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Running head: MARKETING AUDIT Marketing Audit for the Natural History Museum Completed by University of Table of Contents I. Marketing Audit Approach (A. Executive Summary. B. Table of Contents. C. Summary. D. Recommendations).…………………………………………………2 1. Internal Analysis Approach …………………………………………………………………………………2 2. Market Analysis Approach ……………………………………………………………………………………11 3. Competitor Analysis Approach …………………………………………………………………………11 4. Environmental Analysis Approach …………………………………………………………………12 5. Strategic Analysis Approach ……………………………………………………………………………12 II. Marketing Audit ……………………………………………………………………………………………………….14 A. Executive Summary …………………………………………………………………………………………………….14 B. Summary conclusions for: 1. Internal Analysis …………………………………………………………………………………………15 2. Market Analysis …………………………………………………………………………………………….22 3. Competitor Analysis ……………………………………………………………………………………22 4. Environmental Analysis ……………………………………………………………………………23 5. Strategic Analysis …………………………………………………………………………………….23 C. Suggestions and Recommendations ……………………………………………………………….27 References ……………………………………………………………………………………………………………………………….29 I. Marketing Audit Approach The marketing audit is the information-gathering process that seeks all relevant data on the natural history museum’s (founded by Leeds Society) own resources and its external environment. It is useful to break the audit down into four parts to which attention can be focused: • internal analysis • market analysis • competitor analysis • environmental analysis. • strategic analysis. Time and resource factors, where a comprehensive audit can take three months or more to compile, dictate that a marketing audit must be selective but comprehensive. Ultimately, the information gathered must be distilled to inform the future direction of the museum. Too little information will allow gaps in future planning, while too much information, if much of it is irrelevant, will only lengthen the time taken to develop a marketing plan (Brown 1998). 1.Internal analysis Although not conducted in this way in most marketing literature, it can be useful in the museum context to break the internal analysis down into four parts: an outline of policy; an assessment of resources; a consideration of the marketing resources; and an analysis of marketing activities centered around the elements of the marketing mix. The rationale for focusing on the marketing mix is that, first, the SWOT analysis appraisal of the strengths and weaknesses of the museum’s resources is conducted in terms of the marketing mix, which means that it is an automatic continuation of the process, rather than reassessing the material already amassed. Second, the marketing strategy is ultimately decided in terms of the marketing mix, and so again it enables a focused continuation of the information-gathering process (Brownlie 1998). The one drawback is that it is all too easy, once the information is gathered, and when deciding the strategy, to refer only to the internal analysis and the analysis of the strengths and weaknesses of the resources, while ignoring the other data and analyses collected. Therefore this approach is recommended with a caution: the analysis of the museum’s environment must not be neglected, but should be integrated with the resource analysis in the final strategic decisions. The following outlines some of the factors to be taken into account when undertaking an internal analysis. It is worth outlining the history of the museum first, in order to assess the rationale for much of the museum’s policy decisions and activities in the past. The areas that need to be considered will include the following: History Policy Resources (the type of information required will include physical resources; human resources; and financial resources) (Brown 1998). Physical resources • nature of collection: scope and value of collection; preservation facilities; environmental controls; security measures • description of external appearance of building: prominence as local landmark; architecture and materials (if noteworthy); listed status • location of building: proximity to rail and bus stations; incidence of passing trade; proximity to public car parks; direct access to thorough-fares; access for coaches; redevelopment plans for nearby sites • description of interior of building: decor and color schemes; state of repair; number of exhibition areas with their size; available space • technological resources: computers; word-processing facilities. Human resources • number of employees: full- and part-time; curatorial staff; volunteers • skills: management; professional; future potential; level of experience • staff responsibilities: job titles; departmental structure • services of external personnel: local authority; corporate sponsors • work experience placements. Financial resources • major funding organisations and