2012 Wrap-up: Five Tech Trends That Are Making a Difference

Tech TrendsAs this is our final newsletter of 2012, I want to step back and take a look at trends in our industry that I have been paying attention to this year. I find that often we get drawn into the “new shiny thing” syndrome, where a new technology gets a lot of hype but ultimately turns out to be a distraction. How do you know what’s “real” and worth paying attention to? Below, I share five trends I am convinced will stick, and that are worth your time and attention in the coming year.

1. CRM (Customer Relationship Management) Is Entering the Mainstream

Two years ago, in our December 2010 newsletter, I wrote:

“New technology is a proven way forward to building better, more robust relationships with your patrons, and maximizing every moment of every staff member’s precious time. And just as e-mail went from unknown to commonplace in five years, I predict that CRM will quickly become a ‘must-have’ technology for the arts.”

In 2012 we’ve seen this idea take hold. Our research shows that the vast majority of arts managers now understand the benefits of CRM. Our technology system, PatronManager CRM (a CRM and ticketing system that melds all ticketing, fundraising, and marketing in a single system), now has more than 300 organizations signed up, more proof that the arts world is embracing this trend.

2. Big Data Is Coming

Today the corporate world is well into the era of “big data,” as you surely know if you’ve been paying attention to news headlines. The aggregation and analysis of data is helping marketers (and politicians) target consumers in a more sophisticated manner than ever before. The New York Times Magazine explained how this is applied on the web in a November article titled “Who Do Online Advertisers Think You Are?” The CEO of BlueKai, a data aggregator, explains, “Oil was to the industrial revolution as data is to our information economy.” His company has technology that can divide consumers into 30,000 market segments. I do worry that the arts may suffer from a narrow-casting of patron interest as this trend continues, but right now there’s a long way to go, and most arts organizations can certainly improve their response rates by tackling the kind of segmentation you can do from within a CRM system.

We’re also seeing the maturing of several “big data” initiatives in the arts. The Pew-funded Cultural Data Project aggregates historical data across the industry. According to its website, “The CDP provides nonprofit arts and cultural organizations with the tools necessary to streamline financial reporting, quickly and easily track trends in their own performance and benchmark themselves against others.” Also, TRG Arts has developed the Community Database Program, a master database of arts patrons in 18 communities, providing a national snapshot and the ability to analyze arts attendance in a more finely tuned way.

3. The Early-Adopter “Arts Organizations as Broadcasters” Have Shown Up

For years (see here in 2007 and here in 2010) I’ve been saying that as soon as the hardware for television and web browsing becomes the same, any arts organization could become its own broadcaster. I’m not talking about copying the Met and showcasing your events in movie theaters — I’m talking about live-streaming events on the web, offering access to audiences that for whatever reason can’t or won’t make it to a live production.

In the past year, a few arts organizations have done this well. I’ve watched live jazz events streamed by Jazz at Lincoln Center. JALC tells me that it is working to include a streaming clause in more and more artist contracts, and is investing more heavily in streaming technology. Last week the Metropolitan Museum (not opera!) here in NYC streamed a live opera, “The Peony Pavilion.”

There’s no doubt that live-streaming technology will become even simpler to use. Eventually it will be as easy as turning on an app on your iPhone, placing it on a tripod, and clicking “stream.” After all, isn’t that basically what Skype is already?

Think about the ways you could engage your audience and bring them closer to your organization in this manner. It doesn’t have to be the live arts event — there are plenty of opportunities for interviews, backstage tours, pre-concert talk-backs, etc.

4. Social Media Is Becoming Institutionalized

I’ve lamented that for the past few years Facebook has been the “crack cocaine” of marketers. One mention of Facebook and it seemed that all conversation about other kinds of marketing (e-mail, direct mail, all the rest) would get drowned out.

Thankfully, social media marketing is coming back to earth. The initial free-for-all has calmed down as organizations realize that doing successful Facebook marketing is hard to do and quantify. The lure of outsized returns on Facebook propelled that company to an astronomical IPO this year, but its stock price today reflects the reality that marketing on Facebook (and Twitter, for that matter) is just like any other kind of marketing: You need numbers, measurable analysis, and a coherent strategy. That said, as Michelle Paul and I argue in our book Breaking the Fifth Wall: Rethinking Arts Marketing for the 21st Century, social media marketing is an entirely different animal, and the metrics that you look for in direct mail don’t necessarily apply. Building word of mouth and community on Facebook will ultimately lead to ticket sales or donations, but you ought not look for the strict ROI measures as you would with a direct mail or e-mail campaign.

Facebook and Twitter seem to be the institutional social media sites that will stick for a while. Pinterest, Instagram, and Tumblr are making inroads as they focus on largely image-based approaches to social sharing.

5. Dynamic Pricing Is Becoming Accepted

I was recently at a ticketing industry conference in which I heard a VP of the San Francisco Giants explain that they reprice every seat for every game on a case-by-case basis. They have consistently improved their revenue numbers (last year by 7 percent), but it’s still as much art as science. There’s no “black box machine” that does all the work for them. What they do have, however, is a flexible ticketing system that enables them to quickly and easily reprice when they want to.

There’s some pricing experimentation going on in the arts, mostly at the biggest organizations, which in many cases are seeing dramatic improvements. There’s now enough evidence to support the idea, and several firms specialize in helping organizations do this. It’s a trend that’s increasing, and for good reason. I’m an aisle seat lover, and so are many others — so I can’t see why most arts groups set prices based only on distance from the stage. I figure in the next few years they’ll realize that I ought to be paying more for those aisle seats.

Finally, I want to say thank you to all our clients, and to the thousands of you that we’ve reached in our seminars, webinars, and at arts conferences this year. We come to work every day trying to help raise the bar for the industry we all care about, and your passion fuels ours. Thank you for your support and best to you in the new year.

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