REMIX

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FOREWORD Welcome to this eBook in association with the Guardian Culture Professionals Network where Peter Tullin, co-founder of CultureLabel.com, walks through several consumer trends and ideas that are reshaping the landscape to usher in an age of opportunity for the cultural entrepreneur. He explores the prospects this might offer those organisations that embrace these new realities and the pitfalls that may befall those that don’t. This eBook is made up of a selection of chapters taken from the forthcoming REMIX, which is being published as an enhanced App book, also with The Guardian. The App book will feature content from the REMIX Global Summit for Culture, Technology and Entrepreneurship, held in partnership with Bloomberg and Google on 27 September 2012 in London. Ongoing updates will be posted to the REMIX blog as a publication such as this is forever a work in progress. REMIX is written from the perspective that entrepreneurs, whether within or outside organisations, change the world. The spread of their ideas, products and platforms, driven ever faster by the digital revolution, will continue to disrupt established ways of doing things and accepted wisdoms. Change is the constant, and in our new connected world the user, customer, audience or bystander can change things, even if organisations themselves don’t or won’t. Our desire is to see cultural organisations in the driving seat of change, embracing and benefiting from the opportunities that are available to them. REMIX is also based on the premise that there is an insatiable demand for what the cultural sector is well placed to supply. This huge market opportunity combined with entrepreneurial strategies means sparks will fly, and big ideas can flourish. Culture and creativity are central to bringing people together and improving their lifestyles, entertainment and leisure. Cultural expression is now core to building powerful communities and brands, creating content and experiences that engage on an entirely new level.

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Meanwhile, technology continues to disrupt business models and distribution strategies. Consumers are changing, and are more powerful than ever, and entrepreneurs are finding entirely new ways to meet their own need for commercial gain. REMIX explores the territory where culture, business and technology, and where heritage and innovation meet.

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INTRODUCTION In 2009, along with Simon Cronshaw, the other co-founder of CultureLabel, we published Intelligent Naivety on the emerging field of cultural entrepreneurship. Rather than focusing on ideas, which hardly seemed in short supply for the people we met in the cultural sector, we explored 56 strategies designed to turn those ideas into reality for generating new commercial revenue within cultural organisations. At the heart of our thinking was the start-up mentality of creating something out of nothing: forming the structures, alliances and strategies to leverage the assets you already have, rather than being restricted by financial constraints. Three years on, in the midst of tough economic times, the advice we gave in Intelligent Naivety stands as true as ever. Cultural entrepreneurship is a win-win scenario, developing new audiences as well as the opportunity for creating commercial revenues to invest in cultural content. Intelligent Naivety analysed countless innovative organisations – from the corporate giants of the eighties to the dotcoms of the noughties – in an attempt to document their ‘secret ingredients’. It has since been used as a handbook for would-be cultural entrepreneurs in organisations of all types and sizes. CultureLabel.com represents my own journey into cultural entrepreneurship. We embarked upon a very simple but potentially big idea: an online retail site for the best of global culture where art, design, heritage, music, film, fashion – and a whole lot more – could collide. Central to this was a core understanding of mainstream consumer retail trends: online and offline, cultural and high street. Our mission of connecting culture with the consumer remains central today, and even though CultureLabel is still relatively young, the pace of growth, even to this stage, has been electrifying. Our cultural entrepreneurship niche is in retail. But we’ve witnessed a flood of other opportunities emerging for the aspiring cultural entrepreneur, as consumers are increasingly demanding what the cultural sector is well positioned to supply. 4


Even in the midst of this economic downturn, demand for cultural content, brands and experiences is booming. In the UK, pop stars like Coldplay and Rihanna can barely compete with the 2011 blockbuster Leonardo Da Vinci exhibition at the National Gallery, with a total sell-out seeing tickets being re-sold for up to £400. In the same year, Tate Modern turned 10 years old – a building designed for two million visitors now caters for close to six million annually; a new extension is underway to meet the demand. Seven out of 10 tourists visit London for its heritage and cultural assets, and it has almost as many visitors each year than New York and Paris combined (Visit Britain). Crucially, supplying this consumer demand is not just reserved for large organisations. Entrepreneurship means the playing field can be levelled. Take the experience economy, where consumers demand ‘real’ experiences in part to counteract their increasingly digital worlds. The cultural sector has been quick to respond and drive this trend. For example, Punchdrunk is pushing immersive theatre to new levels. Their New York based show Sleep no More has been running for more than a year with ticket prices of $75. In the UK the company has created a ground breaking Key Holder membership scheme that people need to join in order to even have a chance to see their performances or access insider information about them. Meanwhile, Tate Modern has embraced performance art in the launch of its new Tank spaces and received widespread critical acclaim. The live experience provided by the cultural sector generally, combined with the shiny new temples part-funded by the lottery, have proved a huge draw to the public and this should fill us with confidence; from the niche appeal of You Me Bum Bum Train to the blockbuster of Frankenstein at the National Theatre. With nearly 50% of the global population in cities (about 3 billion people), ‘citysumers’ as they’ve been termed tend to be more adventurous and ravenous for these experiences. Social media is allowing a new generation of thrill-seekers to zero in en masse on the next big thing. Secret Cinema’s rapid growth is a by-product of both of these trends and its commercial success is funding the artistic endeavours of parent company Future Shorts. It reinvents the cinema experience by theatrically recreating the environment, bringing the film alive for the audience. Its production of Lawrence of Arabia at 5


