BA Top-up innovation and entrepreneurship - Vejle Musikteater

C reated b y

C ecilie B jerregrav Fæ rgem ann S ørensen Jim m i Ø steril Tofthøj S ørensen Terezia H rdlovicova A gnese K aleja

1st external exam , 2nd sem ester

B A Top-up, Innovation and Entrepreneurship U C L Vejle, M ay 2020

S up erviso r H ans Lottrup

N um b er o f p ag es and keystro kes 54 / 45.622

C e cilie

Jim m i

Te re zia

A g n e se

C reated b y C ecilie B jerregrav Fæ rgem ann S ørensen Jim m i Ø steril Tofthøj S ørensen Terezia H rdlovicova A gnese K aleja

1st external exam , 2nd sem ester B A Top-up, Innovation and Entrepreneurship U C L Vejle, M ay 2020

S up erviso r H ans Lottrup

N um b er o f p ag es and keystro kes 54 / 45.622

The group w ould like to extend a great g thanks tow ard s Vejle M usikteater w ho has b een very help ful and forthcom ing in the creation of this rep ort.

Introduction

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Problem statement

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Delimitations

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Summary

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Methodology

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Philosophy of science

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Primary data

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Secondary data

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Theories

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Analysis

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The current market situation

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COVID-19 (SARS-CoV-2) and its effect

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Vejle Musikteater’s website

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Frontpage

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Target Group

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Social Media

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Example: Live performance

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Example: Balcony concerts

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Instagram

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Discussion

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What is the need?

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How to do it?

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The benefits

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Competitive landscape

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SoMe identification

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Virtual Reality identification

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The Business Model

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Social Responsibility

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Financial analysis

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Profitability

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Effect of current situation

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ROI

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Risk Assessment

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The Strategy

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Conclusion

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Bibliography

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Books

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Internet sources

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Articles

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Appendix

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Appendix 1

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Appendix 2

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Appendix 3 - Background

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Appendix 4 - Target group

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Appendix 5 - Social Media

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Appendix 6 - Ideas that were put aside

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Introduction There is an old saying “Nothing is certain but death and taxes”1.

Since the dawn of time, the whole universe has been under constant change and things have evolved. Change is inevitable.

Human beings have had to adapt to this constant change around them and have had to evolve from living in caves, to discovering fire, inventing the wheel and the airplane and are now travelling into space to explore the potential future for generations to come.

Charles Darwin said the famous phrase about “Survival of the fittest”2 - not referring to the most physically strong individual, but the individual who was best suited for change according to the surrounding in which it lived.

In more recent times, external factors and events have continuously pushed humans and nature to adapt and evolve. When we specifically look at the world in the past 200 years we as human beings have gone from a relatively primitive way of life into a modern, advanced technological marvel. Does this mean that evolution is over and change does no longer occur ? No. Not by any means.

Just in the 20th century we have seen events like WWI, The Great Depression, WWII, The oil crisis, 9/11 and The financial crisis. What do these events have in common?

They have all forced people and businesses to rethink how they went about their everyday lives or how they were doing business.

Furthermore, the whole world is going green in terms of changing habits and internal culture into organic and sustainability. The aforementioned events coupled with the constant evolution, expansion and distribution of technology - especially the Internet - has given the consumer the opportunity to look behind the curtains of big industry. Consumers are shaping the future of companies by making choices whether or not to consume a product based on the origins of that product or service.

Vejle Musikteater will also have to adapt and look into the opportunities that the ongoing digital innovation has to offer to the industry, in order to catch the generations of the future, all the while being sustainable and acting in an environmentally friendly nature as possible.

Nothing will return to how we were used to and every business has to turn their strategy and value proposition upside-down in order to survive.

1 2

Daniel Defoe, in ​ The Political History of the Devil,​ 1726 ​https://go.aws

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Crisis always leads to change and change often leads to improvement.

Some say3 that we will have to get used to referring to the world as B.C. and A.C.

Before Corona and After Corona.

Problem statement Vejle Musikteater needs to market themselves better, in order to stand out in the background of similar businesses, especially at this time (SARS-CoV-2). The enterprise has a successful and mature business by now (est. by Vejle Kommune 1993), and has a proven record of struggling in times of hardship when numerous shows have been cancelled. It is a challenge for every business around the globe. This paper will try to analyze the opportunities of sustainable growth in the current market and suggest a prognosis for the business for the future.

How did the SARS-CoV-2 affect Vejle musikteater’s situation and what is the opportunity of future sustainable growth ?

3

https://www.nytimes.com ​

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Delimitations The group found out that there were some rumours from november/december 2019 about something which could affect the business life. Data from around that time did not show any huge fluctuations from Vejle Musikteater customers. After finding relevant articles to back up the rumor, the group chose not to use data from the rumor since there was nothing to analyze from it, connecting the customers behavior to the rumor.

Financial calculations in this paper are based on assumptions and research. It was not possible to find the real budget of any theater in Denmark or get the economical data from the company in general.

The paper focuses on the two main ideas that the group came up with. To see other ideas of the brainstorm and why they were put aside, see Appendix 6.

