Friday, October 11, 2013

Trends Underlying A Not So Quiet Desperation

Once again I’ll miss the Travis Tritt performance when the country singer returns to Durham, North Carolina’s historic Carolina Theater next February.

In part, this blog post will try to shed light on a number of conditions responsible for concert attendance being down - or at best flat - in the United States for many years including several high profile closings in the news recently.  In fact, I may be part of this problem.

Hint – the conditions impacting the live performing arts have nothing to do with lack of awareness, nor are these conditions something marketing can resolve.

As I joked with a long time theater executive last week, after four decades in community marketing and cultural and economic development, I don’t miss it for a second.  Empathetically, he noted he will probably never enter another theater when he retires.

The motivation for researching and writing essays from time to time, such as this one (more like a chapter,) are inspired by a feeling of obligation to give back to young people just starting out in my former field, as was so often done for me early in my career.

In this instance, my reason for missing Mr. Tritt’s performance is that it occurs just a few days from when I have made prior plans to attend a performance a few blocks away of The Book of Mormon, thanks to a friend’s season tickets at the Durham Performing Arts Center.

While my involvement lapsed many decades ago, Mormon is my ancestral religious heritage going back eight generations.  Ever since the now-acclaimed musical debuted on Broadway more than two years ago, my niece, a returned missionary, has been singing its hilarious songs.

As I recall, Mormons are known for their sense of humor and poking fun at their culture, but no culture is eager to be in the cross hairs of the geniuses who created South Park.

However, if memory serves me,  Mormons are also resilient and good at turning what may seem a disadvantage into an advantage.

Very telling is that news reports note that the Christian faith (Mormon is a nickname) has even run notices in the performance Playbill distributed to attendees at the door and some attendees have even been inspired to convert. 

However eclectic my personal musical tastes are, they lie far more toward country than Broadway musicals.  But I also spent a now-concluded four-decade career in community destination marketing, in part trying to weave arts and culture of all genres into overall community brand appeal.

This included helping performance venues harvest the 4.5% of visitors who will attend concerts on a trip including just less than a percent for which the performances are even the main reason for the trip.

For those who turn up their nose because the proportion seems small, it is the same as the percentage who participate in festivals or attend sports events or visit historic sites or museums (caution – often enthusiasts inflate this potential by showing it as a percentage of some types of visitation rather than overall visitation.)

Among daytrip visitors to integrated destinations such as Durham, which has long been noted for weaving the arts into its overall destination appeal, the proportion of visitors attending concerts can nearly triple, with 1-in-4 taking in a concert while on trips made for other purposes.

Visitors now make up 70% of attendees at Durham’s seven largest performing arts venues or nearly 420,000 admissions annually, including one venue regularly ranked second or third highest in attendance nationwide and in the top 10 worldwide among venues of its type on quarterly metrics.

Studies of cultural vitality show that Durham’s ability to draw attendance from outside its borders outstrips its comp set and is also 72% greater than the national average, evidence that awareness is no longer an issue.

Overall, if you include performances in venues such as places of worship and schools, close to a third of Americans attend a concert during a given year. But less than 5% attend any one particular musical genre such as country in a given year.  Rock is an outlier, drawing 11%.

Collectively, touring Broadway productions such as The Book of Mormon have 13 million admissions annually, down about 20% from 2010 and 30% from a peak in 1996.

An average of between 30 and 40% attend repeatedly as season ticket holders according to the Broadway League, so by my calculation, between 3 and 3.5% of American adults attend touring musicals and plays.

The problem with averages is that each type of performing art draws from a different demographic.  For instance, particularly in the South, touring Broadway skews much older, much more female, much higher income and overwhelmingly Caucasian, compared to the general population. 

But for me, there is more for me to the significance of Tritt’s visit to Durham.

In 1989, just as I was being recruited to Durham, where I still live, Travis Tritt was one of a handful dubbed as “hat acts” to hit the charts because they often wore hats and they once again steered country music back to its more traditional sound.

Others included Vince Gill, Alan Jackson, Clint Black and of course, Garth Brooks.

These artists stepped into the boots of performers like George Strait and Keith Whitely, who died suddenly that year just as Tim McGraw, another “hatter” arrived in Nashville.  In a few years he was also on the charts, along with two other “hatters” Toby Keith and Kenny Chesney.

But as much as I still listen to these artists today, I must admit I have passed more than once on seeing each of them in concert.