Alexandra Palace saw 15,000 fans in Bedouin attire descending on the venue. As sponsors like Microsoft and Nokia create associations with the experience, Secret Cinema has recently moved into new releases. More people saw their version of Prometheus, transformed into the Alien universe at a huge warehouse near Euston, than at the BFI IMAX per night. How much do they spend on conventional print marketing? Nothing. They cleverly use their core community to drive word of mouth through social media. Therefore, while we are by no means immune to economic pressures, cultural organisations should still have the confidence to think big and defy the downturn. This brings us to today. While many of the strategies from Intelligent Naivety stand the test of time, the context in which they are applied is changing rapidly. For REMIX, the aim is to look more closely at the context, environments and trends that cultural entrepreneurs could harness in their pursuit of new audiences and revenues. The intersection between culture, technology and entrepreneurship is, we believe, where some of the world’s best ideas are emerging. The current levels of innovation in each of these sectors individually is fast-paced – but put these trends together, mix and match, REMIX, and the opportunities become exhilarating. The REMIX book analyses a handful of consumer trends that are driving major changes. Whether it’s the trend, or the counter-trend, we believe these could form the basis of some bright new entrepreneurial ideas within the culture industry. As demonstrated throughout the book, the opportunities afforded by embracing entrepreneurship are immense. But it’s also worth considering the dangers of not doing so. It is hard to make change happen in an organisation if the model does not appear to be broken. Kodak, for example, were the inventors of the digital camera, yet their reluctance to fully recognise and embrace the digital revolution ultimately led to its 6


downfall in the camera market. Cultural organisations should always be asking themselves this question: if we did not already exist, would we build us again? Closer to the cultural sector, Amazon.com has now created the biggest library in the world by virtue of allowing millions of eBooks to be shared effectively free of charge for a limited period between users in the US. Five years ago, would you have believed eBooks would be the dominant sales format on Amazon (Kindle only launched in November 2007). How do we survive and thrive in an environment where change is the constant? How might a global network of institutions work together to roll out products rapidly by working together in ways not previously contemplated? In developing products and platforms with international potential, how do we create new structures that will allow us to compete? Who are our partners for these tasks? This is what REMIX seeks to answer. As the vanguard of innovation in culture, entrepreneurship and technology becomes increasingly intertwined. We are about to witness the ascendancy of the cultural entrepreneur, able to knit these diverse worlds together. There are certainly enough global, national and local opportunities and challenges that need a creative solution. I hope REMIX will help inspire more entrepreneurs, from within and beyond cultural organisations, to step forward and respond to the call. Peter Tullin Co-founder, CultureLabel.com – @petertullin / @culturelabel www.culturelabel.com/remix

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MOBILE CULTURE “There are 5.9 billion mobile subscribers; that's a staggering 87% of the world population.” As we see just by looking around any train carriage or local museum, the internet has truly gone mobile. 1.2 billion of those users are browsing the web through their devices. This accounts for 8.49% of global website hits and it’s growing fast. In the UK, there are nearly the same number of searches for ‘art’ per month through mobile as through desktop. In terms of users and sales, Android leads the way and iOS (iPhone) is not far behind. At the moment the App store for the latter device is proving more lucrative in sales but the user battle has tipped in favour of the former. In 2012 more Android smartphones will be shipped than PCs and Apple will reach a similar position shortly. That’s pretty staggering if you think of the capabilities of a smartphone, which is in every way a mobile computing device. Global growth is unsurprisingly led by China and India, which already account for over 30% of subscriptions. We should also not forget that mobile computing takes other forms. Apple CEO Tim Cook predicts that “tablets such as the iPad will outsell desktop and laptop PCs within a few years.” The Kindle has also sold well and new pretenders such as the Google Nexus and Windows 8 devices will all help grow the numbers further. These mobile devices allow us to access culture on demand, locate it physically and interact with institutions in new ways. At MobileCulture, an event co-created by CultureLabel, Anthony Robbins of the Museum of London (MoL) revealed more than 300,000 people had downloaded the Streetmuseum App, which peeled back layers of time in London. 95% of those downloads came from the iTunes store. The follow-up Street Museum Londinium attracted the support of the History Channel, and the latest version Dickens Dark London offers a series of in-App purchases as MoL attempts to monetise the platform for the first time.

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Making money from cultural Apps has been the challenge to date as there have been a number of high-profile releases but those which have been big commercial successes have primarily been driven by the private sector. For example, T.S. Elliot's The Wasteland from Faber & Faber made back its investment in just six weeks. The choice of developer was critical, with Faber identifying Touchpress as the technology partner following their App store chart toppers such as Wonder of the Solar System and Elements, which also pushed the creative boundaries of the electronic book. The longterm foundations of this relationship are crucial, with Shakespeare's Sonnet the next release in the works, featuring contributors as diverse as Sir Patrick Stewart, Kim Cattrall and Dominic West from The Wire to take Shakespeare to a new online audience. Pricing In both these cases, the Apps were priced at £9.99. Although this is considered a high price point for an App, it seems audiences are prepared to pay a premium for quality content and production combined. This is an interesting difference from the route Arts Council England have taken with their digital channel, The Space, which proclaims the arts live, free and on-demand. Arts Council England and the BBC have the clout to help with content aggregation so it will be interesting to watch this experiment. Ultimately, as with CultureLabel.com, customers are demanding convenience, everything in one place, along with curation and user and social recommendations to help navigation. The critical mass of content on services such as iPlayer means the service can make intelligent recommendations to help you discover new content and when you add a social layer that allows you to track what your friends watch as well. One concern with The Space experiment is whether an opportunity for sustainable income generation (with the subsequent reinvestment in creating cultural content) has been overlooked, considering the willingness of audiences to pay for certain content. Furthermore, in an age of on-demand entertainment, has the platform gone far enough to deliver content when and where requested? Convenience is critical to consumers increasingly used to multi-platform experiences – they even expect them cross-border.