Summary

This paper is based on research of development opportunities for Vejle Musikteater in the future and how SARS-CoV-2 affects the business right now. In this project, Google Analytics data has been discussed in the analysis section, for overview of the market. Report includes knowledge, skills and competencies of the group, gained in the 2nd study semester, more specifically implemented in the discussion section.

Methodology Philosophy of science To develop the research in a sensible way, qualitative intervention and quantitative non-intervention design was applied to this study. Before any interaction with the business was established, the group made a desk research as a pre-understanding process, to see

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what is that they do and how it is possible to contribute to the business. Quantitative non-intervention was used to analyze population on a descriptive study basis. Qualitative interviews were held at the same time when action research took place, in order to be able to gather the data from both and understand niches where development could take place.

Focus group for eye tracking experiment was allocated in a non-randomized way to possibly avoid potential bias, what in this case could be using the wrong target audience.

By proceeding with action research, initial expectations changed and although the start group was focused on developing the VMT website, in the end the decision was made to go into improving the business overall.

Primary data The primary data for this project were gathered by making research and using biometric technology – eye tracking and interviews. Both were part of a research, which investigated customer’s experience with buying tickets on Vejle Musikteater’s website. A total of 23 people participated in this research conducted at Vejle Musikteater. The sample was representative and included people of various age-groups. The eye tracking test required people to sit down with a laptop and scroll down Vejle Musikteater’s website. In order to maximize the validity of research, each of the respondents had the same task – to buy 4 tickets for a specific show. This helps to check how long it takes for them to go through all the steps, or where they had issues. After the testing, each person answered a few questions about their experience, and their recommendations.

As in any other research, there are few potential biases, which might affect the reliability of the results. First, the technology failed a few times during testing, for example, the mouse was not working properly, and the website collapsed. These factors would drastically change the eye tracking results if they were not carefully noted in time. Other problems could have been caused by the fact that the interviews were conducted in a room where respondents could hear each other. Hearing the answers of others, before even making the test themselves, could have affected their perception and changed the way they answered.

Secondary data In order to obtain relevant information, it was necessary to investigate secondary sources, which include trustworthy websites, articles, books and researches.

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Theories The different theories were chosen in order to answer the research question. It was necessary to choose models from various fields, so the topic can be examined from different perspectives.

To analyse the market situation during coronavirus, the data from Google Analytics were gathered to show the effect and how the theater has handled the situation and gathering restrictions through social media and alternatives online events.

The NABC model will be used to describe the current need on the market and the suggested strategy on how to approach the need. Further in the model different benefits and competitors will be described.

After the analysis, the SWOT model will be used to conclude the Strengths, Weaknesses, Opportunities and Threats for the ideas. Using this model will help to design and implement the strategy in a more realistic, cheaper, and easier way.

To examine the one chosen idea deeper, it is a good idea to use Business Model Canvas.

This model is very useful to describe different parts of the business concept, and it helps to define a specific value proposition of the idea.

Sustainability is a necessary part of any business, that is why Corporate Social Responsibility creates a big part of the strategy. The discussion will focus on different points of how the strategy helps the environment, while keeping in mind sustainability in terms of profit and people.

Risk management will be used to look at the chosen strategy from a critical point of view, identifying different potential risks and their influence.

Scrum was used to divide ideas and create a strategy for the teater. Sprints were created to keep the best overview over the different tasks and processes. With all the Analysis and Discussion on the idea, SCRUM model will help to design sustainable strategy with specific points on suggested implementation plan.

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Analysis The current market situation

The group got access to Vejle Musikteater’s ‘​Google Analytics​’ during a Matchmaking event earlier in the 2nd semester. It was relevant to get access to the account because it shows a lot of information about the target group and the sales process in general. After the COVID-19 closed the teater it has only been more relevant to analyze the data from the customers buying process and visitors on their website to see the effect the virus has had on the teater since the lockdown.

This analysis is about the COVID-19 and how it has had an effect on the theater since it came to Denmark and closed everything down. The group will come around data from Google Analytics to show the effect and how the theater has handled the situation and gathering restrictions through social media and alternatives online events.

COVID-19 (SARS-CoV-2) and its effect COVID-19 is a global pandemic that put Denmark on a lockdown the 12th of march 2020.

The worldwide pandemic has forced a lot of leaders all over the world to close their borders and countries in general to stop further infection. The danish prime minister, Mette Frederiksen, also put Denmark in a lockdown, which meant that larger gatherings became illegal overnight. Therefore, Vejle Musikteater was forced to close down and cancel and refund or reschedule a series of planned events.

To be exact they rescheduled 32 events and cancelled 15 events.

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Fig.14

By looking at the orange line it does not look too good for Vejle Musikteater, because it indicates that Denmark will have to be closed for quite some time, which is harming for the theater because they can not open up and welcome their customers and sell tickets to different events while Denmark is on lockdown or at least before the danish Prime minister change the rules or make concrete restrictions about larger gatherings.

