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To Charge or Not to Charge – Museums and the admission dilemma

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Silvia Filippini Fantoni from Indianapolis Museum of Art spoke at MuseumNext Dublin in April 2016 about the challenges of introducing admission charges at her institution.

Silvia: Hi, everybody. My name is Silvia Filippini Fantoni, and I am the Director of Interpretation, Media and Evaluation at the Indianapolis Museum of Art.

Generally when I speak at these conferences, it’s really to talk about what I know and do best, which is how to engage your audiences, but this time I thought I would sort of venture in a bit of an unchartered territory, at least for me, so bear with me. Don’t be too mean on Twitter – I still need to have a job to do on Monday.

I’m going to talk a little bit about the questions of charging admission or not, in museums, and the reason why I thought I would go there is because this question is a very relevant question for my institution. You will see in a minute that we’ve been struggling with this for at least the last ten years.

It’s also a question that I personally struggle with. I obviously work to destroy or take down barriers to access, try to get people of different ages and different income levels to engage with their institutions, so for me, introducing admission can represent a barrier, so I’ve had mixed feelings about this as well, as my institution has gone through not charging admission, to charging admission.

But, I also thought that this question was relevant to most of you. Even, I know the debate in the UK, and I start hearing the same thing in Europe, where public funds are getting cut, and so a lot of you might be asking yourself the main question, will I get to a situation where I need to charge admission? That’s why I thought it was relevant to ask these questions.

I’m going to disappoint you from the beginning – I’m not going to give you an answer, a straight answer. I think that each institution really needs to work out whatever its business model is, and works best within the context in which it operates, but what I’m going to do here is to take you with me a little bit on a journey, a journey that, really, my institution went through in the past years, to really move from non-charging to charging admission, make you understand what the rationale was for doing that, the reaction that we had, the impact that it had on attendance, on demographics, and on the engagement with the institution, and eventually, discuss what is going to happen next to try to compensate for some of the things that happened as a result of charging admission.

I hope this will be beneficial to you, too, in case in the future you will find yourself in a similar situation. I do hope not, but in case you do, this is sort of what happened to us.

I’m going to start with giving you a little bit of context. This journey that I want to take you in started 133 years ago in the city of Indianapolis. For those of you who don’t know where it is, that’s on the map, which is the middle of nowhere, pretty much, in the United States. So, exactly 133 years ago, the Indianapolis Museum of Art was created.

It was in downtown Indianapolis, and then in the 60s, it was decided to move it to a midtown location. You can see there, surrounded by 150 acres of land. A new building was built that hosts a universal collection, from Ancient Egyptian works to contemporary design. We also have a beautiful garden, as well as an historic property on the campus, that was built in the early 20th century. So, it’s quite a complex institution.

In 2000, it was decided that the institution needed to expand and grow, not only to showcase more of its collection, to also be able to store more of the collection, but also, in the hope that more visitors would come. I’m saying in the hope, because I don’t think that was based on any research; it was just a hope. So, the idea of built it, and they will come. Well, they didn’t, but we’ll see that in a minute.

So, first expansion was in 2005. We built a new wing of the museum that was connected to the rest of the museum, so that we could show more works of art. This expansion was not enough. It was followed by another initiative. In 2009, we acquired a house that was designed by Eero Saarinen, so a modernist architect, which is about 45 minutes away from Indianapolis, so we manage this location; we organise tours, and we also manage the collection.

Then, the third, because all good things come in three, is the development of a contemporary art sculpture park, that was in the 150 acres of land. We took 100 acres and turned them into this contemporary art park which opened in 2010.

So, what happened? Did more visitors come? No. So, there was a little bit of a drop, obviously when part of the museum was close. This data is only about the museum – it’s not about the other two locations. As you can tell, after we reopened, there was a little bit of a, sort of, spike, which was also due to a blockbuster exhibition, Roman Art from the Louvre that we had, but generally, we did not essentially have a lot more visitors after we opened.

What we had, unfortunately, is a lot of debts, because we accumulated debts in order to make these expansions. Also, I don’t know – in the United States at least, my museum, most museums in the United States are not publically funded, so we have an endowment which we invest, and we make interest every year, and the idea, generally, is that we should use 5% of our endowment every year, otherwise the endowment goes away.

