Britt's 2008 Season Achieves Artistic and Popular Success, Likely to Have an Operating Deficit (10-1-08)
MEDFORD, OR — Britt Festivals closed its 2008 season earlier this month with attendance levels at 69,000, an increase of about 17% over the 2007 season attendance. Operating expenses were higher than ever, and fiscal year-end results are likely to show a deficit of about 11% of 2008 budgeted revenues. Results are in large part due to music industry changes, specifically higher artist fees, and a challenging economy.
Britt's 2008 season included 43 performances, with three performances at the Lithia Motors Amphitheater at the Jackson County Expo Park, and one performance at the SOU Music Recital Hall. Six concerts sold out: Crosby, Stills and Nash, Michael Franti and Spearhead, Mark Knopfler, Billy Idol, a co-bill with George Thorogood and the Destroyers and Buddy Guy, and Bonnie Raitt. "We're delighted with the strong ticket sales, especially in light of tough economic times," says Britt's Executive Director Rick Hood, "and we thank our members, patrons and sponsors for their support of the 2008 season."
"In 2007, patrons told us to get a stronger lineup in 2008," Hood says, "and we really feel that we delivered. In addition to the great sold-out concerts, we presented a lineup of world-class artists such as Midori, Wynton Marsalis and Return to Forever, offering strong programming to a wide variety of audiences."
Britt is operating in the midst of a rapidly-changing music industry. As reported in the January 12, 2008 issue of The Economist, the recording music industry saw the continued trend of decreased sales of physical albums. The Nielsen SoundScan reported that album sales dropped 19% in 2007 from the year before. The Economist also reported in the same issue that paid digital downloads did not begin to make up for the loss of revenue from CDs, and that the growth of paid digital downloads is slowing.
"The business model of the music industry is going through some big changes," says Hood. "Artists are relying more heavily on live performances for a greater percentage of their income. As a result, artist fees have skyrocketed."
Britt also faces challenges associated with presenting artists. "There are more active venues in our region than there were five years ago, and more options for the artists' management to choose from," says Mike Sturgill, Britt's Director of Programming and Production. "In order to compete, we have to be able to meet artist fees, or we lose the date."
Britt's 2008 artist fees were almost 33% higher than in 2007, amounting to the highest in Britt's history.
The confluence of industry changes, higher artist fees and the current economic downturn have affected Britt's ability to cover operating expenses in 2007 and 2008. In 2008, that year-end deficit will come to about 11% of its budgeted revenues.
Despite operations deficits in 2007 and 2008, Britt remains well-capitalized, thanks to a history of frugal fiscal management. The organization has financial reserves and a growing endowment in place.
As a non-profit organization, ticket sales cover about 65% of Britt's operating costs. The organization relies on support from memberships, corporate sponsorships and other contributed income to meet operating costs.
"In this rapidly changing environment," Hood says, "we are reviewing every aspect of our business model to ensure that we remain an integral part of the cultural landscape in southern Oregon. We are conducting patron research and surveys, and are developing new ways of looking at membership, programming, audience development and institutional giving."
One of the key aspects to Britt's success is the membership program. Hood says, "The financial support we receive from the membership program is vitally important, yet we've seen a decrease in our membership over the last few years. From the surveys we conducted this year, we were reminded that 'The Britt Experience' is of utmost importance to our members. In order to remain sustainable, we're developing new ways to strengthen our membership program, finding ways to retain our loyal members and show them how much we value their support."
Britt Festivals is a non-profit organization that presents and sponsors performing arts and supports those activities through on-going education and audience development programs and through cooperation with educational, civic, cultural and governmental organizations in Southern Oregon. In addition to presenting concerts, Britt Festivals maintains a formal education program through the Britt Institute. Established in 1985, the Britt Institute hosts a wide variety of learning opportunities through a multi-faceted approach of summer camps, workshops, artist residencies, grade school programs, lectures and adult learning opportunities.
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