Today a friend pointed out the Marketing portion of the MOA’s website to me, and I wanted to share some of my thoughts on it. I remember being suspicious of their claims a while ago, but I had no way to confirm or deny those suspicions. Now, however, I’m better versed in the art of the 990, and the MOA has shared more information about the auditorium at Hall. So let’s take a look!
From the website:
Throughout the recession, our earned revenue has been essentially flat—a significant achievement in this economy.
“Essentially” is such a magic word, isn’t it? Stick “essentially” in front of anything and you can essentially say anything and essentially no one will ever bother you for any essential details. Essentially.
Given the context, I’m assuming that by “earned revenue” the MOA means “program service revenue”… (Ticket revenue, rental revenue, concession revenue, etc.; not grants, contributions, or investment income.) The MOA’s “program service revenue” can be found on the first page of the 990s…
To sum, from 2008 to 2011, earned revenue fell by 15%. According to the MOA, this is “essentially flat.”
(Interestingly, musicians’ compensation, which the MOA says has risen by 19.2%, is not “essentially flat.” Apparently somewhere between 15% and 19.2%, things stop being flat.)
Is program service revenue decreasing by 15% “a significant achievement” in this economy? Let’s look at the percentages that program service revenue increased or decreased at other orchestras. This graph is ordered by population of each city’s metro size, biggest to smallest…
I’m not clear on how the MOA’s program service revenue decreasing by 15% is “a significant achievement”, unless “not failing as badly as Philadelphia” is a significant achievement. But I welcome clarification.
Our marketing efforts have maintained stable ticket sales across 150 music events a year in a 2,450 seat Hall.
Maybe so, but here are the revenues from those ticket sales…
Is a 17% drop “stable”?
(As a side-note, here’s a strikingly similar graph of the amount spent on advertising and promotion from 2009-2011…)
On the other hand, maybe it’s impressive that ticket sales only dropped 17% since advertising decreased by 27%…
This is a solid accomplishment in a recession and in a community of our size.
Ehhhhhh. See the second graph above, that compares various communities’ gains or losses in program services revenue. I’m not convinced. Give me some harder numbers to back your assertion up.
Our strategic plan calls for 80 percent paid concert capacity and for a 2 percent increase in annual revenue year over year. (Our current paid capacity is 69 percent.)
Wow. An eleven percent increase in paid capacity? That sounds ambitious.
Until you realize…
The renovated hall has a decreased capacity. Some seats were taken away for the larger stage – more were taken out for accessibility sake – I think the new seats might be larger than the old ones – the sound system may have something to do with it, etc. Bottom line: the old hall had 2,450 seats, the new one has 2,092.
So let’s run the numbers…
Sixty-nine percent of a 2450 seat hall? 1691 tickets sold.
Eighty percent of a 2092 seat hall? 1674 tickets sold.
This is ambitious but achievable.
In other words, the MOA thinks…selling 17 fewer tickets per performance than it is now…is…”ambitious but achievable.”
Way to shoot for the moon, MOA.
17 responses to “Musings on Marketing”
Woman, you need to be on the board of this orchestra.
@PianoGirlAnn, this is clear to everyone but the current board, apparently.
I agree that that Miss Emily should be on the board. We just need to raise her yearly “contribution” that is needed to be a member of the board! She obviously has the intelligence and perhaps more so than some of the current board members!
This is a worthy goal – I’m sure that this could be done with crowdsourcing or whatever social media fundraising is “it” these days. What is the minimum annual donation needed?
I was reviewing the MOA response to the letter from the legislature back in December 2012 and was struck by one paragraph that I hadn’t looked closely at before: It states the fundraising was geared to raise $110 million for the Building For The Future Campaign of which $50 million was for the renovation of the hall, and of the remaining $60 million, $30 million was to go to the musicians and $30 million for artistic initiatives. It also states that the $30 million for artistic initiatives has already been raised and used for touring, recording and artisitic projects. I am paraphrasing the paragraph, however I find it interesting that it is clear in the letter that $30 million was to go to the musicians. If this is the case, then why is there such an issue with the negoiations of the musicans salary and benefits?
The MOA has said that without this money, their initial offer would have been even lower. I can’t find where they said this now, but I’m nearly positive I read it somewhere. If anyone knows what I’m talking about, let me know…
Wow! How much money do they need for the musicans salaries and benefits? I have lost track of that number……… I would think $30 million would go a long way!
I don’t know how it works in Minneapolis, but here in Detroit there is not a minimum donation. In the past, there was a suggested minimum, but that could be waived if the candidate brought other needed assets to the table.
Currently, the DSO asks that board members put DSO giving “at or near the top” of their charitable giving recipients, but does not put a number on it.
Save Our Symphony (Detroit) (www.saveoursymphony.info) is an organization that supports the DSO, They pools small donations from their members together to fund the $2,500 donation required to become a DSO Governing Member. A Governing Member is a voting member of the corporation. This way, people who do not have the ability to donate at the voting member level still have representation in the corporation. For the last two years SOS has funded 8 Governing member positions at the DSO. The individuals chosen to fill these positions are active at all levels of the DSO including membership, governance, outreach, education and philanthropy.
I see no reason why this could not work in Minneapolis as a way to get Emily on the MAO board. If they would have her that is….
Thanks for the info, David! I definitely hope several pro-audience members are elected at the annual meeting in December…people who solicit opinions and ideas from the broader Twin Cities community, and have intense and lively discussions on-the-record with Michael Henson.
Do we really have to wait until next December for new board members? Really?
I don’t think they want to use this money for compensation, but rather for the investments that in future will pay for compensation. In other words the $30 million is a principle. If they only want to draw off their investments at a 5% annual rate, $30 million would only “pay out” $1.5 million a year. But someone correct me if I’m wrong. Plus I’m not sure exactly what the idea of artistic projects even really means, or what they have in mind about that…
Emily, all your brilliant data-crunching is sadly confirming what we have known all along in out guts – the dismal truth is that the current Board and Management is not interested in music or in truth. They are impervious to reason and logic. They are not interested in real negotiation. Without a change at the top the prospects for the future are bleak indeed.
If you shoot for the moon and miss you don’t always end up among the stars. Sometimes, especially if you’re an overly ambitious type and do it over and over again, all you really end up with is a large and rather difficult to explain body count. o.0
This reinforces what I’ve posted in the comments section before, and what I’ve thought from the beginning — the management has no intention of ever letting the orchestra perform again, no matter what negotiations are made. They plan to rent other regional orchestras for occasional orchestra shows, and not fund a “standing orchestra” full-time. They want to run just a concert and events venue.
Anxious to connect with you about a music education, musicians benefit event next week. Why yes, I shoulda(coulda-woulda) been more timely. Sometimes life is a moving target for those of us with ADOaS (Attention Deficit Oh a Squirrel!) Sigh. Please-please-please email me at your earliest…
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