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Relational Revenue

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Earned Relational Revenue Index, 2016-2018 Overall Trends

 

RELATIONAL EARNED REVENUE INDEX TREND

(1,530 ORGANIZATIONS)

 2016 2017 2018 2016-2018
change		 2016-2018
change, adjusted for
inflation

Membership & Subscription Revenue/Total Expenses (before depr.)

 7.1% 7.3% 6.9% -0.2%  

 Ave. Membership and Subscription Revenue

 $185,132 $185,483

$187,397

1.2%

-3.6%
Ave. Total Expenses $2,618,955 $2,538,064 $2,715,921 3.7%  -1.2%

  • Average membership and subscription revenue growth fell short of inflation by 3.6% while growth in expenses was only 1.2% lower than inflation. As a result, the relational earned revenue index contracted by a modest 0.2%.

Earned Relational Revenue Index, 2016-2018 Trends By Sector

 

RELATIONAL EARNED REVENUE INDEX, BY SECTOR (1,530 ORGANIZATIONS) 2016 2017 2018 2016-2018 change 2016-2018 change, adjusted for inflation
Arts Education 0.7% 0.6% 0.6% -0.1%  
Ave. Membership/Subsc. Revenue $13,088 $13,346 $13,656 4.3% -0.6%
Ave. Total Expenses (before depreciation) $1,897,383 $2,069,752 $2,154,153 13.5% 8.1%
Art Museums 5.3% 6.2% 5.5% 0.2%  
Ave. Membership/Subsc. Revenue $1,073,922 $1,051,800 $1,049,842 -2.2% -6.9%
Ave. Total Expenses (before depreciation) $20,355,540 $16,869,389 $19,196,516 -5.7% -10.2%
Community 2.4% 2.6% 2.4% 0.0%  
Ave. Membership/Subsc. Revenue $18,354 $20,534 $20,333 10.8% 5.5%
Ave. Total Expenses (before depreciation) $760,277 $799,805 $836,356 10.0% 4.8%
Dance 8.0% 8.1% 7.6% -0.4%  
Ave. Membership/Subsc. Revenue $146,060 $152,974 $152,663 4.5% -0.5%
Ave. Total Expenses (before depreciation) $1,827,013 $1,896,127 $1,998,963 9.4% 4.2%
Music 4.7% 4.2% 4.0% -0.6%  
Ave. Membership/Subsc. Revenue $18,958 $17,966 $18,034 -4.9% -9.4%
Ave. Total Expenses (before depreciation) $404,421 $424,174 $446,381 10.4% 5.1%
Opera 14.2% 13.4% 13.7% -0.5%  
Ave. Membership/Subsc. Revenue $745,276 $728,846 $761,811 2.2% -2.6%
Ave. Total Expenses (before depreciation) $5,263,400 $5,419,966 $5,579,117 6.0% 1.0%
PACs 4.9% 4.7% 5.2% 0.3%  
Ave. Membership/Subsc. Revenue $593,120 $568,094 $680,554 14.7% 9.3%
Ave. Total Expenses (before depreciation) $12,037,333 $12,105,435 $13,095,914 8.8% 3.6%
Symphony Orchestras 10.4% 10.3% 9.2% -1.2%  
Ave. Membership/Subsc. Revenue $243,941 $236,504 $226,844 -7.0% -11.4%
Ave. Total Expenses (before depreciation) $2,343,682 $2,304,185 $2,459,484 4.9% -0.1%
Theatre 14.9% 14.3% 13.6% -1.2%  
Ave. Membership/Subsc. Revenue $298,912 $300,221 $293,766 -1.7% -6.4%
Ave. Total Expenses (before depreciation) $2,010,982 $2,094,750 $2,156,803 7.3% 2.1%
Other Museums 6.7% 6.9% 6.6% -0.1%  
Ave. Membership/Subsc. Revenue $388,288 $390,029 $388,188 0.0% -4.8%
Ave. Total Expenses (before depreciation) $5,789,970 $5,613,315 $5,843,239 0.9% -3.9%
General Performing Arts 4.0% 5.5% 5.5% 1.5%  
Ave. Membership/Subsc. Revenue $75,033 $101,139 $107,176 42.8% 36.0%
Ave. Total Expenses (before depreciation) $1,894,690 $1,840,324 $1,953,657 3.1% -1.8%
  • General Performing Arts, PACs, and Community-based organizations saw growth in subscription and membership revenue that outpaced inflation over time. General Performing Arts had the highest growth in relational revenue at 36%. One organization in that sector skewed average relational revenue and expenses high, but eliminating it from the analyses does not substantially change the direction or magnitude of the trend.
  • Subscription and membership revenue declined over time in the Art Museum, Music, Orchestra, and Theatre sectors. Symphony Orchestras had the largest drop in relational revenue at 11.4%.
  • Earned relational revenue growth fell short of inflation in the Arts Education, Dance, Opera, and Other Museums sectors.
  • In inflation-adjusted figures, all sectors saw growth in total expenses except Symphony Orchestras, Art Museums, Other Museums, and General Performing Arts organizations.
  • For Art Museums, the drop in relational revenue was met with a higher drop in total expenses leading to the positive growth in earned relational revenue index. One organization in that sector skewed average relational revenue and expenses high, but eliminating it from the analyses does not substantially change the direction or magnitude of the trend.

