Saturday, August 17, 2013

Pay as You Will: An Experiment in Free Admission



A little more than a year ago, I wrote about a big idea the Children’s Museum of Tacoma (CMT) was putting in place. In January 2010, in the thick of developing a strategic plan and in the midst of an expansion involving a move, Executive Director Tanya Andrews presented her board with seven big ideas. Big Idea #3 was going to Pay as You Will, or no admission fee.

The decision for CMT to go to Pay as You Will–or no admission fee–was motivated by an interest in easy access to the Museum for Tacoma families. A community scan conducted as part of strategic planning indicated the need. Pierce County where Tacoma is located is one of the poorest counties in Washington. In numerous areas within the city children experience multiple risk factors. Two military installations, one a mega-base, are located in Pierce County. About half CMT’s visitors were visiting the museum for free or reduced fee on Free Fridays, with library passes, or on free Market Play Days following the Farmer’s Market.

For Tanya and her board, however, 50% free or reduced admission did not add up to access. Tanya explains  “When low-income families come on Fridays during free times, it further segregates our community. But when Mom A and Mom B are here and they share a love for their child, they have that in common. Where else is there a natural gathering of young parents? If any museum should be free, it should be children’s museums.”

In presenting Big Idea #3 to her board, Tanya asked, “If I told you that all you had to do is replace $50,000 in earned revenue from admissions and CMT could drop admission, what would you choose to do?” There was no hesitation; the board voted to adopt a Pay as You Will plan.

Planning on Multiple Fronts
Implementing Pay as You Will was part of a larger set of decisions and actions. Introducing Pay as You Will leveraged CMT’s reopening at a new location, with new exhibits, and a larger, 8,000 square foot, facility (up from its previous 4,000 s.f. building). Replacing $50,000 in admission revenue as well as reaching a higher percentage of total earned revenue (from 30 to 70% of budget) would come from membership, birthdays, programs, cafĂ© revenue. Membership was enhanced to be more attractive to people interested in convenience and to those interested in a purchase with a philanthropic benefit.

CMT made sure people knew about Pay as You Will. Callers heard about it on the recorded message along with directions and hours. Multiple screens on the website highlighted and explained CMT’s admission policy. Staff was prepared for a conversation with visitors and gently encouraged them to make a donation.

A Strong Start
As reported here 9 weeks into the plan (January 14 - March 16, 2012), initial results from Pay as You Will not only met, but exceeded targets–intentionally conservative ones. In just 9 weeks, the Museum received more than $50,000 in admission contributions. One-in-four general visitors (almost 90% of non-member visiting families) contributed at an average of $11/family or $2.82/person. Membership was almost double projections. As important, the Museum was welcoming families from more ethnically and economically diverse backgrounds in the area.

Fast Forward to June 2013
Six months into its 2nd full year, CMT appears to have escaped the dreaded “sophomore slump,” that drop in attendance that typically follows an opening year of being new with the attendant buzz. CMT has landed just under-and-over its early first year returns in several areas which may be assumed to be the natural and inevitable variations in attendance and income every museum experiences.

  • Growing Attendance. In its first 12 months at its new site, CMT served 123,022 visitors in its galleries, down (a scant) 1.5% from the projected 125,000. Attendance did slow after its first 9 weeks when serving 160,000 visitors in 12 months looked possible. These figures compare to 39,350 annual attendance at the old site. Comparing the first 19 weeks of years 1 and 2, CMT has experienced a small (less than 4 %) decline in gallery attendance from 53,489 to 51,496 visitors.  
     
  • Keeping up Revenue. Admission revenue in the first 12 months was $193,381. Revenue for the first 19 weeks of year 2 has stayed close to what it was in year 1, dipping somewhat from $90,128 to $86,525, an average a few pennies per visitor less. Nevertheless, it is 70% more than the $50,000 gap that Tanya had used in framing Big Idea #3 to her board. 
    Member Relations. Membership has doubled since the Museum opened its doors at its new site and tripled over its previous level. Member visits continue at about 20% of total attendance. Renewal rates have been climbing to 23%, up from 11% previously and, hopefully nearing CMT’s goal of 30%, the lower end of the industry standard.
     
  • A More Diverse Audience. Now around 50-60% of families visit from zip codes considered lower income, up from around 30-40% of families from these same zip codes. Twenty percent of visiting families self-identify as military families and that, Tanya says, is “huge” in Tacoma. In Pierce County, veterans are 10% of the population.
     
  • Intangible Returns. Two other benefits have been picked up through observation, anecdote, and word-of mouth. Front desk staff notice that those who decide to pay at the admission desk and give $30 or $40, do so joyfully because they decide what to give. And locally, Pay as You Will has enhanced CMT’s stature with the bold step it has taken to respond to and serve the community. 

As Committed as Ever
CMT’s commitment to easy access for children and families from across the community is long-term with Pay as You Will as a long-term experiment towards realizing that commitment. Set it up as a 5-year experiment, CMT is half way through year 2. The Museum doesn’t expect to make a solid business decision until it is has at least 2-1/12 years of results to consider. But no one, Tanya says, is talking about going back to charging for admission.

Pay as You Will has been an effective strategic experiment. It is increasing access and creating connections across the community while allowing the Museum to achieve its financial goals. It is also opening up new territory for CMT’s future, bringing bigger questions to the forefront for the Museum to explore: What are we now able to see, deal with, and obligated to do to become the museum our community needs us to be? What’s our role in making this a thriving community for families with young children? How can we help boost the attachment and resiliency of children in military families?  

Successful on multiple fronts, Pay as You Will is allowing the Museum to more fully inhabit its larger purpose in serving its visitors, community, and itself.

2 comments:

  1. Thanks so much for this inspiring and informative post! I'm really intrigued by the way they saw this switch as part of a goal to increase % of earned revenue, and how it worked.

    Our museum has a $5 admission fee, but we also have lots of sponsored free days (about four per month) and use an informal policy of "spontaneous free" to invite in anyone who seems leery of paying. I keep struggling with the question of whether frequent free days (and spontaneous free) maintains the "value" of the experience while creating energized novelty around free days, or whether being free/pay what you will all the time would be a better approach. I'll be sharing this with our team. Thank you.

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  2. Thank you, Nina! I'll make sure Tanya Andrews and her board see your comment. They have been sorting out the same kind questions and comparisons you note as part of your on-going consideration of factors: access, energized novelty, value of the experience. And, of course there is a set of factors for every museum and its community. I have admired Tanya's clarity about what was important (access) and what that would cost, not to mention the bold step to increase their % of earned revenue. Great good luck with your conversation. I would love to hear where the thinking–and action– leads.

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