By looking at the yellow, green and red lines it can give the theater a little bit of a hope, because the infection is not spreading wildly and is in some kind of control, which means that the sight of the Prime minister allowing larger gatherings in the nearest future is looking bright. There are less cases with people getting the virus and more people getting well.

The graphs below shows that people visited the website less after the 12th of march, the date that Denmark closed down, and that the most visited page from this dataset was the frontpage and that the second most visited was the subpage about the coronavirus.

Already before Denmark locked down the teater got overwhelmed with calls from customers with questions about tickets they had bought to different shows. Therefore the teater had a good opportunity to update their website with the answers to all the questions 4

​Videnskab.dk - COVID-19 12

or just inform the customers that the webpage would be updated or that they would receive an email or text with information if changes did affect them. 5

Fig. 2

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Vafo.dk - ‘Vejle musikteater bliver kimet ned’ 13

Vejle Musikteater’s website Frontpage

On the theater’s frontpage they created different slides in a carousel to guide the visitors to the subpage about Corona and to advertise about the alternatives the theater provides to their customers, which they can enjoy from home while they are waiting for Denmark to open up and allow gatherings at the theater.

Fig.3

Fig.4

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Target Group

Fig.5​​ The graph shows buying visitors divided in age categories from january 2020 til april 2020.

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As it shows the teater has customers of all ages, but is especially good at attracting the older audience: ​65+​. (See Appendix 4)

Social Media 7

Even though Vejle Musikteater can not host events for their customers, they have focused on entertaining via social media using their Facebook Page to advertise for alternatives online events like balcony concerts, live performances, competitions etc. (See Appendix 5)

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Google Analytics Images: Facebook ​

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Example: Live performance

Fig.6

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Example: Balcony concerts

Fig.7

Vejle Musikteaters target group is very wide, but the older audience of 65+ is the best represented by statistics. It would make sense to speak to this specific target group through Facebook, but because the later explained strategy is based not only on SoMe but also on VR technology, the target group is defined as middle age up to seniors.

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Fig.88

Instagram

Vejle Musikteater does have an Instagram account, but they do not maintain the activity on a regular basis. In march 2020 they uploaded 5 posts but before that there was 1 post in february 2019 and before that 1 post in may 2017.

Fig.9

They do have a lot of followers so they could easily reach wider by using their Instagram account to upload and advertise for upcoming events.

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​Business News Daily 18

Discussion Due to the international lockdown caused by corona, many people are stuck at home in a quarantine. Everybody has different ways of dealing with the situation, but all of them have something in common: They are searching for something to entertain themselves at home.

What is the need?

It is no secret that streaming services such as Netflix or HBO are thriving now9, since it became one of the stable parts of everyone’s day. Cinemas, theatres and many other public places are closed, and one could say all they can do is wait until it is over.

As was mentioned in the introduction, all previous big crises have changed the world in some way. People have different opinions, ideas and points of view about the pandemic situation, but they can all agree that the world will never be the same.

It will change the way we run businesses, make strategies and operate on an everyday level. Since many companies are closed, this is the right time to rethink their business models and adapt them to the new environment. This is a pretty hard task to do, since nobody knows how the new environment will look like. Hundreds of thousands of people are dealing with financial problems because they lost their jobs and are trying to pay the bills from savings. When things come back to normal and people start to earn money again, companies need to realize that customer’s buying behaviour will differ from the one before the corona crisis. People will be more careful about how they spend money and what they invest in. Taking all this into consideration, it could be concluded that the hard part for companies is just about to start. They will need to use innovation to improve their products and differentiate themselves from all the other companies on the market.

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https://www.theguardian.com ​

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How to do it?

Depending on the level of innovation, there are two approaches that Vejle Musikteater could take. The first step of the strategy is to optimize their presence on Social Media. The research shows that the average age of theater visitors is 48 and the numbers will not change drastically over the next 5 years. Vejle Musikteater, as well as other theatres, are facing a challenge to attract a younger audience.

Analysing their current Instagram profile, it is clear to see they are not taking enough action to promote themselves through this marketing channel. Over the past 3 years, they have only 7 new posts. Instagram is a great platform to promote interesting visual content and become well known among the new target group. Nowadays, their posts include few pictures and videos with repeating content and the whole feed is not very aesthetically pleasing. Being a theatre, Vejle Musikteater has so many great opportunities to create interesting content. People are curious beings, and always want to know what is happening behind the curtain, how the actors are getting ready in the backstage, or how different effects on the stage work. Instagram would be a great way to promote the theatre and become closer to their customers.

Fig.10 Virtual reality theater

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The second step of the strategy is to use Virtual Reality in the theatre to provide a completely new and exciting experience for the audience. Theatres all around the world are implementing digitization10 strategies in order to keep up with technical development.

The first phase is to use 360-degree cameras around the stage and broadcast the shows.

This will not affect the customers physically sitting in the theatre, they will just sit and watch the show. However, it will be a huge change for the theatre. Broadcasting the shows live would mean that the theatre is not limited by the number of seats they can sell, and people who are not able to attend can enjoy the show from the comfort of their home. Moreover, using the 360-degree camera provides the view of the whole stage and the customers can see how different props and technologies are used. If people would watch the show from home, they have the option to watch it either on their TV, laptop or smartphone.

