Monthly Archives: April 2009

Good news for arts marketers!

The USPS is in major deficit mode, but for once, rather than passing along its issues in rate increases, it is actually DISCOUNTING in ways that may really help nonprofits who do mass mailings over the summer months. You must apply by June 11, 2009, and there is some nuts and bolts work involved, but you can reap significant savings and, at the same time, reach more prospects. The cost savings comes in the form of a per piece price credit to postage paid based on the incremental volume mailed over the baseline.

The savings are based on using Standard Mail Saturation Mail. Saturation mail is defined as reaching 90% of the households in a specific carrier route. Now, many of you know that I advocate for very highly targeted prospecting – only reaching the very best households that match your desired households. So, you will want to use saturation mailing only on those carrier routes you or your market analyst/list preparers know will be productive. But if you can demonstrate to the USPS that you will increase over your baseline, the credit per piece mailed can be $.022. Think of it as stretching your budget to allow you to mail more, and right now that is good news when we know mailings have to be larger to yield the needed ticket sale results.

Talk to your USPS district manager. Requests have to come directly from your organizations, not from mail houses or agents. You’ll need some time to do the math, so don’t put this off to the last minute. You, your budget, and those added households you can now afford to reach will all be glad.

Arts Marketing for Success 2009. Part 1.

There are three things that can happen to an arts organization (or any nonprofit) during a recession.
1) You can close your doors and basically go dormant. 2) You can scrape by, maybe in worse shape, but making it. 3) Or you can thrive.

Sounds crazy, doesn’t it – THRIVE. Yet it is happening. People are lined up in the rain outside the Chicago Arts Institute for the Edvard Munch show. Movies are selling out hours before show time. Symphony concerts, popular artists, lecture series – shows in venues coast to coast are selling all tickets. People are responding to arts and culture.

How can you ensure this kind of good news? Follow these rules and tips as a start, and come back next week for more in the tool kit.

ArtsMarket’s Rules to Live By

1. Plan to thrive. That’s right. Plan for success. Even now.
2. Budget to thrive. Invest resources where you can see results.
3. Program to thrive. Do what will stand out, be noticed, and program what will “demand” an audience.
4. Market to thrive. Create a compelling story. Share it. Prospect. Link.
5. Brand to thrive and image to thrive.
6. Govern and lead to thrive. This is exactly not the time for fear. Careful stewardship, for sure. But thinking for long term success now will let you open the box of your thinking (see my logo, above), explore new opportunities, edit back that which will go nowhere, and focus on the goal.

Over the next few weeks, I will be translating these into tools for the month. We’ll start with marketing, because April is the start of prospecting season for most performing arts organizations. It is when major budget allocation decisions are being made for next year’s marketing budget. Next month, we’ll focus on governing and leading to thrive, so you can move forward with those plans in May in June.

Using the ArtsMarket Rules to Live By in Your Next Season Marketing.

Your marketing effort for next year isn’t going to work if it is only about survival. You have a brilliant chance, right now, to emerge from the shadows and be the answer to consumer needs and wants for great art, great entertainment, great food for the soul. THINK AT 40,000 Feet. Plan for increased participation, and increased revenue. I challenge you to NOT set low expectations.

When you plan and budget to thrive, there are 10 things not to do in the current economy. Address each of these, and you will succeed.

1. DO NOT cut direct marketing. There is so much less clutter out there right now that every piece of mail is noticed, and if written write, provokes a response.

2.DO NOT stop prospecting. Everything is about prospecting. Remember that the #1 rule of business is to get a new customer who WILL COME BACK. So first you get them in the door, then you provide a great experience, and they return. You must prospect. People who don’t keep your organization top of mind are probably – like all of us – a little too numb to pay attention to what play is on stage where next Saturday night. Remember, your house list faces bigger churn in a recession so you constantly need to find newcomers.