 

See the Trend Chart

Earned Relational Revenue Index, 2016-2018 Trends By Size

 

RELATIONAL EARNED REVENUE INDEX TREND, BY SIZE 2016 2017 2018 2016-2018 change 2016-2018 change, adjusted for inflation
Small 3.7% 3.5% 3.4% -0.3%  
Ave. Membership/Subsc. Revenue $3,643 $3,474 $3,409 -6.4% -10.9%
Ave. Total Expenses (before depreciation) $98,698 $99,382 $100,051 1.4% -3.5%
Medium 5.2% 5.1% 4.6% -0.6%  
Ave. Membership/Subsc. Revenue $51,582 $49,074 $45,584 -11.6% -15.8%
Ave. Total Expenses (before depreciation) $988,437 $971,370 $985,642 -0.3% -5.0%
Large 7.5% 7.9% 7.4% -0.1%  
Ave. Membership/Subsc. Revenue $1,052,016 $999,662 $952,521 -9.5% -13.8%
Ave. Total Expenses (before depreciation) $13,999,978 $12,712,063 $12,826,941 -8.4% -12.7%
  • All size organizations had decreases in both relational earned revenue and total expenses over time after adjusting for inflation. The decline in total relational revenue from memberships and subscriptions is much more than the decline in total expenses both both Small and Medium organizations, leading to a slump in relational earned revenue index for all organizations.
  • Medium organizations saw the highest decline in index value at 0.6%, followed by Small organizations at 0.3%.
  • In inflation-adjusted figures, Large organizations had the largest dip in total expenses over time that which helped to offset the decline in relational revenue leading to the minor loss in the index value by 0.1% compared to that of Small and Medium organizations.

See the Trend Chart

Earned Relational Revenue Index, 2016-2018 Trends By Geographic Market

 

RELATIONAL EARNED REVENUE INDEX TRENDS, BY GEOGRAPHY (1,530 ORGANIZATIONS) 2016 2017 2018 2016-2018 change 2016-2018 change, adjusted for inflation
New York-White Plains-Wayne, NY-NJ 5.3% 5.8% 5.5% 0.2%  
Ave. Membership/Subsc. Revenue $594,040 $574,931 $583,509 -1.8% -6.5%
Ave. Total Expenses (before depreciation) $11,263,317 $9,836,490 $10,658,690 -5.4% -9.9%
Los Angeles-Long Beach-Glendale, CA 8.90% 9.70% 7.8% -1.2%  
Ave. Membership/Subsc. Revenue $118,626 $137,913 $116,601 -1.7% -6.4%
Ave. Total Expenses (before depreciation) $1,328,389 $1,426,479 $1,502,069 13.1% 7.7%
Chicago-Naperville-Arlington Hgts, IL 10.8% 10.9% 10.3% -0.5%  
Ave. Membership/Subsc. Revenue $191,932 $196,484 $188,903 -1.6% -6.3%
Ave. Total Expenses (before depreciation) $1,769,810 $1,799,176 $1,826,810 3.2% -1.7%
San Francisco-Redwood City- South SF, CA 5.3% 5.1% 4.9% -0.4%  
Ave. Membership/Subsc. Revenue $156,938 $160,629 $154,703 -1.4% -6.1%
Ave. Total Expenses (before depreciation) $2,960,042 $3,150,689 $3,162,745 6.8% 1.8%
Washington-Arlington-Alexandria; Bethesda-Rockville-Fredericksburg, DC-VA 6.8% 6.8% 6.3% -0.5%  
Ave. Membership/Subsc. Revenue $139,266 $148,929 $146,099 4.9% -0.1%
Ave. Total Expenses (before depreciation) $2,041,847 $2,205,490 $2,316,534 13.5% 8.1%
Large Markets 6.9% 6.6% 6.1% -0.9%  
Ave. Membership/Subsc. Revenue $114,396 $111,469 $110,727 -3.2% -7.8%
Ave. Total Expenses (before depreciation) $1,650,424 $1,682,139 $1,827,042 10.7% 5.4%
Medium Markets 7.8% 8.0% 7.6% -0.2%  
Ave. Membership/Subsc. Revenue $210,437 $209,978 $217,051 3.1% -1.8%
Ave. Total Expenses (before depreciation) $2,682,498 $2,625,502 $2,843,076 6.0% 0.9%
Small Markets 11.1% 11.7% 11.6% 0.5%  
Ave. Membership/Subsc. Revenue $123,267 $131,881 $141,215 14.6% 9.1%
Ave. Total Expenses (before depreciation) $1,107,259 $1,131,484 $1,216,594 9.9% 4.6%
Very Small Markets 7.6% 6.8% 7.3% -0.3%  
Ave. Membership/Subsc. Revenue $72,637 $67,586 $75,546 4.0% -0.9%
Ave. Total Expenses (before depreciation) $952,488 $999,227 $1,037,490 8.9% 3.7%
  • Growth in subscription and membership revenue lagged inflation for all except Small markets, which increased 9.1% above inflation.
  • The biggest deterioration of subscription and membership revenue was in Large markets at -7.8%, followed by NY, L.A, Chicago, and San Francisco, all of which saw declines exceeding 6%.
  • The average organization in all markets increased their total expenses above inflation except New York and Chicago.
  • In D.C., Medium, and Very Small markets, earned relational revenue growth fell short of inflation.

See the Trend Chart

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