The disadvantage of this technology is that people would need to use mobile technology to get the full experience, since they can easily move it, if they watch it on TV, they only get a static view. They can move around in the scene on their laptop, but it is a less intuitive experience than with mobile phones.

When people are already used to the broadcast and using more technology, it is time to introduce them to VR glasses. The glasses will be needed to watch the show, because instead of props, backgrounds and costumes, the theatre will use green screen and a technology called dot mapping. This will allow the theatre to change the backgrounds and costumes more easily without having to spend a lot of money making them from scratch or buy off-the-shelf solutions. The customers would also have an option to buy the glasses and bring them home, if they prefer to watch the show at home, or are simply not able to attend the theatre. Compared with smartphone broadcast, the glasses will provide much more realistic and intuitive experience and will allow the audience to immerse themselves into the show.

The benefits Social media development creates value for every subscriber as well as for the company.

People are interested in how the theatre works and what is going on behind the scenes. An option could be to make interviews with actors, directors and theatre employees to provide extra information about the shows and maybe even have Q&A with questions from their

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https://www.broadwayhd.com ​

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subscribers. Sharing this content on Instagram and Facebook will create an extra value for the customers. Another benefit of optimizing the social media would be that customers can get the same information from all the platforms. The key to a successful Social media strategy is to be consistent with the information provided to the customers throughout different channels.

There are benefits of using Virtual Reality too. The biggest selling point is that customers are not obligated to leave their home in order to enjoy the culture. This will be useful for people who do not live in Vejle and would have to travel long distances to see the show, or for people who must drive, because they save on fuel cost and produce less CO2. A big benefit of Virtual Reality and unlimited seating is that the show will never be sold out, so people do not need to worry about missing out on their favourite artists. It will also mean, they do not need to think about buying the tickets early to get the best tickets, because with VR, they can be right on the stage.

Competitive landscape Using Social Media to attract a younger audience to the theatre is a challenging goal, but not impossible with the right strategy. Nowadays, there are tons of competitors on Social Media. Currently, there are 2 130 000 Instagram users in Denmark and the number is increasing every day.11 The biggest age group is 25-34, which is a perfect match for Vejle Musikteater.

11

https://napoleoncat.com ​

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Fig.11

Companies from all fields are starting to realize how important it is for their customers to find them on different platforms. Restaurants, florists and mechanics are using Instagram to get their audience involved, share information about latest offers or discounts. With so many distractions, it can be difficult to stand out from the crowd and get the customer’s attention. However, with a unique approach and targeted content, VMT can expand their customer base to new generations.

The competition for Virtual Reality are TV, Netflix, HBO and other streaming services.

Anyone who has tried the VR goggles can confirm that it is an experience like nothing else.

One can really immerse into the show and not even realize, they are just sitting at home.

The atmosphere is the same, just like it would be in the hall. There is no doubt that for some of the customers it would be their first time trying VR, that is why it is important for the theatre to manage customer service very well, and help everyone with the technical difficulties. This could be one of the obstacles, since people might be afraid of how it works and that it is too complicated. On the other hand, it can be assumed that once they have tried it, they would be amazed and want to try it again.

When it comes to Vejle Musikteater, their current main digital platform is the website.12 A research had been made in order to find out if it works correctly, how easy it is to find information, and if anything should be changed in the process of buying tickets online. The 12

https://www.vejlemusikteater.dk/ ​

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results had shown that there were few issues and distractions, which confused the customers and took them some time to understand. For example, the process of choosing a seat ended up being the biggest confusion for most of the participants. They had to click to select each seat individually even when buying 4 tickets, they did not understand which seats were available, or which seats had the best view. The system did not let them select a seat which was available, but informed them only when they were ready to buy. This made them cancel the whole order and start the process all over again. When asked afterwards, most of the customers were annoyed about it and would prefer VMT to optimize their website. These small, but essential details are crucial when it comes to customer’s experience, and Vejle Musikteater needs to make sure to hire responsible and skilled people to run any further digitalization.

SoMe identification

Virtual Reality identification

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Looking at both of the ideas, it is easy to see that one is relatively cheap and easy to implement, while the second requires additional financing and resources. It could be argued that SoMe development will not affect the business drastically, but should be implemented alongside the VR technology. These ideas will be investigated further in this project, since it requires more research and financial considerations. This approach was chosen because it is considered to be more innovative, ambitious, and more sustainable for long-term planning. Even though it could be assumed to be too expensive and too big of a risk for a small theatre such as VMT to implement current ideas, it is necessary to make further research to find out.

The Business Model By having any discussion of how Vejle Musikteater should develop their business, the common understanding should be shared of what is the business model and how it works.

For creating new strategic alternatives, the group needs to look at the logic of how this enterprise intends to earn money. Accordingly, a need to start a discussion about who is the end-user and what is the definition of the customer group for this business.