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For example, iPlayer content can now be downloaded so you can take it on holiday. It also allows for international subscriptions for a small fee if you are not based in the UK. The old broadcast model is facing major pressure from a host of providers – from free services like 4OD and ITV Player to paid services like Netflix and LoveFilm; all of which are also challenging the current dominant subscription services from Sky and Virgin Media. The flexibility of services is critical, with content available on mobile devices in App form as well as through devices like the Xbox 360 and PS3, reaching people in the home and on the move. Commercial players such as Digital Theatre started with a browser interface in the same way as The Space, but have evolved onto other platforms such as being shipped with the Samsung Smart TV, which has already sold 50 million units. In brief, it is clear that art distribution strategies must already be multi-channel, personalised and on-demand. The App Economy It’s easy to get carried away with the excitement of creating an App but it is a costly endeavour, with a return far from certain either in audience or revenue; such is the competition for eyeballs. There are over one million Apps at the time of writing – more than 600,000 in the iTunes store and over 400,000 for Android devices. The consensus at the MobileCulture conference was that organisations were better starting closer to home with mobile-friendly websites. If you want to get ahead of the curve then Responsive Design, where sites automatically adapt to the size of the screen, is a growing trend and is often more cost-effective than building device-specific versions. From a nice-to-have just a few years ago, mobile-friendly design has now simply become a must, thanks to mobile adoption rates. 51% of smartphone users are more likely to purchase from a mobile-specific website, but incredibly only 4.8% of retailers have a mobile site. Despite the number of users, fewer than half of US museums currently provide visitors with an opportunity to use mobile technology during their visits (American Association of Museums, Nov 2011).

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Mobile commerce is also growing dramatically. 2009 sales were just $1.2bn, but by 2015 they are predicted to be $119bn. Online sales are expected to go from $210bn to $1.4 trillion in the same period. 50% of Groupon’s business is expected to be from mobile in the next two years. We should also not forget social commerce, viewed by some as the next big growth area. Social commerce is driven by (and often takes place within) platforms such as Facebook and is largely being driven by mobile devices that are themselves propelling the growth of these platforms. Pinterest.com is one giant visual collectors wish list and many are speculating the 'buy' button next to those items could be close as the site is rapidly building a critical mass of uses. It is no surprise that Facebook is the biggest proponent of social shopping and the world's largest social network with nearly a billion users stepped in to buy the site. Social shopping is estimated to reach $30bn by 2016. CultureLabel has just released an App that creates a Facebook shop for our members and over 100 partners activated this within the first week. The mobile experience has also become more important to offline retail. The ability to make price comparisons is now simple thanks to barcode scanning Apps from sites such as eBay or Amazon. An increasing number of ‘click and collect’ services are available from retailers such as Currys and Halfords, giving the benefit of internet pricing and providing an alternative to waiting for the postman. Front of House What will mobile mean for front of house services such as ticketing? One guide might be Eventbrite.com, which is one of the fastest growing dotcom businesses in the world. They have sold nearly 65 million digital tickets and are rumoured to be filing for an IPO before long. Users can sell ‘airline style’ 2D barcode tickets via a sales page that can even be personalised. The tickets can then either be printed or scanned directly from the mobile phone. They even offer a box office service where you can take payments on the iPad and check-in guests. In a very short space of time they are now working with partners like the National Portrait Gallery for their recent David Bailey exhibition.

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The digitisation of ticketing and integration with the wider retail offer allows for the sale of add-on merchandise, such as catalogues, in order to drive up average basket orders. Data is the new oil, and is the foundation of initiatives like the Tesco ClubCard or Amazon.com recommendations. The ability to identify ‘high-value’ customers through data analysis allows an organisation to experiment with innovative discounting and other segmentation strategies. The same tactics can be used effectively with other audience segments. For example, the London Symphony Orchestra has just released a mobile App specifically targeted at students and young people with support from the digital R&D fund set up by NESTA, Arts Council England and the Arts & Humanities Research Council. Enabling a mobile museum experience will continue to evolve as consumers seek the benefits they get in other environments such as retail spaces. For example, the emergence of Near Field Technology turns your phone into a debit or credit which could be touched against a reader device to pay for things inside a cultural venue. This technology will become increasingly commonplace. You can already get on trains via your Oyster card and pay for a coffee if your credit card is Pay Pass enabled, providing the shop has a reader like in Pret-a-Manger. The take-up is already extremely widespread in countries such as Turkey and it is only a matter of time before the same can be said elsewhere. Near Field integration with phones introduces the possibility of cashless payment. Google Wallet allows your phone to replace an assortment of cards from Credit to ID. The first uses of Near Field within cultural venues are already being explored. Nokia has partnered with the Museum of London to explore multiple ways the technology could enhance the visit once you are past the entrance. The experiments range from getting information on exhibits, buying tickets to future exhibitions, and posting ‘Likes’ to social media platforms, to retail and café vouchers. The integration of Near Field Technology with virtual reward cards could provide valuable data and audience incentives.

