1 / 35

The Private Sector’s Support for the Arts: The U. S. Experience

The Private Sector’s Support for the Arts: The U. S. Experience. Joanne Scheff Seminario Internacional: “Inversion Cultural: Los Nuevos Escenarios” March 2001 Caracas. History of Support for the Arts in the U. S.

amelia
Download Presentation

The Private Sector’s Support for the Arts: The U. S. Experience

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. The Private Sector’s Support for the Arts: The U. S. Experience Joanne Scheff Seminario Internacional: “Inversion Cultural: Los Nuevos Escenarios” March 2001 Caracas

  2. History of Support for the Arts in the U. S. • Non-profit enterprise developed after the Civil War through efforts of and investment by emerging upper classes. • Museums and symphonies were administered by their founders and supported by wealthy individuals. • Provided source of honor and prestige. • Protected art from government intervention and from the whims of the masses.

  3. History of Support for the Arts in the U. S. • 1930s and 1940s: art became more popularized: • taught in universities • played on radios • 1950s: Ford Foundation under W. MacNeil Lowry provided millions of dollars of capital financing to support infrastructure of arts organizations.

  4. History of Support for the Arts in the U. S. • Other foundations followed Ford model. • 1965: National Endowment for the Arts created: cultural emphasis by the government given official life. • Followed by creation of state and local arts agencies. • Contributions from corporations and foundations: • 1955: $15 million 1990: $500 million

  5. History of Support for the Arts in the U. S. • 1960s - mid-1980s: promotion boom in the arts: • Increased accessibility of arts to greater numbers of people  • Expanding attendance levels  • Growth of new and larger performing arts organizations

  6. Growth in the Arts 1965 1995 Orchestras 58 1,000 Opera 27 110 Dance 37 250 Theaters 12 400

  7. Income Sources for Arts Organizations • 50% earned (ticket sales, etc.) for performing arts; less for museums • 50% contributed • Individuals: 70% - 75% • Foundations: 10% - 15% • Corporations: 10% - 15% • Government: 3% - 5% (Federal, state, and local)

  8. Philanthropy from Individuals • Major source of charitable contributions: 83% of giving overall • In 1996: totaled $150.7 billion overall from 75% of Americans • Another 14% said they would have given but were not asked! • $10.9 billion for arts, culture, and humanities

  9. Philanthropy from Individuals, cont’d • On average, people give between 1 and 2 percent of their income to charities. • 50% of arts contributors report annual incomes of $50,000 or more. • Cultural donors are older (50% over age 50) than donors to other charitable organizations (23% over age 50). • Cultural donors are more likely to be married and less likely to have children at home.

  10. Motives for Giving • “Altruism” masks the complex motives that underlie giving behavior. • “What people want most is simply to be sought.” • “Every individual needs to feel that he is a worthwhile member of a worthwhile group.” Harold Seymour

  11. Motives for Giving, cont’d • Builds self-esteem and self-image • Builds social status or prestige: public recognition for good deeds • Pride in association with an organization, its programs and personnel • Belief in value of the arts and in responsibility to support them • Some people give because they are asked by someone they like and respect.

  12. Motives for Giving, cont’d • Required to give at work -- pressured by superiors • Family tradition of being philanthropic • Financial planning considerations: tax deductions • Primary inducement for giving:belief in an organization’s goals and offerings.

  13. Major Gifts vs. Small Gifts • 80% of gifts come from 20% of givers. Problematic to rely on a few major donors: loss can be destabilizing. Necessary to expend effort to obtain many small gifts. • Small gifts ($1 to $1,000) tend to be made regularly -- usually annually. • Major gifts are often a one-time stretch gift (for endowment drive or capital campaign). • Moderate gifts given annually by major givers.

  14. Major Gifts vs. Small Gifts • Small gift givers are customers of the organization. • Small gifts focus on the organization’s annual and shorter-term needs. • Major gift givers are stakeholders in the organization. • Major gifts focus on donor’s agenda.

