Andrew Lovett is the director and chief executive of the Black Country Living Museum, Dudley

Be wanted, rather than just known

Andrew Lovett, Issue 116/01, p14, 01.01.2016

The best museums are those that recognise they operate in a market

Because I want to remove what sometimes feels like a firewall between culture and enterprise, I was delighted when my museum won two business awards recently.

Some have said that museums are worthy, but represent market failure, and therefore deserve public money. While I agree some museums merit investment – implying some kind of payback, rather than subsidy – by the taxpayer, I do not accept what sounds like haughty rejoicing of museums being a market failure.

It might be uncomfortable, but I believe the best museums are those that recognise they operate in a market. To make it work, however, they must want to do it, and believe it is the right thing to do. The museum’s heart and head need to be in it. If you don’t feel this way, museums may no longer be the place for you.

Notwithstanding Arts Council England’s welcome revenue funding for specific things and the need to raise major capital from public sources, many museums take pride in being self- reliant. Just as being a charity isn’t a tax status but a conviction, being enterprising with your assets to earn money isn’t a chore but a mindset.

Your organisation must care about numbers.I am amazed how many people running museums show a lack of curiosity about the important numbers. I am often asked what kind of organisation you need to create to be good at using your assets.

My answer is to insist on regular, accurate, contrasted and widely circulated financial information. See financial management as a test of talent, not arithmetic. Be risk-aware, not risk-averse. Be prepared to adapt.

Numbers should be organisationally unifying and motivational. Even if your museum is free, I would, at the very least, measure how much you earn from each visitor.

Set a budget for it and test your talent. At the Black Country Living Museum we earn £16 gross from each visitor and £1.60 net from everything we do, and we know where every penny comes from.

Being a museum is rightly central to our brand. Many organisations are also charities, established to provide public benefit. Museum and charity – your mission, and two simple words that everyone you’ll ever meet understands.

They are words that will live on long after the latest buzzwords have faded. So don’t undermine being a museum and charity. Feel proud of what you do every day. It is a good test, and you’ll know if you’re cheating.

I would also urge museums to be distinctive. Identify what makes your museum’s assets stand out. For what do we want to be famous? Whose needs can we match up with? Who wants to trade with us?

Every economics book starts by asking who wants to give you something – usually money – that they value less than something you have on offer. Not everyone can give something, but you might find a film location manager, business sponsor, a couple looking to get married, a housing association that wants somewhere to hold its Christmas do, a TV documentary maker, or, you’ve guessed it, visitors.

For all those potential diverse matches, the difference we try to make, in addition to the special character of our museum, is how we treat them and provide peerless experiences.

I also recommend developing more intensity and commitment to your relationship with visitors by turning a financial transaction into long-term loyalty based on an emotional attachment. Membership schemes and annual passes are great for this, as they are more about “buy-in” than “buy”. Think marriage, rather than speed-dating.

Finally, don’t be a busy fool. Put more of your effort into being wanted, rather than just known.