status of funding • income for past five years: sources of income—earned; grants; sponsorship; donations; other (Brownlie 1998). Marketing resources Consideration needs to be given to: the role of marketing in the museum and the resources available for the marketing function, which includes an assessment of the physical, human, and financial resources (Kotler, Armstrong, Saunders, and Wong 2001). Role of marketing • marketing philosophy: formalized strategy; personnel involved in determining philosophy • role of marketing in museum: activities undertaken by marketing; resources devoted to marketing; interaction with other operational areas; interrelation of marketing for users with stakeholders and other publics • marketing personnel: seniority of marketing officer or member of staff responsible for marketing; numbers and levels of staff working on marketing problems (Brownlie 1998). Physical resources • technological resources: computer systems; word processing; information systems for marketing information on target markets; database for mailing list; desk-top publishing; in-house printing; use of Internet. Human resources • marketing and marketing-related staff: outline responsibilities; level of experience; seniority in museum; degree of influence on marketing planning; voluntary help • involvement of senior management and board/trustees in marketing decisions • services of a local authority for marketing activities • support of Friends • advertising agency or market research agency. Financial resources • total marketing budget; decisions on budget; proportion of overall income • marketing budget expenditure • additional resources available for contingency (Kotler, Armstrong, Saunders, and Wong 2001) Marketing activities The marketing activities are assessed in terms of the elements of the marketing mix: product; price; place; promotion; and people.
The following factors will need to be included: Product The museum product can be examined in terms of the core product, namely (1) the museum building and (2) the exhibition; and the supplementary product, namely (3) the services offered. 1 Museum building • external appearance: banners; signage on building; appearance of entrance • internal appearance: ambience; state of repair; furnishings; layout; noise; temperature; air quality; lighting; signage 2 Exhibition • collection: presentation and interpretation; use of technology, special interpretative facilities; turnaround of permanent collection • temporary exhibitions: blockbusters; involvement of local community • exhibit development research undertaken 3 Services offered • facilities: information desk; cloakroom; bars; catering facilities; shop; opening hours; number of seats in galleries • facilities for the disabled: wheelchair access; wheelchair seats; hearing loop; disabled lavatories; lift; braille signs • educational services: workshops; lectures; resident artist; schools education • special events • service quality: complaints procedure (Brown 1998) Price The following factors need to be included in the consideration of price: (1) sales trends for past five years (if appropriate); (2) pricing policy; and (3) fundraising. 1 Sales trends • income totals per exhibition: average size of audience; average ticket yield per exhibition • types of sale: students; children; groups, etc. • seasonal variations: per month or per quarter 2 Pricing policy • procedures for establishing and reviewing pricing policy • pricing procedure: demand oriented; competition oriented; cost oriented • variations in price: by market segments; time of use; discounts for groups • methods of payment: credit cards • promotional pricing: incentives 3 Fundraising • income generation: variety of services offered for which a charge is made; income from services offered; pricing policy for services offered • resource development: target markets for fundraising efforts; benefits offered to potential donors; income from fundraising; current and past trends and future expectations • Friends and volunteers: policy on Friends organisation; use of Friends in fundraising; corporate membership; policy on volunteers; deployment of volunteers (Brown 1998). Place An assessment needs to be made of the time and place of the museum’s service delivery. • availability: opening hours; after-hours facilities (e.g. answering machine); seasonally • access: location of museum; signage; public transport; car parking facilities; disabled access • reception or information desk: opening hours • computers: mailing list • ticket agents • outreach facilities. Promotion Promotion can be broken down into (1) promotional resources and (2) the various elements of promotional activity, together with an assessment of their effectiveness (Brownlie 1998). 