High-street strategies

Commerciality and sustainability are becoming words that many galleries and theatres have to consider more, as austerity measures result in reduced grants and financial support for the arts sector. This has been a harder transition for some institutions than others. I have met many curators, operation managers and volunteers that feel overt commercialisation in some way undermines or sours the fundamental reasons for preserving and presenting collections, rather than enhancing and supporting them. The result of these beliefs can dramatically inhibit the progress of their retail operations.

Few items on sale in galleries and theatres would be deemed essential. Most products encourage impulse, even frivolous purchases. Purchases may well enhance the experience of the visit or prolong the enjoyment afterwards but they still mostly fall into the category of non-essentials. The need to engage and excite customers emotionally is critical in the buying process.

Buying pain is an inhibiting behaviour in which shoppers spend more cautiously due to a perception that a store doesn't represent great value

Retail theatre

As high-street retailers grapple with the implications of ever-changing shopping habits, many have shifted their emphasis towards the customer experience. Whether that is testing stations in food establishments, products to try in technology stores or demonstrators in toy stores, the need to create excitement and emotional engagement is deemed increasingly important. For museums and art galleries this may result in more thematic approaches to display. For example, products displayed in crates surrounded by packing materials to create the feeling of discovering priceless artefacts in the institution’s storage or archives.

Pricing strategies

School parties with pocket money show little regard for price, only concerning themselves with spending every penny they have brought with them. While this category, labelled ‘Spend thrifts’, does make up a percentage of the population, unfortunately the majority of the visitor population fall into other categories, where pricing is a more sensitive issue. Some practical pricing approaches we can take will have a dramatic and immediate effect, such as:

• using pricing strategy to create perceived value
• addressing ‘buying pain’.

With regard to a pricing strategy, many of the buying decisions we make are based on contrast or comparison. This is most notable with price comparison. If two very similar products are priced at £19.99 but one highlighted a previous price of £29.99, then this is likely sell better. Why? There is a perceived increase in value. While consumers are becoming savvier to these types of retailer techniques, we are still very susceptible to them.

Pricing strategy could also include the use of price anchors and decoys. If a range of products is priced from £1 to £29.99, the higher priced items might feel expensive in comparison to the others, thus lowering the volume sold of that item. Adding a decoy product at £49.99 that appeared only marginally better in terms of size or quality would have the effect of making the £29.99 product feel better value. Coffee shops offer three different sizes of coffee for this very reason, resulting in the medium-sized coffee becoming the best seller.

Addressing buying pain is an important issue for the arts and culture sector. Buying pain is an inhibiting behaviour in which shoppers spend more cautiously due to a perception that a store doesn’t represent great value. In a value or pound store, the risk is very limited, and therefore our behaviour can become very impulsive and frivolous. In contrast, our behaviour in a motorway service station is often more measured, knowing that we are paying a premium for its convenient location. It would be reasonable to assume that most customers would perceive art gallery shops to be expensive, compared to high street and supermarket retailers. In some instances this may be true but often it isn’t. Reducing buying pain and the perceived risk can be as simple as strategically placing a number of great special offers, price promises or examples of prices that beat the high street.

Layout dynamics

As retail stores will think very carefully about the layout of their fixtures and utilise ‘hotspots’ (areas with the most traffic and visibility), the arts can do the same. Ensure that the first hotspot features seasonal and topical products. This can link to an exhibit or show or reflect the time of year.

Then consider how well targeted the products are to the customers. One gallery I worked with doubled its conversion rate by moving fun, quirky and more affordable products near its main walkway. The more premium ceramic and glassware products were moved closer to the counter. This worked on two levels. First, the shop became less intimidating to first-time visitors, and second, staff at the counter were able to engage with customers who were showing an interest in the expensive, crafted items.

Note that this isn’t a ‘one size fits all’ approach and considering the dynamics of the shop is important before putting lower-priced items to the front. Pricing strategists encourage higher-priced items to be the first thing customers see to act as a price anchor.

Different products for different visitors

Many museum and art gallery shops can develop a reputation for products that extend beyond the day visitor. Here are two potential opportunities:

• Local gift buyers can be attracted to unique product lines. Museumselection.co.uk and Culturelabel.com have created strong businesses by making museum and gallery collections available to customers across the country.
• Goods branded for your local town or city, or linked to its history. With the demise of tourist information centres in many towns, some museums and galleries can fill this gap in the market by stocking a range of products that were traditionally found in tourist information centres.

Minimum order quantities and price break points can result in branded items being prohibitively expensive for smaller museums, galleries and theatres. An approach we have suggested is to invest in branded ribbons, tags and gift wraps, which when applied to off-the-shelf products can make them appear branded or bespoke. This is also an effective way of testing products you are considering commissioning at a later stage. Wrapping a boxed product in branded gift-wrap displayed alongside unwrapped items can have the same effect.

Regardless of size or budget, retail spaces can play a greater role in sustainability. Best practice surrounds us in many stores on the high street and online, so don’t be afraid to innovate and test new ideas or approaches. The retail landscape is transforming before our eyes and the arts and culture sector can trailblaze rather than play catch-up.

Corin Birchall is Managing Director of Kerching Retail.
www.kerchingretail.com