How big of a barrier is admission cost for millennials?
Hint: It’s not the first… or the second… or the third…
Cultural organizations are in an interesting spot when it comes to engaging millennials. Millennials are the largest generation in the US, and already make up a majority of attendance to cultural organizations. However, because this generation is so large, they are also the only generation not being reached at representative levels. In a nutshell, millennials are both the generation we need to keep satisfied and the generation we must do a better job attracting.
The topic of engaging millennials seems to be everywhere in the industry, and – as often happens with prevalent topics in industries that aren’t widely data-informed yet – it’s steeped in “I think” solutions. One of those “I think” solutions is the idea that free or discounted admission is a magic bullet to long-term millennial engagement because admission cost is a primary barrier to visitation due to this generation’s lack of funds.
But is this even true?
This assumption is understandable, in some ways. According to a report by the Federal Reserve, “Millennials are less well off than members of earlier generations when they were young, with lower earnings, fewer assets and less wealth.” This generation has seen an increase in wages, but they have not kept up with inflating living costs. At the same time, Pew Research found that millennial households are earning more than previous generations did at the same age. It’s true: Millennials are both the richest and the poorest generation at the same time.
So is admission cost a primary barrier to millennial cultural organization attendance? Can cultural organizations discount their way to long-term millennial engagement?
1) Cost is not a primary barrier to visiting cultural organizations
Not everybody has interest in visiting cultural organizations, but we like the folks who do! At IMPACTS, people who express interest in visiting cultural organizations but have not attended one in the last two years are called inactive visitors.
Engaging millennials means understanding why millennials may not be coming in the door at representative rates in the first place. Though they are separated in this chart, barriers to attendance do not necessarily operate in isolation. The reason somebody doesn’t attend may be “I’d rather go to the movies.” …But it could also be, “I’d rather go to the movies and the museum is far away.” The reasons why we choose to do or not do things can be connected and play off of one another.
The index values in the chart below show the weighted values of individual barriers. Items with index values over 100 are of particular note, and are the primary barriers to attending cultural organizations. These are our most pressing opportunities to resolve in order to increase attendance.
In the chart below, “Millennials” are those born in or after 1980, and “Non-Millennials” are those born before 1980. Only adults over 18 are represented in the data, so Generation Z is not included in this chart.
For millennials who have interest in visiting organizations but have not recently done so, cost is the 14th biggest barrier to visitation. It’s not the first. It’s not the second. It’s the fourteenth.
The top reason interested millennials do not attend is simply that they prefer to do something else. Interest in visiting is not the same as intending to actually visit. While they may be interested in attending the history museum, for instance, they may be more interested in a day at the beach, seeing a movie, attending a pop concert, or enjoying Stranger Things on the couch. Preferring an alternative leisure activity is a 4x bigger barrier to visiting cultural organizations than admission cost. It’s also worth noting that people generally find admission prices are worth their cost for cultural entities.
While leaders should perhaps rejoice in the good news that admission price generally isn’t a top reason why people don’t visit, this data often feels like a bummer when we share it. The disappointment makes sense. After all, establishing relevance and rising above the noise in today’s connected world is more complicated than blaming admission pricing for our woes.
Access challenges – the second biggest barrier for millennials – include issues related to real or perceptual “hassles” of visiting an organization. This includes items such as physical travel distance, planning difficulties, an organization being unresponsive to questions (or perceived as such), or a non-compliant building or experience. Not feeling welcomed (“attitude affinity perceptions”) and having bad past experiences (“negative precedent experience”) are also bigger obstacles for millennials vs. non-millennials and are represented in their own categories in the chart.
“Nothing new to do or see” is also a significant barrier. We will take a deeper dive into this barrier in August on this site. (If you’re not already subscribed to this website, you can sign up here so you don’t miss it.)
All of this isn’t to say admission cost is never a barrier to attendance. It can be – but most of the time it’s not the reason someone with interest doesn’t visit. Cost is also not a primary barrier for people who aren’t interested in visiting at all.
2) Discounting doesn’t do what you think it does
There are several false, underlying assumptions about discounting and human behavior that are further embedded within the idea that discounting is a great strategy to engage millennials.
The initial attendance boost gained from offering a discount may be intoxicating, but this practice creates a negative cycle that often results in less visitation over time – and it’s a tough cycle to break. People who attend with a discount have lower visitor satisfaction scores and are less likely to endorse the organization. Critically, earned endorsements drive attendance, and less satisfied folks are less likely to return, making this a rather pervasive issue.
Once an organization is perceived as one that offers discounts, people are likely to defer their next visit to the next discount. (“Let’s go to the movies instead of the science museum today. The museum isn’t offering a discount.”) This lengthens the already-lengthy visitation cycle to cultural organizations and requires even steeper discounts over time to sustain attendance. (“The only discount I can find is only 5% right now, so let’s wait for something better.”) This thought process risks people choosing something else, because they are already operating at a perceptual value loss… and they haven’t even walked in the door!
