Pent-up and deferred demand borne of pandemic-related closures has largely been satisfied at the close of the third quarter of 2022. Here’s what this means as your organization considers its attendance projections.

It’s been a strange couple of years for the cultural industry (and humanity in general), to say the least. Since the pandemic started closing the doors of beloved cultural entities across the United States and around the world, executive leaders have grappled with questions of institutional survival, strategy, and solvency. Many cultural organizations suffered staggering attendance losses in 2020 due to the pandemic.

And as they began to reopen again, entities next faced concerns about “getting back to normal” – “normal” often meaning our 2019 attendance and operating conditions. For better or worse, one thing that’s become clear is that there may in fact be a new normal, wherein conditions may be less durable than before the pandemic. Real-time data and research have grown even more important as circumstances continue to evolve rapidly and may continue to do so for years to come. Data will help us make sense of these changing conditions and our assumptions about them.

One such condition is “pent-up demand,” where organizations may expect an increase in attendance because people who couldn’t previously go are now visiting.  We have been tracking pent-up demand for cultural entities over the course of the pandemic. Has this demand been realized? What might this mean for cultural organizations as they continue their pandemic recoveries?

Here’s what we know.

 

Pent-up and deferred demand developed as the pandemic started

Let’s start by clarifying the difference between pent-up demand and deferred demand, because we’re noticing these different conditions often seem to be lumped together in conversation. It may seem a matter of lexicon, but to misunderstand these conditions hinders our ability to learn from the happenings of the last few years and move forward with a better understanding of our business practices.

During closures in 2020, cultural institutions largely had pent-up demand. Pent-up demand takes place when people want to come but cannot due to the operations and availabilities of cultural organizations. Individual coronavirus concerns aside and regardless of agreement with the reasoning, many folks could not come in the doors of cultural institutions for a time – even if they wanted to – because many museums, zoos, and aquariums were closed! When people cannot attend when they very much want to do so, we call the demand “pent-up” (i.e., the demand is unable to be satisfied). Of course, the hope is that the pent-up demand will sustain itself long enough to encourage visitation upon reopening.

After reopening in 2020 and throughout 2021, cultural institutions largely had deferred demand. Deferred demand takes place when people can visit but choose not to. After organizations reopened their doors and created availability (thus satisfying pent-up demand), the remaining demand was largely a function of deferred intentions.

“Deferred demand” suggests that people may be both interested and intending to visit an organization but are choosing not to attend at that particular moment. Their reasoning may be immediate (e.g., “I’m still worried about the coronavirus right now”) or it may be awaiting a future condition (e.g., “I’m waiting until my children are vaccinated” or “It’s not worth going to the aquarium when the touch tank remains closed”).

These differentiations matter. During periods of time in 2020 marked largely by pent-up demand, a critical task for cultural organizations was to remain relevant and top of mind during closures so audiences would prioritize a visit upon reopening. In 2021, however, a critical task was to understand and work to alleviate the reasons for deferred demand so that the demand may be realized. At IMPACTS Experience, we call people who have interest in attending but who choose not to visit inactive visitors. Many inactive visitors are the people with deferred demand, and understanding their barriers to visitation are critical.

Now let’s check in on the current state of play regarding pent-up and deferred demand for cultural institutions.

 

The good news: Attendance is generally recovering for US cultural institutions

On the whole, attendance to cultural organizations is recovering! We are generally observing this among the 224 organizations we monitor at IMPACTS Experience. To get a sense of the attendance trend, we’ve aggregated the attendance for thirteen various exhibit-based organizations in the US as of the end of the third quarter of each year for whom we have access to their daytime attendance information. These organizations are all well-attended (i.e., over 500,000 annual daytime visitors) and span the United States in terms of their locations.

The data are indicated as index values. 100.0 represents the collective baseline attendance level for these organizations through Q3 2016. As shown below, attendance collectively increased by modest measures through Q3 2019. Indeed, Q3 2019 attendance was up by 2.5% when compared to Q3 2016.

Are we all together now on how to read and understand the chart? Great.

You will note that these organizations secured only 43.1% of Q3 2016 daytime attendance in Q3 2020. Yikes! But things began to recover by Q3 2021, and even more so as we recently closed Q3 2022. Hopefully, this recovery trajectory will look familiar to many executive leaders reading this article.

