Is Your Price Right?

by:

Joe Patti

Via Bill Byrnes, Dean of the College of Visual and Performing Arts at Southern Utah University, I recently became aware of a company called The Pricing Institute. Their services seem to focus mostly on optimizing the pricing structure of arts organizations.

My initial thought was that price does not develop relationships. If I am going to have a consultant come in to help me improve my organization, pricing while important, isn’t going to solve my organizational problems over the long term. But what isn’t valuable to me as theatre manager has worth to blogger me because I know it may be of interest to my readers.

An observation made on the Pricing Institute website bears noting. Price may not develop relationships, but it can ruin them. “Excessive or irregular discounting practices can leave customers confused and even resentful,…”

Taking a look at the case studies, it is clear that they don’t just emphasize retail price points. One of the problems they saw with Huntington Theatre Company’s approach was that the “marketing messaging was focused on pricing vs. value.” For Philadelphia Live Arts, one step they took was creating a separate identity for the Live Arts performances versus Fringe performances.

Reading through the website, I can see the value of the the services they offer. I didn’t really doubt the importance of making wise decisions about pricing. Given that fund raising is becoming more difficult, effective generation of earned revenue becomes crucial. I readily admit that I could certainly use some guidance in making prudent pricing decisions. But as I said, I can see this sort of a examination as part of a larger consultant visit.

I suspect that most arts organizations would be of the same mind. They probably don’t hire a consultant until there are so many areas of concern that guidance in just one area isn’t enough.

Come to think of it, that might be why the Pricing Institute is structured the way that it is. It is a joint venture between three different consultant firms. The structure may allow them to give stand alone pricing guidance to those who just want that while also enabling three different consulting organizations to provide great pricing advice when addressing organizations with larger concerns by calling on the expertise of their partners. As I said, I don’t know if that is how they operate, but the ability to offer a sort of “value added” service could be advantageous to all.

Artists As The New Entrepreneur

by:

Joe Patti

I was reading an interview on Inc.com with Jim Collins, author of Built to Last in which he says being an entrepreneur is less risky, though much more ambiguous, than working for someone else.

Not risk. Ambiguity. People confuse the two. My students used to come to me at Stanford and say, “I’d really like to do something on my own, but I’m just not ready to take that much risk. So I took the job with IBM.” And I would say, “You’re not ready for risk? What’s the first thing you learn about investing? Never put all your eggs in one basket. You’ve just put all your eggs in one basket that is held by somebody else.” As an entrepreneur, you know what the risks are. You see them. You understand them. You manage them. If you join someone else’s company, you may not know those risks, and not because they don’t exist. You just can’t see them, and so you can’t manage them. That’s a much more exposed position than the entrepreneur faces. But there’s lower ambiguity on the paint-by-numbers path: very clear but more risky. The entrepreneurial path: very ambiguous but less risk. Of course, the truth is that it’s all ambiguous, anyway. If you think you can predict the future, you’re crazy.

One of my first thoughts was that if this were true and everyone thought this way, everyone would be an entrepreneur and no one would be around to work. Is it the illusion of security predicated on the belief that a company has a business model and system that will ensure salary and medical insurance payments are made that causes so many to work for another instead of themselves? Who wants to handle all the legal paperwork and accounting associated with running one’s own business when you can work for someone who has lawyers and accountants to do that work already? (Though lately few are investing too much confidence in accountants and lawyers.)

But on the flip side of things, I wondered if the relative lack of security associated with working in the arts is one of the reasons so many arts organizations pop up. If the prospects of success are chancy across the board, I suppose it is logical that you cast your lot with the devil you know rather than joining someone else. You figure you can out economize them. If they are putting on good shows eating frozen pizza, you can do a better job while surviving on ramen noodles all the while hoping you will be eating better at some point down the road.

I think people in the non-profit sector embody Collin’s vision of entrepreneurs pretty well in that many do understand the risk and ambiguity involved with working for another or one’s self. I almost wonder if it might not be worthwhile encouraging people in the arts to apply this energy and willingness to endeavors outside of the arts. We have all been told, if you can imagine doing something else, do that rather than pursue a career in the arts. I am sure everyone has envisioned what that something else might be. In some cases, it might involve working for someone else, but that vision might be easily be diverted to working for oneself.