During this time, we went to using 8% of our endowment. If we combine this with the effect of the recession, during which our endowment lost $150 million, we arrived at a situation where, essentially, if we continue like this, we would be closing in 20 to 30 years.

So, this brought some changes within the institution. The first change was trying to make more revenues, one way or another. So, the museum was free, with the exception of exhibition – I’ll get to that in a moment. But, we’re midtown – people need to drive to the IMA, so we said, okay, well, let’s start charging for the parking, which is not uncommon in the United States. So, we introduced a $5 charging fee.

After that, exhibitions, which is our main source of income – and the four years that I’ve been at the IMA, five years, almost, we went from charging $8 to $20 for an exhibition. So, this is the O’Keeffe exhibition, which was the last paid exhibition that we had, and we charged $20 for it. So, the price of exhibitions went up.

The other things we did is to reduce costs. We had two rounds of layoffs, one in 2009 and one in 2013, and I wasn’t there for the 2009 one, but I was there for the 2013 one, and I can tell you, it was a very painful experience to see some of my colleagues go. We are now at the point where we have the lowest number of employees in the museum in the past 20 years, and we still can function with that.

The other choice was to cut the budget, so a lot of our budgets got slashed, but we still survive and do stuff. We actually do more than what we used to. One of the ways to cut the funding was to reduce the number of exhibitions, both the smaller exhibitions as well as the larger exhibitions. We had three per year, and now we are down to two per year, of the larger, what used to be a paid exhibition, and try to focus more on the permanent collection, so even the exhibitions, in order to reduce the cost, just try to kind of leverage these 55,000 beautiful works of art that we have in our collection, and build exhibitions around those things, as a way to reduce the cost. So, we tried this as well, another thing.

Another thing that we tried, and we continue, are committed to do it in the longer term is, we changed the focus on the value of the institution. The previous version of the institution was very much focussed on research, and the idea here is, we really focus, started switching the focus on the visitors.

How did we do that? We created an audience research and evaluation team, which now includes two fulltime staff, four part time data collectors, and two contractors that we work with, to collect data from visitors and non-visitors. We also included … developed a new visitors centre exhibition development process, which has helped involving the visitors into the decision making that goes into creating an exhibition.

Then, we also developed more participatory and experiential programming. So, we’ve kind of made the switch, and the switch has been paying off, in some way, but not enough to really move the needles in a significant way, from a financial point.

So, despite all of these attempts, ultimately it was necessary to make a decision in December of 2014 to change our business model. So, instead of charging for the parking, and charging for the exhibitions, we decided to charge for general admission. The general admission included the historic property, includes the museum, includes exhibition, and includes the garden. It doesn’t include the contemporary art park, because for political and administrative reasons, we can’t charge for it. The parking became free. We introduced a number of free community days – we have five to seven per year. We have the first Thursday of every month, from four o’ clock to nine o’ clock, we’re free, and then we have what we call the access pass, which basically gives people that have lower income the right to pay only $1 to access the museum.

Then, we kept the membership what it was before, so a single membership costs $55, and $75 is for family membership – that gives you access to all of these things for free for a year. So, that’s kind of the business model that we adopted.

What was the rationale for going to this model? First of all, we wanted to stop nickel and diming people. One of the things that we got from feedback is that people were tired to always being asked to give money, whether it was for the parking, and then for the exhibition, and then for the added tour, and things like that. So, we said, okay, people really don’t like this. They want to pay once, and get everything included. I don’t think that they were thinking about $18 when they answered that question, but that’s the feedback that we got.

The other rationale, the biggest rationale, was to try to be less dependent on unstable sources of funding. What I mean by unstable sources of funding for us is, well, the endowment – it proved that even though we have a very good endowment compared to other institutions in the US, we can’t control what the recession does, and when it comes and when it hits, and so relying strongly on an endowment, and withdrawing more money from it than is sustainable, it’s really not a sustainable practice for the long term.

