By David Kime

 

My experience earlier this year will sound familiar to artistic directors and administrators across the United States. On Wednesday evening, March 11, 2020, the A Voice for Good directing team huddled in my living room. Our Easter season, 120-voice mixed choir had three concerts scheduled over the coming week.

The COVID-19 virus was quickly becoming headline news here in Utah, and life was starting to grind to a halt. We realized that the concerts that weekend would likely be our last for several months. But could we even proceed with these performances? The Western Regional ACDA Conference had occurred in Salt Lake the previous week without incident. Why would our experience be different? Over several hours, we plotted to perform a live-streamed concert with limited in-person attendance. We would create film and audio recordings on Saturday and Sunday nights, just before our venue would close indefinitely.

Twenty-four hours later, we gathered again; new problems required a new game plan. As of that day, each of our performance venues had closed. Churches, universities, businesses, and local governments signaled that we were entering lockdown. Our 2020 season ended without a single performance. We met with choir members only in small groups for emotional “goodbyes” that Sunday. As the new lockdown reality sank in, we realized that we now faced more daunting challenges. No performances meant no donations. No donations could mean no 2020-2021 artistic season. We needed a new fundraising plan, and we needed one fast.

 

Executive Summary  

 

Researchers Janelle Kerlin and Tom Pollak, writing in The American Review of Public Administration, suggest that arts nonprofits’ revenue fluctuates significantly based on holistic economic patterns.[i] Before the pandemic’s onset, experts noted “stagnating growth” in world economies.[ii] Both of these factors foreshadowed an imperfect 2020 for arts nonprofits, but COVID-19 has left our organizations in financial free fall.

 

Thriving in the post-COVID-19 world will require rigorous adaptations in the nonprofit sector. While remaining grounded in the community-building message we share, arts nonprofits must apply evolving evidence-based fundraising techniques. Several basic principles will yield best outcomes: pursue robust business partnerships, engage with individuals, and invest in measuring impact.

 

Pursue Robust Business Partnerships

Dissecting the arts business funding relationship, a 2018 Conference Board study reveals that a strong partnership with a given arts organization can motivate ongoing donations.[iii]  As Figure 1 displays, company size can provide insight into different reasons that propel business giving.[iv] Note, however, that a long-term existing relationship motivates giving at all company sizes.[v] If our organizations do not already have corporate partnerships, it is time to start forming them.

To begin building partnerships, identify companies where individuals are deeply committed to the arts. As Figure 1 denotes, especially for small businesses, executive and employee interest in the arts are among dominant reasons for corporate giving.[vi] Local businesses including music stores, instrument rental services, and performing arts venues provide a practical starting point. These businesses are filled with arts lovers who sympathize with the economic difficulties that our groups face. We should also consider less apparent potential partners. Many businesses in historic districts and gentrifying “arts districts” harbor deep interest in and commitment to building local arts organizations. Their donations will allow us to build our organization and strengthen the community, fostering a culture of high-quality art.

Daellenbach, Thirkell, and Zander, in a 2013 study, found that one or more passionate individuals within a corporation can effectively guide a nonprofit seeking business funding.[vii] Such an advocate builds excitement about and support for potential partnerships within a company.[viii] The authors point out that leaders within the arts should apply this information; they “need to be knowledgeable about the business community and individuals in the business community. They should seek to understand who might be the advocate in various companies.”[ix] As we identify, educate, and engage both employees and executives, we lay the foundation for future financial partnerships.

Furthermore, arts leaders must shape partnerships to also benefit corporate partners. In proposing a symbiotic financial relationship, arts organizations may explain both research and applications surrounding their work, highlighting how the arts address relevant business struggles. As employers and outside organizations have recognized, the COVID-19 pandemic is spawning increased mental and emotional health difficulties.[x]  Arts organizations have resources that can help businesses alleviate these difficulties. Leaders need to think creatively about how to present and share these resources.

Consider, for example, potential benefits of singing to individuals. Graham F. Welch and Costanza Preti, in reviewing previous research literature, note the growing body of research that confirms singing’s benefits, including improved feelings of health and wellbeing.[xi] As Töres Theorell highlights, singing can result in higher concentrations of the hormone oxytocin and can positively affect the immune system.[xii]  Why not apply such benefits to addressing the mental and emotional health problems brought on by COVID-19?