1 Promotional resources • promotional budget: decisions on budget; as a proportion of overall income; of earned income; according to needs; previous year plus inflation • promotion budget analysed by type of expenditure • additional resources available • desk-top publishing, in-house printing, photocopying facilities • advertizing agency • promotional activities with other museums or organizations in marketing association • promotional objectives and relation of promotional activities to each other • systems for handling customer enquiries resulting from promotion • measure of effectiveness used • decisions on design of promotions for different target markets 2 Promotional activities • corporate identity: image; brand; use of logo; typeface, etc. • personal selling activities: lectures; fundraising; increasing use of services • promotional literature: print quantities by type of print, season, and exhibition; distribution methods and analysis of outlets • use and creativity of direct mail: use of database for target marketing; size and segmentation of mailing lists; retrieval systems and scope for personalisation; use of other direct marketing techniques, such as telephone sales • sales promotion: incentives; linked ticket schemes • advertising: advertising policies; use of paid advertising media People A number of factors need to be taken into account, including: • staff morale and motivation • arrangements for communications: briefing and consultation meetings • advice and involvement from board members • use of Friends and volunteers • training and development: training budget; training policy. 2. Market analysis The marketing audit is critically concerned with understanding in detail the markets with which the museum interacts. Since museums have a number of markets, and not just the user markets, consideration should be given to each market in turn. The following factors will need to be taken into account, investigating users, stakeholders, and other relevant publics (Brownlie 1998). 3. Competitor analysis All museums have competitors, both direct and indirect. Competitors exist not only in the user market, but also in other markets, such as the fundraising market, or volunteer market. The significant current and potential competitors should be identified, and the more important of these should be studied in depth (Brown 1998). 4. Environmental analysis An assessment needs to be made of the external environment, both of the current situation and of possible changes. 5. Strategic Analysis. The marketing audit should be an ongoing activity. Records of attendance levels and financial records should be examined regularly. Evaluation of the effectiveness of promotional efforts should be conducted and consulted on a regular basis, and the measurement of performance should be constantly assessed. If a museum has not previously undertaken a full-scale marketing audit, it might be a good idea to hire a consultant to oversee it, since the audit should be impartial, and staff do tend to be biased in favor of the museum! The first time an audit is undertaken can be extremely time-consuming and often those responsible for undertaking it will find that many of the systems for monitoring performance and so on will not be in place. It is then a learning experience, and as each audit is undertaken, systems for amassing and detailing the required information will be created.
The information retrieval should become an ongoing activity of the museum, with ideally a review or audit taking place annually. At first a lot of irrelevant information will be gathered, but as each successive audit is undertaken, the museum will become adept at seeking the appropriate information. Moreover as the museum learns about the process and sets information retrieval systems in place, the whole process should become considerably less time-consuming, and ultimately more informative. II. Marketing Audit A. Executive Summary This marketing audit – by using the benchmarks and guidelines specified in the first part of the work – will analyze the effectiveness of the Leeds Natural History Museum’s operation and will provide conclusions and recommendations as to whether any significant changes are to be introduced with regards to museum’s functioning. The museum was founded in 1862 by Leeds Natural History Group, UK. The collection was combined by various members and was housed in a building donated to the Society by a wealthy benefactor in 1868. Until 1880, admission was strictly limited to Society members and friends, but after that date, the general public was admitted free of charge. After the First World War, the Society was in a state of financial crisis, and so negotiations were held with Leeds Municipal Committee to take over the collection and building (Costa and Bamossy 1995). The collection of natural history artifacts is largely of local origin, with a national dimension. A significant proportion of the collection is not on display, but is kept in storage. There are two curators who work on documentation and research of the collection, although