The other thing that I consider an unstable source of funding, at least in the US climate, is sponsorship. Why is that? Well, on one side, corporate sponsorship really got a hit from the recession, and it’s a hit that we never recovered from, because even now that the situation is better from an economic point of view, we don’t have the same level of engagement from donors in the corporate world, so that’s a problem that persists.

The other problem is a generational problem, the baby boomers generation that’s really committed to supporting institutions like museums financially, is slowly aging and dying, and we don’t have any proof yet that the new generation of millennials is really going to fulfil the same role, and be as engaged with our institution. We have a hard time to engage them and make them come in the first place, so what is telling us that they will sustain us in the future? We have no proof or no evidence of that right now. So, that’s why I put funding here as an unstable source of funds.

So, the idea is to try to increase the earned revenue, which is something that we can a little bit have control on, and particularly, also, increase the number of members. The idea of the membership is very important in our business model, and I will explain it in a second, but the idea is really that your members tend to be more engaged with your institution, and if you’ve managed to engage them in the long term, they can kind of become further level of membership, and then 20 years down the road, 30 years down the road, they’ll bring their children. Their children will bring their grandchildren, and they might become donors, themselves, for your institution. So, the membership component was a key part of the decision making process.

Also, it was one of the reasons why they decided to charge $18. So, how did we get to this amount? Unfortunately, we didn’t do it in a very scientific way, and that’s maybe one of the reasons why we’re having some issues. But, one of the ways we went with, we looked at different things; we did a survey asking visitors and non-visitors how much – it was then asked in a specific way, how much people would be willing to charge, and I think the answer we got was about 12 to 14, was I think the maximum that people wanted to pay.

We looked at other institutions in similar socio-demographic contexts, so in other cities like Seattle or Denver, or Atlanta, that are very similar to us in size and demographics, and that helped us see what those costs were.

We looked at other institutions in town. We were the only museum that did not charge for admission in town, and other museums charge from 13 to 32, depending on the kind of experience that they provide.

Finally, the rationale, and I think that was the biggest factor, was to try to make the membership appealing. In our business model, getting more members is very important, so we wanted to have a price that would make people say, ‘Okay, well, I’m here, a family of four – it would cost me $60 today to get in. For $75, I can get a free membership, and if I come twice, I get my money worth of the experience’. So, that was the rationale for this amount of money.

So, let’s look for a second at the kind of reaction that we had. This decision was made in December of 2014, and it was implemented in April of ’15, so we had four months to make the change, which meant also closing off part of the campus, that before was free.

So, what do you think the reaction was? Any idea? Did people love us? No. Yes? Then you’re an optimist. People did not like this decision, whether it was the press, or people expressing their opinion through social media. They did, and these are the kind comments; these are the nice comments. So, if you want to see the really nasty ones, just go to our Facebook page and watch the reviews of a year ago, and you will kind of see the level of reaction.

I think people had three main concerns, and two of these concerns, we kind of expected, so we kind of had accounted for it. One was, like, well, it should be free. Some people thought that we were state funded, for some reasons. I don’t really know how that’s possible in America. It is possible, but most museums are not.

Some people are concerned with going from zero to 18 – they felt it was really too much of a jump.

The third one was one that we kind of didn’t expect much, and the one that ended up biting us in the ass a little bit more than the others, which was the fact that we closed up access to the gardens. I think the gardens had really played a role in the museums to engage the local community; people would just go there to relax, to recharge, to spend time with their family, and all of a sudden … They’ve always perceived the gardens as being a public garden; they never really realised that it was not a public garden; it was the garden of the museum, it costs money to maintain. But all of a sudden, we closed it down, so people that would jog across the gardens or would bike across the garden couldn’t have access anymore, because they would have to pay the ticket and go into the building, and then exit on the grounds. That was one thing that I think really people were upset about, and I would say that the other questions died down relatively quickly, but this is the one that we’re still trying to sort out, given the situation.

This type of reaction obviously didn’t make the rest of the staff very happy. This is the point, probably, that we reached the lowest level, in terms of staff morale. Obviously, as you can see, the museum has gone through a lot – two rounds of layoffs, cuts right and left, and then on top of it, you get this kind of response from the audience, and sometimes the response that you get, it’s attacking things that have actually nothing to do with admission, or projects that people have been working hard on, and they’re good for the community, but unfortunately, when there’s these sorts of situations, everything gets thrown in the mix.

