Museums and the Advantage of the Product Differentiation - Research Paper Example

Strategic Management: The British Museum s Purpose: The purpose of this report is to analyse the strategy of the British museum in order to find the strengths and weaknesses and to suggest measures. Background: Museums play an important role in providing the people with entertainment in their leisure time. In order to enhance their market share. Museums should focus on implementing new strategies in order to attract more customers and increased market share. (Peschiutta, 2001). Many establish museums and cultural organisations cannot only rely on income generated; the public funds are decreasing with an increase in the attendance of people visiting these museums. With the increasing demands of greater accountability from government and funding bodies the planning and implementation of successful marketing strategies has become more important (Laczniak and Murphy, 1977). Weak or no strategy can lead to a big trouble for even a well-established Museum. The challenge facing the Museums are to adopt appropriate strategies and technologies in order to make its presence well felt by the customers to generate and get as much. Company History: "The British Museum Company Limited was founded in 1973 by the Trustees of the British Museum to advance the educational aims of the Museum. The Company currently engages in a number of activities, including wholesale and retail, publishing, the production of replicas and other merchandise, and licensing. Retailing: The Museum has expanded its retailing division over the last few years, with the opening of the Great Court at the center of the Museum offering further opportunities for trading. Having the best designed shops the company offers several products for the customers from the books Specializing in ancient history, archaeology, art history and ethnography to pocket money priced items. The Company stocks many materials suitable for use in National Curriculum project work. These also include guidebooks to the Museum, postcards, T-shirts, stationery, camera film, stamps, jewelry and inexpensive gifts and the Museum's exclusive collection of replica sculpture, jewelry and fine silk textiles Publishing: The British Museum has a long history of publishing, dating back to the mid 18th century, with the first recorded publication of catalogues to the early collections in 1749. The British Museum Press was founded in 1973 and is the world's leading museum publisher. Around 60 books are published each year in the broad subjects of history, archaeology, ethnography, fine and decorative arts and numismatics for scholars, children and the layman. Merchandise For a number of years the Company has been producing replicas and gifts based on objects in the collections of the Museum. Often directly molded from the originals, the replicas are the closest that the customers can get to own actual historical pieces. In addition, the company produce a wide range of stationery, jewelry and accessories, decorative ornaments and other gifts inspired by objects and motifs within the collections. Licensing: The Company has worked with a number of manufacturers to produce licensed products using the Museum's collections as inspiration. Merchandise ranges from jewelry to calendars, from cushions to gloss paint." (The British Museum Shop) "The British Museum illuminates to present and future generations the histories of cultures. The Museum holds for the Nation collections of antiquities, prints and drawings, ethnography, and coins and medals. The collections derive from all continents and represent over 10,000 years of human history." (Directgov, 2004) Furthermore, without neglecting the necessity to provide knowledge, education, and entertainment through a highly aesthetic presentation, the museum's directorate is also seeking to blend the new concepts of museology and the scientific theories regarding the interpretation and presentation of material and immaterial cultural heritage in a way that the modern visitor can understand. "The British Museum holds in trust for the nation and the world a collection of art and antiquities from ancient and living cultures. With a current turnover of 58 million, the primary objectives of the Museum are to increase audience engagement with its collections and to build capacity so as to succeed in its ambitions." (fss, 1998) The Museum is now aiming at increase in the revenue. To achieve the purpose it is important to evaluate the strategy and plan new strategical measures, which can eke the management in acquiring the desired target. To gain the above objectives the management of the museum needs to change its vision towards marketing. The Museum urgently needs a MIS in order to effectively undertake the marketing activities and related decision making. "A marketing information system (MIS) consists of people, equipment, and procedures to gather, sort, analyse, evaluate, and distribute needed, timely, and accurate information to marketing decision markers. To carry out their analysis, planning, implementation, and control responsibilities marketing managers need information about developments in the marketing environment. The role of the MIS is to assess the manager's information needs, develop the needed information, and distribute that information in a timely fashion, the information is developed through internal