Arts and Humanities 

Submitted by ArtsMemphis

Our vibe. Our city.

Rhythm n’ Blues to Ballet n’ Barbeque

Memphis’s diverse cultural heritage is a key part of our city’s identity and a source of pride. Artists from Memphis have impacted the world, and the arts are at the center of transformation in our city today. Despite our cultural assets, Memphis is facing a difficult socioeconomic climate and struggling schools. Legacy arts institutions, arts organizations of all ages and sizes and even non arts organizations see the arts as a bridge to reflect the diversity and challenges of Memphis. The Memphis arts community continues to become more collaborative and working together to provide for a promising future through quality arts engagement.

The arts are also an important economic driver for Memphis. The economic impact of Memphis nonprofit arts and culture organizations is more than $125 million. This includes $62.6 million in spending by nonprofit arts and culture organizations and an additional $62.6 million in event-related spending by their audiences. The nonprofit arts support 3,898 full-time equivalent jobs and generate more than $15 million in local and state government revenue.

The nonprofit arts are a cornerstone of our tourism industry and a huge draw for visitors to Memphis. A full third (700,000 people) of the 2.1 million attendees to nonprofit arts events live outside of Shelby County. Non-resident arts attendees spend more per person than local attendees ($54.64 vs. $16.72) as a direct result of their attendance to cultural events. Out-of-towners spend 227 percent more per person than local attendees as a result of their coming to cultural events. 50 percent of out-of-town attendees said that they would have traveled to a different community to attend a similar cultural experience. This shows that if our community fails to provide a variety of cultural experiences, our audiences will take their discretionary dollars and spend them someplace else.

The impact of the arts doesn’t stop at the door of the theatre. Attendees to cultural events spend an average of $29.28 per person as a result of attending the event, excluding the cost of admission. This means dollars in the door for local businesses. For example, when patrons attend a cultural event, they may pay to park their car, eat dinner in a restaurant, shop in nearby stores and pay a babysitter when they get home. Out-of-towners may spend the night in a hotel. Event-related spending in Memphis is higher than the national median ($24).

Nationally, the economic impact of U.S. nonprofit arts and culture organizations is $136 billion. The nonprofit arts support 4.1 million full-time equivalent jobs and generate $22 billion in government revenue.

Local arts organizations have expressed the following challenges.

Difficulty Adapting to Social and Economic Change 

The recent economic downturn foregrounded the structural weakness of traditional arts business models.  Indeed, a number of major cultural institutions around the country have been forced to close their doors in recent years due to their commitments to unsustainable strategies.  Locally, a number of arts groups have come up with ingenious innovations to streamline their operations, become more nimble, and open up new streams of revenue.  But adaptation is not easy.

It’s important to note the critical role of external contributions in keeping most arts groups afloat.  This dependent relationship means that many arts groups are reluctant to change their model or traditional categories of programmatic offerings for fear of alienating their most generous, longtime donors.  And, as with any business, the cost of acquiring brand new customers/donors is dramatically higher than the cost of stewarding existing ones.

All of these factors are exacerbated by changes in public taste.  Specifically, the increased appetite for – and availability of – “stay-at-home entertainment” options, such as streaming movies, TV, and video games.  The traditional arts aren’t competing with one another – or even with movie theatres, rock concerts, or sporting events; they’re competing against Netflix and PlayStation.

Liquidity Shortage

The business model for most nonprofit arts groups – much like their counterparts in the direct-service arena – is one in which the core mission (e.g., performances, exhibitions) loses money, when viewed independently of charitable donations.  In other words, the ticket sales from any given ballet, opera, or museum show almost always fall far short of the corresponding production costs.  This is noteworthy because it highlights the central importance of creating content that drives charitable donations.

This has several important consequences – one of which has to do with liquidity.  Since performances and exhibitions are effectively, in business terms, “loss leaders” – delivered at very slim profit margins – they exert serious pressure on cashflow.  And the primary way to mitigate that pressure is by increasing marketing and fundraising activities; but, of course, these activities are also cost centers that must be weighed carefully against cashflow limitations. 

Need to Change Public Perceptions

For most Americans – including a majority of Mid-South residents – the fine and performing arts have negative connotations: they associate theatre, classical music, ballet, opera, and museums with words like “boring,” “old-fashioned,” and “elitist.”  Glib ads on television have ingrained these backwards stereotypes in the popular imagination.  This means that many legacy arts groups are faced with a dual challenge: to fulfill their artistic mission with, AND to make a case for the art itself as a relevant – indeed, critical – part of contemporary life.  Something worthwhile, accessible, and fun.  Local arts groups are making major strides in this direction, but the widespread misconceptions are like “wind resistance” – slowing them down as they push forward to expand their base of patrons and donors. 

Arts Education

Arts participation leads to students staying in school, succeeding in school, succeeding in life and succeeding in work. Following national trends in arts education, students in Memphis have less access to the arts during the school day. Organizations are relying on private funding more than ever before to enable students to experience the arts in after school and summer programs in addition to enabling them to provide supplemental in school arts programming. 

Arts Education

Additional Resources

Americans for the Arts - Arts & Economic Prosperity IV National Findings Report

Americans for the Arts - Arts & Economic Prosperity IV Memphis Specific Data