So, I think this was probably the lowest point, for myself and probably for the staff of the museum. At this point, a lot of people left. Others stayed and kind of embraced the change, and figured out a way to work with it, while others stayed and decided to be miserable about it. So, there’s a little bit of this still going on.

Let’s look now at the impact. So, what happened? What happened to our audience? What happened to the way that people engaged with our institution? So, what do you think happened? Any idea? Do you think our attendance increased or decreased? Nobody says anything. Somebody says increased. I love that optimism. No, it dropped.

So, no surprise here. It’s really hard to say how much it dropped, unfortunately, because being so open before, a lot of people just went to the gardens and didn’t necessarily check in, so we don’t really know exactly how much. So, I have, like, a range here for you to get a sense of.

Here is the people that checked in at the desk before. Checking in at the desk when we were free was not compulsory. We invited people; it was right there, so most people did check in, and we could count them, but there were some people, particularly members, that just went straight up to the galleries, or they went straight to the garden.

So, if you look at this difference, it’s about 15%, and probably it’s bigger, because it doesn’t count people that didn’t check in. The other measure that we have is Lilly House. Lilly House is the building, the historic property on campus, and we checked in in the same way. There’s only one entrance; people came in, and the person at the desk counted before, and they’ve counted now, so that one is something that we can easily compare. In that case, the drop was 40%.

The drop outside was bigger than the drop inside, as you can see here. So, probably it’s not that everything had a drop of 40%. Probably the buildings, the museum itself, and the collection, had the lower drop, and the gardens a higher drop, but this is a little bit of the reality. So, the gardens ended up paying for this experience, because people just used them as a way to engage very briefly, or to run, or to have a picnic, or to socialise, and now they don’t feel like they want to pay $18, and they go somewhere else.

Do you know where they go, guys? They go to our sculpture park. So, we have our own competition built into our own system, so that sucks. But, you know, we can only build from there.

Good things – so, we went from negative; let’s go a little positive here. So, the membership grew, as we expected. Obviously it became certainly more advantageous to, if you come two, three times a year, really $55 is not that much, and so obviously we saw a spike in membership. It’s going to be interesting come May 1st, which is going to be a year after we started charging admission – we started in April, but May 1st was when the big blockbuster exhibition was there, so we started, like, wrapping up the membership a lot. So, it’ll be interesting to see what happens when May 1st comes, and see if these people are going to renew or not, so that will be interesting to see a year from now, where we’re at with these numbers.

When you look at demographic and psychographic, again, to be expected, but essentially the population became older, [whiter], richer, and less families. The last two are not statistically relevant, so I put them there because they represent an inversion of the trend that we were building before.

But, the other thing that’s interesting to me is when we look at motivation. We use the Fogg model at the IMA – I don’t know if you’re familiar with it, but what is interesting here is that, in the last three to five years, we have been able to really build – those that came to the museum to engage with other people, which we call facilitators, and recharger, those that come to the museum to just recharge and relax.

This charging admission shows an inversion in the trend, where we now attract more people that want to learn. So it, to me, represents a little bit of a step backward.

When I look at this data, and I look at this data of five years ago, they’re not very different, so in a way we jumped back of a few years. Not ten, 20, but I would say three, four years in terms of where we are with our demographics.

One thing that increased was the time that people spent in the museum, at the IMA by 20 minutes, which is great, you’d think. For about ten years, we had the same exact medium average, two hours, and now we are, like, two hours and 20 minutes. So, you think, great. Great for the engagement with the organisation. But, not quite.

When we look at what people do and where they spend their time, let’s start with out permanent collection gallery. Most of the galleries dropped, so these people didn’t necessarily go to the galleries, compared to the years before, so there were less people going to all of the different galleries. Just a few galleries had a rise, but because they didn’t have anything showing the year before.

So, they are not going to the galleries, so where are they going? They’re going to exhibitions. So, there’s less people coming to the museum, but those people that come to the museums are more likely now to go to exhibitions than they were before, which is certainly good for my team. We work very hard on creating incredible experiences through our exhibitions, but generally, we need to work better now to make the connection with the permanent collection, and with the gardens.