company records, marketing intelligence activities, marketing research, and marketing decision support analysis." (Kotler, 2002) In order to suggest the desired population to be addressed and the customer's inferences the marketing staff will undertake the different primary and secondary research surveys. The cutting edge of these surveys is that they are designed while keeping in view the financial position of the Museum. The following table gives an indication of the research objective, with the suggested respondents/sources and best methodologies. The method has been taken from the Market Segmentation Study for Robben Island Museum. Research Objective Respondents/sources Methodology 4.1 To identify and understand the different profiles of market segments To source from: Attendance registers, including comments on experience Any applicable surveys conducted in the recent past Any other source provided by the client (verbal and/or written) Client, stakeholders & selected individuals of key market segments (e.g. retail, education & heritage institutions, touring organisations) Desk research Desk research Desk research Interviews (sample) In-depth Interviews (sample) Other, suggested by client and/or service provider 4.2 To identify key suppliers of customers Any applicable surveys conducted in the recent past Any other source provided by the client (verbal and/or written) Stakeholders and/or selected individuals of key market segments (e.g. retail, education & heritage institutions, touring organisations) Desk research Desk research Interviews (sample) In-depth Interviews (sample) Other, suggested by client and/or service provider Research Objective Respondents/sources Methodology 4.3 To identify future market segments Any applicable surveys conducted in the recent past Any other source provided by the client (verbal and/or written) - Stakeholders and/or selected individuals of key market segments (e.g. retail, education & heritage institutions, touring organisations) Desk research Desk research Interviews (sample) In-depth Interviews (sample) Other, suggested by client and/or service provider 4.4 To determine the satisfaction amongst current markets - Visitors to Museum - Stakeholders and/or selected individuals of key market segments - Fact-to-face interviews - Telephonic interviews (sample) (Market Segmentation Study for Robben Island Museum, 2005) The primary and secondary data will be sorted compiled in order to get the information, and will be stored properly in order to help the management in undertaking effective decisions regarding the marketing and strategical issues. Hence these information will be the base of the future steps for marketing. Mission Statement The British Museum aims to: - Collect, keep, and preserve objects as well as related evidence of the life of the local people in the pre-industrial and early industrial period - Help the local people to become aware of their cultural identity and its history - Promote education - Introduce visitors from London and abroad to different cultures of the World's ancient nations such as Egypt, Greece, Japan with of course the rich cultures of Europe and America. Objectives: The museum's broad objectives are: - To increase visitor numbers by a policy of communication, public relations, and collaboration - To make use of the new technologies which will help the museum to promote itself all over United Kingdom, and internationally too. - To blend the new concepts of museology and the scientific theories regarding the interpretation and presentation of material and immaterial cultural heritage in a way that the modern visitor can understand - To ensure permanence through: i) Premises, implying continuity ii) Consistent, steady revenue, guaranteeing development and progress. In order to analyse the strategic situation first of all SWOT analysis have been under taken, which I have presented as under: 2.1 SWOT Analysis the British Museum STRENGTHS Huge Collection: The huge collection of the Museum related to the ancient nations. Steady revenue: Funded by state, local as well as European Union's support programs. Free entrance Culture centric educational activities for school groups and culturally sensitive social groups Diploma Courses for the students. The Museum's Informative printed material (successful bulletins, leaflets) Presence awareness despite the lack of proper marketing - Marketing Department. Enthusiastic stuff Friends organisation (approximately 3000 subscribed members) - keen volunteers Good relations with media Web based presence On-line Shop. WEAKNESSES Over-reliance on state and local authority funding No ticket income Lack of marketing department - marketing efforts No relevant researches regarding Museum competitiveness Lack of proper space and exposure. Lack of facilities for people with special needs OPPORTUNITIES Major national trend of promotion and introduction of cultural activities related to conservation and heritage issues More people moving into area Computer technology for promotion purposes Imminent renovation of the building THREATS Current economic climate. Shop and leisure city centre expanding Major competitors: UCL museums and Collections, The Foundling Museum, Sir John Soane's Museum, The Library and Museum of Freemasonry, Theatre Museum, and London's Transport Museum. Results to be achieved in future can be less than projected After performing the SWOT