Monetisation of Cultural Assets
As can be seen from the above graphic, museums rely heavily on foundations, trusts and personal contributions against a backdrop of government budget cuts, but nonetheless sit atop a treasure trove of culture, which, if deaccessioned tomorrow, would fetch billions.
Indeed, the market value of art sold in 2017 was 63 Billion USD (source: Art Basel and UBS Global Art Market 2018 Report) and according to Skate’s Art Market Research, the global inventory of art is valued at USD 400 billion, available to trade at any time on the global art market.
And yet, museums have traditionally seen fundraising and sponsorship as a ‘necessary evil’, despite it being such an important source of income.
Add to this the ICOM Code of Ethics (2013) that requires only a ‘written policy regarding sources of income’ and recommends simply that ‘museums should maintain control of the integrity of their programmes’.
So, should museums be thinking about reducing their reliance on government funding and private donations, and capitalising more profitably from the global art market?
Visitor Engagement Metrics
Why not use visitor engagement counters, co-located with artworks, to measure the visibility of loaned items from private or corporate collectors?
These loans are often made (without any money changing hands) specifically to promote the private collection and to enhance its market value through improved visibility and provenance, so why can museums not share more profitably in this value chain?
This ‘eyeballs means money’ approach is, after all, the business model of the advertising sector. The advertising space in this case would not be a billboard, website or magazine, but the wall- or floor- space in a public museum or gallery that will be occupied by a loaned piece.
At the moment, visitor engagement is based on figures for the whole museum, not the artworks themselves. Co-locating visitor metrics on the art itself would be a game changer, since art accrues value through exposure, as well as through improved provenance. Both factors can lead to increased market value when the piece is next sold at auction or private sale. Each museum would potentially gain from the same successful business model that has powered Google to stratospheric heights.
One big benefit of hard metrics would be to show corporate sponsors the real-time visitor engagement enjoyed by a work (and hence also their brand logo sitting next to it), since sponsors will normally pay for higher visibility, just as they pay more for advertising space on a popular website or magazine. They just need to see the hard data to be able to quantify it.
- the private collector (the lender of the piece) would be able to measure the real-time visibility of the item during the exhibition, just as you can measure the popularity of an Instagram page
- a corporate sponsor could decide if the artwork visibility merits co-placement of their brand logo and how much this is worth to them
- the museum generates a revenue stream by monetising this increased visibility on loaned items from private collections
So, is it time to monetise cultural assets in public museums?
Such revenue streams would allow museums to play a more profitable role in the global art market, recouping the investment made in providing visibility to art market star players.
It would be an approach based on hard data and would lend itself to establishing price traceability over the lifetime of the object.