Two serious arts posts in two weeks, this time on the use of data in organizations. Because why should data analytics be limited to the marketing team?
A shorter entry this week, since I have a midterm exam in two days that needs some intensive study, some group work to get done later today, and some research on World Heritage listed sites that needs to be completed. The light at the end of the tunnel is a trip to Barcelona for a short break from university studies, before we launch into the second half of the semester.
Anyhow, I’ve been wanting to get some of these thoughts down for a while, maybe one day I will turn this into a longer, better referenced article that illustrates the point with actual data. But for now just making the following point will suffice:
Analytics is more than just a marketing tool.
By which I mean, the collection, analysis, and evaluation of large scale data as part of the strategic processes in businesses is not something that business and especially arts leaders should confine to the marketing team. It’s an approach that can be useful across every aspect of a business.
To some extent, this view is already echoed in the for-profit world; after all, operations and logistics specialists use data sets to manage inventory and evaluate performance, and financial analysts develop grand and arcane models to identify investment opportunities. However, it seems that when people talk about concepts such as “big data”, it’s confined to marketing, to identifying how you can generate more revenue from customers.
Now don’t get me wrong, this is a great use of analytics. A recent Artsblog article by Jordan Silton makes some great points on how analytics can do great things in arts organizations. But it limits itself to the realm of the digital campaign. By confining analytics to marketing (and the low hanging fruit of digital marketing campaigns), arts organizations may be missing out on a real opportunity to see gains in performance in all aspects of their organization.
Let me illustrate. For the average US arts organization, a significant proportion of the revenue comes from contributions from private sources such as individuals and foundations. In the former, analytics of your donor database can identify trends in giving over time, clarify your donor demographics (and compare it to your audience to make inferences on non-donors who you may be able to turn into donors), and monitor the usage of benefits to donors and to members. In the latter, analytics can provide you with hard numbers that can make a sound, transparent case to foundations as to the return that they can get on investment in your organization.
At the operations side, monitoring how people interact with your venue can be invaluable in areas such as staffing, inventory management and placement, and even in the curation of exhibition spaces – knowing which artworks attract the most patrons can allow you to juxtapose other, less known works of artistic significance in close proximity.
As an example of this, in one piece of work that I did I evaluated a set of data to see which seats in a theatre venue were the most heavily sold. Contrary to common expectations, it wasn’t in the acoustically or visually optimal position, but in a spot that allowed easy access to the bar and toilets at interval! That sort of information can help you when it comes to “scaling the house” (pricing your seats).
Another example is the work being done by the Dallas Museum of Art, where they are using a free membership and loyalty program to build up a detailed picture of their visitors and how they interact with the museum space.
You can also make use of analytics in the back office, looking at everything from your accounting (to streamline budgeting, ordering, and purchasing), to IT (database and CRM software usage), to the evaluation of staff initiatives and programs. And of course there’s all the work that you can do in marketing, to retain and build existing customers, to bring in new customers, and to evaluate the performance of your media campaigns.
Now don’t be put off by all this talk of data. Much of the hype around analytics goes into the whole “big data” fad, but analytics is applicable and useful regardless of how big your organization is. Moreover, a lot of the data that you need may already be there, in your accounting, ticketing, and CRM systems. However it may be “dirty”, requiring cleaning out of errors and duplicate entries. But even that process can bring benefits, identifying areas of improvement in the processes that your organization uses (such as removing duplication of information gathering).
The point is that analytics is something that can benefit any organization, across all aspects of its operations. Having good analytics helps you to make better strategic decisions, and shows transparency and accountability to your stakeholders. It’s something that can take your organization from being good to great.
Observations on music, coffee, and the occasional controversial thought.
Copyright © Gerard Atkinson 2013. Unauthorized use and/or duplication of this material without express and written permission from the owner is strictly prohibited.