For example, a choral arts nonprofit seeking business funding might volunteer several leaders to offer a free corporate choir—whether online, outdoor, or indoor—to any interested employees. At a time when employee health and well-being rank high among corporate problems, leaders will find such an offer attractive. The company addresses its priorities, the arts organization receives funding, and roots of collaboration begin to grow into strong branches of partnership.

In tailoring proposals to meet business needs, arts leaders can present funding opportunities as chances to achieve community-related goals. Mirae Kim’s 2017 study of 909 American arts nonprofits examined these organizations’ levels of community engagement.[xiii] Kim found that nonprofit arts groups play a role not only in the market economy but also in civil society.[xiv] Regardless of corporate partnership, nonprofit arts groups wield significant influence in communities. Bridging gaps between the educational, religious, cultural, and nonprofit sectors of their communities, they have a significant role to play in advancing positive relationships between diverse organizations and groups. Even newly formed arts organizations can wield a cultural and community influence that companies lack simply because of the organization’s nature. Organizations with most civic involvement tend to have large webs of connections with other leaders and organizations.[xv] They focus on their nonprofit status and realize that similar groups also engage in civil society.[xvi] Potential corporate partners should recognize that funding well-connected arts groups will bolster their status in the community. As arts leaders, we need to leverage these potential benefits by engaging in consistent community outreach.

As we seek business funding, we should not discount company characteristics. As Figure 2 demonstrates, the 2019 Conference Board report found a meaningful difference in types of donations based on company size.[xvii] As company size increases, it appears that the amount of in-kind donations decrease.[xviii]  In-kind donations include nonmonetary contributions. For example, a fabric store might donate materials for a choir or orchestra to sew masks, or a caterer might donate a cast meal for a certain event. Based on these findings, fundraising-savvy arts leaders will simplify proposals to larger organizations, seeking only monetary donations. Working with small businesses, arts leaders will recognize and encourage other types of giving.

For instance, many arts groups provide occasional meals for their performers. Seeking a partnership with a local caterer, groups might seek a subsidized or free cast meal in return for providing advertising on programs and websites. Alternatively, groups might offer for their organization’s volunteers to work with the catering company on a community project. In the previously cited 2019 report, the authors encourage arts organizations to seek common causes with business partners; this type of collaboration on a social, political, or economic issue can be beneficial to both organizations.[xix] Whether the collaboration is cause-based or profit-focused, both arts groups and businesses find strength in working together.

 

Engage with Individuals

While some will argue that targeting individual donors yields less than developing corporate collaborations during uncertain times, a balanced approach will provide best results. As Kerlin and Pollak point out in their analysis of historical nonprofit funding, organizations “do not appear to compensate for losses in private contributions and government grants through increases in commercial revenue.”[xx] Simply put, at a time when it is likely that government and private funding will respond negatively to the economic downturn, arts leaders cannot turn to corporate funding as the cure-all. Continued efforts to reach individuals in our communities and in our organizations will produce new fundraising solutions.

Understanding individuals’ values should influence how arts leaders tailor fundraising efforts. In a 2017 study, Lee, Fraser, and Fillis, gathered information from art gallery attendees to find out whether individuals would more likely or less likely donate when faced with one of the following scenarios:

• The gallery closing as a byproduct of lacking donations,
• The gallery simply asking for donations, or
• The gallery indicating that any future exhibits would require more funding.[xxi]

Their research concluded that frequent visitors are statistically more likely to donate when faced with the proposition that without increased resources, the gallery might close.[xxii] They also found that those visiting less frequently were more likely to donate when faced with the possibility of more exhibitions or the loss of the current exhibition.[xxiii] However, as the authors point out, organizations must use care to avoid crying wolf; arts leaders should avoid constantly portraying their organizations as on the verge of financial collapse.[xxiv]

These findings inspire significant applications, especially in the deadly environment 2020 has given arts organizations. A dose of straight talk to our long-time donors and patrons regarding the dire situation might provide a stream of life-giving donations, as long as we use such an appeal sparingly. Each donation should be answered with a personal thank-you e-mail or written card; these donors need to know how important their contribution is to arts leaders and to their organizations. Consider providing these loyal patrons with a copy of your group’s multi-year plans; they deserve to see, and possibly even to choose, what their donation will accomplish.