Hallelujah! Attendance is moving in the right direction. However, we observed a redistribution of demand during the pandemic that has remained generally durable (link). In short, the pandemic altered the types of organizations with which the culturally-inclined public chose to engage, with an uptick in people choosing to attend outdoor zoos, parks, gardens, as well as larger indoor aquariums and museums. These are entities that are either outdoors or perceptually allow for freedom of movement. (People felt they could move if someone coughed without a mask on in an exhibit space, for instance.) Many people chose to go to these organizations instead of science museums, science centers, and children’s museums – and especially theaters and performances. Thus, attendance has been slower to recover for many of these institutions.

You may be wondering why 2021 is highlighted in orange…

 

The complication: Pent-up and deferred demand have been largely realized, suggesting a need to consider attendance glidepaths as entities plan their futures

 To show you what you need to know about pent-up and deferred demand right now, we’ll zoom out beyond the 13 organizations in the previous chart and look at overall intentions to visit exhibit-based cultural organizations in the US. The chart below quantifies in days the duration until the average US adult with a stated intent to visit an organization actually plans to visit the organization, and compares the duration of these intentions over time.

Intent to visit is a critical metric for cultural organizations that aligns closely with actual attendance. Unlike those with mere interest in visiting, individuals with intent are actively planning their trips. They’ve made the decision to go. They have a date. Pending unforeseen changes like weather issues or facility closures, they’re very likely to actually walk through the door.

As an industry, we want the measure of days until someone next intends to visit to be lower rather than higher. We want them to be constantly planning to attend! As you can see, the average intent to visit in months as of Q3 2016 was 224 days – about 7.5 months. There are a lot of critical implications of this finding for marketing teams across the nation.  For instance, this duration of time underscores the importance of ongoing digital engagement and sustained marketing investments. If there’s a plan to attend in seven months, an institution may need to keep up the excitement for that visit to be fully realized, even if the plan has already been conceptualized.

For now, though, let’s focus on the changes in these numbers over time.

You can see the pent-up demand for cultural organizations in 2020. People still wanted to go, but the timeline in which they were making their plans was longer, approximately ten months. Remember: These are people with intentions to visit. They know the current conditions at the time of their planning as well as their own risk assessments of how upcoming conditions will impact their plans – and they maintain these plans.

Note, now, the orange bar in 2021, which highlights the dramatic decrease in the number of days before an intended visit as of Q3 2021. From Q3 2020 to Q3 2021, demand was nearly halved from 10 months to 5.5 months. This is when the people who missed you most started making plans to come back and, in doing so, these same people spearheaded our industry’s recovery.

Deferred demand has now largely been satisfied, as of the end of Q3 2023. How can we tell? Because the market’s stated intentions to visit timeframe is now even longer than it was before the pandemic. This measure has returned to historic levels, indicating that the people who wanted to attend have now largely done so.

 

This has implications for future attendance and projections.

It’s time to move conversations away from reengaging audiences who haven’t come during the pandemic to simply engaging audiences again.

Many cultural organizations made hay while the sun was shining, so to speak, and took advantage of this deferred demand this past summer. And that’s a good thing! But the increase in the days between intentions to visit suggests that a new cycle is starting, with the added complication that the pandemic has altered the visitation behaviors of some of our dearest constituents.

The average re-visitation cycle for an exhibit-based cultural organization in the US is currently 29 months. That is, it’s 29 months on average between when someone visits an organization and when they either revisit that same entity or go to another of that same type (such as an art museum). Due to the pandemic, the people who missed us most had their natural visitation cycles disrupted and moved their visit to 2021 or 2022. Having recently visited us, these data suggest that it will now be another 29 months on average from the time of their last visit until they are likely to come again.

As a result (and depending on your entity’s unique engagement strategy), there may be a period of time during which your attendance dips are a bit more dramatic. If nothing else, it may suggest a less ambitious attendance glidepath in the immediate near-term. Reassuringly, market potential projections continue to suggest that cultural entities will slowly continue their recoveries. However, this market potential may be lost if entities take recovery efforts for granted and fail to recognize that competition for leisure time is projected to be particularly fierce in 2023. “If we build it, they will come” remains untrue – and may be even more the case next year if engagement, marketing, education, and programming efforts are not continually prioritized.

The people who missed us when we were closed or when COVID was raging aren’t a bonus atop previously-projected attendance during a difficult time – they are the heroes who fueled our recovery and got us here. They’ve come. They’ve helped us. They’ve done their work as cultural organization attendees and advocates.

And for that, I hope we may all feel grateful.

Now it’s time to keep up our good work and continue to engage.

 

IMPACTS Experience provides data specific to organizations or markets through workshops, keynote presentations, webinars, and data services such as pricing recommendations, market potential analyses, concept testing, and Awareness, Attitude, and Usage studies. Learn more. 

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