they have little time to undertake any active preservation work. There is also a small ethnographical collection, which does not really complement the theme of the museum. In the past the museum has not invested in environmental controls, while security is largely confined to use of attendants (Diai 2001). Leeds Municipal Committee is committed to funding the museum, although funding has not increased in real terms for the past two years. The museum has received a small number of grants from the area museum council and from other sources. It has not been very successful in attracting sponsorship and receives few other donations (Hooper-Greenhill 2002). The museum is keen to attract school parties, and the director personally welcomes the groups, and has developed some school packs in conjunction with local teachers. A lecture series is run in the winter season, although it is not particularly well attended. Researchers are always welcomed, and are encouraged to join the staff at tea breaks and so on. B. Summary conclusions for: 1. Internal Analysis History The museum is now under municipal authority control, and is accountable to its management committee, whose composition is evenly split between councilors and local people. The chair of the committee is a councilor appointed by Leeds Municipal Committee. Policy The museum has until recently had no formal acquisition and disposals strategy, but has now devised a basic policy. In recent years the display of the museum’s permanent collection has taken second place to the blockbuster exhibitions, which are seen as the lifeblood of the museum. The blockbusters have been chosen for their appeal to a wide audience and little effort has been made to appeal to different market groups apart from school groups. Equally, education work is confined to school parties, while there is little attempt at outreach beyond the occasional lecture to women’s institute groups, and so on (Diai 2001). The museum is well known in the area, the only other museum in Leeds being a small art gallery. However, it does not have a reputation beyond the Leeds area. Although the museum is keen to offer a quality service to its visitors, no attempt has really been made to assess the visitors’ views of quality, or to assess the museum’s own operations in terms of the quality that it provides. Resources Physical The building is a rather awesome nineteenth-century structure. It has been separated from the town’s shops by a main road. There is a small car park, although there is ample free parking in Leeds town centre. The interior of the building is suffering from age, with peeling and yellowing paintwork. It has two floors, the large gallery in the ground floor being used for blockbuster exhibitions, while the less popular displays, such as the ethnographic display, are on the first floor. The two administrative staff have access to word-processing and database facilities while the museum has recently installed software for market research purposes. There is a computer in the foyer for visitor use, which locates the galleries and objects in the museum, using question and answer techniques. A crowd usually gathers around the computer which has proved very popular (Diai 2001). Human The museum has ten full-time staff: a director, an assistant director, two curators, two administrators, two shop assistants, and two attendants. There are eight part-time staff, two technicians, attendants, and ancillary staff. At present there are two volunteers, both working with the museum’s curators. The director and assistant director have qualifications in Museums Studies, while the two curators both have university qualifications in their specialist subjects. The director does not attend training courses, although the assistant director has attended a few training courses run by Leeds Municipal Committee on management skills (Hooper-Greenhill 2002). Otherwise there is little assistance from Leeds Council, although it does have a marketing department. The museum appointed a consultant to undertake their first visitor survey three years ago, and have subsequently repeated the survey on an annual basis. Marketing resources Role of marketing This is the first time the museum has formally developed a strategy. The assistant director has been delegated the task, but is strongly supported by the director and the chair of the management committee. The impetus came from Leeds Municipal Committee, which demanded that the museum draw up a marketing plan. In the past, marketing has been regarded as merely promotions, but the assistant director is keen to develop the role of marketing and integrate it with other operations. Much of the role of the assistant director has in fact been in marketing activities (Hooper-Greenhill 2002). Physical resources The museum has two computers for administrative use, which includes a database and market research software.
