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Author Archive | Joe Patti

Info You Can Use: Success May Result In Reduced Donations (Big MAY)

I was surprised by a recent piece on Non-Profit Quarterly reporting the results of a recent study finding that the more successful an arts organization was in attracting an audience, the more donations will decline.  The theory the researchers had was that success made an arts organization look less needy.

I was skeptical of this based on what I have observed, so I did a little digging to find the full article which appeared behind a paywall in Public Performance and Management Review. The details of their finding are a little more nuanced.

Even though the researchers make the statement in their conclusion that,

“The evidence suggests that better performance outcomes in terms of increased awareness and attendance have a negative rather than a positive influence on charitable giving.”

The discussion of their findings seems to suggest this is only true in regard to foundations.

For a 10% geometric mean increase in an organization’s attendance, the amount of all contributions received in the following year decreases by 0.72%

If we separate private giving into its three components (individual, corporate, and foundation giving), this negative relationship is statistically significant for foundation grants only. The amount of all charitable giving decreases by 0.08%

They don’t really make any statements about how individuals and corporations handle their giving in response to increased attendance and awareness.

Other Items of Interest:

Some other interesting things they found was that:

“It is worth noting that the amount of donations appears to be unresponsive to both government funding and program revenue.”

Basically, donation amounts don’t seems to be impacted by the amount of government funding or program revenue an organization receives in a year.

•Giving away free tickets may slightly help donations

“The result for increased free access lends some support to the first hypothesis: a 10% increase in the number of free tickets provided by arts and cultural nonprofits results in a 0.34% increase in contributions. This positive relationship is, however, only marginally significant.”

•Younger organizations tend to receive greater support than older organizations.

Donors, however, appear to prefer relatively young organizations, at least in the case of arts and cultural nonprofits. When we divide private giving into its three components, organization age has a negative relationship with institutional giving but is not a significant factor for individual donors.

Big Surprise

Despite what we read about donors really scrutinizing administrative overhead, for arts and cultural non-profit organizations at least, high overhead is not penalized.

…donors to arts and cultural nonprofits do not care about fundraising efficiency, which is measured by the average cost to raise one dollar. As the cost to raise a dollar increases, donations increase rather than decrease. On average, a 10% decrease in fundraising efficiency (i.e., an increase in the fundraising cost to raise a dollar of donation) leads to a 0.72% increase in the total amount of contributions. In other words, an organization would solicit slightly more donations, as compared to other organizations of similar type and size that spend less per dollar raised.

[…]

This finding is counterintuitive and provides no support for the prevailing assumption that donors view high costs of raising funds negatively. The results show that donors to arts and cultural nonprofits, especially foundation funders, reward rather than punish nonprofits that spend more to raise a dollar of donation.

The idea that the appearance of success is what helps you raise money is what provided the impetus for my deeper investigation. I think we all have a feeling that a few big organizations seem to attract big donations. Because the researchers are only looking at data collected via the Cultural Data Project, the social cachet of being seen to donate to a popular organization isn’t factored into the results. The authors do acknowledge that popularity and visibility do seem to be factors.

They suggest that big organizations are attracting larger donations because they are pouring more money into their fundraising budgets and aren’t being penalized for incurring the overhead expense.

I was interested by their observation that organizational size didn’t seem to impact corporate giving. I would assume visibility in the community, and therefore the ability to make a business more visible, is a factor in corporate giving more than organizational size.

Caveats

The researchers admit that since very little research has been done on these specific questions before, more study is required to gain an accurate picture. They say the statistical significance of the relationship between increased success and reduction in donations is marginal.

They also note that they use attendance as their measure of success which may be a poor criteria since it has no bearing on the effectiveness or quality of the experience for an audience member.

Likewise they note that using website visits as a measure of awareness might not be valid for many organizations whose communities may depend on print media, mailings and word of mouth to raise their awareness.

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What Oskar Said

The keynote speaker for the recent Arts Midwest conference was Oskar Eustis who is current artistic director at the Public Theater.  Tweets in reaction to his speech have been Storified if you want some insight.

A lot of what he spoke about centered on the value of government support of the arts and the value of non-profit arts organizations, especially in his career.  One of his first jobs in the arts was supported by a CETA grant. National Endowment for the Arts money supported the development of Angels in America which he commissioned and directed.  Lin Manuel Miranda’s invitation to perform at the White House saw him perform a song that eventually became the opening number for Hamilton which Eustis developed at the Public Theater.

He also mentioned how he was sitting with Julie Taymor at a session of Aspen Ideas Festival when Michael Eisner stood up and said he thought too much importance was placed on the value of non-profit theater, citing how he had bolstered Taymor’s career when he choose her to direct The Lion King. Eustis said before he had a chance to throw down with Eisner, Taymor pointed out she only developed the skills to direct a show of the caliber The Lion King thanks to the experience she had in non-profit theater.

Like me, a lot of these topics are close to Eustis’ heart. He spoke of how worried he was that as a country we have equated having a market economy with having a market society. That is, that we judge the value of what we do based on how financially successful it is.

If you have been reading my recent posts about economic value of the art and culture vs. intrinsic value, you know this permeates societal thinking beyond just the idea that arts organizations need to be run like businesses and support themselves.

Eustis said that he had been pushing for the Public Theater to present more of its work for free as they do with Shakespeare in Central Park, but his board was reticent because they didn’t feel that people would value something they got for free. Eustis acknowledged that might be the case with some things, but given that people were camping out overnight just to get a spot on line to see Shakespeare, he was pretty sure the Public Theater’s work would be sufficiently valued. In the upcoming year, the Public Theater will mount their first free production at one of their regular spaces.