analysis the following objectives are found important to be considered urgently. In order to formulate the goals it is important to align them according to their importance. Marketing Research: The Museum should try its level best to get the primary and secondary data regarding its audiences demand and taste regarding their cultural educational programs and leisure activities. Because before formulating a marketing plan the opinion of the customers is important to know. Development of MIS system in a cost-effective manner. The products available in all the museums are unique and the museums have cutting edge of product differentiation over their competitors as the British museum has on its competitors. But this advantage can only be used effectively through effective marketing campaign. Marketing plays an important role in undertaking transaction between the audience and the museum, sales manifests (or closes) the transaction. Advertising is crucial in effectively undertaking promotional campaign of a museum. "In the case of the British Museum stress should be given to the sales improvements can also be realised in the gift shop, at the membership desk, and when anyone calls the museum for information. All of these are sales opportunities. Just as in business, success in the non-profit sector demands sophisticated marketing. Done correctly, marketing links museum collections, products, and services to customers so well that selling becomes easy. To be most effective, marketing should be a museum- wide view that guides board, staffs, and volunteers." (Will 2004) 2.3 Appropriate Market Segments: The potential segments, which needed to be addressed, are: Teachers & Researchers: The new customers can be the group of teachers and researchers, which have not been addressed before. This potential group can also play an important role in the expansion of the audiences. Since by satisfying the research and education needs of this group the Museum can get exposure to the students and colleagues of the related researchers and teachers. Hence by selecting the group from the target market which have exposure to more masses the number of addressed individuals can be increased without putting additional efforts. Young and Adults: In order to improve the economical situation of Museum it is also important to address the group of individuals who can donate and contribute to the improvement of the economic condition of the Museum. The youngster can also play an important role in the exposure of Museum to more masses. 2.4 Long Term Objectives: After achieving short-term goals, the vision of marketing plan will be enlarged to the long-term goals, which are as follows: SMART Objectives for the British museum Objectives Activity Time Scale Required Responsibility Promotional Objective: Improvement in promotion by introducing new methods. methods 1. By implementing Web based advertising. 2. By sending e- newsletters. 3. By using the relationship with media more effectively. 4. By hanging billboards on important educational places January 2008 Marketing Staff Market Share Objectives: Increase in visitors for 25% 1. By using aggressive marketing techniques. 2. By gaining knowledge about the competitors steps through continuous research 3. By continuous performance evaluation and improvement. 4. By introducing new services. January 2009 Management & Marketing Staff. Profitability Objectives: Increasing revenue for 30-35% 1. After gaining promotional and market share objectives. Increase in profit to be attained by continuing above-mentioned tasks. 2. By introducing new and attractive programs for other age groups. 3. By introducing new culturally enriched educational programs. 4. By improving the Museum shop. June 2009 Management and Education Staff. Product variety variables: The British Museum should apply the strategy of unique special features to offer its visitors. The museum should undertake special educational programs for the school children. Programmes should also be arranged for special social groups. Services: A range of customer services should be provided to serve the needs of customers. Arrangement will be made in future for the needs of special customers. To facilitate the facility to use credit cards and other modes of payments will be implemented. The reservations for institutional can be undertaken on Internet. Customer satisfaction will be seen as the foremost priority. A comment box will be placed at the most prominent place in the museum and in all the shops to take the comments of the visiting customers, which will help, in undertaking service betterment process. The customers will also able to register their complain through these boxes and on Internet. The quick complaint handling will be undertaken in order to satisfy the customers. The timings of the museums should be increased from 4 hours to at least 8 hours daily. This increase in time will increase the chances of increasing traffic to the Museum. The representatives should treat the customers and visitors with Position: In order to increase the sale income and generate the admission fees revenue the Museum needs to attract the customers from the target group of teachers and researchers. The second important group, which needs to be targeted, is the adults and earning members of the community who can serve the purpose of providing donations and fund-raising for the purpose of Museum. Price: Keeping