3. DO NOT stop PR. There are more PR opportunities out there now than ever, more keyed to age groups than ever. For your networking savvy folks, you have the cocktail party atmosphere of Twitter where you can drop a hint, ask a provoking question, start a dialogue. You’ve got the Starbucksian atmosphere of Facebook, and the ever so professional conference of Linked In groups. You can Flicker, YouTube (and I challenge anyone to take on Carnegie Hall to an even higher level of community building), and so much more. At the snail level, there is a plethora of new micro newspapers emerging with the demise and cuts of metro dailies – ever so accessible. The web sites of existing media, the newsletters and the links….we’ve never seen such ability to use so many PR channels. And let’s not forget the real essence of PR – doing good for the community. Any time you can get out there to help others, right now, you WILL be seen. A number of you have read my blog and Twitter notes on the organization that has been giving tickets to the local food bank so that families can attend performances. The tickets are on the shelf next to the canned soup, and anyone can take them. No one in the audience knows who used those particular tickets.

4.DO NOT sell extravagance. This isn’t the time to market to the luxury-for-me crowd. But it is time to market wonderful experiences that create lasting memories you can enjoy and replay in your mind for months to come.

5. DO NOT cut your back office investment in database excellence. If the fire alarm goes off what is the most important investment you must save that probably isn’t covered by insurance. You got it: your database. And it isn’t just the data, it is how the data is organized and how much it allows you to customize the offers you make. Well structured data lets you personalize your prospecting.

6. DO NOT think that e-marketing, alone, will save you. It will save you a lot, but every arts audience out there has a sizable proportion of older individuals who will not follow you via email and an equal portion of all ages that has opted out of the e-marketing grid for financial or philosophical reasons. They want to see if you care enough about them to get your info to them. Do you?

7.Do not disappear between events. This is particularly important for organizations that have only a few major events a year but are there all year. I know many museums in this boat – especially as special exhibitions have decreased. Find ways to be visible every week, and to create curiosity so that people have to follow what you are doing and thinking. It might be your blog. Or it might be that you start offering salsa classes in the galleries on Friday evenings.

8. DO NOT stop leading. Your organization signals hope, confidence, and meaning to your community. Be out there living the message. Help other organizations. Facilitate civic plans. Be visible, and be confident.

9. DO NOT cut advertising. Okay, you very well might cut advertising dollars, but you’ll do better if you rearrange your advertising dollars. To all of you who have cut back your major entertainment page spending: with so many fewer competing ads, yours will be more visible. To those of you who have wondered where to advertise: you have terrific options now between on-line news media (banner ads), civic calendar/ticketing sites, local cable (incredible deals), and even traditional media. It is turning into a buyer’s market, so take advantage of your opportunities.

10. DO NOT stop saying thank you. In fact, thank your audience and attendees more than you ever have in the past.

I want to come back to point 4, and really every other point about image, atmosphere, communications… I read a recent analysis of Allstate Insurance’s most recent round of TV ads. They are a brand and image marketing giant –i.e. “Like a Good Neighbor We’ll Be There”, “You’re in Good Hands,” etc… Do you remember this winter’s NFL ads, using the Frank Sinatra/Nancy Sinatra “Feeling Kind of Sunday..” tune? It would be hard to find something that did a better job, this difficult year, of creating a happy kind of glow…that tune and sensibility sticking with you until you felt hey, it was Sunday, and time to kick back….so you might as well be there with Allstate…

I challenge you to come up with your own “Feeling Kind of Sunday” imaging for upcoming season. Feeling kind of museum…feeling kind of theatre… Send your ideas and you may see them on the next tips and tools!

And, last but not least, I want to come back to prospecting. What you don’t want to do now is waste money. But you do want to get a call for action/great offer out there to people who will respond. We regularly put together prospect mailing lists like this to target people who wouldn’t be likely to know about a performing arts series through the web. It can be a real challenge, but we see how incredibly well it works. When your returns zoom up there, this is the kind of prospecting to use. For example:

These criteria for everyone on the prospect list (Sample criteria for a given geographic area)

Over 60 (figuring this is still the age group less likely to contain high level web searchers)
Self identified interest in performing arts
Self identified interest in gourmet food
Self identified interest in reading books
Take music/arts classes
Responsive to mail offers

It works.

Best strategy to bank on for the arts in 2009?

The Foundation’s Center’s wrap up on 2008 giving (“Foundation Growth and Giving Estimates”) is just out. It turns out that 2008 wasn’t quite as bad as it could have been. Foundation giving as a whole dropped by only 1.3%. Community Foundation giving was up by 6.7% over 2007. Given all the economic hell that went on last year, the results could almost be considered comforting, especially when placed in the context of the giant increase in foundation giving that happened in 2007. (There was a 17.3% jump in charitable giving in 2007 over 2006, so 2008 represents a 16% increase over 2006.)

