Virtual content has been so successful in recent months, it will likely continue when arts organizations reopen. Is it time to make virtual content a permanent part of your business model? We’re sharing some of the latest data to help you make an informed decision for your own organization.
Organizations large and small are already charging for virtual content. The New-York Historical Society has been doing it since the beginning of the pandemic, and the Berlin Philharmonic began selling virtual subscriptions back in 2008. Is it time for more organizations to move toward this model?
When COVID shutdowns began in March, arts organizations quickly deployed loads of digital content in order to stay engaged with patrons. Most offerings were delivered free of charge while engagement numbers were relatively high. The recent Culture Track report states that 53% of respondents “participat[ed] in one or more digital cultural activities in the last 30 days” while only 13% reported paying for access to that content. The debate over whether this was a missed opportunity has been growing for months.
The arts have a sordid history of elitism, and there’s certainly an argument to remove barriers to access now more than ever. However, arts organizations are in dire need of revenue to survive the pandemic. According to a survey by Americans for the Arts, over 62,000 arts and culture staff members have been laid off nationally, another 49,000 furloughed, and revenue losses are in the billions. This tension between removing barriers but balancing the budget has only grown stronger as the spread of the pandemic drags on.
Colleen Dilenschneider at Know Your Own Bone has been publishing weekly updates on visitors’ intentions to return to cultural institutions as new pandemic data is released. These updates include data by region, demographic, and organization type, and are a great place to start as you assess the market for your virtual content.
The argument to charge a fee for virtual content is compelling. A self-published study reported on ArtsHacker states that 70% of respondents had never taken advantage of streaming content until the pandemic, and a whopping 53.2% were willing to pay for it. These numbers suggest an opportunity to use paid virtual content as a new revenue stream.
Virtual offerings could also provide an opportunity to tap into new audiences. This study by TRG Arts shows new audiences are under-tapped while long-time patrons who purchased tickets early in shutdowns may now be losing interest. This further underscores the importance of engaging a broader patron base.
A recent report by independent UK research firm indigo states that 83% of respondents are interested in digital offerings – and more than half say they would pay for access. How much to charge for a virtual performance is still up for debate, but the indigo report also states that most audiences are not willing to pay the same amount for a virtual show as they would for an in-person experience. The survey also allays fears that virtual content will one day replace the in-person experience; most respondents felt virtual would not completely replace the real thing.
According to Americans for the Arts, revenue from ticket sales makes up over half of the average arts organization’s income. So, although some performing arts organizations have reported an increase in charitable contributions during the pandemic, it's likely not enough to cover lost revenue. Can charging for virtual experiences help make up the difference?
So, while surveys show people are willing to pay for virtual offerings, it’s not clear how much they'll pay, or for what content. What is clear, though, is that as the pandemic drags on, data suggests it's time for performing arts orgs to have a serious conversation about paid virtual content.