nominal entry charges can increase the income of the museum. Museum should have special admission prices for members, groups, families, seniors, students and kids. Coupons and value packages should also be implemented. Establishment design: Interior layout will be designed in an effective manner to attract the customers. All the items in the museum will be played in an easy to reach and highly visible manner. To keep the environment clam and pleasing atmospherics-scent, lighting, color, mirrors and music, will be used. The environment will be kept soothing to make the visitor enjoy the historical monuments and to feel himself as the part of the ancient times. The signage will contain all the relevant and important information regarding the history of the displayed object. Cleanliness of the displayed objects and fixtures will be an important priority. Promotion: In order to establish a brand image it is strongly suggested that the museum should establish a logo and advertising message. In order to promote the products and services to the target audiences the management needs to follow the persuasive advertising. Advertisements can be given in newspapers and magazines. Museum can place ads in trade publications/tourism guidebooks in order to attract the earning individuals. In order to effectively approach the target market it is important to advertise on television on regular basis. Another cost effective technique is to send mails and promotional promos through Emails. Another important approach is telemarketing. Direct mail is another option. Sales promotions such as coupons and contests are also important to be undertaken. It is also important that the museum should also take care of the past client experience for future business, school field trips, as well as walk-ins sine it is important to retain the old customer rather than attracting the new customers. In order to achieve the higher level of customer satisfaction it important for museum representatives to pay special attention to each and every visitor and should treat the customers in welcoming and friendly as well as helpful manner. The advertisement campaign should include direct mailing, ads in magazines and newspapers, advertisements on Internet and promotional emails. In order to undertake a frequent strategic evaluation an annual plan control should be undertaken through setting small term objectives. The management should keep on analysing the performance in the market place. If there is deviation in the performance from the goals specified in the annual plan the reasons should be analysed. The products available in all the museums are unique and the museums have cutting edge of product differentiation over their competitors as the British museum has on its competitors. But this advantage can only be used effectively through effective marketing campaign. Marketing plays an important role in undertaking transaction between the audience and the museum, sales manifests (or closes) the transaction. Advertising is crucial in effectively undertaking promotional campaign of a museum. "In the case of the British Museum stress should be given to the sales improvements can also be realised in the gift shop, at the membership desk, and when anyone calls the museum for information. All of these are sales opportunities. Conclusion: Museums have the advantage of the product differentiation but in order to make the most of it is important to design a successful marketing plan to support the strategy of the company. Marketing variables play an important part in the presentation and exposure to the target population. Age and geographic variables are also important factors. It is important for the Museum to target new segments in order to remain at the cutting edge. In order to remain competitive in the market it is important to present timely and effective information for the target population. The creation of a proper Marketing Information System and its updating on regular basis is very important for the Museum to not only keep its presence felt but also to increase traffic. A step by step marketing plan should be undertaken in order to achieve the desired result. The management should undertake an annual evaluation of the plans and goals designed to achieve. This will help the museum to correct its action towards the right direction. Continuous updating and promotion will make it possible for the British Museum to achieve its goals in future. References Directgov, (2004). Notes for Editors, available from http://www.number10.gov.uk/output/Page5542.asp [Accessed 13 March, 2006] fss, (1998). The British Museum, available at http://www.fss.co.uk/recruitment_campaigns/british_museum/[Accessed 13 March, 2006] Kotler, P., Marketing Management, Millennium Edition, Prentice Hall, 2000, United States. Laczniak, G. and P. Murphy, 'Marketing the Performing Arts', Atlanta Economic Review, Nov./Dec., 1977, 4-9 Market Segmentation Study for Robben Island Museum, 'Quantitative/ Qualitative & Desk Research', May 2005 [Accessed 13 March, 2006] Peschiutta, Claudia, 'Major Institutions Band Together to Market Museums', Los Angeles Business Journal, Vol. 23, No. 23, June 4, 2001, 9. The British Museum Store, The British Museum Company Ltd., available at http://www.britishmuseum.co.uk/page.aspxContentID=8 Will, P., 'Museums Misinterpret Marketing', Management briefing, 2004, [accessed 13 March, 2006] Read More