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Location, Location, Location The smart mobile is also responsible for a revolution using location-based services to blend physical with digital. Apps like Halo allow you to hail a Black Cab via your mobile to a specific location and know exactly when it will arrive, so there is no need to ever get wet on the street corner again. Cultural institutions now exist in a world where they (and their competitors) can incentivise smartphone users to come through their door based on their location. Using Apps such as Timeout or TripAdvisor, you can discover events and venues in your proximity and whether it is worth visiting according to other users’ reviews before choosing to visit. You can then provide your own real-time feedback using something like the mobile version of Twitter, leaving a digital imprint for others to follow (or not) and share in the same way that people use Amazon reviews. In a world where we broadcast more and more of our lives using social networks like mobile Facebook, we are also instantly notifying friends about our experience. Those friends will also instantly be able to zero in on the location of that person if they ‘check in’ or are using another alternative such as Foursquare, making impromptu meet-ups easier than ever before. The platforms referred to are typically non-specific to the cultural sector so deciding which to work with is critical. New players are constantly emerging. For example, the Shopkick App “transforms the high street into an interactive world using your smartphone”. It already has over three million active users, one billion offers viewed and $110m driven in its first year of operation. It has a partnership with Visa that allows shoppers to buy and collect, and you earn ‘kicks’ (Shopkick currency) just by visiting stores. Another popular player in this space is Foursquare which gives its 15 million users rewards for checking into locations. These rewards range from virtual badges to the ultimate status of ‘Mayor’ of your favourite establishment. Ken W. had achieved the lofty status as Mayor of the Guggenheim Museum at the time of writing checking in 48 times 15


in 60 days. A definite way to encourage repeat visits; or alternatively a way to see if your staff are in! Whereas Shopkick has not been adopted by many museums yet (perhaps because they need to invest in equipment), Foursquare usage is more widespread. The Met Museum had 50,000+ check-ins at the time of writing and was offering incentives such as a free tote bag for purchases over $20 for anyone checking in to build its community. A commercial player, the History Channel, has developed one of the more innovative cultural applications of Foursquare. With an incredible 300,000+ followers, the History Channel uses Foursquare to work out where you are, and serves facts and videos. The more locations you visit and discover the more rewards you get, leading to the coveted Historian badge. The project has been launched in both the US and the UK where there are 600 sites that will reveal information. The History Channel has signed up more than 20 UK visitor attractions all of which are offering deals to Foursquare users. In-App advertising also provides a revenue stream. 7,500 people unlocked a special reward badge with a huge 100,000 check-ins in the first two weeks alone. Accessing extra content QR Codes have also received much attention as another way of getting additional content from physical or digital 2D codes. They have recently been used to enable direct purchases of groceries at Tesco Home Plus in Korea through posters at Underground Stations, enabling busy commuters to get their essentials on the move. The same approach was rolled out in the UK but through digital screens. Some people have been put off by the look of the codes themselves, but there are projects such as Louis Vuitton’s recent collaboration with Takishi Murakami that turn the codes into artworks. Augmented Reality is another area likely to take off as useful applications for the technology are matched with hardware support. Perhaps expectedly, because Augmented Reality is still in its very early days, applications in the cultural sector are minimal, as consumers have still not fully engaged with the technology. There are some exceptions. The Royal Ontario Museum has cleverly used it to put flesh on the bones of 16


dinosaur skeletons, and the Science Museum in London has used a virtual reality James May to bring alive a series of objects within it's collections. Holition have a software solution that uses augmented reality to demonstrate how fashion accessories will appear on you and have customers such as Hugo Boss, Tag Heuer and De Beers. An iPhone or iPad camera is trained on a 2D barcode that the user prints and a product – such as a ring for example – will appear wherever it is placed. The company has also worked with designer-makers like Hannah Martin based at Cockpit Arts. One of the benefit of this use of Augmented Reality is that it allows the customer to shop from home rather than requiring the physical experience. Again, when you start putting these different technologies together it produces new possibilities. With on-demand 3D printing production technologies this means you can produce a single unit as long as it is in digital form so stock production risks are minimal. The Fitzwilliam Museum in Cambridge is engaged in a pilot to do this with 3D scans of its collections to sell items as products. The Smithsonian, the largest museum in the world, has just 2% of its 137 million objects on display so is working on a pilot to get the objects into classrooms through 3D printing of replicas. Technology platforms are becoming more closely integrated into everyday lifestyles – the barriers between person and content are rapidly disappearing. This creates opportunities for cultural organisations to ensure the spread of their content through the best channels, as demanded by consumers. It also requires the consideration of context, in order for content to be most relevant for whenever the user requests it, wherever in the world they are.

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CONTENT REVOLUTION Cultural institutions are content producers, stores and curators. The digital age is creating a number of ways to navigate this cultural content in new ways that have not previously been possible. We should start by considering challenges in an attempt to work out where all this might be going. While there have been extensive digitisation programmes, they have often been undertaken across multiple organisations, they are often not joined up, and generally involve patchwork coverage to meet the particular aims of different funding providers. The lack of consistent metadata standards and coordination means the databases are disaggregated, and that makes it difficult for the end user to get what they want. There are some interesting public-sector driven initiatives like the Collections Grid that are trying to meet these challenges on the supply-side, and new contenders attempting to provide demand-side answers. Algorithm Search A range of internet start-ups are trying to solve these problems in the visual arts by developing algorithm searches that identify the characteristics of images to suggest other works you might like based on similar responses across millions of users. They seek to be the IMDB (Internet Movie Database) of art by making intelligent connections between overwhelmingly large amounts of disparate content that would be impossible for any one person to make sense of. Interestingly, most of these sites are backed by Venture Capital funding because of the commercial opportunities within their model. This relates particularly to areas such as art sales if they can achieve the first Google result for an artwork in the same way Wikipedia does for many search terms. Art.sy, based in the US, is the most prominent and has raised $10m, creating a lot of noise with high-profile investors including Eric Schmidt, the co-founder of Google, and the leading commercial gallerist Larry Gagosian. After aggregating the world’s art, a single catalogue can then be navigated in a variety of innovative ways such as visual search, creating convenience for consumers. If consumers like the online experience and join the platform as members it opens up a huge opportunity to sell original or limited 19