When dealing with the general public and casual supporters, we should focus intensely on presenting the opportunities for the future. A video highlighting past performances and future plans—dependent, of course, on donations—might do just the trick. In the A Voice for Good organization, we used this technique for our summer fundraiser. In a socially distanced world, this video provided an easy, effective way to showcase accomplishments and draw in small dollar donations. As Joan Garry writes in The Chronicle of Philanthropy, “When you ask for money, frame the gift as a bridge from where you are now to what’s possible.”[xxv] As we engage individuals, we can target our marketing strategies based on their involvement and interest in the arts.

While targeting various demographics in our communities, we should capitalize on the COVID-19 pandemic to involve talented employees and volunteers in the decision-making process and to apply the forward-facing strategies they bring. The individuals that fill our organizations can augment our fundraising efforts in ways that executive directors, artistic directors, and board members might otherwise overlook. Discussing talent management practices through the pandemic’s lens, Dr. Sandhya Karpe argues that organizational response should include greater experimentation, including opportunities for employees to adapt, fill new needs, and demonstrate capacity: “It is refreshing to observe that high-potentials are eager to embrace new challenges during a crisis, and willing to courageously transition into mission-critical areas of the business that are still unknowns.”[xxvi] Based on Dr. Karpe’s advice, arts leaders who consider bringing new voices to the table may be surprised by the excellent talent and capable leadership they find.

Embracing the talent within our organizations helps us adopt forward-facing strategies to make fundraising simpler and easier. In a 2020 study regarding patterns of giving among UK citizens, Moraes, Daskalopoulou, and Szmigin found that arts organizations need to simplify giving to the arts.[xxvii] By demonstrating the arts’ benefits and providing clear avenues for donating, organizations can gain a larger share of the charitable donations that individuals make.[xxviii] Younger employees in our organizations are uniquely suited to understanding social media platforms, online funding techniques, and best advertising practices.

With a 2019 analysis of fundraising and marketing in the context of American symphonies and opera houses, Besana and Esposito supported the assertion that to effectively confront future difficulties, our strategies must be forward-facing: “Managerial innovation requires propensities for both off-and online marketing and fundraising with an adequate, specific and professional focus on the added value of social media.”[xxix] As arts organizations develop young leaders and engage audiences in forward-focused ways, fundraising will not only thrive, but also contribute to growing unity between arts leaders, our volunteers, our employees, and our communities.

 

Invest in Measuring Impact

In the previously cited UK giving study, the authors note that arts organizations will benefit greatly from transparently demonstrating how donations are used.[xxx] Similarly, in a warning from the 2019 Conference Board report, authors admonish arts organizations to find more ways to quantify and demonstrate the effects of their efforts: “Being able to calculate an ROI-type figure will help to justify the benefits of sponsoring arts programs.”[xxxi] To effectively demonstrate and measure positive impact, arts organizations must collaborate with corporate partners to develop systems of accountability. Arts leaders must also evaluate organizational decisions based on future financial effects.

Arts leaders can capitalize on strong business partnerships by allowing corporate partners a voice in determining how arts organizations will measure impact. The Conference Board recommends “[setting] time-bound, quantifiable goals,” which allows corporate partners and arts leaders to reach consensus and understanding on how to best measure impact.[xxxii] Arts leaders may be most focused on impacting a community or advancing a certain social cause, but they must find ways to track efforts and quantify outcomes. While outside organizations often measure the financial impact that arts have on a community, such as Americans for the Arts, individual organizations need their own metrics, and they need to track progress on their own. Working collaboratively, we can develop means to show corporate partners how many individuals are being affected by our work and how great our economic impact is on the community.

Understanding and applying effective financial measurements will help demonstrate impact. In a 2003 study, Ritchie and Kolodinsky sought to clarify the mystery surrounding nonprofit performance: for many decades, organizations and researchers have not developed consensus on what constitutes effective measurement of financial success.[xxxiii] Ritchie and Kolodinsky found that three areas of measurement—fundraising efficiency, public support, and fiscal performance, as measured by various indicators—seem to give unique insight as to how the organization is performing.[xxxiv] The authors suggest that based on this finding, a nonprofit could weigh the importance of each of the three categories in a way that would create a “composite performance measure.”[xxxv] The study can be accessed here for further information and ideas on developing an effective measure of your group’s financial health, strength, and stability.

Business partners will find measures of this type very appealing; they provide trackable year-over-year data. Such measurement clarity allows for simple, concrete reports to donors, corporate partners, and to the public. Increasing transparency and measuring performance in this way will increase community trust in our nonprofit organizations.