Target group for this particular company is middle-age up to seniors, more specifically age 40 to 65. Statistics were analyzed to see what is the population forecast for the future in the Vejle region. Figures demonstrated that for the next 5 years in the Vejle region, there is no significant change regarding the age groups of population .13 Based on this data, there is no need to focus on a strategy for a completely different target group. In this case all decisions were focused on the existing market which consists of middle aged and senior customers, by keeping in mind expanding in different age groups as well, to develop the brand awareness. The market position for the theater is multi-sided, because organization from one side needs a lot of clients who are willing to pay to see an art on the stage, and from the other side needs a big base of artists who are willing to perform. Consumer job in this case is social, based on the fact that they want to be recognized and gain status in a society. Defining different customer segments leads to discussion of the reason why consumers should turn to the specific company over another.

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See Appendix 1, See Appendix 2

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Vejle Musikteater offers a bundle of different products like concerts, musicals, stand-ups, plays, comedies, shows, ballet and dance festivals, which all together develop value for the current customer segment. The company improves service performance, which is one of traditional ways to maintain advantage in front of competitors. Right now the theater visitors are choosing this particular place for its brand and status in Vejle and in closest regions. By looking a few months back, an enterprise had a strong two way communication and trust with their clients, because they always valued the risk reduction, when they purchased the ticket. That is because the theater had a friendly order cancellation policy. Since the epidemic started, some customers have been giving bad feedback about the company’s way of going through the crisis. Recently, a review was shared that it is not possible to get the money back for purchased tickets, although the show was moved to another date, because of the lockdown, and clients are not able to attend it. Accordingly, customers are starting to lose trust in this business. Based on all this, the company needs to work on an upgraded value proposition, that suits the existing consumer and is able to attract more new visitors.

Vejle Musikteater is already an established business, that is why it is possible to build a new business model on an existing one and leverage existing assets, like sales, brand and channels. The new value proposition in this case is based on giving customers a unique experience to be a part of the action by using Virtual Reality as one of the selling points.

Unlike most VR captures of wildlife or different kinds of events, the new business structure will allow theater lovers to experience the show from actors point of view.

By using this technology, it is possible for viewers to choose from which point they watch the show, and even if their favourite seat is sold out, they can still enjoy this from the first row view. It puts the consumer in the middle of the action and lets them see activity that otherwise is invisible to an audience. By having a 360 degree camera on the stage and streaming service available for a certain fee, it saves effort for people going to the theater and it is going to give a lot of value for those, who for personal reasons can not attend these shows. Introducing newness to the strongly developed market can be challenging when it comes to introducing it to a certain target group, which is not always up to date with technology improvement. It is possible to overcome that risk with developing trust and interest from consumers. In this case, it is going to be done by having a strong social media marketing strategy, where the company will try to make successful two way communication

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and make sure that the target understands and accepts new changes. This way the theater enhances the service quality, increases their status and creates positive social consequences by introducing different storytelling experiences. To communicate and reach the potential customer with a new value proposition, the company needs to secure channels.

The trick is to find the right balance between the different types of channels, to integrate them in a way to create a great customer experience, and to maximize revenues. Owned channels and particularly direct ones have higher margins, but can be costly to put in place and to operate. Partner channels lead to lower margins, but they allow an organization to expand its reach and benefit from partner strengths. 14 Right now theater uses their own channels, and they are working in both, direct and indirect directions. Their own direct channels are web sales and selling force. Sales across their website is the biggest revenue asset and they have a strong selling force when it comes to the customers visiting the show. By using successful marketing and the right tools, they make sure that customers are always spending their theater break in the cafe, ordering food and drinks and they also use the indirect channel, which is selling food and beverages. The company uses partner channels only by creating social media profiles and raising awareness about the company's services, which helps consumers get to their own website and evaluate the value proposition. In the direct media it is allowed to purchase specific products and by coming to the specific show, the value proposition can be experienced by their clients. All that builds a relationship between the company and customer.

Previously mentioned connection is very important, because it deeply influences the overall customer experience. The company has established self-service relationships through automated processes. Although right now everyone can buy their show tickets by being a silent buyer, there is still a possibility to sign up for the newsletter, which includes recommendations of interesting events. Automated services can recognize individual consumers and their characteristics and offer information and suggest products related to orders or transactions. With the new value proposition they are not stepping away from the established relationship, but it would most certainly grow bigger and develop in different directions, like co-creation. By developing SoMe marketing it invites people to share their story and experience of a service provider, in that way creating value for other art lovers and developing their engagement. Moreover, by using VR technology, it directly allows

14

Osterwalder A., (2010)

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everybody to interact with every show of their choice and co-found a deeper meaning of current relationship. Every customer is important to the company not only because they help to build brand awareness, but also when business is dependent on direct sales, every person buying the current service generates more revenue.

Current business model represents transaction revenue stream, which comes from one-time payments. In this case, the type of income is generated by asset sale. Primary income for Vejle Musikteater comes from ticket sales and moreover, from food and drink offering for those who come to watch shows. The company offers fixed, predefined prices, which are based on static variables. In this case it is based on the number or quality of Value Proposition features, on the type and characteristics of a customer segment and on the quantity purchased. At the moment, product price depends on the quality of the artist performing at the theater and how recognized the artists are.

