of its most valuable assets, and, as such, it’s time we start actively talking about it within every department.

 

We would all like a reputation for generosity and we’d all like to buy it cheap.

–Mignon McLaughlin

 

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, Nonprofit Marketing, Sector Evolution, Trends 1 Comment

Most Popular Posts of 2014 for Museums and Nonprofits

KYOB Happy 2015What a year! From the strategic evolution of nonprofit organizations to marketing channel efficacy to the need for millennial board members… These are your (a rather focused tribe of industry leaders) favorite KYOB posts of 2014.

Thank you for reading, engaging with, and passing along Know Your Own Bone among your organizations and circles of industry professionals. I continue to be blown away by your passion for elevating mission-driven organizations – and I am honored to aim to provide market insight for such a thoughtful and hard-working bunch of nonprofiteers! I’m thrilled by the prospect that these posts may be providing value for your friends, colleagues, fellow board members and executives, and even college and graduate students. You folks motivate me to keep provide nonprofits and visitor-serving organizations with intelligence regarding market behaviors and perceptions and I hope that my work being a nonprofit/for-profit double-agent has been of value!

Here are KYOB’s most viewed and passed-along posts of 2014. These are the posts that my analytics suggest you emailed around the most, shared with your friends and colleagues, and got the most attention within graduate programs and professional development curriculums:

 

Why Social Media Is The New Force Empowering Giving Decisions

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.

 

Signs of Trouble for the Museum Industry (DATA)

As the US population grows, the number of people attending visitor-serving organizations is in general decline. And this is a very big problem for sustainability without a digital-age shift in our business model. Here are three behaviors we need to adapt to reset our current condition.

 

Five Things I Have Learned As a Millennial Working with Baby Boomers

Here are my five most valuable lessons that I’ve learned as a millennial “change agent” at work in the land of Baby Boomers.

 

 The New Trickle Down Effect: Why Nonprofits Are Innovators for Industry

Indeed, when it comes to innovation, some of the best R&D happening in our space is being pioneered by nonprofits. Here’s why.

 

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

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.

 

Six Urgent Reasons to Add Millennials to your Nonprofit Board of Directors

Don’t have at least one millennial on your Board of Directors yet? Here are six, critical reasons to call up the nominating committee and work on getting some impressive millennials aboard your nonprofit Board right now.

 

How to Score an Informational Interview: 7 Tips for the Information Age

“Picking someone’s brain” needs an update. Here’s how to actually get an “informational interview” in today’s world.

 

Data Update: Efficacy of Various Marketing Channels (Social Media Still Top Spot)

Social media is an enormously important component of your overall marketing and communication strategy. In fact, data support it as one of the most efficient and effective channels to engage your users and constituents.

 

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

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.

 

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

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

 

Cheers to an incredible 2015 for all of your mission-driven organizations! May this next year bring you and your organizations much success.

Thanks again for following along!

 

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Posted on by Colleen Dilenschneider in Trends Leave a comment