What place-research guru Dr. Richard Florida calls “big-ticket cultural events” are not panaceas to “place-building” because, as he notes in his break-out book on the topic, these events tend to be “one dimensional” and “consume a lot of recreational resources.” 

More indispensible to members of the bellwether “Creative Class” are the more “eclectic,” “indigenous” events that offer a “multi-dimensional” “smorgasbord” where one can go to maximize recreation.

Why?  Simply because they allow people to “modulate the level of intensity” and involvement, to use Florida's words.  For communities seeking to be attractive, it is a both/and proposition, but far more appealing are the latter and that is a hurdle for those operating large-scale facilities.

People turn away from concerts because they require a four hour time commitment, more from daytrip visitors who must commute from other communities.  Often the view at concerts is disturbed by late arrivals or people unable to hold it until intermission or by people jumping up and down or standing to watch, oblivious to those behind them.

Often, even excellent facility or imported sound is a disappointment in comparison to recordings or streaming concerts and there is no way to fast forward past less interesting pieces to favorites.  There is also no way to modulate the cost of tickets, concessions, parking and other fees involved.

These are only a few of the reasons that concert promotion today is about so much more than merely increasing awareness.

I’ll note more of these conditions below but a key influence on the struggles of performing arts attendance is that consumers now have so many other less “mainframe” ways to experience what concerts provide but with better sound quality, flexibility and with the option to tailor to one’s taste at much lower costs.

It is not really the fault of those operating or programing facilities that “big ticket cultural events” appeal to shrinking demographics. But many seem slow to adjust to the findings of numerous studies and analyses noting that merely “amping” up efforts to draw attention is not the solution.

There was a time several decades ago when awareness really was the issue. Many of us involved in community-destination marketing back then worked hard over the 1980s and 1990s to persuade cultural facilities and events to embrace marketing.

Adoption of that advice seemed to break along gender lines.

Female cultural decision makers tended to view marketing holistically, but in general,  male decision makers were very slow to embrace marketing as anything other than advertising, an element already in decline even back then, and now a negative return on investment.

Often this was due to what analysts back then called the “ego effect,”  the same thing that mires so many old-school hoteliers in direct sales.  These are  only two of several elements of a marketing blend and for several decades now they have been the least productive.

Similarly, this is why males more often fall prey to “crony marketing,” seeking advantage and favors based on “who they know” or so-called “power brokers” or seeking through cabals and surrogates to co-opt others into doing their job.

None of which makes for effective marketing.

I presume I was only saved from this fate of gender by early adoption of information-based marketing decision making, but the phenomena is prevalent nation-wide.  While I’ve worked with some of the best in the three cities I served, none were immune.

Several years ago, I was asked to co-chair a joint national panel of cultural and community destination marketing executives.  It was while chairing those sessions that I was first introduced to the growing tendency of some in performing arts to adopt a bullying technique similar to the one long plied across the nation by a few who operate hotels.

Desperate, they attempt through cabals to co-opt marketing meant for the community overall and re-direct it instead to substitute for their own responsibilities.  This led one long-time arts representative on the panel to joke that a reduction in testosterone was in order.

This self-defeating behavior seems to thrive where there is a basic misunderstanding of “roles.”  As one enlightened hotelier put it, community marketing is about tomorrow, marketing individual businesses is about today.

In other words, one is strategic and the other tactical in nature.

Joking about too much testosterone aside, there are good reasons for rising feelings of frustration and desperation among those involved with performing arts and related events and venues.

In addition to circumstances already noted above, the challenges impeding the success of “big ticked cultural events” revolve around several pervasive conditions:

Leisure time is the same as in 1900

While studies show that over the past century, hours worked per employed person in the U.S. have fallen from 2,700 to about 1,600, this doesn’t mean an increase in leisure time, which remains the same as it was in 1900.

In fact, researchers believe “pure” leisure time has actually declined since 1965, especially for women and much of what seems like leisure is really now “fragmented” leisure.

Even on weekends, only an average of 1-in-10 hours of so-called leisure time is available for attending events such as sports or concerts, including travel.

In the meantime, competition for this narrow slice of leisure time is fueled by an ever increasing flood of options that continues to increase exponentially including live concerts streamed over Netflix and via websites.

Leisure activities literally cannibalize each other, leading to desperate hubristic attempts to divert resources meant for overall development, which ultimately undermines a community’s overall appeal.

Over Supply Leads to Dislocation

Economists have long warned that increasing the supply of opportunities to participate in an activity does not lead to either an increase in the proportion of the population who participate in an activity nor the amount of discretionary spending devoted to that area.

