American Association of Museums - 2009 Conference Session Chair: Ted Silberberg, Senior Principal, Market and Financial Planning, Lord Cultural Resources Speakers: Laura Kleinman, Director of Shared Services, University Circle Inc., Cleveland Van Romans, President, Fort Worth Museum of Science and History Ted Silberberg Innovative Ideas and Practices in Revenue Generation and Cost Control Creating CulturalCapital
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American Association of Museums - 2009 Conference Session Chair: Ted Silberberg, Senior Principal, Market and Financial Planning, Lord Cultural Resources.
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American Association of Museums - 2009 Conference Session Chair: Ted Silberberg, Senior Principal, Market and Financial Planning, Lord Cultural ResourcesSpeakers: Laura Kleinman, Director of Shared Services, University Circle Inc., ClevelandVan Romans, President, Fort Worth Museum of Science and History Ted Silberberg
Innovative Ideas and Practices in Revenue Generation and Cost Control
and other visitor-generated revenue• Fewer functions have lowered rentals
income• Endowments tied to investments have lost
value• Diminished corporate and other donations• Governments have imposed grant
reductions • Lower revenues result in layoffs and
reductions of hours, programs and major exhibitions.
Many Museums Have Been Adversely Affected by the Current Economic Downturn
…Particularly Important Today but are Always Essential for Museums
First Case Study: Cleveland Cultural Collaborative
• Laura Kleinman, Director of Shared Services, University Circle Inc.
Revenue Generation and Cost Control Strategies…
Cleveland Cultural Collaborative
An experiment in creating sustainable collaborative initiatives
Presented by Laura Kleinman, Director of Shared
Services University Circle Inc.
Cleveland Cultural Collaborative
History and Background
CCC History and Background• 2004: A formal museum collaboration
– Cleveland Museum of Natural History– Cleveland Botanical Garden– The Western Reserve Historical Society
• 2005: Hire Lord Cultural Resources to investigate possible initiatives and make recommendations in Planning for the Implementation of the Cleveland Cultural Collaborative in early 2006.
CCC History and Background
• 2006: Consortium of 7 local funders provides 2 year grant to hire staff and move forward with Lord’s recommendations.
• University Circle Incorporated (UCI) becomes fiscal agent and home for CCC– Development– Service– Advocacy
CCC History and BackgroundThe “Lord Report”
– 44 Recommendations– 5 Categories:
• Build organizational capacity for improved effectiveness• Maximize savings in purchases and services• Increase earned income and attendance• Increase contributed income• Enhance the visitor experience• Other recommendations
– Phase I and II– Some recommendations required institutional investments
On your mark, get set, go!
On your mark, get set, go!
• Governance
• Meet the players, gain trust, understand their goals and objectives – how can you help meet them?
• Cultural differences, different fiscal years, changes in leadership
• Change is slow……
Accomplishments
Accomplishments
• Increase public awareness• Enhance visitor experience (Increase
• More time on change management• Governance structure with
appropriate roles and responsibilities• Develop a business case
(sustainability)• Importance of scale
Future
• University Circle Inc. is home to former CCC and new department of Shared Services
• Scale up to include all 42 member institutions and businesses
• Form shared services committee with appropriate roles and responsibilities
• Focus on sustainability
Second Case Study: Fort Worth Museum of Science and History
• Van Romans, President, Fort Worth Museum of Science and History
Extreme CollaborationInnovative Ideas in Revenue Generation and Cost Control
Van A. RomansApril 30, 2009
Cattle Raisers Museum
National Cowgirl Museum & Hall of Fame
Fort Worth Aviation Museum
Other Ideas and Examples
• Ted Silberberg, Senior Principal, Market and Financial Planning, Lord Cultural Resources
Creating Cultural Capital
Management Agreements Among Museums
• Does every new or small museum require its own Director or other senior positions?
• 5-10% of senior staff time to manage smaller or new museum in return for payment of percentage of staff costs + management fee= access to experienced staff at much
lower cost than own staff positions= revenue generator for the
managing museum= funders should love it
Museum Mergers
Dallas Museum of Natural HistoryDallas Children’s
MuseumThe Science Place
Dallas Museum of Nature and Science
Time-Shared Ownership/Operation of Museum Building with School District
• Spaceport Sheboygan to include science museum/center
• Sheboygan Area School District wants Magnet School with space science focus
• Share Building:= Magnet School 100% School
District= Science Museum time-shared
based on 22% of time by School District, pays 22% of capital and operating costs
Focus Even More on Resident Markets in a Recession• Fewer Longer Distance Vacations • Substitution of Things to Do Closer to Home
= Incentives for repeat visitation and membership among core audiences:–more rotation of permanent collection
with dynamic themes that “feel like” special exhibitions
– half-price for second visit within 60 days creates exposure to revenue centers
– weekday afternoon strategy– bad weather strategy
A challenge is getting the word out!
= Target non-traditional audiences:–distribution of free admission
tickets to entice lower income/education markets as alternative to free admission periods –communicating with teenagers–museum as community center
Focus Even More on Resident Markets in a Recession
Consider Museum / Non-Museum Collaborations
• “Value Added” Admissions Packaging as Alternative to Museum “Passports”
• Hilton “Manhattan Museum Package” all of 2009 and $20-30 more than regular price– Several Hotels - One Night– American Museum of Natural History –Two
Free Tickets– Skycraper Museum – 2 for 1 Deal– Ripleys Believe it Or Not - $4 Discount–Madame Tussaud’s - $5 Discount– 10% off two restaurants
Find the Right Balance in Admission Charges
• Adding Value Often Better Strategy than Lowering Admission Charges
• Balance to Take Into Account:– nature and quality of visitor experience– length of stay– charges at other museums
• What about Increasing Admission Charges Substantially?– implications to attendance and earned
income– implications to contributed and grant income
Recognize Importance of Contributed Income: Where the Money Comes From
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
Earned
Contributed/Private
Investment/Endowment
Government
Earned 30% 29% 30% 31%
Contributed/Private 19% 32% 35% 35%
Investment/Endowment 12% 11% 10% 10%
Government 39% 28% 25% 24%
1989 1999 2002 2005
What Do Funders Want?
• Focus on mission• Seek to widen access– guest passes from upper level members
provide access to visitors who can’t afford • Avoid unfair competition with the private
sector– prices for space rentals
• Meet wider community needs– admission as full-day pass to eat, shop,
return
BAD News / GOOD News
Bad News:• Worst economic downturn since 1930’s. Good News: • Museums have survived recessions. Some were
built in the Great Depression• Museums to emerge in best shape not those
cutting the most staff and public services • It will be those museums that maintained
existing audiences and grew new ones• And utilize revenue generation and cost control