edition work online, either from a gallery, direct from artists, or on-demand reproductions, generating a steady stream of new income for organisations. Social Search Once sites have an audience, crowd-based or social navigation comes in as a second form of search and discovery. By making the architecture of these websites fundamentally social it means users can collect and comment upon what they discover, and allows the visitor to learn from other visitors. Collectively, the wisdom of the crowd becomes the curator, in the same way that if lots of people buy a certain lawnmower on Amazon and like it, then it moves up the rankings on the basis of popularity and recommendations. In a world where the design architecture of these websites is essentially social then it is very easy for people to share their experiences with their network of friends inside and outside the platform. Those social ripples then grow the audience even further: hence the power of the recommendations. If aggregation is the big idea to enable smart and convenient navigation of content, the same approach is being applied to other forms of culture. For example, the start-ups Anobii and Goodreads are also using ‘the crowd’ to source content and highlight trending topics; but this time to create a social network for books with user reviews and related material. They believe that in a world where physical objects such as CDs, DVDs and Books are becoming less important to us, we want to showcase what we own or have read, and if lots of people do this we will have a really valuable resource to find new things. Again, it’s a great jumping off point to sell things like eBooks. Once you have found a sizeable audience for a problem that needs solving this allows a websites to monetise its user base. Sites of this nature have the potential to elevate users to the position of expert for the things that they have knowledge about or are passionate about, directly challenging the authority of the cultural organisation. For example, Anobii is a challenge to the role of the classic ‘human curated’ library as users can get reviews and search out other related titles themselves by tapping into the recommendations of the crowd. 20


The Pinterest phenomenon of discovering, storing and sharing images has seen a further iteration of this model and the arrival of another wave of art websites. One appealing element of Pinterest.com is that it taps into a ‘collector’ gene allowing anyone to build a virtual scrapbook that reflects their desires and interests to project a lifestyle that may or may not be attainable in real life. ArtStack is an iteration of Pinterest specifically for art. It allows anyone to add works from established or emerging artists to create a virtual collection to rival the real world one of someone like Charles Saatchi. The final element of curation is that you can also follow the experts for insight and inspiration, with curators such as Matthew Slotover on the platform. In the internet world, when there is a new idea, others are quick to follow and The Saatchi Gallery have also recently launched a similar platform called Pictify. The plurality of sites attempting to catalogue the world’s art and allow users the ability to browse, search and collect their favourites, means that convergence is inevitable at some point. Not all of these businesses will survive. As this online territory is still so young, it is by no means clear who the winners of this race will be, or where the finishing line is for cultural institutions trying to pick one. As in all industries, the best will survive and thrive – these cultural entrepreneurs are growing businesses with enterprise values of tens of millions of dollars. They are funded entirely by the private sector without recourse to the public purse but absolutely built around the assets of the cultural sector. Two years ago very few of the websites referred to above existed, showing the speed of change, the perceived commercial value of the cultural sector, and encouragingly the demand online as well as offline to engage with cultural content. Interestingly, the cultural sector is partnering with a number of these platforms to a greater or lesser degree but whereas established cultural organisations are the dominant force in the physical landscape the digital battle is largely being fought between pure-play technology companies. Disintermediation, or the removal of galleries and other cultural organisations from the value chain, is a major threat for the future of the sector. It requires creative and strategic thinking from leaders to imagine new models in which the gallery retains a valuable role. 21


Curated Search The third form of search and discovery, where institutions have a clear advantage, is in 'curated search' where a manual intervention by an expert guides the user. This is the foundation of CultureLabel.com, placing museums and galleries at the core of the proposition. For example, if someone is looking to buy a limited edition, then the fact that the Whitechapel Gallery for example have selected it to be on our platform clearly makes a difference to the trust and credibility provided for the user. In addition to the curated range from the gallery the CultureLabel team exercises an additional layer of editorial curation. The aim of this is to draw together the best items from multiple organisations into unique collections. Another website that is hand curated is Retronaut, created by cultural entrepreneur Chris Wild, an archivist who had previously worked at the Museums, Libraries and Archives Council (MLA). The Retronaut website allows people to travel back into history by releasing time capsules of vivid images. The site has 90,000 views a day (The Times) and over 100,000 fans on Facebook already. Some of these start-ups are well funded with teams of leading technologists and as I alluded to above these models are hard for the cultural sector to emulate. Even when looking for sites to partner with, the multiplicity of new players makes choosing the right one difficult. So as the cultural sector, it is critical to remain conversant with the models of engagement, the emerging players in each area and the benefits and pitfalls for partnering versus creating.

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CULTURAL BRANDING Sponsorship is in the process of evolving into the far more exciting realm of ‘cultural branding’. This involves a subtle but important shift, where the relationship between culture and commerce is more complex and often involves a form of co-production. This change has not always been driven by cultural institutions. For example, the Creators Project is a partnership between Intel and Vice Magazine, who have worked together to identify artists and give them technological tools to push the boundaries of creative expression in innovative ways such as UVA’s (United Visual Artists) partnership with the Coachella Festival to produce a new light and sound sculpture work. Intel and Vice are both renowned creative organisations which possess similar brand values to the artists they engaged with. The Creators Project has collaborated with 150 artists across the globe over three years so far in locations as diverse as New York’s Meatpacking district to the Grand Palais in Paris. Ideas generation between creatives across different disciplines and industries is an important driver of innovation. For example, the Science Museum and Google have collaborated to create the Chrome Web Lab and make the web physical. By going to the project website users control what happens in the gallery whether the museum is open or not. Similarly, YouTube (owned by Google) partnered with the Guggenheim to seek out the most exceptional talent in online video resulting in the YouPlay project: 25 videos were selected via an online competition from more than 23,000 submissions and were beamed onto the iconic Guggenheim building in New York. Intel and Google are representative of a number of technology companies that are driving a change in relationships. In part this is happening because the technology industry needs the online and offline content that the arts produce in order to showcase their innovative tools and platforms. In another example, Panasonic uses the treasures of the British Museum to show off the image quality of its Viera range of Smart TVs.