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The museum usually uses Leeds Council’s printing facilities, which are of a high standard. Human resources The assistant director has assumed much of the responsibilities for marketing, but is keen to appoint a marketing assistant. In the past the museum has received help from marketing students who are attending Leeds College. The management committee have in the past taken little interest in marketing, but is increasingly demanding that the museum become more marketing-oriented. The museum has not used the local authority’s marketing department in the past, although the assistant director is receiving assistance from them in drawing up the plan (Diai 2001). Financial resources The expenditure on promotional activities in the past has accounted for around 4 per cent of the museum’s self-generated income. Marketing activities Product The museum has softened the frontage of the building with banners, and has a sign which is clearly visible from the adjacent main road. The foyer is unwelcoming, the tickets for admission being sold from a booth. The whole museum has a dilapidated air, and appears dark and dingy, and smells musty. The exception is the gallery, which houses the blockbuster exhibition, which is bright and lively. There are no signs in the interior, apart from a notice locating the toilets. The displays tend to be very traditional, laid out in chronological order. There are some exceptions where multimedia have been introduced, and two displays which focus on the issues relating to conservation. Temporary exhibitions focus very much on the blockbusters, with little use of the reserve collections, and certainly no involvement of the local community in display production. Special events are occasionally arranged, usually focusing on the blockbuster exhibition, although there have been behind-the-scenes open days. Surveys have shown that only 20 per cent of visitors are aware of the museum’s conservation stance. Most visitors are fairly satisfied with the facilities offered by the museum, although research has shown that there is considerable demand for a café. The museum was awarded a grant to create facilities for wheelchair users, both access and toilet facilities. There is no access though to the upper floor, and no other disabled groups are catered for. There is a shop with a fairly large stock of books and small souvenirs targeted at groups of schoolchildren. There are toilets and a drinks dispenser with benches beside it, and there are few seats in the galleries. There is no complaints procedure, although there is a suggestions box in the foyer (Hooper-Greenhill 2002). Price The museum charges for admission, with half-price concessions, while there is also a family ticket. Schools groups gain free admittance. The museum has received small grant awards from various bodies and has attracted a few donations from local companies. It has a donations box in the foyer. There is no Friends organization, although there are often volunteers undertaking research in the museum (Diai 2001). Place The museum is open from 10 am to 5.30 pm Monday to Saturday, and from 2 pm to 5 pm on Sundays. The museum has good public transport links, and although its car park is small, there is plenty of parking space locally. There are a number of signposts directing the visitor to the museum (Diai 2001). Promotion The promotional budget amounts to 4 per cent of total earned income. Most of that budget is spent on leaflets, which market research has proved to be effective. The leaflets are produced with the assistance of Leeds Council. They are distributed in local outlets, such as libraries and doctors’ surgeries. The museum is also included in local tourism leaflets. The museum recently developed a corporate identity with the help of a professional designer in the local authority. It now has a logo and distinctive typeface. The museum has in the past advertised on buses, but found from research that this was fairly ineffective. The museum relies on the goodwill of the local newspaper for publicity. People Staff meetings are conducted monthly, with all professional staff and representatives from attendants and ancillary staff involved. There is a small training budget, although most training is paid for and undertaken by the local authority. All attendants have been on customer care courses. Some members of the management committee are business people, and have often given freely of their advice. The museum has good relations with Leeds Council, and at the present has a very committed management committee chair. 2. Market analysis Users The museum has been conducting surveys of visitors for the past three years, and has a clear idea of the profile of users. One-third of users are members of school parties, while children represent one-third of non-school visits. Few older people are attracted. The majority of visitors live in the local area, tend to come in family groups, and are repeat visitors. The museum also attracts a reasonable proportion of visitors for research purposes. Stakeholders and other publics Leeds Municipal Committee has been very supportive of the museum. The local tourist board has included the museum in its publicity and actively promotes the museum, although the town of Leeds is not a tourist destination. Volunteers have been a constant source of help on the curatorial side, although less so in other areas. 3. Competitor analysis The only other museum in the area is a small art gallery. However, Leeds has a large leisure centre which has sports facilities and a theatre. Survey findings indicated that the vast majority of the museum’s visitors attended the leisure centre both for sport and the theatre. There are few specialist gift shops in Leeds, and certainly none selling the range of goods on offer in the museum shop. 4. Environmental analysis The museum is aware of recent education legislation which impacts on its services to schools. The economic situation also suggests that funding from Leeds Council is likely to be reduced in the long term. The population of Leeds is increasing as new homes are built, predominantly for families. The leisure centre is expanding, with a studio theatre being built. It is assumed that the museum will continue to receive funding from its local authority. However, if this is substantially reduced, it is recognized that a contingency marketing plan will need to be put into place, which places more emphasis on fundraising activities. 5. Strategic Analysis 1 To increase the use of the permanent collection in quiet periods between blockbuster exhibitions so that 10 per cent of the reserve collection is exhibited per annum by year 3.