The other place where they go and hang out is the café and the store, so those two hours probably is the maximum level of engagement that people can have with your organisation, and the rest of the time, they just spend it in the café and in the store, which again, great for us because we make more money, but ultimately, for what I do, it would be better if they spent that time elsewhere.

Last thing is satisfaction. So, we expected that, okay, now we’re charging; people have higher expectations of what kind of services and experiences to have, so we’ll have a significant drop in satisfaction, and actually, the answer is that, no, it did not happen, even though there is a tiny, tiny drop, the difference is not statistically relevant. So, the satisfaction stayed the same, which is overall a positive response. I want to hang on to this.

You might have this question – so, all of this, was it worth it? Ultimately, we didn’t make as much money as we thought we would. We made about half a million dollars more than what we made during the same period of last year. This is just, the way the museums see it is, this is just the beginning, something that we need to build on to get to a point where we can make more money, we can get more people to come.

I think one of the problems in this, sort of, projection, that didn’t happen in the way we were thinking, was the fact that there’s a little bit of an imbalance between the cost of a ticket and the cost of the membership. I think we wanted to make the membership attractive, but I think the membership is far too attractive at the moment, and we’re going too fast. So, in order to make a little bit more, it needs to be a different … a better balance between these two aspects.

Other issues that, I think, looking at the way this was implemented, we had is, I think the timeline for implementing this was extremely aggressive. As I said, the decision was made in December, and then it was implemented in April, and there was not enough time to really think through certain kinds of things, including how to communicate this to the audience. I think we were a little bit shy about it; I think we were afraid, and so a lot of …

We kind of wrote a press release – we were like, ‘oh, these interesting changes are going to happen at the IMA, a new tram, a new this, a new that’, and then, ‘and by the way, we’re going to charge admission’. That’s how it felt. So, if you make a decision like this, I think you should just embrace it and be open to why you’re going to do that. We didn’t quite do that right.

Another thing that we didn’t do well was really building a consensus, not so much about the ticket, but about the access to the gardens with the community, just to take more time to kind of work with bikers, work with joggers, work with those people that use the park in that way, to see if there was anything that we could do to make it work for them as best as we … access before time, and things like that. So, that’s definitely something that we should have certainly done better in this situation.

Almost last, what is coming next? So, obviously, we need to continue and monitor attendance and demographics. This first year was a little bit different for us, because we had a big blockbuster exhibition that brought in certain kinds of people, very different people, so we want to see in the longer term how that attendance works out.

We need to evaluate our membership growth. As I said, we need to see, come May, what happens, in terms of, are these people renewing their membership? Are these people more engaged with the institution, or not?

Then we’re in a process of doing a couple of studies which, personally I think we should’ve done before charging admission. We’re looking at a segmentation study, and community engagement studies that will help kind of build our planning and our programming accordingly.

Another thing that we are thinking of doing, but we will make this decision this time informed by research, is investing in our gardens. There’s one big trend in the United States, which is, art museums are losing attendance, right and left, if for the exception of, probably, MoMA and MAP, but provincial museums are losing attendance, while botanical gardens and parks are increased. So, is there a way that we can leverage this sort of resource that we have, and bring in more people into the institution?

To conclude, because I’m already late, I want to leave you with this quote from Richard Evans, who was the Director of the Beamish Museum of the Living North. The reason why I chose this quote is because I think a lot of us don’t really think – we forget that museums are not really free. Somebody … The museums cost money – the question is really, who’s paying for this? This is said by somebody who actually is the director of the most expensive museum in the UK. He charges £19, and in a few years, he’s been able to double his attendance, and his demographics are the same demographics of those of national museums who do not charge.

So, I think that, ultimately, I know this has been a bit of a confusing story, but I just want to leave with a message, a positive message, that even though, if this is the journey you have to go through, there’s light at the end of the tunnel.

Thank you so much.

Silvia Filippini Fantoni from Indianapolis Museum of Art spoke at MuseumNext Dublin in April 2016 about the challenges of introducing admission charges at her institution. To stay informed about our International Museum Conferences follow MuseumNext on Twitter or like MuseumNext on Facebook.

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