Perhaps most importantly, the research is clear that discounting does not reach new audiences. Discounts are more likely to engage repeat visitors rather than first-time visitors. Here’s the data.
Promotions, on the other hand, can be beneficial when used strategically. These are targeted, specific opportunities to celebrate an audience – perhaps by providing admission benefits to families of children who have read a certain number of content-related books at the library, or members of a specific young professionals group. This may sound like a matter of framing, but it’s a matter of strategy. It’s a completely different approach than a broadly publicized discount, in that effective promotions are carefully and thoughtfully targeted to specific audiences. In a nutshell, a discount makes people say, “I got in for cheap.” A promotion makes people say, “I feel valued by this organization.” It’s a treat for a person, not an entitlement for everyone (or near-everyone). For entities anxious to provide discounted pricing to millennials because that just feels like a good idea, targeted, thoughtful, and strategic promotions may be a better one.
Discounts generally cause major problems that harm organizations that deploy them. Often, entities or individual leaders get so addicted to the short-term attendance bumps that they neglect the long-term attendance declines often attendant to discounting.
3) Millennials spend money on experiences (and so do others)
A study by Eventbrite found that three quarters of millennials prefer to spend money on experiences rather than physical goods. The study also found that millennials attend live experiences more than older generations, are likely to increase spending on experiences rather than physical things in the next year, and believe attending live events or experiences makes them feel more connected to other people, the community, and the world. But it’s not just millennials. It’s been reported that 74% of Americans value experiences over products.
The interest in experiences isn’t surprising. Research shows that investing in experiences makes people happier. We also know that likely visitors to cultural organizations are an active bunch that enjoy travel, going out to eat, and partaking in low-intensity outdoor activities such as hiking, skiing, or golfing. Millennial likely visitors are even more active than non-millennial likely visitors.
At IMPACTS, we have identified three keys to millennial engagement: (1) Underscoring personal relevance and why the experience matters to people on a personal level, (2) providing the feeling of a unique or singular experience, and (3) underscoring an organization’s mission. According to a report by Deloitte, 84% of millennials believe it’s their duty to change the world.
The trend toward investing in experiences is good news for cultural entities, as it impacts our ability to secure the funds required to keep our doors open.
4) Millennials find cultural organizations less welcoming than non-millennials
Attitude affinities measure how much people think that entities are “places for people like me.” Negative attitude affinities are a measure for how much people think certain entities are “not for people like me.” This is in the eye of the beholder. It could be that they don’t feel comfortable at the organization because they do not believe it is a place for people of their age, physical ability, the color or their skin, or anything else.
Negative attitude affinities are a reason why people who have interest in attending cultural organizations do not go, as seen in the first chart in this article. But they are also a top reason why people with no interest in visiting aren’t coming. This suggests that negative attitude affinities may be “non-starters” to attending a cultural organization, or may also play a secondary role for some.
Millennials have more negative attitude affinities than non-millennials, though cultural organizations have a way to go with being perceived as welcoming in general. Nearly half of millennials in the US (49.5%) report feeling like orchestras are not for people like them. Four out of ten millennials in the US don’t feel like history museums/historic sites or art museums are for them. Millennials are a notably diverse generation and cultural organizations are not reaching people of racially diverse backgrounds at representative rates, in particular.
I write this a lot, and I’ll write it again: Being free (or discounted) is not the same as being welcoming.
This is a deeper, more ingrained issue that requires a strategic approach. We have not observed many organizations successfully “one-off”-program themselves into engaging new audiences. Instead, the organizations most effective at bringing new folks in the doors tend to be those that integrate the ideals of diversity, equity, and inclusion into their ongoing strategy – and into their frontline staff, leadership, and boardrooms.
Millennial talk is everybody talk. Those trends we commonly attribute to millennials – such as transparency, personalization, and digital connection – do not belong to millennials alone. They steadily and increasingly apply to all generations operating in the world today.
So we have an issue, and an interesting line to walk. Millennials are a critical generation to reach, and we need to do a better job reaching them. We can do this by better understanding what makes this generation unique, but also by understanding what millennials and other generations have in common. Overly siphoning millennials off as “others” may do more harm than good and jeopardize our ability to effectively reach any audiences at all.
It’s important to consider cost as a barrier to visitation for millennials, but the data doesn’t pan out that it’s a primary barrier overall, or that removing that barrier would impact much by way of attendance in the long-term.
Our pressing opportunities are more frustrating and harder to tackle. They involve relevance, connection, schedules, negative past experiences, and perceptions of being welcoming in the first place.
Money matters, but time matters more.
Let’s aim to be worth both millennials’ time and money.
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