Strategy in a Structural Break: COVID and the Culture Sector
In 2008 Richard Rumelt, author of Good Strategy, Bad Strategy, wrote: “There is nothing like a crisis to clarify the mind. In suddenly volatile and different times, you must have a strategy. I don’t mean most of the things people call strategy—mission statements, audacious goals, three- to five-year budget plans. I mean a real strategy…
By strategy, I mean a cohesive response to a challenge. A real strategy is neither a document nor a forecast but rather an overall approach based on a diagnosis of a challenge. The most important element of a strategy is a coherent viewpoint about the forces at work, not a plan.”
The author of this piece was talking about the 2008 financial crisis but, in 2020-1, the COVID crisis is a similar challenge that also requires clear direction. The piece chimed with a number of things I’ve seen at work in the culture sector during this turbulent time.
We have spoken to a lot of organisations that have the budget and headspace for a short-term sticking-plaster fix of digital engagement to put on a temporary COVID-induced wound. But there’s a sense of frustration: a larger problem of how to think about digital activity post COVID, and how to resource it. We hear ‘we know we need to do X, but part of that doesn’t sit in my role, it sits in marketing/operations/more senior roles, we’re doing everything and really we need so-and-so to pick this up’.
COVID is difficult to plan around as no one is exactly sure to what extent its effects will disappear with a vaccine. When a vaccine is rolled out there’s a scenario in which footfall-derived income is similar to pre-COVID levels, and so the immediate need to ‘do some more digital engagement’ will feel less necessary. But it’s also possible that - even in the event of a successful global vaccine rollout - the effects of COVID won’t magically restore audience behaviour and attitudes to what they were before the pandemic.
In particular, specific audiences are unlikely to come back to cultural organisations in the same numbers. Many of those most vulnerable to COVID are likely to be cautious about returning. International audiences are unlikely to be able to return in the same numbers that they did in 2019.
Not to mention the fact that cultural organisations themselves will continue to be under much greater financial pressure than before. All of which makes it more important for leadership to identify activity that has become ineffective, and look at doing more activity that delivers in a post-COVID world.
I believe that it’s a missed opportunity to think of increasing digital activity as a short-term fix to lockdown. A more effective strategy would be to look at the ways digital can continue to provide long term solutions to post COVID problems.
I’m under no illusions of what a complex organisational change that would be. The question of where digital sits and how it supports the wider organisation was not a simple one even before COVID. Dafydd James and Kati Price (Heads of Digital from the National Museum of Wales and the V&A, respectively) showed in 2018 that the sector isn’t consistent about where digital sits, how much autonomy it has, or how embedded digital skills are across the organisation.
It’s fair to say digital teams are under much more strain than they were before, and most departments’ traditional raison d'etre has been turned upside down by COVID. It’s hard for those in digital teams to suggest to less-busy colleagues that they pick up new digital tasks brought on by COVID. In a traditional ‘top-down’ structure this would need to be authorised by the level above the digital team, by a manager who oversees digital and non-digital public engagement activities.
We need cultural leaders to identify:
What activity for engaging remote audiences makes sense post COVID?
Which teams - if they had the requisite skills - would be best placed to deliver it?
How do we give them the relevant skills?
There’s another assumption in all of this that spending more money (including on training) is just not financially viable. But by default digital teams create content that is free to consume. Research from the Culture Restart audience tracker (which One Further was a partner on) has found that “there continues to be a strong, ongoing appetite for digital content across all age groups, and an increase in willingness to pay for it, from 62% in October to 65% in November… Audiences are still expressing an interest in engaging with online content when live events resume, suggesting that, with the right product, it could become a sustainable revenue stream beyond the pandemic”.
No one has dominated this area of the market yet, it’s ripe for exploration. There are examples across the sector from those who have dipped their toe in to monetised online content, and have seen sizeable return on investment. This includes for passive income streams like pre-recorded events, online taught classes and online escape rooms*. In these cases a one time set up cost continues to generate revenue for as long as the product is live and marketed.
What we do in lockdown shouldn’t be about ‘what we should do with an undetermined amount of time’. It should be about what change we think will continue to be valuable, be financially viable and reach new/remote audiences, even when we reopen. COVID, like the financial crisis, marks a ‘structural break’ (to borrow another phrase from Rumelt). The most effective strategies will be those that see the opportunities this break provides and mobilise to meet them.
*Some examples of these in practice: Orleans House Gallery Twickenham Luminaries: A Virtual Lecture Series This brought together various historic houses to give a series of thematically related lectures, so increasing each house’s typical audience and generating revenue for them as a set.
Oxford University Museum of Natural Museum ‘Escape Room’ online (ticketed) event with Steve Backshall (this raised £35K on the night it ran, more than covering costs).
Plymouth Point “An immersive theatrical thriller, made for the internet. Be transported into a world of conspiracy, cults and corporate deceit.” £45 - £55 per ticket for 2-6 people.
Some more examples specifically on revenue generating online content.
