The role of location in the marketing strategy of performing arts organizations
Lai, Christine A
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This dissertation seeks to determine the relative importance of location in the marketing strategy of non-profit performing arts organizations (PAOs). Recent marketing and arts organizational research has shown that PAOs' marketing practices are shifting from product development to audience development. While product development and promotional strategies are important marketing variables, location selection has become an important strategic factor for the arts industry. Yet very little research has been done on the locational dimensions of this industry. Based on a mail survey of PAOs in six second tier U.S. statistical metropolitan areas (SMAs), this paper will investigate: (i) the attributes that explain the location of PAOs in the SMAs (that is, Buffalo, Pittsburgh, Cleveland, Columbus, Cincinnati, and Milwaukee) and (ii) the extent to which location influences the success of PAOs. All six SMAs have a population range of 1 million to 2.5 million. While they are located in a region that has witnessed a decline in manufacturing activities, the cities however are relatively rich in cultural and arts activities. To test the relative strength of location attributes influencing the success of the PAO, a revenue concentration index was created and used as the dependent variable in a multiple regression analysis. This model reveals that location does indeed play a significant role in the success of PAOs particularly with regards to affordability and abundance of arts industry specific labor. In addition to benefiting from arts industry specific labor, PAOs have access to and support surrounding producer services such as accounting, law, advertising, and web page creation, indicating the PAOs gain from urbanization economies. Collaboration with peer PAOs and other institutions such as universities, foundations, and corporations appear to be essential to building audience support and acquiring additional sources of revenue suggesting that localization economies and local institutional support also play a role in the success of the organization.