Instead, if the increased supply (e.g. performances or performance venues) is not carefully calibrated, a dislocation of existing demand occurs, creating disruption when existing demand is divided into smaller slices.  The same is true of underwriting and volunteers.

This is particularly tricky in a regional context where the balance is even more fragile.  If one community seems to buck the trend, it very well may be that another is being eroded.

Both feasibility consultants and enthusiasts often fail to explain this to decision-makers and those who do are often ignored, especially when zero-sum power brokers are involved.

In destination development, as the old saw goes:

“Everything that glitters is not gold…

For everything you win there’s something lost.”

At the margins, the effects can be invisible for many years but not, if they are looking close enough, to those charged with filling seats and recruiting sponsors.

Access to Opportunity Lessens Motivation

Behavioral economists also know that the more opportunity there is to participate in an activity such as attending concerts, the less urgency consumers feel to participate and more they gravitate to alternatives that require fewer recreational resources.

For instance, it is no surprise that touring Broadway attendance has declined as the number of theaters involved increased.

No amount of marketing or increased awareness will make a difference because it isn’t lack of awareness that is the problem.

It is a paradox that the more opportunity there is, the less urgency there is to participate.  In time it catches up with all venues.

Performing Arts Competes with Baking

According to the Census, about the same percentage of the population attends some type of concert in a given year (including those in schools and churches) as will attempt to bake something in the oven.

As I noted earlier leisure activities are in competition with the broad spectrum of other leisure activities.

Marketing a community to draw visitors can certainly expand the pool somewhat but that dissipates once participation in an activity exceeds the fair market share visitors interested in that activity.

Officials seeking to enrich a community’s cultural vitality should take their cue not from enthusiasts for a particular activity or those with self-interest, but by seeking diversity and balance of offerings.

It starts by asking the organization responsible for visitor-centric cultural and economic development to identify where a community is underperforming compared to its potential and competitors.

Systemic Greed

Performing arts venues in North Carolina will now be required to add a 7% tax to tickets instead of 3% because a loophole has been closed.

Some communities such as Raleigh are a seeking competitive advantage by seeking to again exempt non-profits, creating an unfair advantage.

It is not clear whether those who vehemently objected a decade ago to a menu-approach to visitor related taxes, as those behind a new theater in Durham did, now understand the cost of their shortsightedness.

At the time, a 1-2% tax on admissions such as exists in South Carolina and other states would have been used to finance facility construction and upkeep of cultural facilities.

Now there is a 60% increase in the taxes paid by on admission tickets with none of it earmarked for those uses.

Even though facility operators raise the most fuss, taxes such as this are predominantly paid by consumers, not organizations.

But ticket prices since 1989 when the “hats acts” launched have risen by 400%, more than two and half times inflation, a far greater inhibitor than any amount of awareness marketing can overcome.

Only 1% of all acts now rake in 56% of all concert revenue compared to 26% in the mid 1980s.  This greed has left little room for discretionary consumer budgets to absorb the increase.

The top 5% of performers now take in nearly 90% of all revenue.  Add in special parking fees, $10 cokes and other hidden costs and it isn’t hard to see why it is now harder to motivate the small sliver of Americans inclined to attend concerts.

It’s a problem worthy of desperation but lets not blame it on closing a tax loophole, which for profit-making enterprises will be more than offset by a reduction in corporate taxes.

Awareness is no longer the problem nor the solution for performing arts venues.  Its issues are systemic and go far beyond what any amount of amplified marketing can overcome.

Arts and culture are a type of ecosystem and so is a community’s overall visitor appeal.  Leaving portions under-resourced when new favorites evolve is a formula for predatory behavior and cannibalism that only sows the seeds for decline and erosion of those facilities that make a community unique.

Any cultural master planning for new facilities and events should include a plan for not only what’s wanted but more importantly what’s warranted to fill gaps in cultural infrastructure.

Equally important but almost always neglected, this planning must link a plan to increase resources for upkeep and nurturing of existing facilities when new ones are added.

Cultural planning should at the very least include a plan for obsolescence and moth-balling, or better, adaptive reuse of existing facilities and events to serve a an area of the cultural ecosystem that is underserved.

These are not outcomes that should not be left to predation or “power brokers or the fatalistic churn endorsed by some developers.  And siphoning off community destination marketing resources is not the solution to poor destination planning.

Marketing a community is a role distinct from the responsibility to market individual businesses or cultural facilities or events.

Examples across the nation are legion of the disaster inherent when either role is usurped by the other.

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