I really suspect that the internal drive an arts person has that sustains them in starving for their art is the exact same drive entrepreneurs employ in starting up their companies. The only difference is that the arts person may see growing their vision to a 500 employee company as selling out. To be fair, the whole process of meeting with venture capitalists, dealing with human resources, accounting and laws can seem intimidating and impregnable barriers. They say the next phase of the economy will emphasize the creatives. What if this might portend the emergence of organizations and processes which take advantage of the drive and vision of the artist and facilitates with the removal of the barriers either through training or performance of those functions in a manner which the artist can easily relate.

Let me be clear, I am not necessarily talking about empowering artists to be more successful artists. Yes, it would be great if solid arts organizations emerged. I am referring instead to arts people bringing their drive to the thing they would do if they weren’t in the arts. I am thinking about directing that drive toward game and software design to restaurants to human resource companies.

Wouldn’t be heartening to have worked in the arts for 10-15 years and realize that your hard work and relentless drive proves you may just have the tenacity to embrace the risks inherent to starting up a new company and there are people who want to help you do it?

April Can Be A Lot Of Things Month

by:

Joe Patti

So today is Arts Advocacy Day which provides a nice segue into April, the official Take A Friend To the Orchestra (TAFTO) month. If you are not already aware, TAFTO is the brainchild of Adaptistration blogger, Drew McManus who has been promoting the idea for about 4-5 years now. The people Drew has lined up this year to write on the subject of taking friends to the orchestra look very interesting.

The last few years have seen orchestra boards across the country seemingly making every effort to avoid having their musicians perform. If you have any inclination to go to an orchestra or even chamber performance resolving to attend a performance this month can play a small part in showing the classical music groups around the country that their organization has value to the community, even if you only attend occasionally. (Of course bringing 15 friends can play a much bigger part.)

Actually, April is a good time to resolve to attend an arts or cultural event. Places like Fargo, ND notwithstanding, the weather is getting better across the country so it is a fine opportunity to get out and attend performances and go to museums. If your community has First Friday gallery walks, this is weekend could be the time to step out, mingle with others and see some art.

I just heard my mayor on the radio last week saying he wished the First Friday activities downtown happened every Friday. It would be great if every mayor could encourage that level of activity. (I know he wasn’t entirely saying that to score political points because he chaired the committee of the National Council of Mayors that introduced four resolutions about cultivating arts activities across the country.) October is National Arts and Humanities Month so if you don’t feel your community has enough arts activities, maybe for you April can be Take A Friend to the City Council Meeting month where you get the ball rolling on some sort of event(s) for October.

Time To Review

by:

Joe Patti

I am feeling a bit under the weather so I am not of a mind to blog very long today. However, while I was having trouble sleeping last night, it occurred to me it has been awhile since I revisited and revised our front of house procedures manuals for house managers and ushers and more importantly, our emergency procedures. The latter is especially important since we just had an Automated External Defibrillator installed on the lobby wall.

While I ask the house managers to refresh their memories every year and we review procedures with our ushers at the beginning of every season, we are actually operating on instructions I wrote when I first assume my current position. Those instructions in turn were adapted from a manual I used at another place of employment. There is nothing unsafe about the procedures I initially generated, they just may not be the most appropriate for interacting with our community in our specific physical plant.

My suspicion is that practice has diverted from the letter of my instructions. The next step is likely to be bringing the instructions more inline with reality while injecting bits of structure where it might be lacking so our service to audiences is a little sharper.

I have given the task of revising the instructions to our assistant theatre manager. He deals with front of house staff and their activities much more frequently than do I. He also hasn’t had a hand in writing any of the procedures where the rest of the staff has so he has no investment in any of the work. I have suggested he might want to call meetings to discuss revisions.

So I figured I would encourage everyone to consider reviewing and rewriting your procedures both for safety sake but also to ensure you are meeting your audience’s current expectations for their experience with your organization.