This good news won’t hold true for 2009, however. The same report notes that foundation giving will be down anywhere from the high single digits to the low double digets this year. 75% of community foundations will be cutting their giving, and corporate foundations, especially those in the financial sector, will be cutting drastically.

How should the arts respond as you are setting your budgets for the next fiscal year? I think that the arts will see some good news despite the status of foundation and corporate giving. My projection is on increased earned income, based on consumer pent up need translating into increased attendance. And, I think we’ll see some modest gains in time for the arts’ fall season. I’m basing this on last week’s report by Forbes’ economist Noriel Roubini, pojecting that the first quarter 2009 economic contraction of -6% will ease by the 4th quarter, up to about -2%. (By 2010 he projects we’ll be back into positive numbers. This means that the capacity for giving may rebound.) But more fundamentally, consumer spending will be up by fall. Project 4% growth over what you are seeing right now.

So my vote for the fall? Modest increases in earned income. Offer a great season, and market to that pent up consumer need.

A new way of looking at market segments

Grab a copy of this month’s Harvard Business Review. The lead article, How to Market in a Downturn
by John A. Quelch and Katherine E. Jocz, both at Harvard Business School, takes a look at consumer behavior in downturns since the 1970s. And as they point out, consumers never totally stop buying. They become more careful, more selective. But they still consume. They still come to the arts, but they consider their choices carefully.

And, in a recession, market segmentation takes on a whole new meaning. Quelch and Jocz have taken all the demographic and lifestyle clusters that exist out there and condensed them down into four segments:

The Slam on the Breaks segment. This group includes the hard hit, the unemployed – everyone whose world is upside down.
The Pained by Patient segment. The authors call this the largest consumer group in the US right now. Economizing, cutting back, but still doing and going. Carefully investing in whatever they purchase. Probably really looking for bargains.
The Comfortably Well Off cohort. Sure, this includes the upper 5%. But more importantly for the arts, this includes the carefully invested retirees who continue to have the resources to go to the arts.
The Live for Today group. Hey, they never had any savings anyway, so why change?

The authors point out that all four groups spend. Each spends on essentials that “are necessary for survival or perceived as central to well being.” For many, arts, cultural activity, and a way of weaving joy into life is central to well being. That’s a powerful offering that the arts have always had, and it is the message that people will best respond to right now. Anything that is an ‘indulgence’ is probably not going to be purchased right now. Anything that is the same old-same old can be put off for another season. Anything that is unjustifyable – an over the top ticket price, for example – may be looked at as expendable.

The authors point out that all four segments will be responsive to strong brands and good loyalty marketing, so that marketing can be extremely important right now. As they note, companies with excellent brands, like Johnson & Johnson, maintain high stock values through recessions based on continued brand-responsive consumer purchases. So, if arts-lovers can only spend on one event, or on one organization – make sure its yours they trust to offer them outstanding art experience.

Be sure your organization has the resources to market your best strengths. The authors recommend dropping programs/products that just can’t make it no matter what in favor of putting more resources into your core that will attract the most loyalty and new attenders. Focus on strength.

I also think there is great power in responding to the absolute need of the Slam on the Breaks folks. Put any resources you can into opening doors for those who can’t afford art any more. Last week, I was in Canada working with a group that noted the power of offering blocks of tickets at the local food bank. No one needs to know who gets the tickets there, or how large a share of the audience comes through that door.

Take the big picture view…

What’s the number one issue you need to overcome? Retreating due to fear.

The best nonprofits are those that take the long view. That see the world – their art, culture, audience, funders, and future – at the 40,000 foot level. They see where they want to go, and they know that if they keep focused, they will reach their destination. It might mean a little slowing in the pace, but it doesn’t mean giving up.

Andiences and funders will come back, and in fact are coming back already. For audiences, demand is on the increase after months of negativity. For funders, donors, and folks whose discretionary income rises and falls with their portfolio – last month was the best stock market month since August. It still will be hard, but there are some spring flowers blooming out there.

What should you be doing? This is the season for renewals – in memberships, audience subscriptions, and looking ahead to a new year. Do not pull back on your renewal and new efforts. Plenty of people who dropped off your database last fall are ready to – need to – reconnect to art.