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Passion Brands There is a wider trend towards consumer demand for ‘passion brands’ that marks out those companies who consumers engage with brands in an emotional way, and where they are prepared to become part of a community of fellow devotees. Intel have trademarked the phrase ‘Sponsors of Tomorrow’, which is emblazoned on their logo to mark the Creators Project as emblematic of a new direction in the way companies want to connect with customers and work with rights holders. You can see the desire to own a space that is both positive and aspirational in the mind of the audience is central to the recent sponsorship of the 2012 Paralympic Games by Sainsbury’s, which received widespread acclaim. The company sought to completely embrace the Paralympic movement even though most sponsors had traditionally chosen only a small part of the Games. It seemed like a risk at the time as there had never been a single sponsor before, but as with many inspired partnerships, success seems obvious in hindsight. There are risks attached to trading on the passions and emotions of consumers, as it involves an expectation that brands will behave in a certain ‘human’ way, however irrational. Innocent Drinks, for example, based its brand values on simplicity and putting only natural products in their smoothies. When the company was subsequently bought by Coca-Cola, it sparked criticism in some quarters – that this was not consistent with the behaviour fans had expected from the brand they felt so passionately about – prompting a vigorous response from the company that nothing had changed under the new ownership. For some other businesses, artistic intervention in the design and production processes add an additional layer to the attractiveness of their products. Most recently the French luxury goods company Louis Vuitton has teamed up with Yayoi Kusama for a new range and despite the premium price of the products people can engage via an App that merges their work with that of the artist via manipulation of camera images. The blend of product with artist or cultural reference point is a growing phenomenon. Whether it is Ted Baker incorporating the London Transport Museum archive into suit linings,

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Pringle accessing artistic inspiration for their design process with The Serpentine, to Hermes and the photographer Hiroshi Sugimoto at the Museum der Kulturen in Basel. Some brands like Absolut have made artistic collaboration a long-term brand differentiator with the Absolut Blank initiative – the latest in a long line of collaborations with individual artists. Or as an individual ‘brand’, Tracey Emin has worked with Fiat on limited edition art works using their cars as canvases. Authenticity So why have we moved beyond more conventional sponsorship into co-created partnerships, and why is culture increasingly at the forefront of this change? Pine & Gilmore’s influential book Authenticity argued that consumers are not only seeking experiences but most importantly they want authentic experiences that often extend deep into self-meaning. Art in its purest form is a genuine source of authenticity, thereby creating numerous opportunities for creative brand agencies to tap into this for the benefit of their clients through association. For example, the BMW Guggenheim Lab tackled questions such as the future of cities. This co-produced venture uses spaces outside the walls of museums and galleries, providing a growing creative frontier beyond the conventional gallery. In a similar vein, The Grand Tour, a collaboration between the National Gallery and Hewlett Packard (which saw famous works from the gallery reproduced using the firm’s latest printing technologies and put onto the streets of the capital) demonstrated how content could be liberated once digitised, and be seen by millions more people than even the 5 million who come through the doors of the museum each year. Sometimes sponsors have pursued vogue areas such as Street Art. For example, Nissan created a series of live activities outside Tate Modern as part of a major exhibition where the Tate brought a focus to the popular emergence of this art form. The positioning of the Southbank Centre by Jude Kelly as a year-round permanent festival has opened up the spaces to broad-ranging cultural branding exercises. Food is one new frontier, with 26


electronics brand Electrolux taking its pop-up food experience to the venue for four months. Organisations are also leveraging their physical assets in creative new ways. The National Theatre uses its building as a billboard to take advantage of innovative new projection technologies for corporate partners such as Travelex. New York’s New Museum turned the construction of the building into an opportunity by turning the site into a giant billboard for Calvin Klein. Crucially, the power of the commercial message was that the brand was working to help make the New Museum a reality. Sony worked with immersive theatre company Punchdrunk to create a live adventure game for the launch of a PS3 title called Resistance 3. The collaboration tapped into the core skills of the Punchdrunk team to create incredibly detailed and realistic theatre sets in non-venue based environments under London Bridge station, in this case bringing the game to life. Sony’s Carl Christopher-Ansari revealed the company had been looking for a way to partner with the theatre company for some time. Punchdrunk's versatility has also seen them work with the BBC to create a Dr Who experience for young people in their production Crash of the Elsyium. A perceived authenticity of experience, in comparison to such phenomena as the overcommercialisation of top tier football, combined with a boom in audiences seeking live cultural experiences has certainly introduced a realm of new potential. Many indicators are showing record levels of engagement in cultural activities and this should give organisations increased confidence to leverage their assets in new ways. Culture has become big business and this presents a real opportunity to maximise value in the way many comparable industries, including sport, already do. There are also many opportunities for aggregation. The Cultural Olympiad and Exhibition Road project have attempted to show there is strength in numbers in much the same way that sporting associations like the FA have been able to negotiate effectively on behalf of their members for many years. In the UK, eight of the top 10 visitor attractions (Association of Leading Visitor Attractions) are cultural venues and have been for some time. The same is true in established cultural capitals such as Paris or New York. Culture is even being used to anchor and brand whole geographic regions. 27


