Why 2009 Will Be Good for the Arts, Despite the Economy

As 2008 draws to a close, I want to take the opportunity to reflect on some important trends in our field, as concerns technology and e-marketing for the arts. My theme this year is naturally colored by the extremely challenging economic climate that is facing all of us, and most especially non-profit organizations.

Ultimately, my message is a positive one. What is certain is that no matter how our economy stumbles, new technology coming to the market in the next few years will continue to transform old business models and create entirely new ways of operating. And as this happens, the way you manage and market the arts will continue to change. New technology will be a huge positive for our field because the Web has become a platform for highly sophisticated tools at fees that non-profits can handle easily.

It seems to me the best way to keep your organization stable in this environment is to either raise more money or to be more efficient with the money that you have. We touched on the former in our Patron Technology newsletter E-marketing E-ssentials earlier this month; now it’s the second part of this equation that I am urging you to pay attention to. New technology can be central to this efficiency.

Big Software Changes: Better and Cheaper

First, let's talk about what’s ahead for software. Actually, I should step back and start by first explaining that it’s likely that soon there will be no such thing as “software,” as in software that is installed on your desktop computer or a server in the basement of your organization. More and more, technology is moving into a “hosted” environment where programs are available online, provided to you by a company that has embraced a SaaS ("software as a service") model.

Here at Patron Technology we’ve been in that business for over seven years with our PatronMail system. What we are seeing every day now is that many of the software powerhouses of the past (particularly Microsoft) are slowly becoming irrelevant, as Google and others not only replicate their products and deliver them on a SaaS basis, but do so at amazingly low prices or for free. This trend will impact the non-profit world in a very positive way. In the last two decades, for most non-profits, acquiring new software has most often meant signing long-term contracts for relatively expensive ticketing systems or fundraising software that ran on a server. But once software is delivered online, vendors can offer much more sophisticated systems at much lower prices.

What this means for you is that not only will functionality be dramatically improved, prices for this technology will plummet relative to what you are used to. If you’re thinking about buying new systems for your organization, focus on the type of system that you are being sold. If it's a traditional "client/server" system, you'll be asked to pay a hefty one-time license fee, a set-up fee, and an ongoing "support and upgrade" fee each year. If you're talking with a SaaS company, typically there won't be a balloon payment up front, but rather a flat fee per year, with options for support levels and additional modules. From a pricing perspective, the latter should be vastly less costly.

Replace Newspaper Arts Coverage with Your Own Message

Second, I see the landscape of marketing changing, potentially dramatically, because of the demise of the traditional newspaper. We all know that newspapers are facing a huge challenges. Their business models are being turned upside down by the Web and their very existence is in question. In the last month we've seen some ominous signs: The Tribune Company has filed for bankruptcy, and The New York Times has borrowed against the value of its own building to counter a recession-driven dip in advertising revenues. Just this past week, a Detroit paper announced that it would cut back on delivering the physical paper to those who have subscribed to it. And last week The New York Times carried a lead story on how few newspapers have Washington, D.C. bureaus anymore.

If papers are cutting their Washington operations, you know that the arts are next. I see the very real possibility that in the next several years, there may not be a local arts section at all, as print newspapers that survive will be only a shadow of their former selves. We have already witnessed the near-complete gutting of the arts-reviewing staff at the Times; that kind of thing is happening all over the country.

In a world in which there is less arts coverage, cultural organizations will face a vastly different marketing landscape. Of course there will be bloggers and online newspapers that will reach some portion of the arts audience, but not in the same way as before. And when this marketing channel dissipates, cultural organizations are going to be faced with a very new challenge in terms of reaching their audiences.

I've been saying for years that the solution to this dilemma is not to replace newspapers with another newspaper, or to double up on posters on the street. Rather, the right approach is to focus like crazy on developing a direct relationship with your audience members so that you are no longer relying on a third party to promote what you are doing. You’ll still do direct marketing. But you’ll do it in a smarter way, with more effective list segmentation powered by new technology. And you’ll want to share research and statistical data with other organizations, because sharing will mean better targeting and more effective marketing results.

So I urge you to build that relationship with your audience by continuing to develop your e-mail list so you won’t need that third party to get the word out. We witnessed a perfect example of this recently, as Barack Obama’s campaign developed a multi-million-name opt-in e-mail list. The campaign managers knew very well that their e-mail list would be as powerful a marketing weapon as any newspaper or TV ad. While I don’t think that 2009 will be the year that newspapers go away, the story is not getting any better for print journalism for the arts, and that has big implications for what you do in the coming year. I urge you to continue to cement your online relationship with your patrons before the “lifeline” of old media goes away.

The Arts Will Go Live Online

Finally, 2009 will be the year that live online arts broadcasting gets real. If you want to get a glimpse of this future, check out what the Berlin Philharmonic is doing. You can buy tickets to watch a live concert from Berlin. They’ve taken the concept of “Live from Lincoln Center” and cut out the middleman. It’s direct marketing in an entirely new way. This past week the 92nd Street Y did a live webcast of a lecture, and yesterday I watched a live concert from the Cite de la Musique in Paris. The era of live arts and culture, direct from the organization to your computer, is about to unfold. PBS won’t go away, but if you’re following the logic above, I’m sure you’ll realize that many organizations will soon become their own broadcasters. When your patrons have technology that connects the television on their wall seamlessly to the Internet at high-quality speeds and with hi-fidelity sound, a new marketing channel will have emerged.

We’re in a moment of revolutionary change in so many ways, and 2009 promises to bring more and more fundamental changes to the way you communicate with your audiences and run your organizations. So as you consider your ever-tightening budgets for this next year, improving your technology to run your organization more efficiently, developing deeper digital relationships with your patrons, and engaging a new audience online all seem to be good recipes for our challenging times.

Comments

[Dennis Baker]

I am curious how theater marketing departments will use social media to their advantage. I believe that '09 will see a surge in the social media/internet marketing front and those theater companies who thing a blog and Facebook account is enough will be left behind.