Paul Kadzielski

Creating Growth the Smart Way: 3 things an Aquarium can teach Arts Institutions

Posted by Paul Kadzielski, Apr 14, 2015 0 comments


Paul Kadzielski

The Georgia Aquarium had 3.5 million visitors in its inaugural year. This massive launch earned the cultural institution notoriety, donations, and public affection. But, as the novelty of its exhibits dulled, attendance at the state-of-the art facility dropped by 40% in the ensuing years. This steep slide raised flags amongst the staff, who began to ask questions: Why is this happening? Is this normal? What can we do about it?

This is a familiar scenario for the tens of thousands of museums and arts institutions across the country. The National Endowment for the Arts (NEA) reported that only 33% of adults attended at least one traditional art event in the 2011-2012 season, down from 39% in the 2001-2002 season. That’s a worrisome trend given that “there are approximately 850 million visits each year to American museums, more than the attendance for all major league sporting events and theme parks combined.” That means millions of people who used to go to museums are now opting out because they don’t have the time or feel that cultural institutions are a less integral part of their civic and social life. Attendance decline like this ripples through the administrations of institutions big and small, making it difficult to create authentic connections with patrons and raise operating funds, encouraging a dangerous downward spiral.

Treat the Disease, not the Symptoms

The standard solution to falling ticket sales is to add a new exhibit or create a series of unique events. While special exhibitions generally provide a shot in the arm for attendance, they typically have short-term effects and often attract one-time visitors who are difficult to convert into regular supporters. But these sudden spikes of fickle patrons can create an unstable dependency on special engagements for many groups.

Not content to rely on short-term solutions, the aquarium dug deeper. They talked to their peers realized the fundamental flaw in the traditional framing of the problem; people were treating the symptoms, not the disease. “The question is not simply, how do you bring in more customers?” said Carey Rountree, the Senior Vice President of Sales and Marketing for the aquarium, “It’s how do you bring in the right customers, and keep them coming back?

The need to attract and retain loyal supporters is not the sole quest of nonprofits: it’s a vital part of the landscape of business where companies like Nordstrom and Disney use data to fight attrition and fatigue in their customer bases. While companies in all sectors do this kind of work, a clear leader in field is Amazon. They understand that a customer is “more than just a revenue stream; Each has his or her likes and dislikes [and] the more you can identify with a customer as a person, rather than as a chance to make money, the stronger the bond between you will grow.” To make sure customer relationships strengthen at scale, Amazon follows 3 key concepts:

  • You can’t retain who you don’t know: Good data about the details of customer preferences, characteristics, and relationship with the retailer, helps Amazon understand who their existing customers are and how they can best be of service.
  • Happy customers develop a strong love for the company, have greater loyalty, and become brand evangelists: Amazon strives to serve their existing customers in the best way possible so every interaction, from shopping to customer service, is easy and enjoyable.
  • Your new best customers often look like your current best customers: Amazon uses their understanding of existing customers as a starting point to find new ones likely to value their goods and services.

Keen to apply these lessons and tactics to his own predicament, Rountree partnered up with an expert in marketing research and customer engagement at Georgia State University by the name of V. Kumar. After taking stock of the problem together they developed a plan to implement the cutting edge customer retention and engagement practices from the business world for the aquarium. They would use their most precious resource – their own data about current patrons – to inform their outreach and connect with prospective visitors, while simultaneously strengthening the aquarium’s relationship with existing supporters. If the plan worked, it would create a positive upward spiral of increasing attendance and increasing income.

They found untapped communities around the museum where people similar to their most dedicated patrons might live. Once the right prospects were identified, the marketing department sent them personalized messages via a medium that directly connected with their expected preferences to get them in the door. Tackling the second half of the problem, administrators instituted an Entertainment Department to keep visitors entertained while waiting in line. Taken together, both of these tactics were designed to create “the biggest, best and perhaps most powerful marketing tool” the aquarium could have, positive word of mouth in the community.

Cycle of Prosperity 2 copy

Long-term Solutions to Short-term Problems

So what did Rountree, Kumar, and the aquarium get for their unorthodox gamble?

The short answer is $8 million more than their projected profits from the project, or almost 12 times the money they spent. Additionally, they experienced increases in attendance, the likelihood of a return trip, pass renewals, new ticket purchases, purchases at the gift shop as well as the café, and the two holy grails of the industry: visitor satisfaction and new high-value donor identification.

With the right approach towards data focused targeting and relationship building, “even conflicting objectives like growing attendance and satisfaction at the same time can be balanced to turn performance around” says V. Kumar, the analyst hired by the Georgia Aquarium.

While the administrative staff at the aquarium is moving full steam ahead, many nonprofits don’t know about these tactics yet. The effects of this kind of thinking are just beginning in the nonprofit world. “It’s frustrating to see a local museum build a multimillion-dollar exhibit and spend virtually nothing to promote it,” says Rountree, “They can’t understand why nobody comes. The approaches we used are cutting-edge in our business.”

The Georgia Aquarium and You

The Georgia Aquarium is not like every arts organization. Your organization might be bigger or smaller, and have different challenges, but there a lot of parallels that administrators of groups at all sizes can take away and apply to how they approach problem solving in their work.

1) Understand the question before you answer: When Rountree saw declining attendance he could have just said, “our problem is falling attendance numbers,” and stopped there, but he dug deeper and kept asking why. Why did our attendance fall? Why weren’t people coming back? Why were some people coming back and others not? That’s where the real work began.

Usually when a big issue rears its head it has a deeper systemic cause. The right question to ask is one that leads to innovation and inspires a project. If something doesn’t feel right, or the traditional explanation doesn’t quite do it, don’t be afraid to take a step back and keep asking why.

2) Think big and work small: The aquarium could only blow their goal out of the water because they focused on good individual data first and then used it to make a big play. Lots of people get excited about big data but most big data projects fail because administrators don’t “do a good job with the information they already have” and listen to what their data has to say.

3) Play chess, not checkers: When it comes to implementing a solution the administrators in this story did two rare things: they opted for a long-term solution and focused on getting the most out of their existing assets.

Aquarium administrators were always several steps ahead of their patrons needs. When they did their targeting they sent specifically tailored messages to different groups and, anticipating the increase in attendance, launched the Entertainment Department to keep satisfaction high in spite of longer lines. They were also careful with their cash by using existing dollars from other parts of the budget for most of their costs.

Arts administrators have a tough job and an essential one. They sit between multiple competing forces of board members, the public, and artists. And whether you’re a small gallery or the Smithsonian, there are a hundred uphill battles to be fought every year. But by asking the right questions, demanding the best answers, and using organizational assets like data to their advantage, administrators can creatively get to the root of, and address, some of the most persistent problems facing arts organizations today.

Interested in joining the conversation? Meet us in Chicago for the Arts Leadership Precon!

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