  15. Types of Gifts • Annual Fund • Capital Fund • Endowment Drive • Special Events • Planned Giving

  16. Corporate Support for the Arts • 1965 - 1985: grew to $698 million per year. Driven by benevolent self-interest; derived from philanthropy budgets. • Late 1980s - early 1990s: dropped to $518 million. (Recession, reduced tax benefits under Reagan). • By 1994: up to $875 million.(Economic upturn, tax benefits reinstated, growth of sponsorship from marketing budgets).

  17. Corporate Support for the Arts • 47% of U.S. companies support the arts. • 73% of contributions come from small and mid-sized companies ($1 million to $50 million in revenues). • Median contribution of $2,000 • 93% of gifts allocated to arts projects at local level

  18. Types of Corporate Support for the Arts • Corporate Philanthropy • Sponsorships • Collaborations

  19. Why Corporations Give • 74%: to demonstrate good corporate citizenship • 66%: to enhance the quality of life in their community • 46%: to enhance their image and reputation • 22%: to strengthen employee relations

  20. Why Corporations Give • 21%: to increase business networking opportunities • 19%: to increase sales • 18%: to reach important constituencies • 17%: to promote products and services • 13%: to enhance employee creativity • 9%: to increase media coverage

  21. Corporate Philanthropy • Most corporate philanthropy is given for health and human services, education, civic and community affairs. • Corporations donate 0.8% of pre-tax profits. • Tax deduction of up to 10% of adjusted net income allowed by U.S. government. • Corporate foundations can donate up to 5% of gross income without tax liability.

  22. Nature of Corporate Support of the Arts • Philanthropy for the arts is declining: • 12% in 1992 • 9.5% in 1995 • Primarily program and project support as opposed to general operating support. • Avoid supporting controversial or unpopular programs that do not provide desired type of visibility. • Require extensive public relations benefits.

  23. Approaching Businesses for Donations • Accountability is key. Donors do not reward good intentions; they reward good results. • Want to support programs of value; not help an organization limp along to survive. • 82% of decisions about philanthropy made by the chairman or owner. • Decisions increasingly made by employee committees. • Understand funders’ guidelines and interests.

  24. Types of Support • Cash • Goods • Expertise • Services • Space

  25. Corporate Sponsorships • Cash or in-kind fee paid to a property in return for access to the exploitable commercial potential associated with that property. • Undertaken with expectation of commercial return. • Goal is promotion; altruism is implied.

  26. Advantages of Sponsorship • Heightens visibility and enhances profile by linking up with arts organization’s image, appeal, and customer base. • Provides lifestyle association. • Responds to consumer demands that companies give back to their communities. • Helps companies communicate or enhance their commitment to a particular market segment.

  27. Advantages of Sponsorship • Provides benefits other media do not: • Live audiences • Loyal members • Client entertainment opportunities • Category exclusivity • More visibility than TV ads • Matches lifestyle, rather than intruding • Access to databases and volunteers

  28. Advantages of Sponsorship • Merchandising opportunities and sales incentives. • Call attention to, shape, or reinforce public’s perception of a product’s benefits. • Add human element to corporate image • Helps attract and retain quality personnel • Promotes goodwill among customers, clients, and employees

  29. Growth of Sponsorship: 1994 - 1997 • Museum sponsorships increased 41% (to $65 million in 1997). • Sports sponsorships increased 35%. • Corporate media spending increased 21%.

  30. Sponsorship/Media Growth • Sponsorship has outpaced the growth of advertising and sales promotion every year since 1985. • In 1996, growth of expenditures for: • Advertising: 7.6% • Sales promotion: 4.6% • Sponsorships: 15%

  31. Collaborations • Strategic in nature as opposed to sponsorships which are tactical. • More durable commitment - not event oriented. • Common mission. • Authority determined by new collaborative structure. • Resources and reputation pooled.

  32. Collaborations • Comprehensive planning • Well-defined communication channels • Risk greater than in more informal and short-term relationship.

  33. Uses for Collaborations • Expand customer base (both the businesses and the arts organizations) • Improve internal functioning by developing new and better management skills. • Cut costs.

  34. Examples of Collaborations • Share expertise:EDS and Detroit Symphony • Combine office expenses and management: American Symphony Orchestra and Concordia Orchestra • Tie-in Promotions: San Jose Arts Card

  35. Gráficos

More Related