Moreover, service prices can be bigger for those who prefer to sit in current seats around the stage and have a high-end meal option. It also depends on how many tickets have been purchased, because the company is not focused on bundle deals at this stage. By describing the sales, assets which can be sold should be discussed as well.

Every business model requires key resources which are necessary to make a business model work. These resources allow an enterprise to create and offer a value proposition, reach markets, maintain relationships with customer segments, and earn revenues.

Different key resources are needed depending on the type of business model. Key resources can be physical, financial, intellectual, or human. They can be owned or leased by the company or acquired from key partners.15 The company has physical assets such as building, good location, sales systems and distribution networks. Their intellectual resources include brand name, marketing knowledge, partnerships and customer database.

Previously mentioned assets are very hard to develop, but when successfully established can offer substantial value. Based on a company's functions, human resources are something that should be there no matter what, because every organization depends on them. The theater also has financial assets, but that exists based on sales and government involvement. By describing all the assets, the next step is to look at what the company should do to make the business work.

15

Osterwalder A., (2010)

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To operate successfully, main activities are required to create and offer a value proposition, reach the chosen market, maintain established relationships and earn revenue. These should be developed into platform and network direction. For current business, https://www.vejlemusikteater.dk is their main operating platform, which should be maintained, managed and developed. With the new social media strategy, key activities should include regular posts and updates on media like Facebook and Instagram. By involving VR technology, theater should make sure that the market understands and accepts the change, by advertising and explaining it through their digital platforms. The company must manage their platforms not just based on offered shows and their rotation, but also based on the customer segment and their needs and wishes.

Research on their website pointed out that they have more than 40 partner companies, which are based on acquisition of particular activities. Theater is much more likely to develop an infrastructure where they can host the shows, than producing their own events.

Key partners could be show distributors, stage decorating companies, artists and food, beverage suppliers. In the future, by developing the current strategy, their partnerships should include VR technology providers and additional resource managers.

Delivering value proposition, maintaining relationships and generating revenue requires a structure of costs. VMT has value-driven structure and the new strategy does not implement any change of direction here, because it is focused on value creation. The company has to take care of financing show rights, artists, staff, rent and food, beverage section, what all takes care of delivering certain value propositions. In the future plan, additional costs would be advertising and financially securing their rights to share VR based content, and owning the right equipment for such a development.

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Social Responsibility Vejle Musikteater is owned and run by the municipality of Vejle (Vejle Kommune). Therefore, it is necessary to adopt the CSR policy of the municipality as a whole, since Vejle Musikteater has not published or described any individual CSR policy.

In 2019, the city council invited local businesses to join a series of events and gatherings in order to create a common ‘business policy’16. The purpose was to help each other get inspired to join footstep and improve the opportunity for Vejle Kommune to grow through its businesses.

The initiative is named ​#vejle2025​.

From the elements that are relevant to Vejle Musikteater, it is worth to mention a few of the ‘5 ambitions for the business policies’:

Fig.1217

A part of attracting talent would be part of a grander scheme of having talent from all sectors of industries moving to Vejle and start both new businesses and to expand existing business. These could work as sub-contractors and to act as the everyday audience for the cultural institution that is Vejle Musikteater.

16 17

​ ttps://www.vejle.dk h ​https://www.vejle.dk​ , page 6

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Fig.1318

Especially for an institution like Vejle Musikteater, it is important to keep a finger on the pulse as far as keep an eye on innovation and the technologies that other theaters around the world are using, but to keep having the audience on their feet as far as surprising and engaging them into the shows and acts going on in the theater.

The ideas generated are not solely aimed at cultural offers, like theaters, but they show a will to keep the theater alive, diverse and open to inspiration from international influence.

Vejle Kommune also mentions ​‘10 areas to work with’.​ From the elements that are relevant to Vejle Musikteater, it is worth to mention a few:

18

https://www.vejle.dk​ ​ , page 6

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Fig.1419

As far as resilience goes, Vejle Musikteater has a solid base in and around Vejle, even with a few customers coming from abroad. They are by far the biggest player in the area with the nearest competition, Fredericia Teater, which is out of business as of march 202020, was a viable alternative to Vejle Musikteater.

Backed by the municipality, Vejle Musikteater should be able to survive the corona-crisis that has rendered more than 45.000 people out of a job21 and several businesses gone bankrupt. After the crisis, Vejle Musikteater will most likely still stand strong in the community, but will have to evolve, adjust and adapt to the surrounding world and its demands. These demands has to be achieved in order to fulfil the United Nations 17 Sustainable development goals22 that is a “a universal call to action to end poverty, protect the planet and ensure that all people enjoy peace and prosperity by 2030”23.

