In a recent forum in Seattle, consultant Alan Brown challenged arts leaders to think beyond artistic excellence – implying a static, externalized vision – to artistic vibrancy, a phrase connoting the shared experience between musicians and audience when a great performance occurs.  He further proposed replacing the concept of audience development (getting bodies in seats) with audience engagement (building sustainable relationships).   Diane Ragsdale, formerly of the Mellon Foundation, merged both ideas in a speech last year titled “The Excellence Barrier,” suggesting that “to attract and retain new audiences, arts organizations may need to stop selling excellence and start brokering relationships.”

Both artistic vibrancy and audience engagement are key concepts in the TSO’s burgeoning new Strategic Plan.  Part of our vision statement reads, “capture the imagination of the community with extraordinary performances where the combined energy of the orchestra and audience creates magic.”

Sounds great, doesn’t it?  But how does all this tie in with creating a new, sustainable business model – the subject we began exploring last month?

The answer may be coming from forward-thinking organizations like The Saint Paul Chamber Orchestra.  At the SPCO, the term “business model” doesn’t just refer to budgets and ratios of earned-to-contributed revenue.  If the Strategic Plan is the body of the vehicle, at Saint Paul the business model is the chassis.  Several years ago they set out to create a new model that would sustainably fund the achievement of their Vision.  They were wrestling with a similar problem to the TSO:  how to sustain the orchestra over the long-term if its earned income ratio remained at 30 percent or less.

Their answer was surprising, in that they have essentially rejected the traditional “three-legged stool” business model that breaks out different percentages for Contributed, Earned and Endowment revenue.   “Best practices” thinking about this model has varied over time, with some advocating 40% earned and others as high as 50%.  In St. Paul they realized it was a moot point, because there was little possibility they would ever go beyond 30%.

Then-president Bruce Coppock put it succinctly:  “The SPCO’s low ticket-revenue percent was in large measure a result of our structure… by virtue of artistic mission, size, and geographic circumstance, the SPCO is a boutique shop, and can only increase the percentage of revenue derived from tickets to a maximum of 30 to 35% -- if every ticket is sold at full price.  In previous years, we tried to increase ticket revenue by maintaining or increasing prices… this only resulted in smaller audiences.”  [Symphony Magazine, Jan/Feb ’08]

The TSO’s situation is analogous. Although we are a symphony orchestra, not a chamber orchestra, we too are situated in a “shadow city,” a medium-sized community located less than an hour’s drive from a major metropolitan market.  But geographic circumstances make our situation even more challenging.

Minneapolis and St. Paul are two large cities in the middle of the Minnesota prairie, with the usual surrounding suburbs and exburbs, but no other cities of comparable size within several hours’ driving distance.  The Twin Cities are the hub of culture and commerce in central Minnesota.  Their combined gravitational pull is irresistable. 

Tacoma is the second largest in a string of cities clustered along the eastern shores of Puget Sound from Lynnwood to Olympia.  Virtually every one of these communities has its own volunteer or semi-professional orchestra, sometimes more than one.  I-5 is the sole transportation artery, and unfortunately it’s an engineering nightmare of perpetual traffic snarls. Culture and commerce are de-centralized.  People recreate in their own community; audiences are thus “siloed” off into many small organizations.

Even if we had a 2,200-seat concert hall, at the moment Tacoma’s Theatre District lacks sufficient gravitational pull to attract audiences to fill it.  Downtown Tacoma is vastly improved over what it was a decade ago, but it’s still a work in progress and has yet to achieve a critical mass.  Our average percentage of house sold is rising by increments, but we’re still leaving 25% on the table even in the Pantages Theater, with its capacity of 1,200.  And even if the TSO sold every ticket at full price for every concert, we would only raise our earned revenue ratio to a maximum of 33-35%.

I don’t mean to paint a bleak picture; I’m actually very optimistic and excited about the TSO’s future prospects.   We’ve got a dedicated Board team, a wonderful orchestra, my staff is the best I’ve had anywhere, the Broadway Center administration is a strong partner, and our donors are steadfast in their support.  But solutions will only emerge to the extent that we face our challenges squarely and honestly.

In the next post, we’ll continue our look at the new business model created at the St. Paul Chamber Orchestra, and how it is already affecting practices at other orchestras in America.  It is my hope that this will stimulate fresh thinking here in Tacoma, among the TSO Board, musicians and patrons.  Our new Strategic Plan is taking shape, and our future direction is beginning to emerge, like a custom vehicle lovingly made in our own shop.  And in order to really make this new vehicle go, we need a custom chassis!

What might this look like?  It will be different from St. Paul’s.  The whole point their team emphasized was that every community is unique, and the typical industry one-size-fits-all business model only works for a few large metropolitan orchestras.  We can’t simply graft the St. Paul model onto Tacoma.  But we can learn from their process, and we can take inspiration from other thought leaders like Alan Brown and Diane Ragsdale.

Artistic vibrancy.  Audience engagement.  Stop selling excellence and start brokering relationships.  Could it be that the answer lies in these concepts?