10 May 2013 // Thoughts

The Business of Culture: Engines for the Tourism Machine

Common sense dictates that in order to bring tourists to your town (or state or country), you have to have something for them to see. But how does that break down to dollars and cents? In the last “Business of Culture” post before our (epic) conclusion, we’ll examine the financial impact of “cultural tourism” in the United States and abroad.

In the MASS MoCA study from our “Museums and Property Values” post several weeks ago, Dr. Stephen Sheppard writes that “one of the major advantages of a cultural institution compared with other industrial sectors is that cultural institutions create additional local annual revenue by bringing non-local visitors to town.” Findings from the American Alliance of Museums (AAM) seem to support that statement. Americans visited museums 850 million times in the past year, and more people visit museums than all major pro sports events and theme parks combined. Museums rank among the top three family vacation destinations, and 78% of all US leisure travelers participate in cultural or heritage activities. Museums also affect the duration of visits: visitors to historical sites and cultural attractions stay 53% longer and spend 36% more than any other kinds of tourists.

When expanding the playing field to include all arts and cultural institutions, the correlation between museum visits and tourism revenue is even stronger. According to Americans for the Arts’ study “Arts & Economic Prosperity IV”, the average arts attendee spends $24.60 per event, in addition to the cost of the admission ticket, on items such as meals, lodging, retail and child care. In 2010, 39% of arts patrons were non-local attendees, who spend on average twice as much as their local counterparts. Of these non-local attendees, 59.4% reported that the primary reason for their trip was a specific event, and 28.5% spent at least one night away in the location where the event took place. Over 52% of audience respondents said that if the event had not taken place in the location where they were surveyed, they would have gone somewhere else to attend a similar event.

Image courtesy Americans for the Arts

This phenomenon of cultural tourism is not limited to the US. The United Kingdom’s Association of Leading Visitor Attractions (ALVA) found that eight of the top ten UK visitor attractions in 2012 were museums, and these eight museums received over 31 million visits last year. Museums and cultural attractions are main contributors to the UK’s status as the seventh largest international tourism destination, and the total value of cultural and other tourism to the UK economy in 2009 was £115.4 billion, or 8.9% of GDP. VisitBritain.com states that “the number of jobs that tourism supports is forecast to increase by 250,000 this decade, from 2.645 million to 2.899 million” and that “one in twelve jobs in the UK is either directly or indirectly supported by tourism.” One can infer from the statistic above that a large percentage of those tourism jobs are at cultural in nature, forging yet another link between those institutions and employment.

But how are Convention and Visitors Bureaus making the most of this relationship between museums and tourism? Even in Los Angeles, a city not exactly known for its cultural assets, visitors can find museum exhibits, theatre performances, classical music concerts and more through Discover Los Angeles’ “Experience Builder”. Guests to the website simply click on “Culture”, choose which cultural experiences they’d like have on their visit, and then add their choices to their “MY LA” profile. Meet Minneapolis also takes full advantage of the city’s status as a Top 20 location for culture. Visitors to their website will see the museum category prominently displayed on the homepage, which is no wonder, since museums generate an estimated $53 million in economic activity statewide. Cultural Tourism DC offers a Heritage Walking Tour app, so visitors can make the most of their stay in America’s #1 museum city. And in Ontario, Canada, where cultural tourists make up 22% (9.5 million) of all overnight visits, arts and culture experience bundles are heavily publicized online.

In theory, one need only see the long lines outside the museums on the Smithsonian Mall in Washington D.C., the V&A in London or the Prado in Madrid to surmise that, for domestic and international tourism alike, museums mean big bucks (or quid or euros) for tourism. But how will increased technology and decreased government funding affect these robust tourist numbers? Will museums continue to have such a seemingly profound affect on property values, placemaking, employment and tourism in the face of these challenges? Do all the numbers we’ve thrown around over the past four weeks really point to a positive, causal relationship between museums and economic growth, or is it all just smoke, mirrors and coincidence?

In next week’s conclusion of “The Business of Culture: The Impact of Museums on Economic Development”, we’ll pose these questions and explore a variety of possible answers.