19

​ttps://www.vejle.dk​, page 8 h ​ttps://www.dr.dk h 21 ​ttps://finans.dk h 20

22

23

​ ttps://www.undp.org h www.undp.org ​

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Fig.1524

Whenever a company is in the business of entertainment, they have to consider whether or not to implement the digital solutions and possible technology to implement in their business. This is also true for a theater which, in a historical perspective, has already evolved quite a bit over the past millennia. There are still developments to be implemented for Vejle Musikteater that has a unique opportunity to develop their brand even further and stand even stronger in the surrounding environment.

24

​https://www.vejle.dk/media/29682/folder-erhvervspolitik.pdf​, page 8

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Fig.1625

Building on the fact that Vejle Kommune wants to grow by 2500 workplaces total, 400 new businesses per year and a total of 5000 new citizens by the year 202526, there is an opportunity for Vejle Musikteater to incorporate new partners, collaborators and create an opportunity for startups to become sub-contractors to the theater.

Fig.1727

25 26 27

​ttps://www.vejle.dk​, page 9 h ​ttps://www.vejle.dk​, page 10 h ​https://www.vejle.dk​, page 9

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Building on the idea that people will be moving to Vejle and be able to start up new businesses, there is an opportunity for these businesses to enjoy the support from the municipality. These businesses can very easily be tech companies that can help Vejle Musikteater develop the sustainable digital solutions that would be necessary in order to bring Vejle Musikteater into the future. Vejle Musikteater, owned by Vejle Kommune, plays a part in the strategy by the municipality to provide the best base possible for social-economic activities in the most environmentally sustainable way possible.

Financial analysis In order to understand how profitable it is to run a successful social marketing campaign and use VR technology in improvement, it is necessary to define the approximate financial situation and what difference these new options could make. Financial overview was prepared in advance for year 2021, and was made on assumption base. Extra expenses of marketing and VR equipment are included in next year's finances, just to point out the difference. In reality, these changes will not be applied in 2021.

Average ticket price, calculated as 377 DKK, was defined by considering 5 popular performances of Vejle Musikteater and looking at their actual prices at this moment.

Prediction shown in a table below is based on a current target group and assumption that 80% from this target group have been purchased one ticket per a year, to any show.

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Fig.18

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Profitability Gross profit margin ratio measures how efficiently a current company uses its materials and labor to sell products profitably. In this case gross margin is calculated for existing and suggested strategy.

Fig.19

The net profit margin is equal to how much profit is generated as a percentage of revenue and how much of each danish krone in revenue collected by a company translates into profit. This can also be called return on sales.

(net income / sales) x 100

Fig.20

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Effect of current situation Based on the current world situation and its effect on almost every business, the data was analyzed in purpose to see the difference between the existing, suggested and SARS-CoV-2 affected strategy. Influence of epidemy, shown in Figure 20, was calculated by taking into consideration that theater gathers no income for 3 months in a row, but still takes care of necessary expenses.

Fig.21

ROI Investment of 200 000 DKK is necessary to get the VR equipment and to set it up. By looking at figure 18, the suggestion is that the business, although going through a crisis at this moment, is able to get the return of their investment at the end of this year, as the worst case scenario.

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Risk Assessment Contrary to common belief, statistics show that the segment for a cultural institution like Vejle Musikteater are actually ready for technology and digital opportunities to change habits and the ways we perform tasks and do everyday things28. This indicates that the audience would in fact be open to adapt to the change that the option for a virtual reality experience brings.

The risk of a virtual reality project failing is present, albeit very small since multiple theaters around the world on multiple levels and in different types of shows, concerts and plays already have similar digital technology implemented.

Det Kongelige Teater (The royal Danish theater) has adapted in the past years and now offer various multi-angle shows29 to view directly via mobile, laptop or on a smart tv, directly from the comfort of one’s home. Like the royal Danish theater, the Vienna State Opera also offers live streaming from the archives, to the audience at home30.

It is a firm belief that both Vejle Musikteater and its audience are mature and prepared to implement digital technology in order to both improve and spread out the experience of going to the theater, even if it might be virtual, with very little to no risk.

28

29 30

​ ttps://www.dst.dk h https://kglteater.dk ​ https://operawire.com ​

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The Strategy

The group used the framework ‘SCRUM’ to create a better overview of what the entire exam is all about and what needs to be done and when.

The Scrum framework is divived into ‘sprints’ Sprint 1 is to present the idea and start the process with the 360 degree camera.

Sprint 2 + 3 + 4 is implementing, analyzing and testing different ideas into the theater. It is divided into different sprints because it needs to happen in a chronological order.

Fig.22

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Conclusion Vejle Musikteater is a big and well-known cultural institution in both Vejle and in the surrounding area. This paper gives an answer to the previously stated question of how SARS-CoV-2 affects the company and what is the future potential of growth. Analysis describes market situation based on Google Analytics data and discussion offers suggestions for potential strategies and their evaluation. It is believed that Vejle Musikteater will have no problem surviving the corona crisis and research has shown that the audience are ready for Vejle Musikteater to implement latest technologies and move on to the 21st century.

Research discovered that Vejle Musikteater needs to post on social media more regularly.