2 To develop the image of conservation, so that an additional 10 per cent of visitors are aware of the museum’s image in each of the next three years. 3 To develop a commitment to quality in the museum, by setting in place a quality strategy by year 2. 4 To plan refurbishment of the museum over the next three years by year 1. 5 To investigate the feasibility of a café by year 1. 6 To encourage local groups to participate in the development of a new display by year 3. 7 To increase frequency of visits by 5 per cent per annum over the next three years. 8 To establish a Friends organization by year 1. 9 To introduce new programs for families and children by year 2. 10 To increase income development by 15 per cent per annum over the next three years. 11 To develop the shop to increase earning potential by 5 per cent per annum over the next three years. 12 To increase awareness of the museum in the local community by 10 per cent per annum over the next three years. 13 To increase the promotional budget to 6 per cent by year 3. The museum is conscious that a number of issues arising in the SWOT analysis have not been dealt with in the marketing plan for the next three years. Alternative mixes have been developed to incorporate these issues, and will be used as contingency plans if circumstances change (Hooper-Greenhill 2002). Positioning It is clear from the analysis and from developing perceptual maps that the museum should continue to target local people, families, and school parties. To meet the needs of these groups, Leeds Museum needs to emphasize the benefits already on offer and augment its product to create additional product benefits. The resource implications should be dealt with by the increased funding expected from fundraising, while many of the incentives will be self-financing. Two major initiatives will be started with little cost implications: the involvement of the local community in developing displays, and the introduction of new programs for families and children. The initiative that will take substantial resources is the café, but at this stage, a feasibility study will investigate the resource implications and demand for such a facility. Product The corporate identity of the museum needs to be reinforced throughout the museum, not only in its promotional literature but also in its whole image. Consequently, the displays will need to be redesigned to incorporate the conservation message. Multimedia can be effective at getting the message across—a number of computers in the foyer could double up both to orient the visitor and to emphasize the conservation message. While redesigning the displays, local groups can be involved, starting with a group for the disabled to capitalize on and make them aware of the excellent facilities on offer for the disabled. Local groups can also be involved in temporary exhibitions using the reserve collections. Blockbuster exhibitions should be interspersed with these temporary exhibitions, to vary the product and to encourage more repeat visits. A quality strategy will include the need for a blueprint of the museum’s interactions with its visitors, and a customer complaints procedure. The foyer should be made more welcoming—the computers will help, but the ticket booth needs to be replaced with a desk which can double up as an information desk. The stock in the shop should be reappraised and enlarged—market research and a review of local shops and any gaps in merchandise will be required. A study will also need to be conducted into the feasibility of a café, both in terms of demand and resources. New programs should be introduced for families and children. Workshops can also double-up for school use. Demand for workshops and events can be assessed using the museum’s market research. Price The museum should establish a Friends organization, to assist with fundraising and to help as volunteers, for example, for events and workshops. Companies, especially those that are conscious of their environmental image, should be approached for sponsorship funding. Local employers in Leeds should be targeted and personally approached. Relationships with Leeds Municipal Committee are important and must be maintained. However, using the market research and the marketing planning as a base for applications, the museum should be targeting more grant-giving organizations, and should be looking towards government grant funding for the café, if the go-ahead is given by the feasibility study. Place The museum’s transport links are good, as is signposting. The building though is rather awesome. Tubs of plants at the entrance and a brightly lit foyer will make it more welcoming. Suggestions and Recommendations Promotion The museum needs to raise awareness and increase use of the museum by local people. Research data should be used to target prospective visitors accurately with a mail-out. An incentive can be offered, such as a coupon for a 15 per cent reduction in the shop. A mailing list should be set up to include workshop participants, and Friends, possibly developing it for mail-outs of promotional literature. The mailing list should be used for openings for temporary exhibitions. The shop should be publicized, with press advertising at Christmas—a good time to increase sales income. The museum should approach Leeds’s new leisure centre to ascertain if it can place a display in the centre. This would have the effect not only of raising awareness, but also of starting to build links with the museum’s main competitor, in the hope that in the future they can co-operate.
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