As arts organizations consider creative programming, new funding methods, and how to best measure community impact, they should carefully consider how organizational decisions will affect the future. In a 2020 study examining how crowdfunding efforts affect nonprofits, Alexiou, Wiggins, and Preece, found that a crowdfunding campaign’s implications may be based on an organization’s age.[xxxvi] For instance, the researchers found that a crowdfunding campaign will affect both young and old arts nonprofits, but in different ways.[xxxvii] A young nonprofit which fails to meet a crowdfunding goal will likely lose legitimacy with the public and will struggle to fundraise in the future.[xxxviii] A positive outcome, conversely, sends a very strong signal of growing legitimacy.[xxxix] For established groups, a failed campaign does not seem to result in the same negative impacts and may even cause an increase in funding.[xl]

However, Charles and Kim’s 2016 study suggests that an organization’s non-financial performance—based on total attendees, free tickets for attendees, and website traffic—may correlate negatively with amount of donations.[xli] These contrasting examples indicate that arts organizations must consider how varying financial and nonfinancial performance measures will affect their future financial viability.

Furthermore, in a 2011 study, Pandey, Kim, and Pandey studied 1,792 mission statements of arts organizations and found that a focus on activity components in a mission statement can correlate with improved financial and nonfinancial outcomes.[xlii] These positive effects were associated with a focus on factors including accomplishment, communication, and motion in the mission statements.[xliii] As arts leaders consider the level of involvement they seek in community affairs, it is critical that leaders determine whether involvement will undermine or increase the arts group’s impact. Decisions regarding involvement require careful consideration of how that will affect the organization’s capacity to strengthen the community.

Conclusion

Nonprofit arts groups face a range of new challenges and opportunities based on the COVID-19 pandemic. Applying evolving evidence-based fundraising techniques will strengthen our organizations and the communities that we serve. Through robust business partnerships, nonprofit arts groups can secure long-term funding. Engaging with individuals, we as arts leaders can broaden our audiences, strengthen our organizational capacity, and improve our future readiness. Investing in impact measurement, arts organizations will maintain corporate, individual, and community funding well past the COVID-19 pandemic’s end.

 

 

David Kime is a candidate for the Bachelor of Music degree with a combined emphasis in Piano and Organ Performance at Brigham Young University. As a pianist, accompanist, organist, choral conductor, and arranger, David works to bless others through music, reflecting the teachings of The Church of Jesus Christ of Latter-day Saints, of which he is a member. David serves  as an artistic director and the board vice president for the A Voice for Good organization. David loves serving and spending time with great friends, driving in Utah’s and Idaho’s beautiful landscapes, and listening to the Tabernacle Choir at Temple Square.

[i] Janelle A. Kerlin and Tom H. Pollak, “Nonprofit Commercial Revenue: A Replacement for Declining Government Grants and Private Contributions?” The American Review of Public Administration 41, no. 6 (2011): 686—704.

[ii] Bart van Ark, Abdul Erumban, Yuan Gao, Erik Lundh, Ilaria Maselli, Ataman Ozyildirim, Klaas de Vries, “Global Economic Outlook,” The Conference Board, accessed July 30, 2020, www.conference-board.org.

[iii] Alex Parkinson, Graciela Kahn, Emily Peck, and Randy Cohen, Business Contributions to the Arts: 2018 Edition, New York: The Conference Board, 2018, Accessed June 2020, www.americansforthearts.org.

[iv] Parkinson et al., Business Contributions 2018, www.americansforthearts.org.

[v] Parkinson et al., Business Contributions 2018, www.americansforthearts.org.

[vi] Parkinson et al., Business Contributions 2018, www.americansforthearts.org.

[vii] Kate Daellenbach, Peter Thirkell, and Lena Zandler, “Examining the Influence of the Individual in Arts Sponsorship Decisions,” Journal of Nonprofit & Public Sector Marketing 25, no. 1 (2013): 81—104.

[viii] Daellenbach et al., “Examining the Influence of the Individual,” 98.

[ix] Daellenbach et al., “Examining the Influence of the Individual,” 100.

[x] Marion Devine and Robin Erickson, “Human Capital Management during COVID-19: Support for Well-being and Mental Health,” The Conference Board, accessed 30 July 2020, www.conference-board.org.

