Hi all,

Speaking from another side of the income generation fence, I think some of the experiences we've had creating CultureLabel.com hopefully provide (a) practical examples and (b) the proof in the pudding for some of the very wise suggestions mentioned in this thread.

Peter and I set up CultureLabel.com a couple of years ago to try and create a centre of expertise around e-commerce as an income source for the museums and arts sectors. We identified a massive market opportunity to create profit for museums and galleries, partly due to the underperformance of the sector (an average 1-3% of turnover coming from online sales, compared to 20-30% in comparable sectors, despite excellent offline gift shops).

I'd argue strongly that aggregation with centralised expertise is a model well worth emulating across many areas of commercial income generation. In our case, we've been working 24/7 to understand and respond to the online consumer marketplace for museum and gallery gifts. We've invested in the best onsite merchandisers, consumer marketers and technical managers, and have worked hard to pool the expert knowledge of our 200 cultural partners for the benefit of the whole.

As a result, we've developed a core understanding of online cultural customers that is very likely to exceed the capacity of any individual partner, and likewise are able to focus on creating a consumer splash larger than any one organisation can deliver alone. This is why even our largest partners find logic in working together when approaching the consumer marketplace.

We're very proud to say that the model we've used to create this ecosystem is entirely privately funded - the market is genuinely keeping us alive, which obviously keeps us responsive. We've worked closely with our partners to create a commission they can afford to pay on sales generated, which we mutually agree is a fair reward for the value we add.

Cultural partners appreciate that as CultureLabel.com grows in the consumer marketplace, their returns from new sales will grow likewise.

Lessons from our experience so far? I'd suggest that the cultural sector needs to encourage many more cultural entrepreneurs and social enterprises to play this role of centralised specialists in a wide range of opportunities around income generation, especially when focussed on B2C activity.

CultureLabel has long argued for a cultural enterprise fund to encourage such start-ups, ideally managed by business leaders, entrepreneurs and intrapreneurs with an appreciation for the cultural sector. Our original suggestion for this built on our work for MLA on how to encourage cultural enterprise (see http://www.culturelabel.com/cultural-entrepreneurship). We've also recently witnessed some great international examples of such incentive or support schemes, so much of the model's already out there.

Please get in touch if you want to talk any of this through further

Best
Simon

-- 
Simon Cronshaw
Managing Partner
CultureLabel

T: +44 (0) 207 749 6857
M: +44 (0) 7973 793 753
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CultureLabel, 11 Chance Street, Shoreditch, London E2 7JB

New to CultureLabel? Visit our sites:

www.CultureLabel.com - culture retail platform
www.CultureLabel.com/blog - culture meets consumer culture blog
www.CultureLabel.com/digital-museum - practical income generation for museums

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