Saadiyat Island in the UAE and the West Kowloon District in Hong Kong are examples of investments which run into hundreds of millions of dollars. The former has focused as much on the importation of leading international cultural brands demonstrating their financial on the open market. The Louvre signed a $1.3bn deal to build a new complex designed by Jean Nouvel in the UAE. Celebrities flock to private views, especially the openings of a never-ending series of blockbuster exhibitions, which are now eagerly covered by all of the mainstream press further raising the premium for cultural association. Market conditions The effect is not even across the board, as the desirability factor has grown hugely for big ticket items whose price tag has been steadily increasing. Partnerships like MoMA and Volkswagen are breaking new financial ground. This is however reflective of what is happening with smaller organisations seeing a drop in support (as well as some larger institutions) according to Arts & Business. Some traditional stalwarts of the sponsorship marketplace have also fallen by the wayside as certain business sectors, such as the financial services industry, face challenging circumstances of their own. Furthermore, top-level sponsorship figures from Arts & Business appear to show a static marketplace overall. However, this does not account for the level of cultural brand activation that is taking place outside traditional sponsorship relationships or the flow of resources going directly to artists, designers and other creative producers. Interestingly this is often led by creative agencies and PR companies going direct to artistic talent, producers and curators, as well as through cultural organisations. Mother, one of the largest UK agencies developed the Green Box Project for Becks, who are one of their clients. Working with a range of partners such as Cult.Brand they commissioned a group of artists to create Augmented Reality artworks. These were sited across the world and could be viewed through an App on an iPhone. Cultural components have been integrated into new property developments and these also often fall outside official measurements. An example is Slipstream, an art work by 28


Richard Wilson which will be installed at the new Terminal 2, Heathrow Airport. The project has been led by creative place-making company FutureCity who have developed countless others including an artwork by Clare Woods etched into Bramah House. The sculpture is visible to commuters coming into Victoria Station and a result one of the most seen artworks in the capital. In another example of arts investment falling under the official surveys measuring institutional sponsorship, Intel Remastered saw the company develop a unique corporate art collection based on new technology interpretations of old masters. 101 musicians from 33 countries were chosen on YouTube to make up the YouTube Symphony Orchestra. In 2011 it converged on Australia for the latest performance and the extravaganza, which included dramatic projection mapping on the side of the Sydney Opera House. The event has become the most-watched live music concert on the internet, displacing U2 with over 33 million views. The prestige and increasing value of high-level cultural associations has also seen organisations benefit from in-kind co-productions. For example, Toshiba are working with the Louvre to light some of its most iconic features with energy saving low-CO2 LED lighting. The growth of audiences and their high level of engagement as an example of the experience economy has seen relationships become blurred as museums and galleries form commercial partnerships with sponsors. The Sky Arts Ignition Futures Fund pumps awards of £200,000 into innovative projects but has screening rights as a result. Other commercial arrangements include Frank’s Campari Bar, part of the Bold Tendancies exhition. Curated by the Hannah Barry Gallery, it has dramatically transformed a multi-storey car park in Peckham into one of London’s hottest new cultural destinations. The drinks brand is an essential partner in making the space into an all-round experience. Louis Vuitton partnered with MOCA (Museum of Contemporary Art) in Los Angeles for the Takishi Murakami exhibition and their product collaboration appeared within a pop-up shop within the gallery. This worked well in both curatorial and commercial terms as it made perfect sense in the context of the show. 29


So where is this all going? In a world of brand-savvy consumers, cultural organisations have begun to recognise that they are powerful brands to be reckoned with in their own right. Alongside institutional partnerships, many corporates (or their brand agencies) are conceiving and co-producing their own cultural branding campaigns with individuals as well as organisations rather than choosing from a list of sponsorship options. The desirability of the cultural x-factor means the nature of brand partnerships and collaborations is changing beyond recognition, resulting in a more equal footing. Greater investment, the embracing of risk, a desire for authenticity and technology advances will create spectacular opportunities for creating new content and innovations in this area.

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WHERE NEXT? THE AGE OF THE CULTURAL ENTREPRENEUR A bigger question underlies the territory that REMIX is seeking to explore: at a time of ecomomic uncertainty what can ‘remixing’ mean for UK plc? One answer might lie in Austin, Texas. The South by South West Festival (SXSW) has some interesting lessons for London’s Silicon Roundabout or Tech City – or, for that matter, any one of the many hubs nationwide tasked with developing technology or enterprise. Silicon Roundabout is supposedly the UK’s version of Silicon Valley, centred on a cluster of businesses in the Old Street and Shoreditch areas (CultureLabel is one of them). The government is also increasingly providing support and promotion through the Tech City initiative. South by South West is in essence a festival of global creativity. Its particular claim to fame lies in hosting the breakthrough moments of start-ups like Facebook and Foursquare, and since then many entrepreneurs and investors head over in the hope of emulating their success. Held annually, it is a melting pot of ideas, attracting over 100,000 delegates across the worlds of music, film and interactive media. However, it’s at the intersections of all these creative disciplines where a lot of the magic happens. Inspiration comes from all areas and if you put creative people together in this sort of environment then sparks will fly and the conversations are without boundary. So what does this mean for Tech City, other UK hubs and the creative ecosystem? Many ask whether Silicon Roundabout can reproduce the magical formula of Silicon Valley – a perfectly valid question as it’s a pretty successful formula that has produced world leading tech companies like Facebook and Google. But it took a very specific set of circumstances to get to where it is today. Indeed, we should try and perfect some of those fundamentals, such as better connections between funding and ideas. For example, even in the midst of a downturn the City of London has pockets of wealth and there are some great initiatives, like City Meets Tech, designed to unlock a new network of angel investors. The arrival of tech giants in the form of accelerator spaces like Google Campus and the recent announcement of new R&D facilities by Amazon are also

