Van Gogh Museum’s new business concept: innovation in existing range of services
April 14, 2015
To broaden its revenue model, the Van Gogh Museum has recently started offering specialized consulting services. Together with TIAS and other parties, the museum is working on bringing master classes to the Chinese market. How does a museum change to a Museum Inc.? Business Director Adrian Dönszelmann will explain this during the TIAS Alumni Day and Information Session and already sheds some light on the concept here.
Photo: Jan Kees Steenman/Van Gogh Museum
"The Van Gogh Museum is a successful museum, attracting an average of 1.5 million Dutch and foreign visitors every year. However, success also has a downside. We are largely dependent on physical visits for our revenue (ticket sales). When, a few years ago, air traffic was disrupted by a volcano eruption in Iceland, our visitor numbers halved, since many of our foreign visitors could not come.
Our strategic plan for the next policy period, 2014-2017, includes the goals to broaden our revenue model in order to ensure that our financial base stays healthy, including in the future. We want to reduce our dependence on physical visits in the coming years. On the one hand, we do that by increasing global sales of merchandise and licensing, but we also think about new possibilities, new services and products.
Consultations on art preservation and management
It is common practice in the museum world to exchange knowledge. We are frequently asked for advice and find that our advice on various specialized topics is appreciated. In addition, art is increasingly seen by investors as an investment opportunity. However, we also notice that these investors have insufficient knowledge about how you build a collection, maintain the works of art or exhibit art. This is the knowledge that our museum can offer.
We also notice that the increased demand for art objects pushes prices up. This makes it impossible for museums to purchase certain works of art themselves. However, we believe it is important that collections, including private collections, remain accessible to the public. And we advise private and other investors on how this can be done, if it is possible.
These two trends have given us food for thought. We have extensive knowledge about the management and maintenance of collections, about climate requirements for art and the way collections can be made accessible to a large public. We think we can also connect our knowledge to this new target group.
Before we introduced the consultancy concept to the market, we had done extensive market research. Additionally, our experience helps us identify demand. In other words, my motto is: just do it. Of course, it has to be well-thought-out and you must have good partners. We thought, for example, and that was also demonstrated by a feasibility study, that our knowledge about safety and security would be very interesting to other parties. When an exhibition meets the safety standards of the Van Gogh Museum, the market also sees it as safe. We know that. Yet, in practice, we are not asked for advice on these matters. Most questions currently concern our technical expertise in particular. We have, for instance, concluded a three-year contract with a commercial art depot in New York for a climate control system.
Cooperation with TIAS
With TIAS’ support, we have recently begun to organize our master classes Art, Finance & Collections in China. We are developing a master’s degree in “Management of a cultural enterprise” for the Chinese MBA program. TIAS has a large network in China, which opens doors for us. We also understand each other well and know where we complement each other. This is important when working with a partner.
The consulting assignments we have acquired so far come from existing contacts. The first step we took to attract more orders was to map our full portfolio potential. What services can we offer and how can we bring them to the market? We will begin on a small scale. One business manager is now working on introducing these services to the market. We are also able to “shop” with the current staffing. When we get more assignments this may no longer be possible and we will need to recruit more employees.
Added value in several areas
Having evaluated the first pilot projects, we revised the sales targets that we were aiming to generate from the consultancy work in the initial phase. We are now developing various business models and scenarios. One of those scenarios is to make the consultancy work one hundred percent cost-effective. We are also considering the impact of this concept on our reputation. Generating innovative and diverse business concepts together creates energy, as you can think together freely about your next steps and then implement a plan how to get there.
One of the objectives that we link to this new initiative is sustainable employment practice. This initiatives enables employees in an organization to develop in a different way. For the assignment in China, the Collection Management Manager and the Register Office Manager were involved in the training program, and they will also be involved in the implementation stage. As a result, they develop the skills and competencies that are not only of great added value in our consultancy work but also represent an asset for us as an organization.
As a social institution, we are having to deal with more stakeholders than a commercial organization. In addition, a major international brand such as the Van Gogh Museum is a focus of attention for many parties. We notice that the introduction of the consultancy work has caused quite a stir and raised many questions. The museum world initially took a wait-and-see approach. The Ministry of Education, Culture and Science does not know yet either how to advise us on the framework within which entrepreneurial activities should develop in the cultural sector. You see that politics requires that cultural institutions demonstrate a more entrepreneurial spirit, leaving it to the institutions to interpret this themselves. The introduction of a new service concept, such as the consultancy work that we are currently launching, which is a completely new concept, gives a concrete expression to the idea of commercial activities in the cultural sector. And this is good for the discussion and definition of the scope.
We are a trendsetter. We can therefore be a guide for other cultural enterprises that want to do business too. And this leads to useful feedback."