1. Client logo This document may not be reproduced or distributed in any manner without the prior permission of MTM 28 th January 2016 │Contact ed.corn@mtmlondon.com │ Tel +44 (0) 20 7395 7510 Digital Culture 2013-2015 How arts and cultural organisations in England use technology

2. 1 MTM helps its clients take advantage of digital-driven change Consumer insight Market and policy research Strategy and growth Digital transformation Service design

3. 2 In 2012 MTM was commissioned to run a three-year study into how arts and cultural organisations use technology 7,476 Number of organisations invited (2015) 2,822 Total responses across three years of study (2013-15) 239 Organisations that responded in all three years 1.3m! Approx. number of data points collected (2013-15)

4. 3 Digital plays a crucial role for many organisations, across a range of functions The importance of digital to different business areas MarketingPreserving and archiving OperationsDistribution and exhibition CreationBusiness models

5. 4 Impact varies with artform and size, but remains high across all subgroups The overall impact of digital – major positive impact

6. 5 In particular, we have seen the role of digital in revenue generation and business models increase significantly Digital and revenue generation, for example: Now see digital as important to business models (up from 34%) 45% Now accept donations online (up from 35%) 41% Report a major positive impact on revenue generation (up from 11%) 16%

7. 6 However, there have been drops in importance for operations, distribution and creation since 2013 The importance of digital (sig. changes marked with arrows) MarketingPreserving and archiving OperationsDistribution and exhibition CreationBusiness models 201320152013201520132015201320152013201520132015

8. 7 This has fed through into small but significant declines across a range of activity and impact measures Six activities are now less common, e.g.: Live streaming Activities Publishing content to website Making recordings available digitally Falls in six impact areas, e.g.: Impacts Audience engagement Exhibiting the end product Collaborating with other orgs Use data to inform online strategy Two data activities also less common, e.g.: Drops most likely to be reported by medium-size orgs, and by music and combined arts

9. 8 It seems that organisations are finding it difficult to deliver on ambitious plans Reality vs. aspirations

10. 9 Qualitative feedback suggests a number of potential explanations for these declines Our initial live-streaming pilot in 2014 did not lead to high-quality video, so we want to re-assess our options in this area before attempting it again Financial pragmatism – orgs scaling back in non-core areas as budgets tighten? Experimentation – many still in test and learn, dropping things that aren’t working? Consolidation – orgs realising they need to refocus on fixing basics, e.g. website? Barriers increasing – lack of digital skills and suppliers, reduced appetite for risk? Our website…is clearly not doing justice to the scale and reach of our work…As a strategic priority we have earmarked a major investment in a new website as part of a broader digital communications strategy

11. 10 The data show us that barriers have become more widespread since 2013 Top 10 barriers (sig. changes marked with arrows) Lack of internal funding for digital Lack of in-house staff time Difficulty in accessing external funding No senior digital manager Lack of in-house skills Lack of expert advice Lack of external suppliers Lack of in-house confidence Lack of control over IT systems Slow/limited IT systems

12. 11 And the situation has also got more difficult from the point of view of digital skills and R&D behaviours 4 of 13 skills gaps have widened, e.g.: Website design Digital skills Digital production Rights clearance R&D behaviours (NB. change since 2014) Experiment & take risks Evaluate impact of digital work What we are never truly aware of is the amount of time and therefore cost required to train and develop the skills needed for the successful application of new technologies Use research and data for decision-making Small orgs considerably worse off, e.g.: 2 areas have become less common:

13. 12 Against this backdrop we do, however, see organisations which are having great success with digital Digital leaders 13.7 10% of orgs that ascribe highest importance to digital… Number of activities (average 9.5) 1. Do a wider range of activities 2. Do more complex activities 57% Doing standalone digital exhibits (average 23%) 3. Exhibit R&D behaviours 68% Experiment and take risks (average 28%) 4. Realise benefits 97% Report overall major positive impact (average 72%) 5. Especially on financial measures 38% Report positive impact on profitability (average 14%)

14. 13 In conclusion, we observe a sector transformed by technology, but with significant issues to address Benefits widely felt – 72% feel a major positive impact Orgs want to do more – 78% intend to try something new next year Leaders showing the way – doing, more, realising more benefits Difficult conditions for innovation – skills gaps and barriers getting worse Late adopters – 10%+ have no email marketing, website or Facebook Small organisations – unable to sustain R&D, risk of falling behind Digital has had a profound impact… …but the study reveals important risks How can the sector respond to these challenges?

15. 14 Ed Corn Associate Director 020 7395 7519 Ed.corn@mtmlondon.com MTM 20-22 Shelton Street London WC2H 9JJ United Kingdom