[xi] Graham F. Welch et al. eds. The Oxford Handbook of Singing (Oxford: Oxford University Press, 2019), 381—383.

[xii] Welch et al. eds., Handbook of Singing, 923—924, 928.

[xiii] Mirae Kim, “Characteristics of Civically Engaged Nonprofit Arts Organizations: The Results of a National Survey,” Nonprofit and Voluntary Sector Quarterly 46, no. 1 (2017): 175—198.

[xiv] Kim, “Characteristics,” 190.

[xv] Kim, “Characteristics,” 190.

[xvi] Kim, “Characteristics,” 190.

[xvii] Robert Schwarz, Randy Cohen, and Isaac Fitzsimons, Business Contributions to the Arts: 2019 Edition, New York: The Conference Board, 2020, Accessed July 2020, www.americansforthearts.org.

[xviii] Schwarz et al., Business Contributions 2019, www.americansforthearts.org.

[xix] Schwarz et al., Business Contributions 2019, www.americansforthearts.org.

[xx] Kerlin and Pollak, “Nonprofit Commercial Revenue,” 694—696.

[xxi] Boram Lee, Ian Fraser, and Ian Fillis, “Nudging Art Lovers to Donate,” Nonprofit and Voluntary Sector Quarterly 46, no. 4 (2017), 837—858.

[xxii] Lee et al., “Nudging Art Lovers,” 853—855.

[xxiii] Lee et al., “Nudging Art Lovers,” 853—855.

[xxiv] Lee et al., “Nudging Art Lovers,” 853—855.

[xxv] Joan Garry, “How to Ask for Money During a Crisis,” The Chronicle of Philanthropy, last modified July 7, 2020, www.philanthropy.com.

[xxvi] Sandhya Karpe, COVID-19 and the Talent Agility Imperative, Singapore: The Conference Board Asia, 2020, Accessed July 2020, www.conference-board.org. (without an account, access at: www.conference-board.org)

[xxvii] Caroline Moraes, Athanasia Daskalopoulou, and Isabelle Szmigin, “Understanding Individual Voluntary Giving as a Practice: Implications for Regional Arts Organizations in the UK,” Sociology 54, no.1 (2020) 70—88.

[xxviii] Moraes et al., “Understanding Individual Voluntary Giving,” 70—88.

[xxix] Angela Besana and Annamaria Esposito, “Fundraising, social media and tourism in American symphony orchestras and opera houses,” Business Economics 54, no. 2 (2019): 137—144.

[xxx] Moraes et al., “Understanding Individual Voluntary Giving,” 84.

[xxxi] Schwarz et al., Business Contributions 2019, www.americansforthearts.org.

[xxxii] Schwarz et al., Business Contributions 2019, www.americansforthearts.org.

[xxxiii] . William J. Ritchie and Robert W. Kolodinsky, “Nonprofit Organization Financial Performance Measurement: An Evaluation of New and Existing Financial Performance Measures,” Nonprofit Management & Leadership 13, no. 4 (2003): 367—381.

[xxxiv] Ritchie and Kolodinsky, “Nonprofit Organization Financial Performance,” 376.

[xxxv] Ritchie and Kolodinsky, “Nonprofit Organization Financial Performance,” 377.

[xxxvi] Kostas Alexiou, Jennifer Wiggins, and Stephen Preece, “Crowdfunding Acts as a Funding Substitute and a Legitimating Signal for Nonprofit Performing Arts Organizations,” Nonprofit and Voluntary Sector Quarterly 49, no. 4 (2020): 827—848.

[xxxvii] Alexiou et al., “Crowdfunding,” 842—843.

[xxxviii] Alexiou et al., “Crowdfunding,” 842—843.

[xxxix] Alexiou et al., “Crowdfunding,” 842—843.

[xl] Alexiou et al., “Crowdfunding,” 842—843.

[xli] Cleopatra Charles and Mirae Kim, “Do Donors Care About Results? An Analysis of Nonprofit Arts and Cultural Organizations,” Public Performance & Management Review 39, no. 4 (2016): 864—884.

[xlii] Sheela Panday, Mirae Kim, and Sanjay K. Pandey, “Do Mission Statements Matter for Nonprofit Performance?: Insights from a Study of US Performing Arts Organizations,” Nonprofit Management & Leadership 27, no. 3 (2017): 389—410.

[xliii] Panday et al., “Do Mission Statements,” 400.