Monetizing Digital: Three Key Considerations

In a recent article about embarking on digital monetization, we put together a list of questions arts leaders should ask when deciding whether or not to monetize their organization’s digital content. ABA defines monetization broadly, encompassing everything from pay-per-view models to free live streams that attract new audience members — part of the goal being that newcomers might join the organization as long-term supporters, subscribers, and donors. These free streams may also be embedded within a freemium model, where viewers can choose to pay to access additional content or benefits. 

We have categorized these models by the explicitness of the ask for audience contributions, as follows:

The data suggests that monetizing digital content is unlikely to bring in short-term profit, but a mission-aligned, authentic investment in digital may generate substantial value in the long term. Whether you’ve just started monetizing, or your organization is getting ready to take the plunge, read on for three key considerations when developing your digital monetization model.

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Consideration Set 1: The Relationship Between Your Audience & Your Content

What audience(s) are you targeting with your digital content? We’ve seen many organizations tailor their digital content to their existing audiences, first as a benefit to keep donors and patrons involved, and then as a way to broaden the size and scope of their community.  Others have tailored digital initiatives specifically toward individuals and families who have never experienced their in-person programming, encouraging newcomers to visit when it is safe to do so. 

Ultimately, it’s essential to know what your audiences value most in their digital experiences, whether that be the freedom to enjoy content on their own time, the ability to view your art form in a new way, or something else. (To address these questions, ABA regularly facilitates digital strategy diagnostics and digital objectives workshops for our member organizations. Members, contact your member advisor to learn more.)

No matter the audience, successful digital initiatives deliver value to audiences above and beyond what they could access for free. As audiences are inundated with digital content at this moment — and facing real digital fatigue — they may have a hard time noticing the differences in content quality unless those differences are very marked.

Fortunately for organizations not yet ready to take on substantial new costs, differentiated digital content does not necessitate purchasing expensive equipment or hiring professional film producers. Creating opportunities for interactivity, even on Zoom as in the Geffen Playhouse’s wildly popular Stayhouse projects, organizations can counter digital fatigue and differentiate their offerings from others.

Consideration Set 2: The Intersection of Your Monetization Scheme & Platform

Once digital objectives are set, organizations face the reality of their capabilities. Can major sponsors or donors fund creation of differentiated, revenue-generating content? Is archived content high quality and can digital rights be secured to allow frequent updating for new audience development over time? The selection of digital delivery platform is perhaps the decision most reliant on organizational capabilities.

Some organizations are experimenting with creating their own streaming platforms so they can have flexibility in how they charge for, deliver, and gather data about their virtual experiences. In October 2020, the Cleveland Orchestra launched Adella, an online streaming platform in which users can unlock premium content by upgrading to a paid account. Adella is offered for free to subscribers and donors, and at a monthly cost for all others.

Organizations that have instead decided to use arts streaming platforms like Marquee TV, All-Arts, Digital Theatre, and BroadwayHD often report that their decision was due to limited internal capacity or capability to manage distribution and quality control. These existing platforms come with a built-in audience of arts lovers and work with devices like Roku. 

YouTube and Vimeo are also extremely popular sites for uploading and streaming content - although that has been tempered by the recent removal of non-profit clauses that allowed arts organizations to monetize their views. For the majority of patrons, YouTube is an especially familiar and user-friendly option. 

These platforms can be paired with a variety of monetization schemes: organizations can add a donate button to videos and livestreams, or they can make content links private and available only to paid subscribers.

For those focused primarily on galvanizing energy and bringing in new faces, publishing free content on YouTube is an effective way to rapidly reach more people, as we heard in our July 2020 webinar on Loyalty and Revenue in the YouTube Universe. 

Consideration Set 3: Coordinating Content Distribution Between Internal & External Stakeholders

A common concern among arts organizations right now is that digital offerings may unintentionally cannibalize other revenue streams. What is preventing current subscribers from shifting to lower-priced digital packages or buying single tickets when many typical subscriber benefits are unavailable or being replaced with the same digital offerings? 

However, we have found that this can be mitigated via at least three strategies:

1. Making subscriptions more valuable (e.g. by giving subscribers premium content, or by requiring patrons to be subscribers to access digital content).

2. Selling digital in different packaging, delivering a different value to single-ticket buyers versus subscribers (e.g., offering subscribers priority or limiting access for non-subscribers).

3. Instead of selling digital packages, asking for contributed income connected to digital offerings. 

Within our membership, organizations have experimented with all of these strategies. Examples of each can be found in the English National Opera’s ENO TV, available only to members; the San Francisco Opera’s Opera is ON project, in which performances are streamed for free, but only subscribers have access to the content after the live stream; and the Scottish Ballet’s The Secret Theatre, which was available for free for a three-day period, with an upfront request for donation that required users to enter any amount of their choice. 

In the US, the digital experience your organization can offer is highly dependent upon union agreements, which largely shape when, where, and how content is distributed. For all organizations, cross-departmental work must take place to create the content.  Revenue generation requires highly collaborative, cross-departmental teams consisting of experts not only in content creation, but in all facets of the organization.

Secondary Sources

To continue the conversation, we’ve listed below some additional sources about monetizing digital. Did we miss any articles you’ve found especially helpful during the decision-making process? Let us know, and we’ll add them here. 

‘All Arts Organizations Are Media Companies Now’: How the Pandemic Is Transforming Theater: Theater artists and companies are using this moment to rethink what theater can look like alongside technology. This article explores how digital can be its own complete form of theater that co-exists with traditional theater in the future. Examples include audio plays, theater via ‘The Sims,’ and site-specific plays for the internet.

Playing To Music Lovers in the Pandemic: In this interview, the Executive Director of the Los Angeles Chamber Orchestra, Ben Cadwallader, discusses the thought process behind their sponsored hybrid offerings during COVID-19. He asks the question, “How do we create something so that, if people experience the taping live, they still want to rush home and watch the episode?” 

The San Francisco Symphony Plunges Into a New World: The San Francisco Symphony commissioned a work specifically for digital media, featuring a cast of prominent artists.

Netflix & Disney+ Pull Back Curtain On Ballet To Bring Representation, Joy Of Dance To Holiday Season Limited By Lockdowns: The rise of dance films on major streaming platforms has opened up new opportunities for the art form. 

For US arts organizations: 

AEA/SAG-AFTRA agreement paves way for digital theater options post-pandemic: AEA now has jurisdiction over digital work that replaces a live stage show or whose digital audience supplements a live audience during the pandemic.