Accordingly, the group focused the attention on digital marketing improvements, calling it a first part of the strategy. The second part of the strategy gives an insight of VR technology involvement, by planning digitalization of the company. In this case having a 360-degree camera on the stage and streaming service option had been discussed. It does not change the experience for the typical theatre customer, but it gives anyone a chance to be a part of the show, even by sitting at home. Moreover, the group briefly describes VR goggles and dot mapping technology involvement, but the paper is not focused on analyzing that step deeply, because it asks for more specific research.

By having 135 years of well-established theatre culture in Vejle, the group is certain that strategies pointed out will work in a real environment without any major risk.

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Holm A. B., (2014) Holm Andreas Beck, (2014) ​Philosophy of science: an introduction for future knowledge workers​, 2nd edition, Samfundslitteratur.

Osterwalder A., (2010) Osterwalder A., Yves Peigner, Tim Clark & Alan Smith (2010), Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers

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Business News Daily​.

https://www.businessnewsdaily.com/10146-target-older-demographics-social-media.html Juhler, T. (2020, 11. Mar). Vejle Musikteater bliver kimet ned: - Stop med at ringe til os. ​Vejle Amts Folkeblad​. ​https://vafo.dk/artikel/vejle-musikteater-bliver-kimet-ned

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Appendix Appendix 1

Fig.20

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Appendix 2

Fig.21

Appendix 3 - Background Ever since 1884, the city of Vejle has had a dedicated theater in one form or another. A decision was made in 1882 by prominent citizens to build a pompous theater in a florentine style31. That building is situated in the square currently known as ‘Banegårdspladsen’. This means that the theater culture in Vejle has been ongoing for 135 years and has survived several wars, financial crises and both political uncertainty as well as technical development such as the invention of the television and later the Internet in more recent times.

Previously, the then ‘Vejle Teater’ was owned and run by private investors, while the current Vejle Musikteater was commissioned in 1993 and has since then been owned and run by Vejle Kommune (The municipality of Vejle).

31

​http://www.vejlewiki.dk/index.php?title=Vejle_Teater

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Historically, different situations and changes made the previous Vejle Teater trade owners multiple times32. The general reason has been lack of finances to maintain and upkeep such a building.

Vejle musikteater turns 27 years old in 2020 and both the size of the current theater and the shows, concerts and plays being put on the stage including big international names give an incentive for local businesses to both sponsor and/or partner with Vejle Musikteater. This means that because of the ownership by the municipality coupled with sponsorships, there is very little to no risk of the theater being shut down due to lack of finance or of funding.

Fig.22 ​Vejle Teater, built in 1884. Home of Panayotis Brudekjoler “Drømmenes teater” 2017-2020. Image: VAF

The previous Vejle Teater building was occupied by the Germans during WWII, but because of the global political situation where most countries trade with one another and maybe even share economies (e.g. the Euro and the EU, UN), there is also little to no risk of foreign powers invading Denmark and occupying the current Vejle Musikteater building for troops or alike.

Technology has evolved quite a bit since the doors opened to the first Vejle Teater back in 1884. Since then, electricity has been invented and spread to the masses, steam trains

32

http://www.vejlewiki.dk/index.php?title=Vejle_Teater ​

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have long been replaced by diesel trains and some diesel trains have even been replaced by trains powered by electricity. The television has, like electricity, been invented and has evolved into big, relatively cheap, flat screens with multiple features including wifi powered by the Internet - an invention spawned by the american army in the 60s and launched to the public in the 90s. Now, the internet is commonplace in most parts of the western world and incentives are being made to spread the Internet to every person on the globe33. The invention of the film medium, television, mobile phones and the Internet has had the theater lose audience from time to time but in general it is still very clear that the theater as a cultural institution has a place in modern times.

Appendix 4 - Target group

Fig.23

33

​https://www.theatlantic.com/sponsored/vmware-2017/the-possibility-report-articles/1407/

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Appendix 5 - Social Media

Fig.24

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Appendix 6 - Ideas that were put aside

-

Recycled bamboo cups and dishes To save CO2 emissions, it has been an idea to switch out porcelain dishes and metal cutlery with plates and cutlery made from recycled bamboo.

-

Tickets from recycled paper with seeds in them, if customers want a physical ticket.

To those audience that still want a physical ticket, even though there is already an option to receive it digitally, it is recommended for Vejle Musikteater to use physical tickets made from recycled paper containing flower or plant seeds so that the consumer can actually plant the ticket in soil and grow a tree or flower.

-

'Plant a tree', if the customers want a digital ticket.

If the customer wants a digital ticket, they should have the option of choosing to plant a tree in a place of choice. The group was inspired by the “Growingtrees.dk” initiative. This idea covers multiple of the 17 UN Sustainable Development Goals; 1:

No poverty

6:

Clean water and sanitation

13:

Climate action

16:

Peace, justice and strong institutions

17:

Partnership for the goals

-

Donate X% of the ticket price to a charity of choice.

Inspired by the danish ‘pant’ system where the end user is able to donate to a charity when they return their soda- and beer bottles (Save the children

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etc.), the group suggested that the theater audience should be able to donate a part of the price for their ticket to a charity of choice.

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