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welcome. We shouldn’t seek slavishly to recreate Silicon Valley – we should also be playing to our own strengths. In this respect, one answer lies in analysing the reasons why Austin has flourished as a technology hub. The city is already the home of Dell Computers and has just announced a new resident in the form of Apple which is investing $222m in a new campus. Austin is constantly named as one of the best places to live in the US and this is a clue. It is famous for its liberal values (in a state that is perhaps not so famous for them) with its unofficial slogan of ‘Keep Austin Weird’, as well as its legendary music scene (it is the self-proclaimed capital of live music). Likewise, back in London, Shoreditch and surrounding areas have long been a preferred haunt of creatives, from artists, film-makers, advertising, fashionistas or musicians. The bars, restaurants, hotels and retail have all followed over time. However, even as the area closest to the City of London has become more and more gentrified, with rents and house prices rising (now pushing some of the artists and galleries to move elsewhere), the effect has simply spilled over into the borders of Dalston and Haggerston amplifying the scene further. The challenge is to create opportunities for these worlds to collide. We ‘do’ arts and culture really well in London, with global brands like Tate, the Serpentine, Southbank Centre and the V&A. We have content holders such as the BFI and creators like the Old Vic and National Theatre. Then there are commercial operators such as the Saatchi Gallery that have helped position London as a leader in the contemporary art world. Blurring the boundaries between technology and creative disciplines needs to be in the DNA of Tech City and similar initiatives if they are to thrive. They should become bastions of an ‘everyday SXSW’, capitalising on London’s position as one of the true global cities with a hugely diverse population. They are wealth creators in their own right noting that the creative and cultural industries that have continued to grow despite the recession. Survey upon survey highlights our cultural scene as one of the biggest reasons why so many people want to live here. The engineering of technology and 32


enterprise policy initiatives need to have culture hardwired into it if we want to attract and retain talent and provide a fertile creative undercurrent to the everyday life of the city. Aside from Austin, others examples show the success of this formula. Toronto is a case in point, emerging as a tech location partly because companies like Ubisoft want to access the burgeoning Canadian film industry there to make their games more realistic. Channel 4’s film production arm Film4 – behind recent films as diverse as The Iron Lady, Shame and Attack the Block – are providing proof of the value of blurring of creative disciplines. The recently announced Film4.0, an innovation hub is developing cinematic work across multiple digital platforms and art forms. Anna Higgs, who heads up Film4.0, is working with a number of companies in the Silicon Roundabout area, including social-gaming company Hide&Seek. In her words,“the boundaries between platforms are falling away as audiences are able to access stories in myriad ways. Therefore it’s vital that we work across creative disciplines and develop new forms of author-led collaborations that blur the lines between fiction and reality, film and games, and much much more. Right across the UK, it’s brilliant to see hubs of creative practitioners forming, enabling this kind of innovative work.” How do we create the opportunities and spaces for the best creative minds to mix with the best tech and entrepreneurial minds? This is a key question that should occupy the power brokers in government – across arts, culture, business, innovation and technology briefs – as well as the grassroots innovators that make new things happen. In this vein, CultureLabel partnered with Google and Bloomberg to create REMIX, exploring this intersection between culture, technology and entrepreneurship. In the same way that a DJ mixes tracks we want to find creative new blends of these three worlds to specifically understand the role and opportunities for the cultural sector. The inaugural event took place in September 2012, and we’ll be sharing the outcomes and ideas in the remaining chapters. This will be in the form of a forthcoming App book once

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more in partnership with the Guardian. We look forward to you joining us on the journey, and look forward to seeing your forthcoming successes.

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ACKNOWLEDGEMENTS As always my main thanks go to Simon Cronshaw, who I co-founded CultureLabel.com with and have been on a roller-coaster journey with ever since. His thoughts and insights are always worth listening to and can be felt across these pages. Our team continue to inspire me on our mission to take great cultural products and affordable art to the world and their ideas are within these pages also. Special thanks in particular to Jeanne Wolstencroft for her graphic design within these pages. I have soaked up thoughts from conversations with many others also. Thanks go to Florian Wupperfeld. The team at Google including Amit Sood, head of the Google Art Project, and Steve Crossan who has been working on setting up the new Google Cultural Institute in Paris. Other members of the CultureLabel board, especially Hector Proud at Cult.Brand and Anil Hansjee (former Head of M&A at Google) with his great insights into the tech scene and broader investment trends. Thanks also to the Clore Leadership Programme and the Arts & Humanities Research Council for their support of the original research, in particular to my supervisor for the project, John Holden, whose support and guidance has been insightful and very much appreciated. Also to the British Council for supporting the REMIX speaking tour in Australia alongside the Australia Business Arts Foundation (AbaF), City of Sydney and State Library of NSW, State Library of Queensland, State Library of Victoria, as part of AbaF's Richard Pratt Legacy Project developing leadership in the arts and cultural sector with support from the Pratt Foundation. This led to us delivering an extended version of this trend briefing to over 1,000 cultural organisations across four cities. My thanks go also to Jemma Read and Lois Stonock at Bloomberg as well as Laura Scott at Google. Their support of the REMIX Global Summit for Culture, Technology and Entrepreneurship has enabled me to spend time talking to them and an inspirational network of speakers who have provided me with a great many insights for the book.

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