He also mentioned despite doing so many free productions in Central Park, they discovered only their prison program and the shows they trucked out to the five boroughs of NYC were the only programs that were serving a mix of people that reflected the demographics of NYC.

During the Q&A after his address, Mario Garcia Durham, President and CEO of Association of Performing Arts Presenters rose and expressed his dismay that the Kennedy Center was essentially telling people that they would need to buy subscriptions to two seasons if they wanted to get tickets to see Hamilton when it came to Washington D.C.

Durham was concerned that this would place the show out of reach of the demographics with which Miranda most wanted the show to resonate and plead with Eustis to ask Miranda to arrange auxiliary programming to accompany the show that the general population would be able to access.

Eustis replied that while he really didn’t have any control over the decisions made by organizations that presented the show, he did have a right to sit at the table and provide guidance when policies were being shaped. He said if he had his way, when it came time to make the show available for amateur performance, it would only be licensed to only high schools in perpetuity and would never be available for production by theatrical organizations.

I am embarrassed to admit there were some other noteworthy things Eustis said that I can’t recall. They were so noteworthy I tracked down  Arts Midwest President David Freher to discuss them. I figured I needn’t make note about them since they were so vivid in my mind.

If anyone else was at the keynote and was impressed by anything else they heard, please share because it may jog my memory.

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Let None Of Them Be Missed

I have returned from the Arts Midwest Conference in Milwaukee which apparently broke attendance records. I can believe it did because I have never had so much difficulty finding a free moment to speak to agents with whom I didn’t have an appointment.

I will have quite a bit to report over the course of the next few weeks after I have had time to reflect.

One thing I wanted to follow up on from last year’s conference is something of a “credit where credit is due” topic.

About a week after last year’s Arts Midwest conference there was a huge outcry over the NY Gilbert and Sullivan Players (NYGASP) planned production of The Mikado which was employing yellow face and other Asian stereotypes in the production design.

I thought I had written about this in my blog, but it turns out I only made a comment on HowlRound regarding the issue. As I note in my comment there, they were pretty quick about cancelling the production but social media response made the two-three days in real time seem like the issue had lingered for a month.

Before going to the conference this year, I had gotten a brochure which made it appear that they had revamped the production and were offering it again for touring this year. I made a point to seek out NYGASP Executive Director David Wannen at the Arts Midwest conference to ask what had transpired.

Wannen told me they had indeed made changes to the production. Part of that included bringing a large number of advisors on board to help guide them in the production design planning as well as the casting decisions.

He noted that one of their loudest blogging critics was encouraging her followers to audition and support the productions. (Auditions are for the company performing in the entire season so persons of color are being considered for all their shows.)

From the way Wannen described the show, there will be Japanese inspired/influenced elements combined with 19th century England, but nothing overtly stereotypical. I saw one picture of the Mikado wearing a dragon like helm that could have as easily come from Lord of the Rings or Game of Thrones as a fantasy movie set in China or Japan. (It evoked Smaug from The Hobbit more than a Chinese/Japanese dragon for me)

Wannen said the decision to cancel the production last year was made quickly because there was already a conversation among board and staff that the traditional approach to the show wasn’t going to fly for much longer given the social environment. However, there were many on the NYGASP board who insisted on adhering to the traditional production.

The controversy that emerged last year confirmed for the organization that a change was needed. According to Wannen there was something of a shake up in the board. From what I understood in our discussion, there were some resignations.

By some fortuitous happenstance, I was able to gain some additional insight about the sort of continuous effort required for crisis management.  NYGASP appears to have made a lot of constructive decisions, obtained the investment and buy-in of important and influential constituencies and generated some excellent goodwill for themselves.  We may hear/read a news story about redemption like this and assume all is well and the problems have been fixed.

I was seated next to Wannen on the first leg of my flight home. While we sat at the gate waiting to depart, he was on the phone relating the same things to someone that he had talked with me about — mentioning all the steps that were taken and the goodwill they had garnered in the process.

The lesson I took away from this is that no matter how good the situation may appear externally,  there is always more work to be done after a crisis to regain trust and address negative perceptions.

After I had spoken to Wannen, I walked away feeling optimistic about NYGASP and impressed by the difficult choices they had embraced, including admitting there had been a problem. After sitting next to Wannen on the plane, I realized he recognized despite all the positive response they had received thus far, it was too early to declare any sort of victory right yet.

Even though it may be tempting to put bad experienced behind us as soon as possible, it important for organizational leadership to discern when it is too early to do so.

 

The title of this entry is a paraphrase from The Mikado‘s famous “list” song, “As Someday It May Happen.” Traditionally updated with current events, it is evidence that the show survives all sorts of adaptation.

 

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Mario Cavaradossi Could Have Been A Great Rugby Player

One of the first blog posts I made included speculation about what the arts experience might be like if the arts were covered in the newspaper like sports.

A little over eight years ago I made a post about an experiment The Guardian newspaper conducted along those lines.  They sent their sports writers to arts events and their arts writers to sporting events and asked them to write about the experience.

The links to both articles still work so check them out.

I initially sighed at what seemed to be universal sentiments expressed by people who don’t see themselves as arts attendees: “I go by here every day and never realized how amazing it was inside” and “I had no idea arts lovers were so passionate in expressing their appreciation.”

However, all the writers seemed to sincerely enjoy their experience working in the realm of their opposite numbers. Even if they never chose to return, it seemed like they would speak positively about it if the opportunity ever presented itself.

The title of this post comes from a comment made by a sports writer who saw parallels between being a tenor performing in Tosca and being a top notch rugby player.

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